Lisa Caldwell is the EY Americas Business Consulting Leader. In her role, she helps clients reinvent operating models that create business value, redefine leadership models that focus on innovation and create new jobs for future generations.

EY and The Manufacturing Institute recently released a study that explores the key issues top of mind for manufacturing leaders. According to Caldwell, the purpose of this study was to build on existing knowledge.

“Building upon the research by EY and Oxford Saïd Business School, EY and The Manufacturing Institute spoke with US-based manufacturing leaders to learn first-hand what key challenges are top of mind across the industry,” says Caldwell. “The study aimed to uncover how manufacturing industry leaders can identify, develop and operationalise adaptive skills to meet the current and future demands of the industry.”

Based on these conversations, Caldwell heard a lot from manufacturing leaders and what key challenges they are currently dealing with.

“Manufacturing leaders in the US recognise that they face a critical opportunity to close the skills gap, and they need to do so quickly,” explains Caldwell. “By 2030, an estimated 2.1m manufacturing jobs could go unfilled if the skills gap is not adequately addressed. In response to this issue, leaders told us that they need a workforce with the agility to develop new capabilities as their organisations change and with the ability to respond to data-driven decisions and redefined roles. 

“While there were a number of ideas about how to achieve an agile workforce, employers unanimously felt that a unique win-win opportunity to accelerate business and employee impact was through adaptive skills. Manufacturers know that they cannot remain competitive and future ready as the industry rapidly evolves without a workforce that prioritises adaptive skills.”

Adaptive manufacturing skills 

So what are adaptive skills and how are they important to the success of the manufacturing industry? 

“Simply put, adaptive skills are skills or traits that enable individuals to transform their abilities as their demands and environment change,” continues Caldwell. “Adaptive skills are highly relevant to the success or failure of an organisation’s efforts to transform. In fact, 100% of survey participants agreed there is value and applicability in adaptive skills in the manufacturing industry. 

“Employees need to continually evolve and adapt their skill sets over time to adjust to new technologies and processes and to stay current in their profession. Such efforts benefit both the individual and their professional development but also the company, which reaps the rewards of increased productivity and enhanced employee morale. According to the study, transformations that invest in adaptive skills are more than twice as likely to succeed than those that do not invest in adaptive skills.”

What are the most important skills that manufacturers must develop among their workforce to aid future transformation?

“Our research with Oxford Saïd Business School uncovered five foundational adaptive skills that drive successful transformation across industries: 

• Learning agility
• Analytical acumen
• Social and emotional intelligence
• Resilience
• Creative reasoning

“Then, through interviews with leaders across manufacturing, EY and MI researchers found that leaders also consistently mentioned three additional adaptive skills that provide value in manufacturing: root cause, accountability and systems thinking.”

What is the role of company culture in accelerating the benefit of adaptive skills? 

“Actually, the topic we heard about most often in our conversations with respondents was the need for an adaptive culture. Adaptive corporate cultures reinforce critical adaptive skill sets and intentionally engage the worker as an individual, a team member and an important part of the greater system.  In an adaptive culture, the tone is set from the top, but achieving your desired culture is ultimately dictated by employees who are influencers. They’re usually go-to employees whose opinions are trusted and sought after. In manufacturing, the influencers are on the shop floor. Influencers will either be the anchor that drags your organisation down or the rocket ship that accelerates your organisation to new heights. 

“We also heard from manufacturers that another critical input to an adaptive culture is collaboration and feedback. This means engaging teams across your organisation for

input, rewarding good ideas and providing feedback about ideas submitted. Ultimately, reinforcing adaptive skills through an adaptive culture serves to create a flywheel effect to generate exponential impact (i.e., reinforcing a continuous focus on and development of adaptive skills).”

How adaptive skills can be a strategy for manufacturing leaders looking to overcome the challenges of today’s labour crisis

Caldwell knows that the manufacturing sector is facing unique challenges including limited pools of talent, increasing competition for talent, and challenges with increasing agility and speed in hiring. 

“82% of respondents said their organisations are seeking new and innovative ways to invest in the careers of their workforces. In order to overcome the challenges of today’s environment, manufacturers must create a win-win for both employees and the business. Adaptive skills are the translation point needed to reskill the current workforce and rebrand, attract and retain new talent pools.”

Caldwell argues that adaptive skills are important for manufacturing leaders who want to reskill their workforce.

“Unique synergies develop when workers have adaptive skills combined with traditional core skills. Adaptive skills serve as the translation point for those with traditional skill sets to access new opportunities and for those with more future focused skills to connect with onsite job requirements. As a result, employees with traditional core skills can better connect to future needs allowing manufacturers to reskill workers across the business. Conversely, employees with adaptive skills can, in many cases, adapt to traditional roles.”

So how do adaptive skills support recruitment and retention across manufacturing organisations? 

“Recruiting for adaptive skills helps to activate new recruiting sources. Future-minded hiring practices target dynamic individuals with the ability to continually learn and upskill as the demands of the role shift. One of the organisations we studied has removed educational requirements to expand the talent pool. To fill new and existing roles, organisations must expand their talent pools beyond traditional sources. Internally, using adaptive skills, many organisations have deployed existing talent into new roles, breaking the conventional linear career pathways. 

“Manufacturers are also finding that providing employees with opportunities to develop adaptive skills serves as a sound retention mechanism. We heard many specific examples about people within the organisation who showed high levels of accountability and agility and were able to grow their skills from manual to digital or manual to leadership and therefore remained engaged and more likely to stay in manufacturing as their career opportunities expanded. Leaders are broadening their efforts to market the value of adaptive skill sets to create a more fulfilling career while also opening up new career pathways. These efforts help to differentiate the employee value proposition (EVP) or value to the employee of working at a given employer and directly address attrition risks.”

In the long-run, Caldwell believes that adaptive skills will have a huge impact on changing the manufacturing industry.

“74% of the respondents said the skills needed for manufacturing jobs are changing rapidly. As manufacturers are redefining what it means to work in manufacturing, talent is rethinking where and how they look for career opportunities. We found numerous examples where adaptive skills serve as differentiators to employees as they decide where to progress in their careers. Through speaking with manufacturers, we confirmed more of how “new” manufacturing is redefining what it means to work in the industry. The opportunities available from the shop floor to the executive suite require a deep level of thinking and problem-solving, an understanding of systems and how to optimise their performance. Opportunities like these attract energetic, innovative talent, allowing manufacturers to compete with other industries for these exciting positions.”

How are employers using adaptive skills as a catalyst to challenge current learning strategies?

“Companies that rely on traditional one-size-fits-all learning models are not optimising their investment in adaptive skills. Manufacturing leaders told us that combining immersive and individualised learning experiences accelerates the win-win between the organisation’s business needs while fulfilling workers’ desire for a more meaningful work experience. 

“Immersive learning experiences use real-world scenarios to train employees in an engaging environment. Leaders shared how they effectively incorporated immersive learning experiences on the shop floor to teach adaptive skills across their workforce. The advantages of immersive learning for the individual and the organisation are significant. At the organisation level, an adaptive workforce can more easily adapt to change, learn new technical skills and contribute to a more collaborative culture. At the individual level, there is greater engagement and job satisfaction. 

“Individualised learning creates engaging experiences that drive true learning and performance for the career needs of each employee. Employers have an opportunity to provide individualised learning as a differentiator for current and future employees. Recent research by The Manufacturing Institute also tells us that manufacturing jobs that offer individualised training and a clearer path for career progression are more attractive to recruits and have greater learning retention.”

Caldwell has some final advice for manufacturing leaders: While technology and process are critical factors to achieving data-driven manufacturing, successful transformation begins with people. 

“Viewing the skills gap challenge through a wider lens will help modernise the workforce. Adaptive skills can serve as a differentiating factor to reframe the industry and better attract and retain talent. Investing in their adaptive skills can not only increase the likelihood of future success but also can serve as a vehicle to directly address the current talent shortage.”