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Suppliers Narrow Talent Gap as Company Culture Shifts

Changing times, changing skillsets roil N. American supply base
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Auto suppliers in North America are growing bullish about creating the talent they need as the industry’s skillsets shift.

So says the latest quarterly analysis of supplier sentiment conducted by the Original Equipment Suppliers Assn. The group’s Supplier Barometer Index for the second quarter of 2020 jumped from an all-time low of 15 in April-June to 53 for July-September. Any number above 50 is positive,


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Mixed Impact

OESA says suppliers remain sharply divided about the impact of the continuing coronavirus pandemic.

Compared with the previous quarter, 47% of responding executives see better times ahead, and 38% are bracing for worse conditions. The survey says companies with sales less than $1 billion are the most bullish.

The biggest staffing challenge throughout the supply base has been rebuilding the hourly workforce.

Supplier executives report they are struggling to staff up—either in coaxing their employees back or finding replacement workers—as production revives. Most worry about matching their capacity to sales growth in all major markets, not just North America.


The pandemic has spawned new and efficient approaches to the workplace, notably teams that combine remote and on-site members. Virtual collaboration, says Mike Jackson, OESA’s head of strategy and research, “will continue to fundamentally alter future organizational and talent paradigms.”

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Flexible work schedules are likely to become the new norm in North America, the OESA report says. Half its respondents in the U.S. already are widely altering shift times and crew assignments for much of their production. That compares with 45% in Mexico and only 20% in Canada.

Executives cite progress in changing their corporate culture since the start of this year as the auto industry embraces such changes as electrification, connectivity and autonomous vehicles. Half acknowledge that moderate or wide gaps currently exist, but nearly 90% are willing to address the issue.

Shifting Culture, Skillsets

Respondents say they are having better luck realigning skillsets than changing their corporate cultures.

Two in five respondents expect that training, greater work flexibility, new policies and better communication will help realign the roles and responsibilities their workforce will need over the next 1-3 years. But the remaining three in five expect skill gaps will remain unchanged or even widen during that period.

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OESA says executives see greater work flexibility—in workplace, work space and schedule—as key to attracting and retaining talent.

Half the executives polled say they plan to expand talent development programs in the next 1-3 years. Much of that effort will involve broadening existing plans, creating more individual programs and launching more mentoring initiatives.

Bottom Line

The auto industry’s unprecedented upheaval is being further complicated by the coronavirus pandemic.  OESA’s report says the North American supply base is showing both flexibility and resiliency in recognizing and coping with its own challenges.

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