The manufacturing industry is currently in the middle of a massive transition. Industry data shows that nearly 80% of experienced manufacturers are nearing retirement, a shift often called the “great experience exit.” While this change is inevitable, as Baby Boomers and older Generation X professionals make up a significant portion of today’s workforce, it poses a real risk for OEMs who depend on job shops or suppliers that don’t have a succession plan in place.
If your supplier doesn’t have a proper leadership or knowledge transition plan, they may end up shutting down or selling off assets, leaving you scrambling to find a replacement to meet your capacity needs. That means starting from scratch on qualifying new suppliers, which can lead to longer lead times and potential disruptions to your production schedules during this adjustment period.
At Wal-Tek Industries, we believe your manufacturing partner should be built to last. That’s why succession planning is a core part of our business strategy.
Why Succession Planning Matters in Contract Manufacturing
We’ve seen too many shops close abruptly with no leadership pipeline in place. Instead of selling the business, they sell off assets, leaving customers high and dry without a partner. These businesses often rely on tribal knowledge, meaning critical skills and customer insights aren’t documented or transferable. Without a succession plan, that knowledge disappears when key employees leave. For OEMs, this creates chaos in the form of lost time and an urgent pressure to qualify a new supplier.
How do we know a succession plan is important? We have OEMs asking about ours!
Recently, a large client audited Wal-Tek and spent hours reviewing our written succession plan. It was imperative to them to ensure we had clear, well-defined arrangements before they tasked us with a critical, ongoing project.
This is just one recent example, and not the first time a customer has followed up with us to ensure we’re built to last. For many large manufacturers, this is a key component of their risk mitigation strategy. And we believe it’s only a matter of time before mid-sized businesses start prioritizing their manufacturing partners’ future plans.
Wal-Tek’s Approach to Succession Planning
Building leaders at every level
At Wal-Tek, we’ve designed a workforce training strategy that ensures long-term continuity. This includes:
- Junior leadership programs to grow machinists into future leaders.
- Shared training for middle managers, giving them the same exposure our senior team has had.
- Playbooks and SOPs that ensure tribal knowledge doesn’t disappear as machinists retire.
Our goal is simple: even when someone in a critical role leaves, the customer experience pertaining to quality and consistency doesn’t change.
Cross-training and redundancy
Our succession strategy doesn’t stop at leadership and management roles. It’s embedded in our shop floor processes, such as:
- Cross-training across equipment to ensure uptime, even during machine maintenance.
- Standardized processes in precision machining services and sheet metal fabrication.
- Redundancy across our teams, including estimators, machinists, and welders, so no one role becomes a single point of failure.
Our culture of intentional redundancy means that whether we’re performing laser welding, tube laser cutting, or the other capabilities that make up our scope, our customers can trust delivery remains reliable.
Beyond the customer experience: How future-proofing our business impacts culture
Developing a clear, comprehensive succession plan across our organization doesn’t just benefit our customers; it positively impacts our people. It offers our team members the opportunity to grow, but it also supports them when they’re not at work. Whether they’re taking a vacation or need to step away to deal with personal matters, we have the ability to pass off their workload to someone equally knowledgeable about the ins and outs of what they do. That way, when they’re ready to return to work, they can come back fully recharged and without having fallen behind. This culture keeps morale high and productivity consistent.
Succession Planning = Success
When you’re evaluating suppliers, be sure to ask yourself one critical question: “Can this supplier grow with me?”
If your manufacturer doesn’t have a succession plan in place, they likely have a finite capacity to serve you. Here at Wal-Tek Industries, we’ve made succession planning part of our growth strategy. We want to scale with our customers, providing them with reliable services as their demand increases. Our Rapid Inventory Program (RIP) ties directly into our long-term succession strategy, as it ensures we can meet demand consistently, without disruption, even as our customers grow.
We believe that succession and success go hand in hand. With Wal-Tek’s succession roadmap, we’re building a company that will be here for the long haul.
Request a quote from Wal-Tek to partner with a precision machine shop with a plan.
