Do you know India is going to be the third-largest automotive market in the world, in terms of volume by 2026? As a result, recruitment in the automobile industry is also sure to rise. India manufactures approximately 26 million vehicles including Passenger Vehicles, Commercial Vehicles, Two Wheelers, Three Wheelers, and quadricycles. This highly concentrated industry has only a handful of large corporations that make up the majority of producers of each type of product. The bigger the sector, the bigger is the role of HR practices in the automotive industry.
HR challenges in the automotive industry cannot be overlooked. The automobile industry to experiences a human dimension issue. Effective HR management is the need of the hour to manage teams. Right from hiring procedures, recruiting solutions, quality staffing, payroll, all relate to some of the other challenges faced by HRM.
Critical HR Challenges in Automotive Industry with Solutions
Even after employing over 19 million people in the automobile sector, there still occurs a skill gap in the industry. Due to this gap, HR has to play innovatively on talent strategies to be adopted at the workplace. The recruitment in the automobile industry must be such that they are capable of taking initiative and demonstrating bold new thinking.
Here are some of the key HR challenges in the automobile industry and how to overcome them.
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1. Less Talent Availability
Automobile recruitment is facing a critical shortfall of talent at both the technical and commercial levels. Due to the lack of proper expertise, at times the companies have to compromise on the quality of skills. It is not easy to get the most desired and qualified person in this hugely competitive market. There is a need for recruiting solutions that provide the organization with the required talent to cope with the emerging challenges and needs.
2. Facing Redundancy In Skill-Sets
Recruitment in the automotive industry faces the problem of redundancy. Due to the involvement of robotic process automation and artificial intelligence, the employees are still at this time are getting redundant. There is an ongoing need for learning in the flow of work in this industry. HR practices in the automotive industry also provide a learning platform for its employees through certain courses. Firms have to cut on their workforce instead of robotic automation. HR has to focus on retaining their old employees. This is a moral responsibility and will ultimately boost productivity.
3. Lack Of Collaboration & Communication
It is one of the major HR challenges in the automotive industry. In many companies there occurs an inherent mismatch in the organizational initiatives announced by the top management and those understood by the subordinates. Due to this communication gap in the Automobile industry, the strategies of the top leadership are not getting properly communicated. There has to be a mediator who communicates the information and helps in settling down the issue by filling this gap.
4. Low Compensation Rate
Recruitment in the automobile industry faces an issue relating to its compensation. This is due to very less rise in annual compensation in the Automobile industry as compared to the manufacturing industry. This also keeps the required talent away from the industry. Automotive consultants and recruiters must revise the compensation considering the market fluctuations and employee’s needs.
5. Negligible Employee Engagement
HR departments face the challenge of low employee engagement. There is a need for the automotive industry to improve its ability to create and foster engaging work environments. Here the HR departments have to mammoth the workforce. The leadership and senior management might be in completely different cities, states, or even countries. HR teams have to build a platform where all these departments can come together and interact whenever needed.
6. No HR Strategic Plans
Whether it be any organization, it is very important to develop operations and emphasize strategic planning. Due to the lack of strategic plans in the automobile industry, the profit ratio gradually shows a decline. HR practices in the automobile industry must focus on determining value prepositions, segmenting the marketplace, and analyzing competitors.
7. High Turnover Rates
In the automotive industry, the employee turnover rate is very high. The reason could be a low salary, job insecurity, or dissatisfaction. To cope with this, the HR department has to bring in policies and provide perks for employees to retain them.
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8. Difficulties In Developing Corporate Leaders
As the workforce in the automotive industry keeps on moving it is difficult to retain. Unless an employee remains in the industry for a long time it is difficult to develop corporate leaders. There must be policies to retain them and give them opportunities so that they reach up to a level in the organization.
9. Workforce Calculations
The complete automotive manufacturing industry and the overall engineering industry face the issue of workforce calculations. From simple to complex they can vary like normal headcounts and the number of hours employees work up to the employee turnover rates and the increase or decrease in employee productivity. These HR practices in the automotive industry help in assessing the shortcomings and meet the requirements of the workforce.
10. Handling Company’s Reputation
With the ongoing ups and downs in the market and the moving of human resources, it is important to maintain the reputation of the organization. Even if people move from an organization, a negative statement in the market can spread for a long time. The HR department has to be alert about gossip chains and counsel their employees in case of any grievances.
Conclusion
The automobile industry in India has to overcome these problems like rapid production, sales, lean manufacturing, and cost-cutting. Other issues related to initiatives coupled with unusual restlessness in the human assets. The Indian automobile industry in India has to align with global best practices. The HR practices must be aligned to manage its strategic priorities and uncertain government policies. ‘
However, many corrections are already introduced in many of the Automobile companies in India, and the results will start to look positive very soon. To get people with the required experience or expertise, outsourcing from a hiring agency is also a good option.
