Scott hudson alcoa

40 PEOPLE & STRATEGY

Case Study

Smart Manufacturing and Smarter Talent Acquisition

and Development: Extending Alcoa’s Talent Pipeline into

Communities

By Scott Hudson

HRPS 37.3 Hudson.indd 40 9/24/14 12:28 PM

VOLUME 37/ISSUE 3 — 2014 41

tions for automotive, aerospace, and building and construction.

In 1952, Alcoa established Alcoa Foundation with an endowed fund as the company’s global nonprofit arm. Since its inception, the Foundation has become one of the largest corporate-endowed foundations in the U.S., with assets of approximately $470 million. The work of the Foundation is enhanced by Alcoa’s employee volunteers who contribute their talents and time in 24 countries to make a difference in communities. In 2013, the Foundation contributed more than $22 mil- lion to nonprofit organizations throughout the world, building innovative partnerships to improve the environment and to educate tomorrow’s leaders for careers in manufac- turing and engineering.

In 2008, Alcoa created the talent acquisition center of excellence to coordinate special- ized services for the three business groups:

campus and experienced hire recruitment; capability development and performance workforce planning; and leadership and high-potential development. In 2010, the Foundation aligned its educational portfolio with Alcoa’s talent acquisition and develop- ment priorities by adding guidelines and metrics for workforce development and sci- ence, technology, engineering, and math (STEM) initiatives. Alcoa Foundation’s STEM and workforce development interests are translated into key themes and metrics (see Exhibit 1).

More alignment was achieved in 2013 when the Foundation and Alcoa’s human resources, environment, health, and safety groups came under the same organizational umbrella. The restructuring coordinates Alcoa and the Foundation’s workforce development prac- tices and programming, especially those tied to the transportation and aerospace end markets.

Manufacturing companies are using the principles of Smart Manufacturing to pursue inno- vative advancements with products and manufacturing processes (Sujeet & Davis, 2010). Smart Manufacturing is a proactive and disciplined approach to implementing advanced process manufacturing technolo- gy. Part of the Smart Manufacturing approach focuses on the identification and development of high-quality talent required to drive innovation with products and processes.

“Alcoa’s transformation into a lightweight multi-material innovation powerhouse is in part powered by a skilled workforce of top engineering and manufacturing talent,” said Alcoa Foundation President Esra Ozer. “To sustain the transformation, Alcoa and Alcoa Foundation are pursuing innovative practices to extend Alcoa’s talent pipeline into com- munities, through public–private partner- ships, and with leadership and employee engagement.”

Alcoa and Alcoa Foundation are aligned to innovate with the third “P”—people, by driv- ing shared value practices to talent acquisi- tion and development within communities and Alcoa.

In 2013, Alcoa celebrated its 125th anniver- sary as a global leader in lightweight metals technology, engineering, and manufactur- ing, with operations in 30 countries. The company innovates multi-material solutions to advance automotive and aerospace trans- portation, enables high-performance build- ings, and improves industrial and consumer electronics products. Alcoa’s three principal business groups are global primary products to make aluminum; global rolled products for air and ground transportation and pack- aging; and engineered products and solu-

Manufacturers are facing a talent acquisition crisis. Global companies like Alcoa are leading

initiatives to increase engineering and manufacturing talent in their communities. Employer-based

initiatives provide opportunities to tap the expertise and resources of corporations, educational

institutions, training providers, and governmental agencies. Together, these stakeholders can help

streamline and improve education and training and revitalize interest in a field where competition

for engineering and manufacturing talent is only going to grow.

EXHIBIT 1. STRATEGIC EDUCATIONAL THEMES AND METRICS EXHIBIT 1: Strategic Educational Themes and Metrics

# of individuals who acquire certification in a manufacturing field. # of individuals who gain employment or improve their employment status in a manufacturing field. # of individuals who acquire entry-level or advanced engineering credentials. # of individuals who gain employment or improve their employment status in an engineering field. # of individuals, organizations or communities impacted.

# of individuals who acquire certification in a manufacturing field. # of individuals who gain employment or improve their employment status in a manufacturing field. # of individuals who acquire entry-level or advanced engineering credentials. # of individuals who gain employment or improve their employment status in an engineering field. # of individuals, organizations or communities impacted.

Workforce Development – Provide education and training opportunities which lead to employment in engineering and manufacturing.

# of youth who gain transferable STEM skills or continue their education in pursuit of a career in STEM. # of teachers trained or assisted. # of schools impacted. # of individuals, organizations or communities impacted.

# of youth who gain transferable STEM skills or continue their education in pursuit of a career in STEM. # of teachers trained or assisted. # of schools impacted. # of individuals, organizations or communities impacted.

STEM – Support innovative education and training programs and teaching curriculums in Science, Technology, Engineering and Math to support careers in these disciplines.

Invest in educational and training endeavors where Alcoa, as a lightweight metals technology, engineering and manufacturing company, can offer our expertise and make

a difference, specifically in the areas of:

2

HRPS 37.3 Hudson.indd 41 9/24/14 12:28 PM

42 PEOPLE & STRATEGY

Context for Shared Value

The Manufacturing Institute and Deloitte estimate that “as many as 600,000 well- paying manufacturing jobs are going unfilled” because companies cannot find the right tal- ent for entry to experienced levels (Deloitte and the Manufacturing Institute, 2011). Across its global businesses, Alcoa faces tal- ent acquisition challenges unique to manu- facturing due to:

• Growing disconnect between the skills needed for advanced manufacturing careers and how educational institutions and training providers are preparing students

• Poor public image, with manufacturing seen as dirty and dangerous with limited career advancement potential

• Heightened competition for engineering and manufacturing talent as more baby boomers retire over the next 10 years.

So, to what extent can a corporation’s talent acquisition challenges and priorities be addressed through its philanthropic contri- butions? The rule of thumb is that a compa- ny’s corporate contributions cannot ultimately benefit the company. For example, a company’s foundation cannot award a grant to a community college if the company is requiring the school to select top students to be hired by the company. However, a com- pany’s foundation can provide funding to the school for workforce development programs to prepare students for manufacturing careers in general without any stipulations for hiring.

To address the talent acquisition challenges and priorities, Alcoa and the Foundation have adopted the concept of “shared value” (Porter and Kramer, 2011) to build partner- ships that extend the talent pipeline into com- munities while addressing larger training and education and employment gaps for engi- neering and manufacturing careers. The STEM and workforce development opportu- nities can be broadly grouped into three types of community benefits that bridge Alcoa’s talent acquisition priorities with the Founda-

tion’s STEM and workforce development goals:

• Promote high-paying STEM capable careers

• Extend access to next–generation talent pipelines

• Engage untapped pools of talent

Alcoa’s talent acquisition priorities and the Foundation’s primary educational themes used for grant making are aligned with opportunities to extend the talent pipeline into the community (see Exhibit 2).

The community benefits are aligned with Alcoa’s and Alcoa Foundation’s STEM and workforce development interests.

Engage Untapped Pools of Talent: Women in Engineering

Alcoa invested $13 million to expand its wheel manufacturing plant in Hungary to meet growing demand for its lightweight,

durable, low-maintenance aluminum truck wheels. The expansion enabled Alcoa to increase employment at the facility and pro- duce twice as many Dura-Bright EVO surface-treated wheels in Europe by early 2015, compared with current production levels.

In Hungary, Alcoa and other companies face stiff competition for engineers. To increase the supply of talent in engineering and techni- cal careers, Alcoa undertook two initiatives:

• POWEngR. Alcoa initiated this program to achieve greater gender diversity in all occu- pations and to improve business results through diversity. The initiative kicked off with a workshop for interns and female employees and resulted in the launch of the Ambassador Program, which engages 11th and 12th grade students in discussions about technical and nontechnical careers.

• Association of American University Women (AAUW). As a complement to POWEngR, Alcoa Foundation’s partner- ship with AAUW in Hungary led to a men- toring and summer STEM program for girls that was created with local Alcoa employees, college and university faculty at

EXHIBIT 2. BRIDGING THE SHARED VALUE DIVIDE EXHIBIT 2: Bridging the Shared Value Divide

3

Community Extend Access to Next Generation Talent Pipeline

(K-18)

Community Promote High-Paying

STEM Capable Careers

Community Engage Untapped

Pools of Talent

Alcoa Talent Acquisition Priorities •Prepare & connect with potential recruits

•Increase competitiveness & talent pipeline

Alcoa Foundation Educational Themes •STEM capable careers

•Workforce Development - engineering & manufacturing talent

HRPS 37.3 Hudson.indd 42 9/24/14 12:28 PM

VOLUME 37/ISSUE 3 — 2014 43

Budapest University of Technology and Economics, secondary school educators, local community organizations, and AAUW partner organizations. The girls are learning about engineering and manufac- turing careers, and have support on their journeys to prepare for these careers.

The AAUW initiative was replicated in Barber- ton, Ohio, another Alcoa wheel and transpor- tation products location, and builds on Alcoa’s customized operator training program with Stark State College. Barberton schools are part of a tri-city partnership where teachers and guidance counselors develop workshops and conferences for middle– and high–school girls and their caregivers to learn about engineering and manufacturing careers requiring two- and four-year degrees.