Recent years have taught us to be humble in the face of a rapidly changing world. We have learned that the intangible achievements of European civilization, such as a sense of security or economic and political stability, are not given to us once and for all. Added to this is the growing voice of the exploited planet and the need for serious reflection on its condition and ways to prevent global catastrophe.
It has been said for some time that we are living in a world described by the acronym BANI: Brittle, Anxious, Non-linear and Incomprehensible. The near future will be a time of adaptation to this new vision of the world, both in the context of private and business strategies. In the industrial area, it will be dominated by a few of the most significant trends.
Ensuring supply chain resilience
Threatened or even disrupted supply chains are a problem that the industry has been facing for several years now. The Covid-19 pandemic, Russia’s war against Ukraine or unforeseen natural disasters like the recent earthquake in Turkey have taught us that the economic environment has become unstable and unpredictable, which has a major impact on costs, processes and the very operation of businesses.
Ensuring supply chain resilience has become crucial for survival in a highly competitive market. Companies are opening up to new technologies and solutions to support them in dealing with this challenge. There is a clear increase in the awareness of Polish companies in the area of lean management. Something that until recently was an innovative “add-on” is becoming an essential component of the development strategy. Intelligent systems are being implemented, allowing ongoing control of material flow, optimization of assortment or even consolidation of suppliers. This trend is bound to gain in importance in the near future.
It should also be expected that the need for more effective control of the supply chain will result in a shift of production back to EU countries. There are many indications that this will benefit Poland, which is developing towards a leading role in the EU, continuing to attract investment and labour.
In an era of problems with the availability of raw materials, shaky liquidity of production, demographic change, significantly affecting the labour market, one hears more and more about the strategy of vertical integration. It makes it possible not only to make the supply chain more resilient to all kinds of fluctuations in the business environment, but also to keep the know-how within one’s own organization, and protect it from competition. The vertical approach is also a way to expand the scope of intellectual resources – access to new technologies or the talent base.
This strategy has its drawbacks, of course, due to the complexity of managing multiple stages of the production process. Here, however, another important trend comes to our aid.
Automation and digitization of production
This is, of course, no news. We have been talking about automation and digitization of production for a long time. However, it seems that now the Polish market is much more open to them. Entrepreneurs find it much easier to accept digital transformation, because they have seen how fast technological progress in this field is happening. Those who don’t keep up are left behind.
This attitude is, of course, also fostered by the labour shortage. And it’s not just the fact that some human labour is gradually being taken over by robots, but also the flexibility and agility of operations in a situation of high employee turnover. In this context, solutions such as digital assembly instructions, for example, which allow new operators to start work immediately, will certainly gain in importance.
Looking for cost savings in non-obvious areas
Galloping inflation, problems with the availability of raw materials, geopolitical turmoil that threatens supply chains are driving up production costs and thus product prices. This in turn reduces market competitiveness. Looking for a way out of this situation, manufacturers are beginning to discover and appreciate the potential of process optimization.
Moreover, savings are being sought in less obvious areas, such as the management of C-parts, which include fasteners. It turns out that the large volume of this type of assortment and the associated processes have a real impact on a company’s cost structure.
Processes in turn lead us to the idea of sustainability. This word was perhaps the most repeated one of 2022. We’ve talked about it a lot, but it just goes to show that we all care about environmentally and socially conscious business. With necessary new policies and regulative measurements ahead of us it’s time to move from talks to actions.
This trend is also inspired from the bottom up, by changes in the labour market. A new generation of environmentally conscious employees is coming to the fore, for whom identification with the values of the employer is often more important than material benefits. They are the ones who will take the lead in bringing environmental change, rather than economic change.
New hiring strategies
Looking at business from a broader perspective, it is impossible to ignore the factor of a dramatically changing labour market. Increasingly, we are talking about a market of the worker, a generational change, a replacement of the work ethos with an ethos of self-development. The Polish market will be a particularly interesting field of observation here.
According to Eurostat, the unemployment rate in Poland is almost the lowest in Europe (3% in November 2022, next to the Czech Republic 2.7% and Germany 3%). A new generation of so-called “job-hoppers” is entering the market, willing and often changing jobs if they become boring or otherwise fail to meet their expectations. At the same time, this generation is clashing with the cult of work still professed by senior colleagues, which will cause tensions and communication problems.
In this context, inclusive leadership, based on emotional intelligence rather than IQ, is increasingly important. The role of leaders will be to guide companies through the difficult process of adapting to this situation, taking into account the different needs and different attitudes of a multigenerational workforce.
It will also be necessary to lean into new hiring strategies in a world where straightforward material values are giving way to factors such as a sense of security, the need for attention, and the compatibility of one’s values with those of the company.
How to provide employees with the space to develop their potential and self-fulfilment, while safeguarding the company’s interests? Particularly in industry, where most jobs still involve manual labour, often based on automatic, repetitive activities, this will be a major challenge.