The wrong kind of future talent?

By James Bellini, The Talent Foundation

For a generation the talent agenda in developed economies has focused on the needs of the service sector. After all, in a country like the UK almost 80 per cent of GDP stems from activities in the creative sector, law, accountancy, tourism and the retail trade. As a result, the tech-savvy younger generation has been counselled to sharpen its skills around ‘soft’, people-centric concepts of personal engagement and team-building enabled by the growing array of digital devices and social media.

What is changing?

But consider a different scenario for our future talent needs, one dominated by a resurgence of manufacturing in the west, where capabilities around engineering, innovation and the production of tangible things will become more important. Not only will the BRICs nations and their smaller emerging market cousins be challenged for supremacy as the predominant workshops of tomorrow’s world, our entire approach to our human capital will need a radical overhaul.

In his excellent book The New Industrial Revolution, the FT’s Peter Marsh charts the appearance of a new, globalized manufacturing geography driven by what he calls ‘hybridisation’. Through the convergence of technology and quality standards the number of ‘manufacturing-capable’ countries has grown, so that value chains are becoming more dispersed. Production functions will increasingly be split between high-cost and low-cost parts of the world. This trend towards ‘hybrid manufacturing’ will favour the long-established manufacturing expertise of the old industrialised world – and call for a large, knowledge-based manufacturing talent pool to match.

Why is this important?

Global Reach

Marsh cites the case of the UK-based company Westwind, a global leader producing specialised components for the electronics industry. Under the Westwind strategy its British factory in Poole concentrates on more sophisticated, hard-to-make air-bearing spindles while its production centre in Suzhou in eastern China handles the manufacture of higher-volume, lower cost parts. Another example is ArcelorMittal, the world’s leading steel producer. Its business plan is designed to reap the benefits of a global patchwork of steel plants in both high-cost and low-cost economies. This enables the company to produce cheap semi-finished steel in one country and then ship it to high-value plants elsewhere for conversion into, say, corrosion-resistant panels for the car industry.

Another view on a western manufacturing resurgence is Ruchir Sharma’s Breakout Nations, in which the BRICs scenario is given a thorough re-examination. Sharma points at the slowdown across emerging markets in recent years with ‘the most hyped emerging markets – particularly the BRICs nations – faring among the worst’. This slowdown, he says, is allowing the US and parts of Europe to regain competitive ground. Sharma’s conclusion is blunt: ‘the perception that poor nations are rapidly catching up the rich may well give way to the rise of the west’. If true this has enormous implications for the geography of global manufacturing over coming years – and for the balance of skill sets needed in the services-led developed world.

Print Revolution

Yet another commentary, Makers, by Chris Anderson the Editor of Wired, observes how the Web has democratised the tools of both invention and of production. Put simply, in the digital age anyone can design and make real stuff, without recourse to enormous factory production lines. The rapidly growing Maker Movement, Anderson notes, is being shaped not just by engineering-oriented pursuits such as electronics, 3-D printing, robotics and computer numerical control [CNC] but by traditional activities like woodworking, metalworking and old-style arts and crafts. Since 2006 a regular series of Maker Faire events has attested to the surge of interest in the making of things. Last year’s Faire in San Mateo, California attracted 120,000 attendees. This year’s event calendar includes Newcastle, Barcelona, Hannover London and Rome. Check out http://makerfaire.com.

A recent story in The Sunday Times carried the headline ‘Hello 3D Printing, Goodbye China’. The digital 3D printer, it said, ‘promises to disrupt conventional manufacturing and supply chains so radically that advocates compare its impact to the advent of the production line’. So, a crucial question: is this a disruptive technology that will turn a burgeoning grass roots DIY manufacturing movement into a second industrial revolution that will transform the economic landscape of the old developed world. And if so, how should talent professionals address the challenge?

– See more at: http://www.shapingtomorrow.com/trends.cfm?output=1&id=22865#sthash.6slkTihH.dpuf

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