Story time. Stay with me.
You own a factory. The factory was founded in 1957. It produces furniture using 40 machines that are upgraded roughly every 40 years; the last time that they were upgraded was in 1981. These machines can last the full 40 years if they are well-maintained and regularly serviced and they can sometimes last for longer. In fact, factory owners tend to try and stretch out their life to get as much value out of the machines as they can. However, even with servicing and maintenance, the machines perform more poorly in their final five years.
It’s 2020 and the machines are on their last legs, officially due for an upgrade next year. You can service them again and probably get an additional few years out of them as a result. Or, you can upgrade them. Upgrading them is triple the cost and requires a bit of effort but will mean that you get to start afresh and will improve productivity dramatically because the machines will be at their sharpest and full of life and energy. As a result, revenues will increase and your company will be doing so well that lots of new machine vendors will offer you brand spanking new machines as a sample so that you buy more machines from them. You weigh it up and decide that whilst that all sounds fantastic, it’s a lot easier and cheaper to go with servicing the machines one last time. You weren’t around for the last upgrade and right now, you’d prefer to stick with what you know and avoid all the upheaval. You decide that it financially makes sense to drain the life out of the machines whilst you can before spending on any new ones.
Three months after a full service of all of your machines, one breaks down, it’s irreparable. You’re one machine down but it is much more cost effective to replace machines in bulk so you continue to operate with one less machine. Within the next three months after that seven more machines breakdown. You contact the vendor only to find out that they have gone bust and so no maintenance is available. Your productivity has dropped dramatically and you struggle to fulfil your orders. As a result, you start to lose some of your customers. You try to get a new contract for a new set of machines but because of how poorly your business is doing you cannot afford to pay for a contract in full and no vendor believes that you will be able to fulfil your payments over time. Within 12 months, the last of your machines break down along with your entire business. Everything falls apart. If only you’d invested in your key asset when you had the chance.
Far too many businesses are operating with this factory owner’s mindset. Talent is the key asset in any business - no Fourth Industrial Revolution or automation is going to change that. It is imperative that businesses invest in their talent in order to avoid losing them. We are already seeing the evidence of an exodus away from the corporate world because businesses are not taking their talent expectations seriously enough. Companies like Escape The City are proving popular for, often, junior-mid level professionals fed up of the EVP they are being offered. I encourage businesses to do the research, speak to your employees, make the necessary changes in order to have a happy and inclusive workforce and retain your people. It’s an employee market and your success is determined by your ability to attract and retain the best. Don’t get left behind. Your competitors are waiting.
Image credits: Ziarul Financiar; possector.com; allbusiness.com
