According to a recent analysis by Report Buyer, “Logistics: Global Industry Guide,” the global logistics market is forecast to reach $1.04 trillion by 2012. Furthermore, the Americas account for 35.2% of the global logistics market value.
As manufacturers expand their global presence, they can’t afford to be inefficient. That means they must draw from the innovation and creativity of people representing different cultures. That requires the ability to clearly communicate the company’s vision of its future to all associates. Every employee must clearly understand how they fit into and contribute to that vision.
Diverse skill sets are extremely valuable to the overall success of a company’s ability to get products out the door. Not convinced? Maybe one of the world’s most successful companies can change your mind. McDonald’s Corp. currently manages 32,000 restaurants, serving more than 60 million people in over 117 countries. The company reports that more than 60 percent of its home office and U.S. company workforce is made up of racial or ethnic minorities or women. The same holds true for suppliers. The company spends about $4 billion per year on supplies from U.S. minority and women-owned businesses. Why? McDonald’s states on its Web site that through diversity comes innovation. Specifically:
“In our increasingly competitive industry, we must seize every opportunity to innovate. We must constantly look at our structure, our processes, and our products from every angle, always asking, ‘Is there a better way?’ Different perspectives, backgrounds and experience help us to see opportunities for positive change.” (www.mcindiana.com)
The Relevance of Diversity
How is diversity relevant to manufacturing? A recent article on Changeboard.com, “Leading the Way in Manufacturing Industry,” reminds us that manufacturing was originally a marketplace that excluded women. After decades of exclusion, however, inclusion was something the market could not ignore. Diversity makes manufacturers more flexible and responsive, leading to more dramatic improvements in the bottom line.
In logistics and material handling organizations there is diversity of educational backgrounds as well as race, creeds, ages and experience. A college graduate handles all the scheduling while a person with a GED from high school runs the warehouse lift truck, or deals with tractor trailer drivers and manages all the people involved with shipments. Diverse skill sets, but all these individuals are equally valuable in getting the company’s product out the door.
Even within various regions of a country there is race, creed and age diversity. One of my clients has a materials and logistics organization that includes employees from their mid 20s to mid 50s with diverse backgrounds, races and experiences.
They’ve surpassed their performance goals. As a jumping off point, the group established several values and commitments that would build trust. Trust is key to safety and safety is necessary for productivity. Trust eliminates distractions.
For another client, it only took three weeks to diagnose the company’s major issues, customize an approach to address these business issues, engage all levels of the organization to develop solutions, and change the company culture. Translated into tangible benefits:
• Shipments increased from $375,000 to $8.1 million
• Sales increased from $29 million to $105 million
• Lead times were reduced from 14 days to 6 days
• Service levels increased from 76% to 99.6%
• Warehouse audits were reduced from 9 to 1 in six months
By following our guidelines and focusing on open discussions, engagement and support, this company’s shipments grew by 200% in 18 months.
In conclusion, workplace diversity fuels momentum and trust in an organization by energizing all constituencies: employees, customers and shareholders.