Article: HR development in manufacturing sector

Strategic HR

HR development in manufacturing sector

With strong sales and increased attention from the investment community, manufacturing industry requires human capital now more than ever as they plan to be the fastest growing service sector.
HR development in manufacturing sector

The human resource department plays a wide variety of different roles in the success of an organization. To compete in an ever-changing world, businesses must frequently realign themselves. Organizational development is a way to improve a company through this change process. When done effectively, organizational development focuses on the best use of the company's employees.

Human Resource Development (HRD) is the framework for helping employees develop their personal and organizational skills, knowledge, and abilities. Organizational development is a planned effort for a work group and/or the organization, managed by leadership and supported by employees, to increase organization effectiveness through planned change in processes and systems. The focus of all aspects of Human Resource Development is on developing the most superior workforce so that the organization and individual employees can accomplish their work goals in service to customers. Organizations have many opportunities for human resources or employee development, both within and outside of the workplace. Human Resources may set strategies and develop policies, standards, systems, and processes that implement these strategies in a whole range of areas. The following are typical of a wide range of organizations:

  • Recruitment, selection, and on-boarding (resourcing)
  • Organizational design and development
  • Business transformation and change management
  • Performance, conduct and behaviour management
  • Industrial and employee relations
  • Human resources (workforce) analysis and workforce personnel data management
  • Compensation, rewards, and benefits management
  • Training and development

The HRD function in the manufacturing industries is often concerned with payroll, administrative work and mediating between the management and the workers. Mostly, the manufacturing companies lean on the HRD function in times of labor unrest and strikes. Manufacturing is the use of machines, tools and labour to produce goods for use or sale. The term may refer to a range of human activity, from handicraft to high tech, but is most commonly applied to industrial production, in which raw materials are transformed into finished goods on a large scale.

Approximately 5.8 million jobs in other sectors depend on, or are supported in some form by the manufacturing industry all around the world. U.S.A’s manufacturing industry alone provides 11.7 million jobs and boasts as the world’s 10th largest economy. These two facts illustrate the vital role manufacturing industry plays in functioning of the economy worldwide.

GE as a global company with operations in more than 100 countries believes in developing the talent of new employees  with programs designed to give in-depth experience and build skills that are crucial for long-term success. Their heritage is built on continuous learning, which is why they invest more than $1billion annually in training and education offerings.

Tata Steel formerly known as TISCO and Tata Iron and Steel Company Limited is the world's seventh largest steel company, with an annual crude steel capacity of 31 million tonnes. It provides free medical services to all employees and their family that continues after retirement too. Plus it provides monetary incentives to employees who pursue higher education in a related field along with study leave, scholarships, etc.

Oil and gas company Hilcorp, headquartered in Texas with ore than 1400 employees, tops Fortune list of the best workplaces in manufacturing and production for the second year in a row that paid a hefty $100,000 bonus payouts last December. This is a great place to work because employees do their best and put their best foot forward to make things better for tomorrow. Its employees says, ‘we all show up every day with our A game and do our best. ‘

With strong sales and increased attention from the investment community, manufacturing industry requires human capital now more than ever as they plan to be the fastest growing service sector. Now, many small and large enterprises are realizing the value of effective human capital and their essential contribution towards business success. Other than the general challenges of global competition, product development and cost containment, manufacturing faces major issue in the HR department. In the times of dynamic global market developments, HR in manufacturing industry needs more focused attention than ever. As largest provider of employment, manufacturing industry unsurprisingly face some serious HR challenges:

Recruitment difficulty: The large number of job positions to be filled pose a challenge for the HR. What makes the task of filling many job positions even further more complex is the need of specific skill set required by the worker. Manufacturing industry who look for skilled workers, frequently face shortage of people with the right skill set and abilities, hence forming another hurdle for the HR.

Employee retention: An increase in turnover rate in manufacturing industry is a common phenomenon as people often leave to explore new and exciting opportunities. Other reasons for increase in turn overrate may be due to no growth or development of the employee on both professional and personal front, low pay package, lack of benefits or poor work environment.

Global competition: As this increases, the task of making the company attractive to top talent and innovators in this age of cut throat competition, is a challenge important for the survival and growth of the company in the industry.

Training and development:  It is the sphere where HR has to operate to its optimum. It is equally essential to provided adequate training to employees, in order to keep them update with the latest developments in the industry and prepare them better for the upcoming challenges. 

Decline in workforce: Even though the sector seems to be growing, and there is a perpetual demand for workers, there is a shortage of skilled candidates as salaries in manufacturing is higher compared to the combined salary averages across all other industries, but unfortunately it is not acting as a magnetic factor in attracting new and better talent into the industry.

As far as Human Resource Management is recognized as one of the most important managerial aspects in the life of every company. HR in manufacturing is much more rules-driven and consistent in applying those rules. HR role provides leadership in designing of the organization growth. A poorly designed organization is like a colander; in there we can pour top level talent and hours of effort into it. A well-designed organization uses its talent effectively and HR works on it so hard to build talent.  Many small to mid-size manufacturing companies have become increasingly aware of how an effective human resource leader can contribute to the success of the business’s bottom line. With the perpetual growth in the manufacturing industry, the role of HR is bound to play an even more crucial and complex role in the future. But with diligent care, HR can overcome each and every hurdle and do what it does the best: Help the company achieve newer heights.

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Topics: Strategic HR

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