How do you solve a problem like people?
Unemployment rates in the UK are extremely low and this, coupled with the brain drain of Brexit, is causing one of the biggest employment issues seen in decades.
Manufacturers and machine builders, who have been faced with a torrent of economic and political decisions outside of their control, are now juggling an extremely delicate situation.
On one hand, orders and the pipeline for the future is extremely buoyant, on the other they are looking to mitigate global supply chain issues and, closer to home, trying to retain the good people they have whilst attracting the good people they need.
Talk about being between a rock and a hard place.
Manufacturers, as you would expect, have taken measures to overcome these issues and these range from increasing salaries to retain staff, and accelerating promotion opportunities to investing in apprentices so they can grow the next generation.
All are valuable and need to be in place if the UK is going to reclaim its place at the top table of industrial action.
However, one aspect of manufacturing that goes under the radar when considering labour woes, is outsourcing and the more you consider it, the more you wonder why an increasing number of firms haven’t adopted this approach.
Outsourcing non-core disciplines, such as certain manufacturing processes or administrative tasks, is a strategy that has been proven to address the challenges firms are facing in finding and retaining staff.
By outsourcing tasks to specialist providers like ourselves, management teams can transfer a lot of the risk associated with these activities. This can include things such as fixed cost of ownership and supply chain management.
Additionally, outsourcing non-core disciplines can also give manufacturers access to specialised expertise and resources that they may not have in-house, including design for manufacture, assistance in value engineering, assembly in a certified ESD assembly area (for sensitive electronics), as well of one of our main selling points, design and accreditation to UL508a for customers in North America.
The last twelve months have brought recruitment woes firmly into attention and manufacturers are slowly, but surely, switching on to alternative ways of balancing out recruitment and retention.
If bosses decide to outsource certain tasks and processes, they can save costs associated with hiring and training new employees.
With energy prices going through the roof and supply chain disruption pushing commodity costs higher, there is little room for error for UK manufacturers that are growing and still want to make a profit.
If you strip back recruitment to its very basics, then outsourcing part, or all the build, means your strategic partner will take on the costs and responsibility of recruiting new employees and you don’t have to face the hefty bills associated with candidate advertising or a recruitment agency.
Naturally, outsourcing this ‘risk’ makes perfect efficiency and time sense. You benefit from having an expert in place to, more often than not, save you money and time and don’t have to worry about hiring, training and indeed losing employees.
It’s a selling point for us for sure, but likewise, we have to appreciate that we have similar employee challenges as everyone else.
Over the last decade we have built our own in-house training school, which gives people the skills they need to not only do the job, but progress in our business or elsewhere. That coupled with many different employee engagement techniques means that although not ‘immune’ to losing trained labour, we tend to ‘win more than we lose’.
Recruitment is only one of the ways that outsourcing non-core disciplines can have a major benefit to your business.
It can also deliver flexibility in capacity so you can manage fluctuations in demand without a major hit to financials and gives you access to specialised skills that would usually be out of your reach.
The final element that should never be overlooked is ‘speed to market’. If you’re a disruptor or an established manufacturer bringing an ‘innovation’ to market, then you must consider how quickly you can do it.
Knowing what is and isn’t your core competences is key to any organisation, it’s then about finding partners that are complementary to you and developing partnerships – ideally, early in the design phase.
It’s also very important to check out your potential partner, not just checking for financial stability, but looking at ownership, culture, markets they work in, current customers, capabilities, and capacity – due diligence should be thorough. Make the right choice and strategic outsourcing can - and will - offer you many benefits.
Tony Hague, CEO of PP Control & Automation (PP C&A)
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