The Impact Of Impending Labor Shortages On Field Service:

Three practical solutions for the labor shortage problem

One of the most pressing concerns among field service executives is the impending shortage of skilled workers. These concerns are well-founded. The U.S. labor market is expected to face a shortage of approximately 8.2 million workers by 2027, reports Thomas Lee, head of research at Fundstrat Global Advisors.

This shortage is fueled by two trends. The first trend is referred to as the “Silver Tsunami.” This is a term that describes the enormous number of employees who are reaching retirement age over the next 10 years due to population demographics. Within the manufacturing industry alone, nearly 2.5 million will have retired between 2015 and 2025, resulting in a 2-million worker shortage by 2025, according to the Manufacturing Institute, an arm of the National Association of Manufacturers.

The second trend is due to that fact that millions of people have dropped out of the U.S. workforce due to factors such as disability and opioid addiction or because of prison records that make it difficult for them to find jobs. In fact, the percentage of the adult population that are working or seeking employment has dropped by 4 percent since 2000.

Meanwhile, the U.S. population and gross domestic product (GDP) continues to grow while the unemployment rate remains at a 17-year low. The net impact is that the demand for labor is outstripping the supply of labor in the United States. What will this mean for field service?

Blumberg Advisory Group and Field Service Insights recently conducted an economic analysis of the U.S. field service industry. The study examined the demand for field service labor in 16 different vertical market segments. Currently, these segments employ approximately 12.6 million field workers. However, an additional 2 million workers will be required by the year 2021 to meet market demand for service and support.

Considering every industry sector is facing a labor shortage, field service organizations (FSOs) will need to adopt creative and innovative solutions to overcome this gap. Fortunately, several viable solutions exist.

Using A Blended/Variable Workforce Model
FSOs can turn towards freelancers as a strategy for responding to labor shortages. Many millennials prefer freelance work because of the flexibility and autonomy it provides them, while retired baby boomers also appreciate the ability to generate additional income by working freelance. In a recent study, we found that 77 percent of FSOs are utilizing a variable workforce to handle shortages, and two out of three are using a freelancer management system (FMS) to source and manage talent. Users of FMS platforms boast that greater agility, reduced costs, faster time to market, and improved efficiency are the benefits of this strategy.

Reengineer Service Delivery Processes
FSOs will need to learn how to accomplish better results with fewer workers. One way to do this is by reengineering the way in which service is delivered. For example, the typical way that most FSOs handle field service activities is by assigning new hires to a telephone technical support capacity and dispatching the more experienced field service engineer (FSE) to resolve on-site issues. This is counterintuitive when you consider that more experienced FSEs are the ones who are best qualified to provide remote support and guided technical assistance to new hires. By switching these roles, FSOs can leverage their workforce for better results (i.e., remote resolution, first time fix, etc.) and improve the customer experience.

Utilize Advanced Technology
Many FSOs are realizing that digital technology can play a significant role in resolving the labor shortages. For example, IoT enables an FSE to save time in anticipating and preventing problems. AR provides a platform that new FSE hires and end-customers can utilize to troubleshoot and resolve problems on their own or through the help of guided troubleshooting. Initial pilots have found that FSOs can experience up to a 20 percent improvement in first-time fix rate after deploying AR. Lastly, artificial intelligence and predictive analytics can be utilized to diagnose problems, isolate the faults, and recommend and implement corrective actions. In short, digital technologies enable companies to reduce and eliminate the need for human involvement in the field service process, permitting FSOs to do more with less.

The impending labor shortage is not a myth. FSOs must be prepared to deal with it. Within every challenge lies an opportunity. This situation is no different. With a little planning and innovation combined with effective execution, FSOs can achieve remarkable results with fewer people.

Preparing for the Fourth Industrial Revolution

Antonia Kay gives a preview of WBR's upcoming event in St. Louis

Worldwide Business Research (WBR) will be hosting the Connected Manufacturing Forum on June 19-20, 2018 in St Louis, MO. I recently had the chance to talk to Antonia Kay, the Program Director, about a few emerging trends impacting the Manufacturing Industry.

1. What are the biggest challenges facing the Manufacturing Industry today, specifically when it comes to Industry 4.0?

We are at the beginning of the Fourth Industrial Revolution, which will fundamentally change our lives. Things that we deemed impossible or futuristic as children – artificial intelligence, human-like robots, drones, self-driving cars – are quickly becoming an everyday reality. As fascinating as it may sound, these technological advancements translate into a lot of uncertainty and hard work for industrial leaders tasked with “giving a facelift” to their manufacturing ecosystems.

The biggest challenge most executives are facing today is mapping out their digitalization journey, making first steps towards connectivity and automation, and adapting their company culture to the drastic change that comes with the digital transformation. As of today, there is no one-size-fits-all approach to connected manufacturing, but top global industrials are investing in IoT, cloud computing, advanced analytics, robotic process automation, and 3D printing in order to capture opportunities early on and secure their competitive edge in future.

2. What do you see as the most important trends and opportunities with respect to Industry 4.0?

The Industrial Internet of Things (IIoT) is the word of the day.

Global manufacturing organizations are investing in predictive maintenance and condition monitoring – the move from don’t fix what’s not broken to making sure things don’t break through continuous, smart monitoring and maintenance of the factory equipment.

Augmented reality (AR) and virtual reality (VR) are big too, as they can drive equipment optimization and productivity on the factory floor and beyond.

And, of course, there is an ever-present talk about Big Data and advanced analytics – how do you collect and secure your data assets, how do you leverage it for informed decision making, product/service innovation and, eventually, improved customer satisfaction?

The opportunities that come with connecting people, processes, and assets are endless. The question is, how do you do it?

3. What is the Connected Manufacturing Forum and why should people attend?

Connected Manufacturing Forum is a networking and learning platform for Industry 4.0 frontrunners who are ready to move past fear of the unknown and revolutionize their business, one step at a time.

4. Can you give an overview of what people will get?

Connected Manufacturing Forum will offer a comprehensive coverage of the main Industry 4.0 trends and will help manufacturing leaders find answers to their toughest digitalization questions.

We have a good number of real-life case studies focused on Industry 4.0 blueprint development and implementation, projects that have helped companies like Johnson & Johnson, LEGO, Intel, Boeing, Coca-Cola and more start their connected manufacturing transformation, align teams around the same goals and prepare for future industry advancements.

Cultural change and workforce management is a big topic this year – executive leaders from Georg Fischer, Kuhn Krause, Subaru, Nature’s Variety will share best practices in preparing your organization for the Industry 4.0 revolution, delivering required training to your existing employees and expanding your talent pool by attracting new, highly skilled workers who will drive the future of your company.

Lastly, we will be discussing innovative technologies – IoT, augmented reality (AR), 3D printing, robotics, sensor technologies, human machine interface (HMI), predictive analytics – that can help companies improve processes and optimize efficiencies.

5. Why did WBR choose to produce the event, and how will it be different from other events focused on Industry 4.0?

Our in-depth market research indicated that there was a high need for an Industry 4.0 conference that would help industry leaders benchmark their connected manufacturing strategies and find solutions to the toughest digitalization challenges.

While there are many smart manufacturing events out there, the quality of our content and the seniority and experience of our topnotch speakers by far outweigh competition and what other events have to offer. Our program was developed through in-depth interviews with Fortune 500 executive leaders and is packed with case studies, panels, roundtable discussions, and interactive workshops focused on real-life challenges that manufacturing executives are trying to overcome on a daily basis. Our goal is to help them do just that and progress to the next digitalization level.

6. What will people be missing if they do not attend?

They’ll miss out on top-quality, real-life content and outstanding industry networking opportunities. If your company is going through a digital transformation, you simply can’t miss Connected Manufacturing Forum!

7. If they must come up with one reason why to attend, what should it be?

Connected Manufacturing Forum is your one stop shop for all things Industry 4.0. Have questions about digitalization? Don’t know how to roll out an IoT initiative and deliver on it? Want to learn from the best in the industry and meet the most innovative solution providers? Then hurry up and register today!

Register to join 150+ executives in a collaborative debate on the emerging Industry 4.0 trends in Manufacturing, Technology, Operations, and Advanced Engineering.

And as a bonus to my readers, use code CM18BLUMBERG to save 25% on your ticket!

REGISTER NOW