The Challenge has Shifted – The Intersection of Talent and Production

I had a conversation last week with the CEO of a mid-sized services firm: “I’m not complaining, business is really good, and we are growing double digits every year.  But I’m realizing that I’m out of everything all at once – talent, plant space, equipment.”

“What’s the right play?”

The challenges of the current environment have shifted.  While growth work coming out of the recession has largely been about business model innovation and demand creation, the dialogue has taken a powerful turn.

It’s now time to scale.  

Post recession it was about making sure you moved quickly to address emerging new markets.  What I’m hearing now are questions about innovating to meet the new wave of bookings that these activities have established.

In the larger arc of business, there is always a progression of constraints for each portion of the economic cycle.  These natural cycles of new product birth, adolescence, young adulthood and maturity have been amplified by powerful technical shifts such as mobility and cloud.

The result is that when a demand shift occurs it moves quickly and sets a new ‘playing field’ leaving incumbents behind.  Take for example cloud services, now providing data analytics as simple function calls, that in the past would have taken months of development work.  This has shifted the demand for talent in this space from algorithm creation to curation and application.

What makes this even more difficult, is that the talent to expand our legacy processes and production tools is hard to come by.  So the question becomes: how do we work our way towards growth with these very real constraints?

The answer lies not in looking at talent and operations/processes as separate problems to be solved, but by considering them together.

Four Ways to Solve the New Growth Dilemma

#1: Focus

What: Get really clear on your core platforms and services so that your work is not fragmented.  It was really easy to say yes to many “special” projects during the post-recession recovery; as long as it added to the earnings and balance sheet, it was good business.  Now is the time to do that by-customer analysis to carefully look for those that are consuming more than their fair share of your operational resources.  Secondly, it’s good to assess the end-market expectations and carefully decide on the growth potential.  Stack rank the end markets you clients participate in and shorten that list to those with the best prospects.  Business that is just OK can keep you from accepting more great business.

How: The first place to start is to talk to your key producers and those in your fulfillment operation.  Which customer orders make them wince?  Once this high-level cut is done, take a look at the numbers by product and client and see if they tell the same story.  Then look for groupings of products or services that can be put together into groups and eventually platforms.  What you are looking for is internal leverage, the smallest set of platforms to serve the largest group of clients.

#2: Shrewd Process

What: If you haven’t worked the process map on your internal systems for some time, this can be a very good way to release talent.  Many times solid work using lean principles has taken double digits percentages out of cycle time, labor and scrap.  My primary clients in manufacturing water and energy are all seeing big gains by upleveling digital integration and simplification of products and services.

How:  If you have in-house talent, use the by-customer analysis of number one and unpack the key 3-4 process areas  that are most impactful to that client or service.  By the time you’ve done the top five clients, you will likely have achieved a substantial gain in process steps and efficiency of talent.

#3: Targeted Tech

What:  Similarly to the point above, if it’s been awhile since you’ve had the hood up on your operations, it’s time to do some analysis relative the opportunity for targeted automation and tech.

How: In addition to cloud mentioned above, a  new generation of trainable robotics can provide significant support to manual operations.  Careful investments in CRM, as well as collaboration and knowledge management tools, should be considered anywhere the processes are well understood, or smart systems can give you a head start.

#4: Talent Development

What: Now that you have narrowed your product and services focus, and reduced both the labor intensity and number of process steps, it’s time to turn toward talent.  In doing this, it’s important to focus on the highest leveraged roles with your investments.  I find these are in three areas: lead operator, supervisor and process engineering.  These are what I call “the first order positions.”  Second order positions include supply chain roles like planning, logistics and distribution. Those in the third tier are roles that integrate these such as directors of ops, sales and procurement.

How:  The work needs to be undertaken with HR as a partner to do solid org chart work, role design and individual assessment.  Understanding where you are regarding the talent that you need for now, as well as the near future, will allow you to do organic development where possible.  Once you find those candidates with both the willingness and capability, you can invest in them through 360 analysis and training that assures that they are ready for the challenges to come.

Strategy and prioritization needs to be applied powerfully to constraints that matter.  By carefully deconstructing the challenges, you can make sure your investments create much higher returns.  When this is done well, the firm will become much more focused and agile, with room to breathe.  This white space can then be used to become an even higher value partner to your chosen end clients and markets.  Simplicity matters in this economy, and creating clarity will make you a very compelling partner.

If you’d like to have some help parsing through the areas we’ve spoken about today, I’m happy to lend a hand.  To get started on this journey, please give me a call at 847-651-1014 or use this link to set up a 20-minute, (no-strings-attached) consult.