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5 Quick Questions: Labor Will Define Success

Tue, 11/12/2013 - 10:44am
Joel Hans, Managing Editor, Manufacturing.net

At the 2013 PACK EXPO event in Las Vegas, Nevada, one particular figure caught the eye of Manufacturing.net — Chris Cole, founder and CEO of Intelligrated. His passion for devising new philosophies and methods for addressing the labor and education problems in the U.S. demanded further investigation. Thus, we recently got him on the phone to dive in.

Chris Cole founded Intelligrated in 2001 and has more than 30 years of experience in the high technology capital equipment and services industry, 25 of those at the executive level. Prior to founding Intelligrated, Chris served as chief operating officer of Pinnacle Automation, Inc., and held various executive positions with Milacron, Inc. Chris received his undergraduate degree from Wesleyan University and an MBA from Harvard University, where he was named a Roger Siver Fellow in 1979.

Manufacturing.net: Attracting skilled labor is not a new issue for manufacturers, but it seems to finally be getting the attention it deserves. Why do you feel that’s the case?

Cole: My own opinion is that while progress has been made, we’re still nowhere near where we need to be, in terms of getting people trained to be productive and into the skilled labor force quickly at all levels. There’s an acute shortage of programming talent across the U.S., even though there is more of it here, and more creativity in it here, than probably anywhere else.

I can tell you that, as a company with a rapidly-growing software business, we have had to become geographically diverse, in building pockets of excellence around the country, mostly because you cannot attract enough talent in any one market. While there’s great people available around the country, in order for us to grow like we’re growing, I now have software groups in Atlanta, New York, Grand Rapids, Cincinnati, St. Louis, as well as Emeryville, Calif.

We’re a big believer in co-ops. I think, sadly, there’s not enough focus on apprentice programs and training programs. At the end of World War II, there were some great ones in this country, and there still are some great ones in Germany. But we under-invest in that. It’s a huge investment upon a company’s part to take people who aren’t ready to be fully in the workforce and get them ready. A lot of the money we spend today on the education system is money that is wasted, particularly when there is no connection between the subjects that are being taught and where the job opportunities are.

Having said that, there is a whole series of jobs in manufacturing — industrial maintenance and plant operations — that are a little more skilled than the shop floor workers or the order fulfillment people, and I think there’s a big shortage of them. That’s why we’re working at codifying training programs to not only train, but re-train and certify. But, even in our world, we’ve had trouble just going out onto the street and hiring those people.

Manufacturing.net: Aside from the false perceptions that can hinder manufacturing from being seen as a quality career path, what is the most significant trend impacting the manufacturing work force? How does this relate to recruiting and retaining quality, skilled employees?

Cole: We’re doing a lot of very innovative things in the robotic truck-loading and -unloading. We don’t have full product line, but we have some very major manufacturers and retailers interested in automatic truck loading and unloading. I bring that up because among the worst jobs at a distribution center is loading trucks. It’s hot in the summer and cold in the winter. Being in the nose of a long trailer in the middle of summer is going to be painfully hot, and it’s going to be freezing cold in the winter.

These are jobs that are not preferred in a distribution center or at a manufacturing company, and therefore they’re the kind of jobs that make people not want to go to work there. They’re not necessarily unsafe, but they’re unpleasant. If we can bring automation to that, and have the people working in more pleasant areas, that makes it easier to find and retain employees, and you need less of them doing the worst kind of jobs.

Another example of that is the move towards goods-to-operator processes, in which the work is brought to the workers, rather than having the workers have to move all day to get to the goods. I don’t want to make too big a deal about how transformational it is, but a lot of our employers are employing handicapped people, who don’t have mobility, but because the work is coming to them, they don’t have to have mobility. It’s enabling other social benefits, if you will, when they can hire and productively use people who don’t have the capability to handle what would have required fully skilled, capable people.

Manufacturing.net: You referenced a number of different facets impacting labor during your product launch press conference at Pack Expo, and it seems to be a subject you feel very passionate about. Why is that the case?

Cole: I do see the long-term trend of manufacturing employment in this country dropping, although I wouldn’t be surprised to see if it’s gone up a little since [the recession]. I think a part of that has to do with the fact that we’re just seeing the productivity gains of the power of the microprocessor on the shop floor. The microprocessor is 40 years old, and it’s taken a while for it to come up with orders of magnitude of productivity. We’re just beginning to see the power of the iPad and mobile working devices in manufacturing and distribution.

In some ways, that productivity may reduce the percentage of the population that’s employed specifically doing the "touch" part of manufacturing, but I think it will greatly enhance our productivity overall. All I can say is that even though our unemployment rate is still way too high, I still have a problem finding people to fill jobs. Most of my customers have problems finding people to fill jobs. This says, to me, that more work needs to be done to bridge the disconnect between our education system and getting people to work where the jobs are going to be.

I am afraid that some of the things our federal government has done in certain states — the Affordable Care Act — has made hiring those people more expensive, and has made it more attractive to not deal with those human resources issues and exploding costs through automation.

Manufacturing.net: Intelligrated is in the unique position of both serving manufacturers, as well as being one itself. So, drawing from both experiences, what best practices can you share in helping to address some of the labor issues affecting many U.S. manufacturers?

Cole: Allowing for more, if you will, “permanent part-time” jobs. There are parts of the business in which we should become more flexible to allowing people to work permanently part-time, if they want to. Unfortunately, the Affordable Healthcare Act has brought out the worst sides of that — people are being forced to take part-time jobs — but we have had some success in hiring college students who cannot work 40 hours a week, but would be grateful to have a 20-hour-per-week job. Sometimes, we can hire people for Saturday and Sunday shifts, and they’re happy to work on weekends. Not everybody has to fit into the traditional 40-hour workweek.

Manufacturers, in many cases, are leading the way in finding more flexible ways to work with labor. It gives the flexibility to build people’s confidence without necessarily becoming full-time employees. There’s more technology that can be put to play in training people, in ensuring their skills are high. We can meet customer requirements by checking on those skills, and we’re doing a lot of great things with e-learning and working with some outside colleges to train people.

Manufacturing.net: If you could give U.S. manufacturers one thing, what would it be? Why?

Cole: Hopefully this would be a different answer a year from now, but if I could give U.S. manufacturing one thing right now, it would be a stronger economy. I really think our customer base have been doing remarkable things, but it would really help if the economy was growing, and there was a better overall macroeconomic environment. I think we’ve done a remarkable job, considering what an unremarkable job our overall government has been doing relative to how we’ve managed things since the Great Recession started.

Having said that, it’s probably not as interesting an answer as you’d like me to talk about. The next thing would be fixing the education system, to where more emphasis was put on preparation for really working in the real world. It seems like a lot of high school and public education is not teaching students about how they’ll have to interact with other people, how they have to work and how they have to deal with technology. I’d certainly like to see better technical training, and better-trained people coming in to the workforce, particularly out of high schools. It’s just remarkable how ill-prepared some people are, even with a college education. I’d love to find ways to improve that.

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