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A Supply Chain Investment that's Guaranteed to Pay Off

June 9, 2015
Investing in supply chain talent, while difficult and time-consuming, will pay off in dividends that will sustain your company for the long haul.

The recent MH&L 2015 Salary Survey revealed that finding and retaining talent is the biggest challenge that material handling and logistics executives face. With numerous schools now producing supply chain-degreed talent, you would think the situation would at least be getting better. But it's not.

One of the problems is too much over-specialization within supply chain disciplines. The University of Tennessee recently conducted a study to better understand the talent crunch, with the goal of offering potential solutions. In the course of that study, UT researchers talked to a global consumer packaged goods company about its recent difficulties in recruiting supply chain talent. As it turns out, engineering graduates with strong technical skills weren't so good at logistics and procurement, while business school grads who understood logistics and procurement had to be trained in the technical skills the job also required. So the CPG company's supply chain hiring too often resulted in finding somebody who was proficient in one area and then having to train them in another—essentially, reeducating them.

As the UT report makes clear, most executives struggle to strategically recruit for their supply chain talent gaps. "More than 90% of CEOs recognize that they need to change their strategies for managing talent," says Shay Scott, director of UT's executive MBA program in supply chain management. "First and foremost, supply chain talent is a critical priority that must be addressed now."

"Companies increasingly must extend their supply chain's talent base beyond technical skills to bring more leadership and professional skills into more levels," agrees Kelly Marchese, principal, Deloitte Consulting, who conducted Deloitte's 2015 Supply Chain Survey. "This has the potential to empower and inspire employees at all levels to support constant innovation in fast-moving industries, and to generate new forms of leadership that can help create more engaged and effective supply chains."

Only 45% of the 400 U.S. executives polled for the Deloitte study say they are extremely or very confident that their supply chain organizations have the competencies their companies need. That's consistent with other recent studies that indicate how the rapid rush of new technologies (Internet of Things, 3-D printing, robots, etc.) and distribution strategies (e.g., omni-channel) is leaving many companies behind. Finding recent grads skilled in the nuances of such diverse areas as Big Data analytics, lean warehousing, sustainability and transportation management is a pretty tall order, as even the best schools can't possibly simulate real-time, real-world conditions of managing a contemporary corporate supply chain. There's always a Next Big Thing that's going to change the supply chain as we know it.

"Approaches to talent management must evolve with supply chains to ensure today's workers can meet tomorrow's challenges," Marchese says. "That can only occur if executives at every level are informed and in agreement when it comes to their talent needs."

What it really comes down to, then, is leadership, and that's a commodity that's as vital as it is rare.

While conducting its study, UT uncovered eight best practices in supply chain talent management, and offers them as a guide to where and how to find the people who will take your companies to the next level:

  1. Clearly define and identify whom you want to hire.
  2. Use mentors, sponsors and first coaches.
  3. Develop and use individual skill and development plans.
  4. Offer internships and co-op programs.
  5. Partner with top universities to develop supply chain talent.
  6. Have a separate, ongoing top-talent system.
  7. Hire for overall supply chain skills, not a specific job.
  8. Create a diverse culture and support active diversity programs.

As the UT study suggests, supply chain talent is our most important resource. The investment you make in your people will pay off handsomely, not just in the short-term but throughout the entire lifecycle of your company.

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