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Gross mismanagement part II B: Furthering the discussion

Ed. Note: Glenn Beall's Dec. 1 By Design article generated 19 comments in what became a spirited online discussion of the intersection of corporate management, university curriculum and on-the-job training. Here Glenn extends the conversation drawing from his own experience as a business owner to outline his stance.

Glenn Beall

January 4, 2012

6 Min Read
Gross mismanagement part II B: Furthering the discussion

Ed. Note: Glenn Beall's Dec. 1 By Design article generated 19 comments in what became a spirited online discussion of the intersection of corporate management, university curriculum and on-the-job training. Here Glenn extends the conversation drawing from his own experience as a business owner to outline his stance.

My last article with this same title was posted on Dec. 1, 2011. That story claimed that the current lack of enough technically competent new employees could be lessened if corporations were willing to provide on-the-job training. That article solicited a perfect storm of replies to the Editor. Fortunately the majority agreed with my conclusions.

However, many rightfully pointed out that corporate greed was only one of many factors contributing to this problem. I was chided for not sharing the blame with universities that refuse to modify their curriculum to adapt to the changing needs of industry. Government regulations and taxes were sited by several readers. Some claim that trade unions have unnecessarily driven wages and benefits to a non-competitive level.

At the same time others believe the plastics industry refuses to pay high enough wages to compete with other industries in securing and retaining the level of employees required by the increasingly complicated processes and equipment. Another pointed out that American corporations are actually spending money to train people in low-labor-rate countries, but not in the U.S.

Many of the replies, but notably S.D.'s, were well thought out. All of these comments coming with different points of view combined to expand my little article into a much more interesting and useful discussion of a topic that was obviously of interest to PlasticsToday readers. It may be presumptuous of me, but I would like to believe that all of these different comments represent the opinions and concerns of what I call the "man-in-the-street" of our part of the plastics industry. I am only sorry that I don't have a vehicle for presenting these opinions and concerns to our politicians and industry leaders.

I sincerely appreciate these replies. Regrettably I don't have the knowledge or time to individually respond to everyone. As a substitute let me leave you with three real-life short stories that address three of your comments.

Real life experiences

I owned and ran a company called Glenn Beall Engineering (GBE) for 25 years. That company did plastic product design and development including model making, prototype moldmaking, and the injection molding of preproduction components. That company gave me experience not only in managing people but in selling to keep 13 moldmakers, six designers, and 11 other employees busy. I had to learn how to go deeply in debt purchasing capital equipment. I also learned to think ahead in order to make payroll, and what to do that one payday when there wasn't enough money in the bank.

Paying high wages

With regard to the plastics industry not paying competitive wages, GBE was located close to and half-way between Milwaukee, WI and Chicago, IL. In order to hire employees it was necessary to pay slightly more than the high wages being paid in those two industrialized cities. The company was also half-way between Abbott Laboratories and Baxter Laboratories. Both paid average wages while providing excellent fringe benefits. My little company had a choice. We could have limited our growth and blamed that on not being able to hire enough technically competent people. Or, we could have paid higher wages and provided generous fringe benefits. We chose the later approach and the company prospered. In all fairness, I have to acknowledge that we were not competing with low-labor-rate international companies back in those days.

University/Industry mismatch

With regard to universities' failure to prepare their graduates for the available jobs, I once hired a mechanical engineer to work as a product designer. He had no experience in designing plastic products, but agreed to learn that technology on the job. After several frustrating weeks he revealed that he had never had a course in drafting. This was well before everything was done by computer-aided design. In retrospect I never asked him if he had been taught drafting. It was inconceivable to me that anyone could get a ME degree without at least one course in drafting and blueprint reading. Then, as now, there is a mismatch between what universities teach and what industry needs.

With regard to corporations' failure to provide on-the-job training, GBE quickly learned that we had to spend time and money training new employees. In the design department we found that the education received by degreed industrial designers allowed them to quickly become productive. We hired graduate engineers with some plastics industry experience; however, it took them much longer to master plastic product design. Our molding technicians became productive almost immediately and their value to the company grew as they gained experience.

On-the-job training

Our most challenging staffing problem was finding enough moldmakers to keep up with the growth of the company. We were able to hire some journeymen moldmakers and they quickly learned how to design and build prototype molds. The majority of our moldmakers were local high school graduates who had excelled in shop courses or people with general machining experience. These two groups of people learned from our journey moldmakers in an unofficial on-the-job apprentice-type training program.

There has been a shortage of moldmakers for as long as I have been in the industry. In the early days, most moldmaking companies had an apprentice-training program, During the rapid growth years, many were too busy building molds and making money to waste time on training apprentices. It was easier to pay a little more to lure trained craftsmen away from the competition. After a while, most companies followed the industry trend and discontinued their apprentice programs. That was the beginning of the moldmaker shortage that limited the growth of the plastics industry.

In the 1960s Abbott Laboratories sent me to Europe to establish sources for their line of disposable health care products. I noticed that nearly all of the moldmaking companies and some of the injection molding companies had some kind of moldmaker apprentice programs. They all claimed to have enough moldmakers.

I explained the moldmaker shortage in the U.S. and asked how they had avoided that situation. Their answers varied, but in general they said that in America moldmaking companies preferred to pay a little more and hire their workers from the companies still offering training programs. They also expressed the opinion that the resulting higher pay rates were the reason why American molds cost more than those made in Europe. In Europe almost all moldmaking companies trained their own apprentices. Each company lost some of their graduate apprentices and hired replacements from those who, looking for better jobs, had left the companies that trained them. This resulted in enough qualified mold makers for everybody. When I returned to the States, I described the European approach to some of Abbott's suppliers. They were still busy making money and weren't interested in making any changes.

Some form of the same training programs were still in practice in the late 1980s when American companies started paying a lot more in order to import trained moldmakers from Europe.

If you expect to hire capable employees, be prepared to pay the going rate or a little more. If there are no capable people to hire, tell your universities what you need while starting your own on-the-job training programs. If you believe you can't afford to train people and pay top wages, remember that if your competitors start training and paying top dollar they will have the employees they need to beat you in the marketplace.

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