Go into any U.S. manufacturing company and you’ll likely hear managers complain about competition from cheap foreign labor or the skyrocketing cost of raw materials.
Linford E. Stiles
Chairman & CEO
Stiles Associates LLC
New London, N.H.
But many are ignoring a major hidden threat to manufacturing: Who will replace senior management when they retire?
According to the Industry Week 2007 Salary Survey, the average manufacturing manager is between 50 and 59 years old. A recent Conference Board report finds that 40% of the manufacturing workforce will retire by 2015. So unless current manufacturing managers plan to work until they’re 70 (and don’t expect many of them to do that), this means we have less than a decade to groom the next generation of leaders. Nowhere will this job be more difficult than replacing those leaders who started the Lean revolution.
Manufacturing has become a field that demands people with technical savvy and the ability to think on a global scale. However, statistics show a decline in the number of students seeking engineering, science, and math degrees, at least in the United States. There is perhaps a false sense of stability within the American manufacturing community because most companies aren’t currently having difficulty attracting experienced Lean managers. But there’s a lot of volatility right now, especially in the automotive sector. Automakers and Tier One suppliers have been shedding executive jobs and this helps keep Lean talent in supply. But we view this shifting of talent as temporary.
Lack of sheer numbers isn’t the only concern. While employees at most major manufacturing companies know a little about Lean, there are few experts. Industry observers note that Toyota, the architect of Lean, is having trouble grooming future Lean leaders. According to Lean Thinking author James Womack, “Toyota’s traditional way of creating managers is to hire them straight from high school or college and carefully coach them over many years to become seasoned Toyota-style leaders. This approach is being severely strained by the company’s breakneck growth. There are simply too many new pupils and not enough mature teachers.”
So what is a company to do? For starters, pay more attention to Lean initiatives and treat them as a successorship program. Study successful Lean programs of other companies, notably those of GE, Danaher, and Hon. Take advantage of training opportunities such as the Lean certification program jointly offered by the Association of Manufacturing Excellence and the Society of Manufacturing Engineers. This training lets future leaders learn from those who have headed Lean programs for the last two decades. Informal retreat programs that unite up-and-coming, high-potential Lean experts with more experienced and proven leaders, is another avenue.
Companies that take the lead in Lean over the next few years are going to be the ones that we see gaining the biggest successes in the next decade and becoming the Toyotas of the next generation.
Stiles Associates (leanexecs.com) is an executive search firm specializing in Lean enterprises.