Raise productyivity By Investing In Labor

By: Mike Schmidt, Manufacturing Business Technology Keeping labor costs down has long been a preferred method for manufacturers around the globe to achieve sustained success and profitability. However, lately it seems manufacturers have found investing in efforts to raise workforce productivity to be a reasonable and desirable alternative. At least that’s according to a recent study conducted by IDC Manufacturing Insights, a provider of market research, analysis, and consulting services. The study, which surveyed 550 individuals across 11 manufacturing companies, found labor productivity was rated as the highest factor for achieving success in manufacturing among all countries, ahead of modern infrastructure, government support, and foreign direct investment. It also was revealed that 70 percent of respondents identified manufacturing as either the single most important industry or the most critical to their country’s economic health. The survey goes on to suggest that respondents from mature economies fared similar to emerging nations when rating manufacturing critical for their countries’ economic well-being. Forty-eight percent of U.S. respondents rated manufacturing as a critical element for economic growth. Other nations responded in a similar fashion: Australia with 52 percent, Brazil with 40 percent, Canada with 54 percent, China with 42 percent, France with 40 percent, Mexico with 42 percent, Spain with 50 percent, and U.K. with 62 percent. Germany and India scored the lowest, both with 32 percent. Study respondents were also asked about factors related to global competitiveness for manufacturers. According to the results, labor productivity ranked the highest in all countries and 42 percent in the U.S. rated it as “extremely important.” With more complexities being added in products, supply chains, and sales processes, a productive workforce is a competitive differentiator across all geographies. With that fact in mind, manufacturers are focused on cultivating a better relationship between management and labor. “The piece of data that I love most out of the survey was that an overwhelming percentage of people that we interviewed said that the workers cared deeply about quality, and almost an equal percentage said that management truly appreciates the efforts of the people in the organization,” says Bob Parker, IDC’s VP of Research. “The age of the contentious management-labor relationship in manufacturing is over.”...