Automotive smartWorkforce Transformation as a critical success factor  

Hardly any other sector of our economy is facing challenges as fundamental as the automotive industry. Plagued by a wide range of disruptive megatrends for years, change is long overdue. And now the pandemic and other recent events have raised the stakes even further. In a new Point of View entitled “Four Questions on Automotive smartWorkforce Transformation”, the experts at Deloitte explain how this skills enhancement program can help drive change by empowering staff. The following is a brief overview of the program’s key drivers, underlying issues and solutions.

The factors driving transformation

The industry is under immense pressure to transform its business model due to a wide range of factors. The triumphant advance of electromobility has been widely celebrated, triggering a fundamental shift in automotive technology that raises existential issues for suppliers, particularly those focused on internal combustion engine (ICE) technologies. Without an innovative approach to this and other trends from digitalization (the connected car) to changes in consumer behavior (car sharing), many automotive companies are risking their future viability. This is especially true as new competitors and tech companies enter the market with innovative solutions that are forcing established companies on the market to rethink their strategies. 

One thing is clear: Without considerable investments, automotive players will not be able to develop the kind of novel products and services in demand today. But how will they secure financing when post-pandemic sales are so slow? After all, manufacturers were already under pressure from the chip crisis and other supply chain disruptions even before the pandemic. Their cash reserves are low, and they have very little margin for maneuver, but the need for transformation is as urgent as ever.

Strategize your way out of the crisis

Given the current circumstances, strategic realignment is absolutely essential for many automotive players. Deloitte’s experts recommend automotive OEMs and suppliers take stock of their status quo as a first step and analyze their own specific risk factors to identify potential for future improvement. Deloitte has an effective tool to do just that: the Global Supplier Risk Monitor. Based on carefully curated component clusters, companies can evaluate their product range in terms of future risks and trends. The tool distinguishes between external and internal risks, i.e., whether or not a particular factor is in the company’s direct sphere of influence. The Monitor’s risk map divides the clusters into four key areas: 

1. Fight the Fires: Faced with a high level of external and internal risk, segments focused on internal combustion engine (ICE) technologies require radical transformation. 
2. Clean your house: Clusters such as axles, electronics and HV batteries have to address internal risks.
3. Address market challenges: External risks are the issue for clusters focused on electric drivetrains. 
4. Keep it going: Components in this cluster (e.g., advanced driver assistance systems (ADAS)) face less risk than other clusters.

Build skills, reduce risk

Companies in the various component clusters each have different priorities for their transformation, but there is one thing they all have in common: It is the workforce that will ultimately determine the success or failure of your transformation, and for that they need the right skills and expertise. Finding staff with the ideal skill set is no trivial task, however, particularly given the current shortage of specialized talent. That is why Deloitte has developed the smartWorkforce Transformation solution, a targeted employee re/upskilling program that is designed to be socially sustainable and to take advantage of public funding. 

This holistic skills enhancement program comprises a wide range of initiatives, levers and modules. The first step is to conduct a 360-degree profiling exercise with all employees to capture a large set of meaningful data ranging from work experience and soft skills to the willingness to embrace change. Based on this data, we define a set of initiatives that are precisely tailored to your workforce and make the most of available subsidies. Employees will be assigned various work placements to gain practical experience in areas of future interest. The program’s AI-driven job matching tool will serve as an effective lever to increase workforce flexibility and reduce extraordinary expenses. With Deloitte’s specialized coaches on your team, you are guaranteed in-depth guidance and continual optimization based on regular checkpoints and feedback loops.

Deloitte helps you secure the skills you need to win the future

The only way automotive OEMs and suppliers will master today’s huge challenges is through a holistic and profound transformation – which is where Deloitte’s transformation expertise comes in. As part of our broader range of services, the smartWorkforce Transformation is a compact program designed to effectively address the vital skills issue. You can rely on the experts at Deloitte Legal to use their expertise to ensure successful implementation in your enterprise. This future-proof approach to skills enhancement will empower your workforce, deliver cost benefits and lay the foundation for long-term transformation success.

Click here to download the full Point of View “Four Questions on Automotive smartWorkforce Transformation” and find out more.