Staffing Challenges in Production Operations
Production operations need to manage staffing with care to ensure on-time order completion, retain or acquire appropriate skills and keep labor costs within budget. Maintaining optimal staffing, however, creates a number of challenges for production operations, as peak production periods often call for a much higher level of staffing than slow periods.
Understaffing poses a serious challenge for production operations. While existing staff often can make up the difference in the short term, it usually comes at a heavy price. Incidents of subpar quality in the product tend to rise, which often throws off production and delivery schedules. Overtime pay becomes a norm as current staff puts in extra hours to try to meet demand, which drives down profit margins. The extra demands drive up workers’ stress levels and leads to absenteeism or high turnover rates. Production operations often face this problem when given large orders during the off season and during the transitional period between the off- and peak-season.
At the budget level, overstaffing drains capital you could apply to infrastructure development, training and marketing. The overall efficiency of the production operation suffers as well, because of redundant staffing and underutilized employees. Overstaffing also runs the risk of employee boredom, which can create production errors because of inattention. Overstaffing often occurs as orders wind down during the transitional period between the peak- and off-seasons .
Production operations face a growing shortage of skilled workers, particularly in job categories like welding and machining. According to "Forbes," more than half of the existing skilled labor pool consists of those aged 45 and over. The physical demands of skilled labor positions make it problematic for these workers to stay in the job market beyond retirement age. Although younger entrants into these fields may accept lower pay, it comes with an experience gap that many production operations find unacceptable.
No single solution provides a silver bullet for managing the challenges of staffing in production operations, but you can take steps and implement strategies to minimize the challenges. To deal with temporary understaffing issues, you can maintain a list of former employees that may prove willing to return on a part-time and per-day basis, or use staffing agencies that specialize in skilled labor. Engage in active recruitment of candidate with core skills that you require, and offer competitive salaries. Demand planning and forecasting can assist you in developing a tentative picture of future labor needs and allow you to take proactive steps to keep staffing at optimal levels.