By Colin Shaw, Partner, Leader UK Operations Practice, McKinsey & Company.
As technology transforms manufacturing, UK companies face an urgent need to reskill their employees. That calls for new approaches to training and development. In the coming years, we expect the pace of change to accelerate, as companies adopt new, digitally-enabled approaches across their operations.
While these changes will be implemented in an organization’s physical assets – the machines it uses on the shop floor and the software that runs those machines – Digital Manufacturing will have a profound impact on the workforce too.
In the UK manufacturing sector, skills have been a perennial issue. The country has not yet invested in large-scale technology upskilling, and the growth of Digital Manufacturing is likely to exacerbate existing shortages of skilled engineers, technicians and managers.
This gradual evolution is also likely to increase the surplus of unskilled labour. Research by our colleagues at the McKinsey Global Institute (MGI) suggests that total UK working hours spend on manual labour will decrease by 12 percent over the next 15 years, while hours requiring specific technological skills and social/emotion skills will increase to fill this gap.
Nowhere is going to experience that change more acutely than the manufacturing shop floor. The number of jobs in the manufacturing environment that can be considered low-skill is likely to shrink dramatically. Some roles, such as warehouse picking, may disappear altogether. In other areas, such as basic machine maintenance, workers will be expected to use technological aids to work faster and more accurately.
It won’t just be the jobs of front-line staff that change dramatically, however. Managers and supervisors will need to grasp new working methods too. They’ll spend less time ensuring that manual jobs are completed correctly, and more time coaching staff and helping them to solve problems. They’ll also need to be comfortable working with data, and increasingly, alongside artificial intelligence-enabled support systems that will automatically highlight issues and make recommendations for performance improvement.
As the number of manual labour roles diminishes in manufacturing there will be a need to facilitate the transfer of some workers into other sectors and industries where the demand for manual labour and the provision of services is likely to remain high and grow, such as hospitality, care and construction.
Building a workforce that is ready for this digital world will require significant, sustained, effort. The good news: advanced technologies are also unlocking a host of approaches that can accelerate, support and improve the effectiveness of capability-building efforts. And much of this training can be delivered in short, sharp bursts.
One major fast-food chain has already used virtual reality (VR) technologies to create a detailed simulation environment for restaurant manager training. It allows a trainee to move freely around a virtual restaurant environment, interacting with staff, adjusting schedules and spotting hazards. The system scores participants in real time and provides automatic tips and feedback to help them improve.
The best results come when both industry and governments play their part in tackling this long-term challenge. This it is an area where the UK is clearly behind the pack, with a spend of merely 0.01% of GDP going to worker training, whereas Germany invests 20 times this and France close to 37 times that amount. For the wider manufacturing sector, especially the SMEs that make up its bulk, that creates a risk of being left behind. As they battle to break the long-term cycle of low productivity growth, UK manufacturers of all sizes need to accelerate the adoption of new technologies, but they also need to upgrade the skills of their people. The industry must take responsibility for that task, but companies can’t do it alone, they will also need the support of government, professional bodies and academic institutions.