4 minute read 16 May 2019
Business People discussing strategy board room

How aerospace and defense can hone new labor strategies for a new era

By

Kevin McConville

Northeast Leader - Advanced Manufacturing and Mobility People Advisory Services, Principal, Ernst & Young LLP

Over 20 years of experience in human capital and workforce consulting. Passionate about building a better working world in which clients grow, optimize and protect their businesses.

4 minute read 16 May 2019

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As it struggles in the battle for young talent, the sector must rebrand itself through the power of purpose and professional development.

In the Transformative Age, technology has found a permanent spot on the C-suite agenda. But it is talent that provides the lifeblood for a company — the creativity and the innovation — that serves as a major differentiator, particularly in an industry with a culture that is slow to adapt to workforce trends.

Government contractors often have a more experienced workforce. Within the industry, the average age of workers has hovered around 47 years for the past five years, and about 29% are over 55. By comparison, in more tech-focused jobs — such as software and web developers — the average age is under 40. Interestingly, as governments look to digitize how it delivers services and what it purchases, this segment of the workforce will be critical for contractors to invest in.

Government contractors are noting this as a business risk, and they’re asking management to come up with tangible actions to address it. But what do the workforce and workplace of the future look like in this sector? Viewed through the right perspective, the challenges can start to look like areas of opportunity — to create a purpose, culture, employee experience, performance management system and physical space that will align to the business’s mission and attract, retain and motivate top performers.

The challenge

Government contractors have a smaller labor pool to draw from because they are constrained by citizenship and security clearance barriers in their pursuit of government contracts. And larger contractors often manage multiple businesses under one holding company, creating fragmented and siloed workforce planning with a variety of talent management capabilities and cultures across business units. For many organizations, the skills gap gets wider when they look out over the next two to four years. And then there are the issues that transcend industries, such as having misaligned talent and business strategies with little collaboration.

While an aging workforce has amassed institutional knowledge and crucial skills — along with other benefits, like greater flexibility to serve in contractor roles and potentially a greater ability to travel to client sites — the question is what capabilities are needed going forward. Many government contractors, facing brain drain from impending retirements, struggle to develop and execute succession planning, as well as continuous learning and leadership development initiatives. As a result, they encounter significant skills gaps and may not be able to identify high performers.

And in many cases, a tenured population often isn’t best suited for staying ahead of the curve with innovation. The sector has to compete with Silicon Valley and startups for the best and brightest millennial tech and creative talent, which is a challenge. The result: as one group edges toward retirement, the new talent supply is insufficient to backfill this talent, and their fresh thinking and new skills aren’t complemented with institutional knowledge.

What can you do?

Faced with these challenges, government contractors have the opportunity to rethink how they align talent strategy with business goals, identify and address skills gaps, reward high performers, and boost collaboration — creating a compelling path to the future and ultimately achieving results that improve the bottom line. Here’s how they can do it:

  • Clearly articulate the purpose of the organization and connect it to the desires of employees. Your company’s purpose — its reason for being — acts as a “north star,” instilling strategic clarity and motivating employees. A Harvard Business Review survey showed that 53% of executives who said their businesses follow a defined purpose describe their companies as successful at innovation and transformation, and 89% said that collective purpose deepens employee satisfaction. You can build on the strong mission and draw of your sector — for instance, how it promotes security and defends national interests. 
  • Identify the skill sets needed, not only today but for the future. Obviously you have immediate needs, but what strategies do you have in the works? The present can often seem like the most pressing concern, but what are you building toward? What skill sets are you willing to pay differentially for? Quantify the value of these positions and use that to support hiring, deployment and retention decisions.
  • Leverage a broader array of worker types. Contingent workers in the gig economy, flexible work arrangements and automation can help you close the talent gap, based on the varying skills required for a given project. Do not neglect diversity and inclusiveness, which helps you thrive by maximizing the power of different opinions, perspectives and cultural references. This is especially important, as governments look at who makes up your workforce when awarding contracts.
     
  • Create learning and other professional experiences for employees. Ask yourself how you’re encouraging leadership development and cultures of continuous learning. Training programs have made great leaps, including simulations, gamification and custom learning portals, to provide cutting-edge ways to engage your workers. Professional growth is important both to employees and to you, so that you can develop leaders and position yourself better in succession planning. (It’s also a good idea to do the same for contingent workers, while remaining mindful of the need to comply with labor laws.)
  • Determine motivating factors for employees and design programs that combine what you need with what your employees value. For instance, 30% of employees in a 2017 survey said they think about personal finances while on the job, a distraction that can be eased through financial-planning initiatives. Parental leave benefits are another crucial area that align with employee needs. Analyses can be performed to optimize how your organization spends its money so your dollars have the most impact. Through such efforts, you demonstrate that you value your employees and what they in turn value, and you build a brand that aligns your organization’s future with their needs and yours.


Through such efforts, you’re threading a unifying mission through different business units to create one cohesive employer brand — one that contributes to your ability to attract young talent and position yourself for the future.

Summary

How does your employer brand contribute to your ability to attract young talent? If you don’t know the answer, then you’re already at a disadvantage. Pinpoint what skills you need for the future and how you can align your growth with employees’ growth.

About this article

By

Kevin McConville

Northeast Leader - Advanced Manufacturing and Mobility People Advisory Services, Principal, Ernst & Young LLP

Over 20 years of experience in human capital and workforce consulting. Passionate about building a better working world in which clients grow, optimize and protect their businesses.