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Reliability in 2016

Projected by Phillip Slater, Author of Sustainable Inventory Reduction

In 2016 the greatest influencers of reliability will be beyond the immediate control of reliability engineers.  These include: 

1. The rise of ‘Generation Y’ and the retirement of ‘Baby Boomers’
2. The rise of China and India and increasing global free trade
3. Improved reliability due to improved technology
4. Exponential increases in communications bandwidth
5. Increased financial scrutiny driven by even more corporate governance

Some organizations will merely react to these changes. These will be the reliability losers. The reliability winners will begin proactively managing for these changes now!

The impact of these influencers will be:

1.       The Rise of ‘Generation Y’ and the Retirement of the ‘Baby Boomers’

The skilled labor base in Western countries will shrink as Baby Boomers retire. Gen Y’s aren’t as interested in ‘hands on’ jobs and will not go through the training required. Skilled labor will become more and more scarce and staff turn over will increase, as Gen Y will not be seeking long term employment relationships. This means that companies in the USA, Australia and other developed countries will have to be more reliant on management processes rather than individual skill. The good news is that the basic principles of reliability engineering and inventory reduction won’t change. Those companies that know and apply the basics using sound process that eliminate guesswork, and do it well, will be winners.

2.       The Rise of China and India and Increasing Global Free Trade

China and India will continue to produce cheaper parts. Anyone that is stockpiling current day parts in their inventory that may not get used for a number of years will be paying too much, increasing their operational costs and making them less competitive.

3.       Improved Reliability Due To Improved Technology

This will mean that companies will improve reliability despite themselves. For some companies this will prevent those companies from taking the required action to manage all the issues until it is too late. Jobs in these companies will go to China and India.

4.       Exponential Increases in Communications Bandwidth

Just as email has changed our expectations of communications in the past 10 years, video will change this further in the next 10 years. The promise of video conferencing, video calls and online training will all come true. This will make it easier to access information and train your team. Companies that adapt to this technology will increase the gap between them and ‘the others’.

5.       Increased Financial Scrutiny Driven By A Tighter Financial Market and Smaller Margins

Working capital and spare parts will come under even greater pressure. Cash management will be more important due to increased competition and free trade impacting returns on investment.  Because of the time lag involved in sensibly managing working capital smart companies will take action now.

In the past 20 years Maintenance and Reliability has been widely accepted as a specialist management discipline. In 2016 reliability engineers will also need to be business analysts with business management skills. They will need to speak the language of accountants but with the understanding of engineers. Smart companies are developing these skills today so that they become part of the culture. In 2016 there will be a wider performance gap between organizations with clear winners and losers – which one will you be?