Production and logistics technology is changing dramatically as the automotive industry adopts electrification and new forms of mobility, but the skills of the workforce need to keep pace because without them no transition is possible.
At this week’s Automotive Logistics and Supply Chain Europe Live conference, leading executives recognised the need for trained and motivated people at all levels, and how current human resources strategy needed to change to secure it.
“The thing we have to take into consideration is that the shortage of trained, educated and motivated people is going to affect us tremendously,” noted Matthias Braun, head of digitalisation and concept development at Volkswagen Group Logistics.
Braun said that the sector is facing a dearth of talent, both in terms of supporting digital technology, but also in terms of the practical tasks of driving trucks and forklifts, or picking parts in the warehouse.
“There is a want for talent [for those] who can code all of the programs we need for making more digital solutions but we also have a need for talent if we think about the daily business and those that are actually moving the goods from A to B.”
According to statistics that Braun used to back up his point, around 45% of companies working in the automotive sector now say they cannot find the skills they need.
It is those people that are doing the work required to transition the sector into a new era but the jeopardy comes from a management culture that needs to lead by example, yet human resources (HR) divisions are at odds with the way skills now need to be garnered and developed.
According to Stefan Crets, executive director at CSR Europe, a 10,000-enterprise strong European business network that seeks to promote corporate sustainability and responsibility, there is a big challenge facing the automotive sector when it comes to upskilling the workforce. The risk is that there will be more layoffs ahead.
“In corporate offices you can define directions, and a CEO can set that action at a high level while middle management starts rolling it out, but it’s your people who have to do [the actual work] and that is not so straightforward and easy,” said Crets.
CSR Europe is looking at the skills problem in a programme it is running with business analyst JP Morgan looking at 30-40 companies across different industry sectors. What they are finding is that HR is not really ready to deal with developing the skills required for a new digitalised industry.
“We have standard HR approaches that look at skilling for the already highly qualified but less so for the others, especially towards the new jobs coming up,” said Crets. “What we have seen in the past is layoffs of an older or unskilled workforce to be replaced by a younger more digital-savvy one.”
Within an inclusive Europe it makes things difficult and Crets said that to make the transition HR needs to apply different processes for learning. To achieve that, it needs to get closer to the business divisions making the transformation, whether they be logistics, manufacturing or sales. Currently HR is too far away from the process.
“There is a big risk there for the automotive sector because the transition from internal combustion to electric has a really big manufacturing impact,” he said. “How we are going to deal with that is one of the major challenges and we have to look at what the role is for human resources, to make it more strategic and determinative.”
Lars Bäumann, executive advisor at VW Group, said there was also a role for management to play. Looking back at his own time leading IT production and logistics at VW Group, Bäumann reflected on the company’s efforts to become more agile and make its project teams more responsive. However, it was not until the management teams above them also adopted a more agile working method that things changed.
“This is an example of how new methods and technology should be taken up by management, and how you can lead by example and show the people that, while you can make errors and not everything is fine, you have also started to change company behaviour.”
All of these factors are now coming into play because automotive companies are vying for talent in a highly competitive environment. Whether university educated or vocationally oriented, the automotive sector is not the number one favourite for the next generation of workers. Matthias Braun said making that workforce realise how “sexy” it was to work in logistics was something the automotive sector needed to concentrate on if it was to change public perception and the skills base it needs.