Advice on how to survive the changing workforce

Companies need to adapt to developments involving the Internet of Things (IoT), smart manufacturing, and the rise of a younger workforce. Doing that, however, will require many changes from a cultural standpoint.

By Mike Hannah May 31, 2016

Manufacturers that adopt programs to address changes in information technology (IT), technology as a whole, and the workforce will find themselves with a long-term competitive advantage. Those that don’t adapt risk joining the long list of companies that couldn’t change with the times.

Benefits of smart manufacturing

There is no debating that plenty has been written about the Internet of Things (IoT) and how it can help drive smarter operations. The IoT is designed to deliver on improved business profitability through faster, more efficient processes, higher quality products at lower costs, tighter supply chain integrations and increased productivity—smart manufacturing.

There is also no debating that this IoT era has brought the rise of the Internet technologies with a nearly endless range of smart things enabled with smart sensors that can communicate with one another. There are predictions that by 2020 there will be billions of IoT devices installed in the industrial world that will be able to self-analyze, conduct predictive diagnostics, and adapt to changes quickly.

In addition, IoT technologies, enhanced by more scalable computing options (on the edge of the plant or within the cloud) and data analytics, bring a whole new range of powerful tools to help drive smarter, safer, and more sustainable operations than ever before. Technologies that can be evolutionary steps to harnessing the most powerful element that too few operations are fully capitalizing on today, their own data.

Value in connectivity

Companies are right in assuming that they’re already collecting tons of data. According to a McKinsey & Co. report, manufacturing and industrial operations generate more data than any other industrial sector. However, most of that data today is discarded at run time and is primarily used for diagnostics and alarming—not to drive process or business improvements. In other words, we’re not capturing the true value.

Speaking of value, Cisco Systems reported in 2014 that the IoT is estimated to create $19 trillion of value over the next 10 years, and interestingly enough, the largest share ($3.9 trillion) of that value will be in manufacturing. Capturing this IoT opportunity is creating increased pressure to pass data throughout an organization’s entire enterprise and to do it reliably and securely.

The IoT will also challenge traditional organizational roles as technology becomes widely embedded across assets and operations. IT will have to join forces with operations technology (OT) to oversee operations that are essential to improve both the top and bottom lines of their companies. The industrial market is referring to this as "The Convergence of OT and IT."

All of this sounds great. So, what’s the problem?

People and culture

In this "convergence," both IT and OT have essential roles to play in helping their companies successfully transition to a single, secure, IP-based network that unifies the industrial environment. These departments will need to address cultural, technological, and strategic challenges for a smooth convergence. This will require changes for both OT and IT professionals.

People are changing, too. Domain expertise is becoming one of the greatest challenges in the industry. Retirements, economic expansion, and IoT technology evolution are overwhelming companies’ ability to staff operations, and they struggle to find talent with the necessary OT/IT skills.

The World Bank Studies estimate that 220,000 new engineers are required every year from 2014 to 2022 to connect the unconnected. This new generation of employees also thinks, works, and uses technology very differently from existing ones. This is especially true in manufacturing where the required technology skills are quickly changing and "tribal knowledge" exists in an older workforce.

Skills and education

The real challenge moving forward is finding qualified staff to design, deploy, and maintain these collaborative industrial network infrastructures. So, effective training in new technology is fundamental. Today’s engineers need to understand advanced networking and information technologies which are growing in prominence in the industry. While outside hiring is often a necessity, it is also a challenge, so building new skills for existing employees can be a vital first step.

The good news is this talent shortage and skills gap are becoming a recognized problem by the industry and consortiums around the world. There are groups that are taking action. For example, The Industrial IP Advantage, a coalition established in 2013 by Cisco, Panduit, and Rockwell Automation, has developed virtual training courses designed to help IT and OT engineers make the most of their network connectivity.

The courses are developed based upon validated reference architectures and will help drive design decisions from the equipment-level to the enterprise network using scenario-based training on logical topologies, protocols, switching and routing infrastructure, physical cabling and wireless technologies—all of which help to establish and maintain a robust and secure network infrastructure.

What the future requires

For the next two decades, a large generation of workers will be reaching retirement age and ready to leave the workforce. However, today these workers may also represent an organization’s largest source of talent, as there may not be enough new workers for all of the positions an organization needs to fill—especially for those requiring advanced manufacturing skills or advanced education in science, technology, engineering and math (STEM).

As a result, organizations need to focus on the value of their total workforce and develop strategies to train, retain, and engage them with the next generation of employees. With the experience and skills developed from many years of employment, retaining such experienced workers and using them to mentor new talent simply makes sound business sense.

It will also be important for organizations to engage in communities and with youth educational programs that are critical for creating and preparing future workers for the modern manufacturing environment.

Attracting young people will be the key to future success for the industry, and we all must take it upon ourselves to show young workers the new face of manufacturing and communicate the wide array of interesting and financially rewarding jobs that are available. Manufacturers need to create a passion for these skills early in the education process and show that manufacturing can be a rewarding career, as well as fascinating, and fun-think robotics and 3-D additive manufacturing.

Mike Hannah is the market development lead for Rockwell Automation’s connected enterprise and smart manufacturing initiative. Hannah is also a MESA International smart manufacturing working group member. This article originally appeared on MESA International’s blog. MESA International is a CFE Media content partner. Edited by Chris Vavra, production editor, CFE Media,

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