News And Knowledge

Reasons Why Human Resources is a Big Challenge in the Auto Industry

Reasons Why Human Resources is a Big Challenge in the Auto Industry

Recently, there have been several changes in the automobile industry on a global scale, resulting in lean manufacturing, cost-cutting, and fast production. These changes have entangled human resources in a way that they have to prepare and train a workforce to face new challenges. However, to survive and make the automobile business grow, human resources itself needs to be aware of challenges, and knowledge to face successfully obstacles in this fast growing industry. 

In light of this, mentioned below are some of the most pressing reasons why human resources is a big challenge in the automobile industry:

1.A Paucity of Human Resources Strategies

According to several studies on automobile industries, researchers have concluded that the biggest challenge for the auto industry is lack of human resource strategic plans. This means they don’t possess the proper tools for training the staff, preparing them for challenges, hiring industry-related personnel, setting designations and hierarchies. Once automobile industries realize they lack these tools, they can start building on them to promote a more streamlined and relevant organizational structure.   

2.High Employee Turnover

Another challenge the automobile industry faces is high employee turnover rate. It’s costly for a company to find the perfect replacement for somebody who leaves, and it can prove difficult to find a replacement as well. According to one research, it can take somewhere around $3,000 to replace a lower-level employee, like a receptionist.

Now, one could imagine the cost of replacing a higher-level employee, such as managers, mechanics, engineers, and others. The only way to deal with this challenge is by analyzing the factors behind a high turnover rate, i.e. is it because the employees are too demotivated, or too tired to work? The human resources in the auto industry have to consider these factors and prepare strategies to minimize it as much as possible.

3.Developing Leaders

Effective leadership is rarely, if ever, readily available. Companies have to develop and groom leaders, and employees also require training and motivation. However, this is the biggest challenge faced by human resources in every industry, but when it comes to the automobile industry, the issue is particularly high, mainly due to the high turnover rate.

Employees switch jobs after a few months, making it impossible for senior management and the human resource department to produce effective team leaders. If employees are not going to stay for long, how will they be developed, mentored and trained to become leaders? With the automobile industry so keen on mass production, they often tend to overlook several aspects of leadership development. They don’t organize training, seminars and leadership programs because their employees are too occupied in completing daily tasks.

4.Lack of Communication

In the automobile industry, the biggest challenge for human resources is to break communication barriers. This is because of the structure of automobile industries. As employees are too busy in completing daily tasks or mentally challenging tasks, like fixing malfunctioned vehicles, they tend to avoid communication. Human resources often have to ignore this due to the nature of the industry, but in order to make employees work better in teams, they need to come up with strategies where they can develop employee communication skills. 

5.Hiring Younger People

Due to the bad image of manufacturing industry, several fresh university graduates avoid working in a job which they think is not white-collar. Several engineers who study automobile engineering tend to pursue management degrees and go in fields like advertisements and marketing. Human resources have to change this image of automobile industry so that the new generation of employees can prove successful leaders.