Labor Costs Expected to Increase, So Will Challenges to Worker Development

by Dean Prigelmeier, President of Proactive Technologies, Inc.

In an article by David McCann of CFO.com entitled, “Labor Costs Will Skyrocket Over the Next Decade”, the author cited new research from consulting firm Korn Ferry  projecting new challenges for employers in the coming years. “Organizations around the world could add more than $2.5 trillion to their annual labor costs within 12 years as a result of the global shortage of highly skilled workers. The report follows up on the recruiting and workforce management firm’s forecast in May that the talent shortage could cost companies $8.5 trillion in unrealized annual revenue by 2030.

This is a rolling crisis that started several decades ago – the repercussions are just now being articulated in terms employers can relate. Employer’s awareness of the approaching crisis appeared for retiring baby-boomers and the anticipated loss of expertise and critically unique task-based skills mastered over decades of performance. Add to that the rise of millenials, the continual introduction and evolution of technology and the disruptive effects of the Crash of 2008. Now employers are finding themselves rebuilding their workforce, in many cases with tools and techniques that haven’t evolved all that much and still without really understanding the seriousness of the challenge, let alone the labor and opportunity costs to their operation.

More Employers Finding Ways To Strategically Ensure Fair Pay

by Stacey Lett, Director of Operations – Eastern U.S. – Proactive Technologies, Inc.

In an article appearing in IndustryWeek entitled “Trying to Ensure Fair Pay, Employers Are Changing Policies,” it noted that according to a recent employer survey “2018 Getting Compensation Right,” “60% of U.S. employers are planning to take some action this year to prevent bias in hiring and pay decisions.” Further, 53% “are planning on or considering adding a recognition program.”

The report went on, “37% percent are planning on or considering changing criteria for salary increases. Among employers not redesigning their programs, most are making changes to the importance of factors used to set base pay increases.”

Developing the Maintenance and Other Technically Skilled Workers That You Need; To Specification, With Minimal Investment

Dr. Dave Just, formally Dean of Corporate and Continuing Education at Community Colleges in MA, OH, PA, SC. Currently President of K&D Consulting  

In the March, 2016 Proactive Technologies Report article, “Grow Your Own Multi-Craft Maintenance Technicians – Using a ‘Systems Approach’ to Training” I described how Proactive Technologies, Inc. has often joined forces with universities, community colleges (many were schools for which I lead the customized training and workforce development departments) and other related technical instruction providers to setup and implement the “hybrid model” of worker development.  This approach has proven itself highly effective for technical job classifications such as Maintenance,Chemical Operators, Press Operator, Tool & Die, NC Machine Operator, Quality Control, Supervisor and others.

This “systems approach” to worker development is simple in its structure but includes metrics and quality control points to ensure that worker development outcomes are clearly defined, progress measured and reported monthly, and goals reached – no matter if the job changes or people change jobs. Although this approach can be used for any job classification in any setting, together we have applied this approach effectively for Maintenance and many other critical technical positions, as well as often neglected supervisor and first-line management positions, for many clients over the last 2 decades.

Pre-Employment Physical Ability Tests Can be a Legal Liability If Not Done Right

by Jim Poole, President of Lifetime Learning, LLC

David Sparkman of EHS Today wrote in a July 20, 2018 article entitled “EEOC Cracks Down on Pre-Employment Physical Testing” that “If your company uses pre-employment physical stress tests for job applicants that result in the rejection of female applicants, you could be in a world of hurt if the Equal Employment Opportunity Commission (EEOC) finds out.” He described the story of Hirschbach Motor Lines, “which used a pre-employment back assessment to screen and reject applicants it believed would be unable to work as truck drivers. Applicants were tested for their ability to balance and stand on one leg, touch their toes while standing on one leg, and to crawl… The company eventually agreed to pay $3.2 million to a class of female applicants after the EEOC filed a lawsuit alleging the strength and fitness tests they took impacted women disparately. Earlier this year another case involving physical ability testing required by a police department resulted in a nearly $2.5 million settlement for female applicants.”

EEOC’s aggressive pursuit of cases demonstrates why it is important that employers understand the legal issues surrounding physical ability tests(PATs). Extreme care should be exercised when selecting and validating such tests. Sparkman quotes experienced lawyers representing clients in these types of cases, “’If a PAT has a disparate impact-for example, if women fail the PAT at a statistically significantly higher rate than men-an employer has the burden of demonstrating that use of the PAT is job-related and consistent with business necessity,’ explain attorneys Mallory Stumpf and Sarah Smith Kuehnel of the Ogletree Deakins law firm.”

Explaining Your Process Training to Auditors, Prospects and Clients

by Proactive Technologies, Inc. Staff

For most organizations, the general notion is that training is going on in every corner of the organization, for every worker at any time of the day or night. One person is showing another person how to perform a process, operate a piece of equipment or software, fill out a form or, yes, make a copy using the new copy machine just installed. Have you ever walked by a copy machine and seen someone standing in front of it, staring at the control panel…then the sky as if seeking divine intervention.

When the resident expert masters a task and it becomes routine, there is a tendency for them to marginalize the task as so easy that the next trainee should learn it by osmosis. If not, maybe the new-hire “just doesn’t seem to want to learn.” Somehow, the organization may get by. In this case, like so many, it may sound like an insignificant example of training, but not to the person who needs the copy and who may be judged if a meeting is waiting for it.

Read the full October, 2019 Proactive Technologies Report newsletter, including linked industry articles and online presentation schedules.

How Much Would “Full Worker Capacity” Through Full Job Mastery Be Worth to Your Firm?

by Dean Prigelmeier, President of Proactive Technologies, Inc.

According to Ed Timmons, CEO of the National Association of Manufacturers, “ our labor costs in the U.S. are still 20% too high.” If he means that employers may be paying too much for unused or unusable worker capacity, and they should seek methods to develop it, I can agree with that. If he means employers should focus on spending enormous amounts on finding alternatives to labor, or randomly cutting workers, or asking workers to work for less wages and less benefits, I would say “hold on a minute.”

Given the growing discontent by workers who still haven’t recovered from the Crash of 2008 and are still trying to come back to the wage level they once had for the talents they possess as their employer and their shareholders built great profits, workers might want a seat at that discussion. Many families, today, are challenged by rising prices of nearly everything and stagnating or eroding wages. This preoccupation with driving down labor costs, while reporting to Wall Street record quarterly profits, may benefit shareholders in the short-run, but it is surely self-destructive and illusionary in the long-run. 

Task-Specific Performance Reviews – An Accurate Metric for a Structured On-Job-Training Outcome

by Stacey Lett, Director of Operations – Eastern U.S. – Proactive Technologies, Inc.

We have all been through it. For decades this has been the topic of comedy shows and movies…the dreaded annual performance review. And when it is over, we might tell our confidants how non-reflective of reality and unfair it was. We calm down over the next few months and grow more anxious each month as we get closer to the next one thinking we are at its whim.

Why are they used? Are they supposed to be a good measure or performance or just a way to meet a human resources department obligation. More times than not they seem like a justification for not giving a wage increase than guidance on how an employee can continually improve and contribute to the organization.

Classes Alone Will Not Close the “Skills Gap,” But Structured On-the-Job Training Can…Every Time!

by Proactive Technologies, Inc. Staff

Proactive Technologies. Inc. works with many employers, a large number of them manufacturers, to set up structured on-the-job training programs designed to their exact job classification(s), built to train incumbent and new-hire workers to “full job mastery” – still the most elusive goal most employers face and the key to” closing the “skills gap.” Under-capacity of workers is an enormous source of untapped value and unrealized return on worker investment. 

The accelerated transfer of expertise™ approach can help any employer quickly and completely train the skilled workers they need AND realize an increase in worker capacity, work quantity/quality and compliance (ISO/TS/AS, engineering specifications and safety) while reducing the internal costs of training. New-hires and incumbent workers are driven to full job mastery and higher levels of return on worker investment (ROWI). The task-based, structured on-the-job training infrastructure is perfect for apprenticeships; instead of marking the calendar for “time-in-job,” job-relevant tasks are mastered and documented. AND, unlike classroom or online training, the cost per trainee decreases with each added trainee once set up. 

Supervisors and First Line Management Need Structured On-The-Job Training, Too

by Dean Prigelmeier, President of Proactive Technologies, Inc.

It seems every organization is scrambling to “lean” the operation these days. This implies producing the same amount of output, or more, with decreased amount of inputs by fine-tuning logistics, internal work flows and processes. Workers get moved around or out, and processes get reorganized and relocated.

Changes to the operation signal that the workers responsible to implement changes will need to know the new way of doing things. All affected workers, all shifts. Yet, often very little thought is given to the effectiveness of improvements if not everyone is one the same page.

Read the full September, 2019 Proactive Technologies Report newsletter, including linked industry articles and online presentation schedules.

Thirteen Good Reasons Why Structured On-The-Job Training Should be Part of Your Business Strategy

by Dean Prigelmeier, President of Proactive Technologies, Inc.

Many articles have appeared in the Proactive Technologies Report covering how Proactive Technologies’  PROTECH© System of managed human resource development can address many of the workforce development scenarios; from individualized, customized structured on-the-job training for a specific employer for specific job classification(s), to regional partnerships servicing multiple employers while partnering with regional educational institutions, private training providers, workforce development and economic development agencies to provide the related technical instruction. There are many winners with this approach, but none so important as the employer and the employee.

Several articles have appeared in the newsletter explaining how Proactive Technologies sets up for each client a unique, structured on-the-job training program, provides implementation support to ensure it is running effectively and provides documentation and monthly reporting to drive each employee’s progress toward full job mastery. The most recent article appearing in the February, 2017 issue entitled “Tips for Establishing Your Company’s Training Strategy – Practical, Measurable, Extremely Economical and Scalable“. While the article hints on some of the benefits to the employer-employee stakeholders, it might be more advantageous to focus on the benefits themselves rather than leave them nuanced. More can be found in other articles at the News and Publications page of the Proactive Technologies, Inc. website.

The High Cost of Employee Turnover

by Stacey Lett, Director of Operations – Eastern U.S. – Proactive Technologies, Inc.

Most companies are dealing with uncomfortably high levels of turnover. When one separates out those employers that facilitated high turnovers to lower labor costs, there are many reasons for this. However, there is no denying the many costs associated with this that exist and the effects that often compound. These costs are often unknown and unmeasured, but all employers should keep an eye on this challenge and explore its full impact on the organization.

It seems counter-intuitive, but there are some who even recently promoted a business strategy that encouraged employee turnover. In a July 21, 2015 Forbes article entitled “Rethinking Employee Turnover,”  author Edward E. Lawler III, “Indeed, the turnover of some employees may end up saving an organization more money than it would cost to replace that employee. The obvious point is that not all turnover should be avoided-some should be sought.” The question is how to determine which ones to keep and which to encourage to leave. Without accurate measures of costs and values of a worker, good employees may be pushed out along with the “bad” and then the true costs of this action realized by the employer after it is too late.

Ensuring Worker Training Complies With ISO, AS, TS and Other Quality Mandates

Proactive Technologies, Inc. – Staff

Each of the quality programs typically modeled by manufacturers and service organizations is rooted in the American National Standards Institute(“ANSI”) program for quality assurance and control that served us up to the 1980’s. What each of the subsequent models tries to achieve is simplicity, standardization and verifiability. Audits are used to ensure these attributes are present.

When compliance with ANSI requirements became inconsistent among manufacturers, International Standards Organization (“ISO”) rewrote the standards to make them more compliable and encouraged an international acceptance of the standards. ISO models allow the host to be certified to a part/process, or to its people performing a process or as an overall facility producing and product(s)/service(s) for export. In any model from a worker’s contribution to the product or service, the fundamental standard is whether there are clear, compliable processes in place to control and measure a repetitive, consistent level of quality. The next standard is whether the host makes a documented effort to train/retrain workers to the processes (when changes occur). The third standard is whether the host has a records system that accurately tracks each worker’s progress toward “mastery” of the processes they are responsible to perform.

From Innovation to Implementation – Success Depends on Preparedness of Those Executing

by Dean Prigelmeier. President of Proactive Technologies, Inc.

How often does a product or service go straight from research and development to service implementation or product production? A skilled, experienced worker may be able to overcome the ambiguity of this hand-off, but it seems there is, today, a shortage of skilled, experienced workers; baby boomers finally decided they can, or have to, retire, or some companies experience high turnover rates of replacements, or most employers say they lack of skilled candidates…or even someone skilled enough to train them.

There are many reasons that this loosely organized hand-off still exists:

• Perhaps from a sense of futility, with engineers seeming to have given up on the notion of training workers first to ensure immediate output quantity, quality and consistency;
• Perhaps it is from knowing that the organization lacks a “system” in place to facilitate the transfer;
• Perhaps it is from the belief that, especially in the early stages, the product or service may go through many changes before a coherent, repeatable process settles in and when it does the next product or service has been introduced;
• Perhaps from a sense of superiority, that “I know how to do this [because I designed it] so everyone else should know what to do.”

For those who recognize the need for worker training and try to incorporate it manually while trying to keep up with engineering and technological innovations, it is common to find a training program released well into the last days of the life cycle – just in time to train workers for the things they made and serviced years before. Manual methods just do not keep up anymore, and they haven’t for the last 30 years. This doesn’t mean we should “leap-frog” to Artificial Intelligence or online training. The cost alone would dissuade anyone from utilizing it for this type of task-specific training, never mind the inappropriateness.

The most efficient and effective path to expediting a process from development of the process (including all pertinent aspects) to implementation is displayed. The task should be the central focus, with each stakeholder department contributing its input and metrics of accurate performance. Simply stated, the engineer can draft a process, then the other departments can add their components in order. Once all inputs are in, everyone can review and make changes based on each other’s observations and comments before a final document is released.

Too often departments are the focus of process development and implementation. Each department may contribute, but each department may also have its protocol, maybe even separate software or manual system, and each creating its own support document. A process making its way through this maze – back and forth with revisions and corrections – may take months. Making changes to it, for things learned in implementation, may not make it through the maze before the next request for change is submitted. Read More

Read the full August, 2019 Proactive Technologies Report newsletter, including linked industry articles and online presentation schedules.

Do U.S. Productivity Measures Measure Productivity?

by Dean Prigelmeier, President of Proactive Technologies, Inc.

A disturbing emerging trend, particularly in the last three decades, concerns the accuracy and quality of the economic statistics reported to the public. You probably have noticed lately that monthly statistics such as Gross Domestic Product, U.S. International Transactions, Unemployment and Job Creation have been issued with encouraging numbers one month only to be quietly revised downward a few months later. Businesses, consumers and policy makers can only implement effective strategies and correct potential dangerous courses if working with accurate data. One of those measures concerning worker relevance, development and effectiveness is “productivity.”

Think tanks have sprung up in Washington issuing reports and policy statements, and some put a cloak of perceived “credibility” around statements they release meant to support a policy direction or change its course – both to the benefit of a segment of subsidizing interests. Confusing us even more is the media’s propensity to report, as “news,” press releases emanating from these think tanks as if accurate, unbiased and inherently factual. Some may be, but when they are reported through the same careless filter, it throws them all into suspicion. The decrease in the number of accurate, readily available sources of news and facts can derail a life or business strategy.

Decreasing the Cost of Turnover WHILE Increasing Worker Capacity, Work Quality and Compliance…With One Approach!

by Stacey Lett, Director of Operations – Eastern U.S. – Proactive Technologies, Inc.

One of the blowbacks of persistently low compensation (i.e. hourly wage rate plus benefits and opportunity for advancement) is the corresponding high rates of employee turnover. The cost of turnover these days can be burdensome for any organization, and most encountering it express that they would like to minimize it.

In a previous article entitled “The High Cost of Employee Turnover” the causes, the costs and solutions were discussed. A handy way to estimate the cost of turnover to the organization was expressed. The Aspen Institute released a “Cost of Turnover” estimate tool of their own to assign a dollar figure to a firm’s level of turnover, to understand to what degree it is currently impacting operations and to explain to how turnover presents barriers to expansion or market adjustments.

Organizationally, things can be done to add window dressing that will attract candidates, but only a worker perceiving job stability and income sufficiency will stay away from actively seeking a better opportunity. Additional education and job-specific training opportunities may keep the worker from dwelling on the inadequate compensation for a while, but not adjusting compensation for the earned skills and value can fuel resentment.

One need only to revisit the Abraham Maslow’s Hierarchy of Needs of college lectures to understand the powerful influence income instability or insufficiency can have on an individual’s decision making. The Crash of 2008 drove most of the workforce to despair from higher tiers down to the fundamental first tier of Maslow’s pyramid. Jobs were lost, homes were lost, dignity and self-worth was stolen and to this day few have felt that they gained that back. Read More

The Skills Gap Solution; Employers Still Reluctant to Commit to Role Only They Can Fill  

by Staff

Education cannot, and should not be asked to, close the “skills gap” on their own. Employers have been concerned about the “skills gap” since the 1980’s, and the nature and location of the job has continued to change…at an accelerating rate. Employers have convinced themselves to wait for education to close the gap. In the meantime, tremendous resources continue  to be expended, but the gap continues to grow.

Educational institutions are not suited, staffed, funded and equipped to train workers for every job, for every employer, nor should they be. Educational institutions do their best work when they build the labor supply with strong, relevant basic and core skills (including STEM), and industry-general skills. Whether those efforts are worthwhile and the resources well-spent depend on two important things: 1) does an employer see value in hiring a graduate, and 2) is there a method in place to ensure those skills are integrated into mastery of the job-tasks the employer needs performed; the value that will influence the employer to retain them.

Apprenticeships – An Alternative to the “400 Hours For Drill Press” Training Model

by Dean Prigelmeier, President of Proactive Technologies, Inc.

“Time-in-Job” Does Not Equal “Tasks Mastered.” It does not reveal much about the level, quality, relevancy and transferability of the “on-the-job experience.” It is akin to students tests being graded on how long they sat in the classroom. But yet this approach endures. Don’ get me wrong, it is better than no on-the-job training effort. However, I think we all agree that it leaves a lot of opportunity on the table.

An unfortunate hold-over from the traditional U.S. apprenticeship is the standard practice of defining the on-the-job training requirement in terms of “number of hours.” General work areas that are thought of as representative of the job are selected, a number of total hours for each area totaling the on-the-job training requirement are prescribed, and this with the required related technical instruction are registered.

Read the full July, 2019 Proactive Technologies Report newsletter, including linked industry articles and online presentation schedules.

The US is Ranked 12th in Talent, Topped By Those Pesky Socialist Countries. What’s  Gone Wrong?

by Dean Prigelmeier, President of Proactive Technologies, Inc.

In an IndustryWeek article entitled, “Top 10 Countries For Talent,” it was reported that the IMB World Talent Ranking for 2018 placed the U.S. at 12th, behind many of those countries that are considered “socialist.” How can that be? Could it be that countries 1-11 found a better balance between a thriving model of capitalism and an economy that filters down to all?

It appears that these countries have deliberate strategies for sustained growth. They cultivate relationships with trading partners to “lift more boats” than just those at the top, and seem to do pretty well with their form of democracy. Their societies reflect this stability in the standards of living, mortality rates, health of their people, lower crime rates and lower numbers of suicides and mass incarceration.

It wasn’t all that long ago that the United States set a high bar for educational attainment, upward mobility, access to healthcare and income security during working years and in retirement. But by most of these measures, the U.S. has continued to slide embarrassingly backward – sometimes as low with some measures to what the world considers a “developing country.” 

In 2018, the Organization for Economic Cooperation and Development announced the results of its 2015 rankings of 72 participating countries for the PISA (Programme for International Student Assessment ) test. The U.S. ranked as follows: Reading – 35th; Math – 24th; Science – 25th.

So it was really no surprise when it was revealed that the U.S. ranked 12th in talent in 2018. Read More

Thinking Past the Assessment – Unfinished Goals and Unrealized Expectations

by Stacey Lett, Director of Operations – Eastern U.S. – Proactive Technologies, Inc.

Literally speaking, an “assessment” is the process of measuring the value, quality and/or quantity of something. There are many types of assessments,  and methods for assessing. In theory, it is the process of evaluating one thing against a set of criteria to determine the match/mismatch.
There are assessments for risk, for taxes, vulnerability. There are psychological, health, and political assessments. There is a group of educational assessments that measure a variety of outcomes such as educational attainment – assessments of course content mastery, assessment of grade level attainment, assessments of Scholastic Aptitude Tests (“SAT”) that compare a student to their peers nationally and a variety of college readiness exams.

Is the “Gainful Employment” Requirement For Education Realistic?

by Dr. Dave Just, formally Dean of Corporate and Continuing Education at Community Colleges in MA, OH, PA, SC. Currently President of K&D Consulting

In May, the U.S. Education Department sent out reminders to universities of the July 1 deadline to update their websites to include specific information to comply with U.S. Obama-era “gainful employment” regulations. A few weeks later it was revealed that the U.S. Department of Education is expected to publish, soon, its final regulation to eliminate the so-called gainful employment rule. However, it may not go away entirely. Proponents of the rule say Congress might later choose to alter the regulation in the reauthorization of the Higher Education Act (HEA), which would require the department to again address the issue. 

Is an Apprenticeship Without Structured On-The-Job Training an Apprenticeship?

by Dean Prigelmeier, President of Proactive Technologies, Inc.

Career and vocation-focused training is a pivotal point in every current and future worker’s life. This world is overwhelmed by forces that make the effort more difficult for the education and training providers, more urgent and critical for the learner, more scrutinized by the employer and constantly measured against time; how long the training takes (which determines costs) and the relevance of the skills acquired to the targeted job which is always moving to the next level of technology. If the training is not “continuously improved” and maintained to be predominantly current and accurate, the graduate may find that jobs for which the new-found skills were targeted now marginally or, even worse, no longer exist.

In theory, apprenticeships offer a promising approach for traditional trades and crafts. As of 2008, more jobs can be registered as apprenticeships with new models accepted by the U.S. Department of Labor. If the program is based on a sound structure and methodology (one that can work for any type of job classification), an apprenticeship capstone – the job-related, employer-based training – would be maintained current and accurate for at least the employer apprenticeship host. Without this component, an apprenticeship experience may be as hollow as some of the for-profit educational chains which are often criticized for high costs and low placement rates.

Read the full June, 2019 Proactive Technologies Report newsletter, including linked industry articles and online presentation schedules.

The Connection Between Worker Capacity, Organizational Capacity and Output

by Dean Prigelmeier, President of Proactive Technologies, Inc.

The term “capacity” has many meanings. The business dictionary defines capacity for different applications, but generally defines it as “specific ability of an entity (person or organization) or resource, measured in quantity and level of quality, over an extended period.” What is often missed is that each application measured for capacity is made up of important contributors that, too, have capacity.

For example, the capacity of a company can be stated as the output measured quarterly or annually, but attempts to improve it without considering the make-up of the people, the equipment, the leadership, the strategy and resources would be difficult. The output would be affected by: 1) the availability of resources; 2) the level of staffing; 3) the quality of the staffing; 4) the output attainable by the equipment in use; 4) the allocation of all resources; and many more factors. The level of improvement for overall company capacity possible is reliant on the level of control of the inputs in use.

Are Advances in Technology Distracting, Rather Than Assisting, HR From the Fundamentals of Worker Selection and Development?

by Stacey Lett, Director of Operations – Eastern U.S. – Proactive Technologies, Inc.

Billions of investment dollars are driving the advancements in technology into every corner of our lives, including the selection and development of workers. Predictably, the emphasis often seems more on the technology and the money it can make for investors than the practicality for the end-user or those it effects.

It is not just the refrigerators that talk to your grocery store, or watches that talk to the phone in your pocket. Wall Street, with an accumulating mountain of cash, can drive any idea to fabricate a “trend” that often dissipates as quickly as it emerges, sometimes leaving disruption in the wake but yields a return for investors. For investors it is the means to an end. To many, it may negatively affect their life and their future.

The Key To Effective Maintenance Training: The Right Blend of Structured On-The-Job Training and Related Technical Instruction

by Dr. Dave Just, formally Dean of Corporate and Continuing Education at Community Colleges in MA, OH, PA, SC. Currently President of K&D Consulting

I spent a lot of my career as Dean of Corporate and Continuing Education at community and technical colleges, in several states. Where we could, we tried hard to provide the best core skills development delivery for technical job classifications the employers in our community requested. We often did this working off the limited, and often suspect, job information the employer could provide to us.

Often we were up against budgetary constraints that limited our efforts to customize programs and keep the programs up to date when the instructor was willing to maintain the relevance of the program. If that wasn’t enough, school leadership often showed ambivalence toward adult and career education due in part to the fact that its demand was driven by gyrations in the economy. Furthermore, the institution was built upon, more familiar with and understood better credit courses for the more stable subjects such as math, science, literature, history and the social sciences.

Enterprise Expansion/Contraction and Worker Development Standardization

by Dean Prigelmeier, President of Proactive Technologies, Inc.

One challenge faced when expanding, contracting or acquiring an enterprise is adjusting the scale of the workforce development strategy(ies) that already exist(s) to the increase/decrease in the number of workers while maintaining a consistent ratio of output, quality yield, safe performance and process compliance. Contrary to an accountant’s perspective on staffing level adjustment, there should be serious consideration given to the range and depth of each worker’s acquired skills; an “inventory” of each employee prior to the official act of expanding or contracting. We take a physical inventory of product, equipment, parts, etc. to assess value, so why would we treat a human asset any different?

Obviously an expansion strategy is different than a contraction strategy, but when it comes to determining the value of a worker it is similar for both strategies. How an organization addresses the development, measurement and maintenance of that value may differ widely. Let’s look at both scenarios.

Read the full May, 2019 Proactive Technologies Report newsletter, including linked industry articles and online presentation schedules.

More Education Won’t Fix Flat or Declining Wages, But Appropriate Compensation and Stable Job Markets Can Make College Worth It

by Dean Prigelmeier, President of Proactive Technologies, Inc.

Having several degrees myself, I can say that I am a strong believer in higher education. I sometimes take issue with the quality and relevancy of courses or degree programs, but I would always encourage an individual to consider the value of acquired knowledge to their life plans and the additional doors it may open.I say this even though many of us who have achieved a higher degree silently questioned how much of their degree really mattered, or how much was forgotten for lack of application when an opportunity to apply it came along too late.

All said, two major trends influence my need to add a caveat to my encouragement to pursue higher education. First, be aware of the endless increases to the cost of higher education and, second, be cognizant of the instability of target job classifications and careers that not only renders a two or four-year degree irrelevant but, today, may leave the graduate empty handed and swamped with student loan debt. Even if the graduate is able to find a job it their expected field, the shock of unexpectedly low and flat wages may harness them to an unfulfilling job for life and sliding backward with all-consuming debt.

Your “Resident Expert” May Not Be an Expert Trainer, But Easily Could Be

by Stacey Lett, Director of Operations – Eastern U.S. – Proactive Technologies, Inc.

Just because a worker is informally recognized as a “star performer,” it doesn’t necessarily follow that they can be an effective trainer. Employers like to think it is as easy as that, but seldom does it turn out to be the case. However, with a little structure, some tools and a little guidance these resident experts can, and often do, become expert trainers.

If one thinks about how an expert is measured and recognized, it is usually by subjective, mostly anecdotal measures. The worker performs job-related tasks quickly, consistently and completely. This implies few mistakes, performance that is mostly within specifications and standards of performance, and no one can remember anything rejected or returned as scrap or rework.

Put Yourself in a Trainee’s Shoes

by Stacey Lett, Director of Operations – Eastern U.S. – Proactive Technologies, Inc.

It is fun to watch a popular TV show on CBS called “Undercover Boss,” reruns and all. Watching a CEO or executive of a major corporation slip into disguise and enter the world of their workers is interesting and entertaining. Sometimes they find the organization needs a little “tweaking,” and sometimes it needs major rethinking.

The entertainment value, I suppose, comes from watching these individuals being tossed into a job classification – alien to most of them – and, while cameras are rolling, receiving a crash coarse in performing various job tasks. Some are performed close to the customer. Not only do leaders get a rare look at what it is like at the lower rungs of the organization, in some cases they get a look at the sub-par performance most of their customers experience and how tenuous the corporation’s existence is – sustained only by the initiative a few loyal, but mostly self-interested, employees who try to make up for the corporation’s short-comings as if their job and future depend on it…which they do. If the company fails, they lose their job, plain and simple. Some put up with the company’s shortcomings in pursuit of the next opportunity.

Worker Capacity; Malperformance Cause-Effect

by Dean Prigelmeier, President of Proactive Technologies, Inc.

How often do we stop and ask ourselves why a worker is malperforming,under-performing or over-achieving? My guess is far too infrequently. Perhaps it is because of the hectic world we live in, with little time to study things deeper or explore an event closer. Perhaps because some of us feel helpless to do anything to correct it or exploit it (in the case of the over-performer) so we leave it alone. Perhaps the internal experts we rely on for answers lack the proper training themselves (in training program development, implementation, performance measurement) to be helpful.However, so much of what separates a high performing company from a mediocre or failing company depends on the collective effectiveness of the workforce. And the underlying desire to correct bad task performance, and proactively develop and maintain good task performance to replicate star performers, seems common, logical and ubiquitous.

Generally speaking, when we troubleshoot an error in performance, we would like to get to the cause, such as “operator error,” “equipment malfunction,” or “flawed material.” But this is more like isolating the area in which the error happened. We can troubleshoot a machine or send material to the lab for testing, but often the analytical “tools” to dive deeper into the human factor are lacking or inadequate, and the will of management to devote the time soft. The notion of worker “capacity” is a very useful tool that can help a company be proactive in preventing most of the common employee-related errors.

Read the full April, 2019 Proactive Technologies Report newsletter, including linked industry articles and online presentation schedules.

Eight Scenarios That Would Make You Wish You Had a Structured OJT System

by Dean Prigelmeier, President of Proactive Technologies, Inc.

I think one can confidently say that most employer’s focus on training the workers they need – to perform the tasks they were meant to perform – has become detrimentally blurry, counterproductive and often non-existent. There are many reasons for that – some legitimate. But without a deliberate, measurable strategy for quickly driving each worker to mastery of the entire job classification, an employer’s labor costs (not just wages, but opportunity costs and undermined return on worker investment as well) can be substantial and act as a drag on an organization’s performance.

Many employers are still waiting for the educational institutions to solve the problem. After all, look at all of the money spent on education directed at “training the workers of tomorrow.” Yet a lot of the institutional strategies appear to include repackaged tools from the past…and not the ones far enough past that seemed to work. For example, the recent comments made by education insiders saying we should have kept the  high school vocational programs that were relatively effective until the late 1970’s in place. These were phased out when the push to prepare students for college took priority. Now, there is a push for community colleges to “pump out” more apprentices which, if done only to meet numbers but not emphasizing quality of the general training, could be another waste of scarce resources of time, money and opportunity for the trainee, the employer and communities. Another decade lost.

Employers Say They Struggle With a “Skills Shortage,” Yet They Cut the Training Budget. What Gives?

by Stacey Lett, Director of Operations – Eastern U.S. – Proactive Technologies, Inc.

Everywhere you read these days, you find commentary on the “skills gap” that employers seem to face when trying to find the workers they need for their critical job classifications. Either there is a skills gap or there isn’t, and more and more economists are challenging that premise. Some, like Nobel prize winning economist Paul Krugman, say that if there is such a skills gap creating a shortage of skilled labor, then wages should be skyrocketing for those positions in a capitalistic, free market model.

Some point to the exploitation of loop-holes in the U.S. H-1B visa program, recently highlighted in a  CBS 60 Minutes episode entitled “You’re Fired” that allows employers to replace long-time, experienced employees with lower-wage temporary workers (with no benefits) from countries such as India – even requiring the laid off worker to train their replacement or forego severance pay.

Some Community Colleges Moving Back Toward 70’s Approach to Vocational Programs; Why Did it Take So Long?

by Dr. Dave Just, formally Dean of Corporate and Continuing Education at Community Colleges in MA, OH, PA, SC. Currently President of K&D Consulting

In a recent article in the Community College Daily News entitled, “A Shift Back to Trades,” , which is an excerpt from an article by Matt Krupnick entitled, “After Decades of Pushing Bachelor’s Degrees, U.S. Needs Mores Trades People,” it appears that many in institutions of higher learning are accepting the realization that not everyone is suited for college or a career requiring 4-year, or more, college degrees. Some people learn better, faster and become more productive from a program focused on training rather than the conveyance of knowledge.

Societies have always had a natural division of labor, represented at one end of the spectrum by those who predominantly work with their hands (e.g. craftsman, builders, fixers) and those who primarily work with their accumulated knowledge (e.g. managers, lawyers, teachers). Closer to the center of the spectrum, some of these types of labor overlap, requiring the application of knowledge in practical uses, such as doctors, accountants, software programmers. Traditionally, careers in the latter required a 4 -year education or more and experience in the field since the positions were heavy on knowledge requirements and industry-general standardized practices.

Can’t Find The Right Workers? Why Not Train Workers To Your Own To Specification?

by Dean Prigelmeier, President of Proactive Technologies, Inc.

According to a recent report by Career Builder.com, more than half of the employers surveyed could not find qualified candidates: 71% – Information-Technology specialists, 70% – Engineers, 66% – Managers, 56% – Healthcare and other specialists, 52% – Financial Operations personnel. According to the National Federation of Independent Businesses, nearly half of small and mid-size employers said they can find few or no “qualified applicants” for recent openings. And anecdotal evidence from manufacturing firms echoes the same challenge with specialty manufacturing jobs such as maintenance, NC machining and technical support positions. This, in large part, can be attributed to the upheaval caused by the Great Crash of 2008 and the following disruption of several million careers. Sidelined workers saw the erosion of their skill bases while waiting years for an economic recovery that, for many, has not reached them yet.

However, many or most of these workers can be “reskilled” or “upskilled” for the current workforce. The solution lies not in waiting for the labor market to magically produce the needed qualified candidates, but rather in each company investing a little to build their own internal system of structured on-the job training. With such an infrastructure, any candidate with strong core skills can be trained quickly and accurately to any employer’s specifications. Furthermore, a strong training infrastructure has factored into it methods of acceptable basic core skill remediation when the benefit outweighs the cost.

Read the full March, 2019 Proactive Technologies Report newsletter, including linked industry articles and online presentation schedules.

Is it Possible to Close the “Skills Gap” if Focused on the Symptom, Not The Cause?

by Dean Prigelmeier, President of Proactive Technologies, Inc.

There is nothing like the futility of trying to solve a specificproblem with a general solution…or treating the symptoms with methods that do not address the underlying problem. No one would use a screwdriver to tighten a nut or bolt. However, in an environment surrounded by a loud, unrelenting and self-interested screwdriver industry “expert” voices there may well be many who try – even those who should know better. Especially if given a “free” screwdriver.

According to the Center for Economic Research, “US Businesses lose approximately $160 billion total every year as the result of the skills gap.” According to a 2017 Training Magazine report, “Total 2017 U.S. training expenditures [employer] rose significantly, increasing 32.5 percent to $90.6 billion, according to this year’s report.” On top of this, in 2018 the US spent $50 million on STEM education (simply putting back what was taken out of education after reforms started in the 1980’s) to “address the skill gap of future employees.” 

Internships of Value – For Employer AND Intern

by Stacey Lett, Director of Operations – Eastern U.S. – Proactive Technologies, Inc.

In my college years, a number of my classmates participated in internships in an effort to gain real-world work skills and experiences, and to be able to add a line to their resumes. Over the years when we compared notes, it seems the results varied from company and by job area. But the common sentiment was that the experiences were not as helpful to building workplace skills and personally fulfilling as they could have been.

According to a NACE (“National Association of Colleges and Employers”) 2015 survey entitled “Internship & Co-op Survey,” “The primary focus of most employers’ internship and co-op programs is to convert students into full-time, entry-level employees (70.8 percent and 62.6 percent, respectively).”  So, it appears most employers view internships as a potential recruitment tool and a way of evaluating candidates for employment.

Workforce Development Partnerships That Last; My Experience

By Randy Toscano, Jr.,  MSHRM, CEO of Legacy Partners 2

Partnerships between employers and local educational institutions/training providers are a tricky thing. Not every employer knows clearly what they need nor can they articulate the need, and not every educational institution can understand the need, or has products or services available or relevant enough to make a difference. If either of these realities are present, or worse both of them, it can make worker development partnerships difficult to disappointing.

Employers are closest to the work that they need performed by the worker, which is usually very different from the employer down the road. Yet employers rarely bother to document what makes up that work to articulate it in an understandable way to an educational institution or training provider. If you doubt that, take any of your job classifications and try to explain it in enough detail to train from it.

Do U.S. Productivity Measures Measure Productivity?

by Dean Prigelmeier, President of Proactive Technologies, Inc.

A disturbing emerging trend, particularly in the last three decades, concerns the accuracy and quality of the economic statistics reported to the public. A lot of think tanks have sprung up in Washington issuing reports and policy statements, and some put a cloak of perceived “credibility” around statements they release meant to support a policy direction or change its course – both to the benefit of a segment of interests subsidizing the think tanks. Confusing us even more is the mainstream media’s propensity to report, as “news,” press releases emanating from these think tanks as if accurate, unbiased and inherently factual. Some may be, but when they are reported through the same careless filter, it throws them all into suspicion. The decrease in the number of accurate, readily available sources of news and facts can derail a life or business strategy.

Take for example the daily explanations by news and business show anchors of why the stock market gyrates up or down, as if the collective market can always be explained simply as, “the stock market reacted to the federal reserve’s decision to not act,” or “the stock market tumbled because of the results of the presidential election” – only to recover fully the next day. Could another simple explanation be that the market moved one way or another because groups with large holdings decided to move them?

Read the full February, 2019 Proactive Technologies Report newsletter, including linked industry articles and online presentation schedules.

Yet Another Reason Structured On-The-Job Training Should Be Part of Any Company’s Business Model – New ISO 30414 Standards for Human Capital Metrics

by Dean Prigelmeier, President of Proactive Technologies, Inc.

A new reason has come to town to support why structured on the job training – at least the 
PROTECH™ system of managed human resource development approach – can be an important component of an organization’s business strategy and model: ISO 30414 – Human Capital Metrics and Reporting.

For far too long, critics have been vocal that decisions on how to reduce costs to protect “shareholder value” were heavily weighted against workers, undercounting the firm’s cumulative investment in each worker’s development and aggregate value of the firm’s worker expertise. It was easy to erase labor wages off the books without considering the loss of value to the company when that value was never measured and counted in the first place. While the benefits of such cuts can provide a short-term lift to earnings per share, the long-term impact on organizational capacity, quality and effectiveness is often not known to shareholders until problems arise.

A “Pay-for-Value” Worker Development Program – Fair to Management and Workers, and Effective Too!

by Stacey Lett, Director of Operations – Eastern U.S. – Proactive Technologies, Inc.

A conundrum for many employers – those who are allowed to consider the wage-value relationship in their business strategy – is “what is the right pay rate for work performed.” An often used strategy is to establish a competitive wage range for a job classification based on area surveys of similar job classification in the industry, adjusted for the uniqueness of work requirements for the employer’s job classification. Once hired, an employee progresses through the wage range measured by time in the job classification, in some cases with wage adjustments based on merit. While consistent, this approach may limit the employer to paying, in many cases, more for labor than the value derived. And here is why.

If an employer purchases a new, technologically advanced, piece of machinery that is advertised to increase the output of a process from 100 units per hour to 300 units per hour, the employer would be disappointed if it only received 150 units per hour. That employer would, most likely, challenge the manufacturer and perhaps request a refund if not satisfied.

Proactive Technologies Discount Program Ends, But…”Low-Risk” Pilot Approach Option Remains in Effect 

by Proactive Technologies, Inc. Staff 

The Proactive Technologies, Inc.’s Fall Discount Offer expired November 30th. However, discounts are still offered for “economies of scale” (the larger the project, the larger the savings due to coordinated travel, production costs and labor).  PLUS, Proactive Technologies has continued the “low-risk” project pilot approach offer for those employers who need to make the case to management before rolling out a larger project.

This accelerated transfer of expertise™ approach is a tremendous offer without the discount. This approach can help any employer quickly and completely train the skilled workers they need AND realize an increase in worker capacity, work quantity/quality and compliance (ISO9001:2015/ TS16949/AS9100D), engineering specifications and safety) while reducing the internal costs of training. New-hires and incumbent workers are driven to full job mastery and higher levels of return on worker investment (ROWI). The task-based, structured on-the-job training infrastructure is perfect for apprenticeships (registered or not); instead of marking the calendar for “time-in-job,” job-relevant tasks are mastered and documented. AND, unlike classroom or online training, the cost per trainee decreases with each added trainee once set up.

Grow Your Own Multi-Craft Maintenance Technicians – Using a “Systems Approach” to Training

by Dr. Dave Just, former Dean of Corporate and Continuing Education at Community Colleges in MA, OH, PA, SC. Currently President of K&D Consulting

Since partnering with Proactive Technologies, Inc. in 1994, together we have advocated the use of a “systems approach” to training that includes a combination of related technical instruction and structured on-the-job training to develop multi-craft maintenance technicians. This approach works equally as well with other job classifications within a organization. This is a viable option to paying tens of thousands of dollars per year to employment recruiters to locate these technicians on a nationwide basis…who still need to be trained once hired. Plus, once the investment is made to setup the infrastructure, you can train as many workers as you need – with a declining cost per trainee.

Replicating Your Best Performers

by Dean Prigelmeier, President of  Proactive Technologies, Inc.

One project I was involved with sought to establish a structured on-the-job training program for a “CNC Operator” position and establish an apprenticeship. It consisted of around 40 different machines; manual and NC-operated of several brands, controller types and purposes. When I analyze a job – task by task – I first contact the resident “subject matter expert.” It is my experience that in lieu of accurate standard process documents that everyone can use when assigned a machine, each operator keeps their own setup and operation notes. They are usually reluctant to share them.

As analysts, we assume that if the subject matter expert is assigned to us, it is a reflection of management’s confidence in the operator’s consistently high level of performance. We also learn a lot about the sub-culture that has arisen at the organization, bordering on “work performance anarchy.” Despite the connotations, this is a useful revelation. This lack of vital information sharing that has been going on can be eliminated. The collective wealth of task-specific information can be screened, validated, standardized and revision-controlled to be shared with all who are asked to perform the tasks.

Read the full January, 2019 Proactive Technologies Report newsletter, including linked industry articles and online presentation schedules.