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Managing people emerges as the new imperative for supply chain executives once focused on maximizing capacity utilization for physical assets.

COVID-19 has prompted smart leaders to rethink their long-term supply chain designs and refocus on people. This means giving more attention to the skills and knowledge employees need, required workplace safety measures and options for leveraging new workforce models to utilize, for example, contingent and remote workers.

“Just as physical assets depreciate, so do workforce skills and knowledge,” says Simon Jacobson, VP Analyst, Gartner. “Labor is the new constraint and needs attention. Supply Chain executives that continue to rely on tacit know-how and do not invest in knowledge management and transference will struggle with capacity utilization.”

Supply chain leaders responsible for the strategy and performance of manufacturing operations need new labour-management strategies that account for three imperatives in particular.

Adapt factory designs to meet social distancing requirements

From assembly lines to break rooms, the effects of social distancing are already apparent in many factories. Requirements for new staffing, frequent line balancing and changing work layouts have disrupted long-term investments in designs for productivity at the line or unit levels. Complying with social distancing requirements calls for changes that are neither cheap nor fast — and don’t discount the impact those changes will have on employees. Some can be a big adjustment for workers, such as having to adapt to new physical barriers without compromising productivity.

The key is to focus on the collaboration and communication components of your social distancing strategy. Start by filling communications gaps between team members with simple visual cues such as signs, charts or status-alert systems.

Adjust on-site staffing to create a more virtual work environment

Although hourly workers are needed on-site for specialist tasks and essential services, Gartner predicts that by 2024, 50% of factory work will be done remotely. Virtual teams will be a reality. As manufacturers move to more virtual environments, supply chain executives will need to ensure the right mix of on- and off-site labour. Successful organizations will be those that can eliminate the “If you’re not on-site, you’re not adding value” ethos from their culture.

Expand staffing skills and requirements to accommodate a more flexible workforce

A flexible workforce is key to a manufacturer’s ability to remain resilient. COVID-19 laid the challenges bare as supply chain leaders worked to juggle permanent and contingent workforces and stagger shifts to keep factories up and running. “That’s just the tip of the proverbial iceberg,” says Jacobson. “Balancing labour supply and demand for an expanding and contracting workforce affects how roles and skills are configured. It’s a profound change to how manufacturers manage factory-level talent.”

Staffing plans will now need to accommodate new skills requirements and take into account variable staffing levels of internal employees and contingent workers. As a result, talent searches for higher-salaried jobs, such as data scientists, might be deprioritized, while searches for gig workers with needed operational knowledge are accelerated.

You don’t have to go it alone. Partner closely with supply chain recruitment firms such as Bastian Consulting to understand and implement new ways of managing talent.