It’s time to transform your supply chain workforce
February 22, 2022
Organizations today are operating in an era of unprecedented supply chain disruption. The pandemic will eventually end, but it will be replaced by other disruptive events, from natural disasters to trade wars to global conflicts, all of which are increasing in both intensity and frequency. In this unpredictable environment, the one thing that’s becoming increasingly clear is that the traditional just-in-time approach to supply chain management is no longer adequate. Organizations need to digitally transform their supply chains to address these new conditions, using modern tools like artificial intelligence (AI), machine learning (ML), and digital twins to predict and monitor the impact of almost every action in and around the business. The result? A step-change improvement in visibility that brings the supply signal closer to the demand signal and reveals leading indicators of the next disruptive event before it occurs.
Achieving that digital transformation will require a skills transformation in the supply chain workforce. Even for high tech companies populated with highly skilled digital experts, the most common mistake in executing this transformation is to focus solely on the technology. Almost 70% of chief supply chain officers (CSCOs) plan to boost spending on digital technologies over the next three years. Rarely, however, is there a conversation about how much money to invest in developing a workforce that can effectively leverage these technologies.
New skills for a new paradigm
Supporting intelligent supply chain operations requires a very different organizational architecture and talent mix than the traditional supply chain operation. Conventional supply chain organizations focus on operational tasks, many of them mundane though necessary. Automation makes it possible for just a handful of people to perform the operational tasks that used to require the majority of the organization.
The modernized supply chain, with its emphasis on AI, ML and analytics can automate many of those mundane steps and free up staff to focus on more strategic, end-to-end business problem-solving. They will need to develop new skills as they make this transition. Staff has the opportunity to break out of their silos and become involved in business-wide strategy and decision-making built on their expertise in the supply chain.
Data scientists and other technical talent will be core to this new supply chain workforce, but not everyone will need a Ph.D. Technology literacy and the ability to use data for analysis and decision-making will be key skills for everyone in the operation. CSCOs will need to build these skills in their people, hiring some new blood but primarily providing the opportunity for people to evolve their skillsets and advance their careers.
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Creating the new workforce
Only 27% of supply chain leaders agree that they have all the talent they require to meet current supply chain performance requirements – let alone address future needs in this fast-evolving high tech market.
Across the operation, the transformation requires innovators capable of radically rethinking how the supply chain needs to run, both in the present and two or three years in the future. Some new talent from outside the enterprise may be necessary to look at organizations and processes with fresh eyes or to fill gaps that appear as you bridge to a new model.
However, developing the people who already know the business provides a direct pathway to the future. The supply chain transformation will be a journey for the whole business and individuals with legacy supply chain roles can take part and even lead that journey. Legacy skillsets can be enhanced and mapped onto the new architecture of supply chain management. In addition to understanding constant flows of data in new ways, communication and coordination with new partners in and around the business offer new career pathways to the established team members. Working with people who know the business and the digital architects, an end-to-end team of innovators and problem solvers can forge a supply chain function that constantly adapts to changing conditions.
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Only 27% of supply chain leaders agree that they have the talent to meet the current supply chain performance requirements.
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Getting started
Evolve the governance structure
Most enterprises will begin with a centralized function, partly because that’s the legacy approach to supply chain organizations and because putting all resources in one place ensures a critical mass of expertise for navigating the transition. Over time, the core can thin into a light-footprint Center of Excellence overseeing a much more decentralized function. This transition will happen in steps as new technologies automate certain functions and the more strategic skill set takes hold. Data scientists, economists and other knowledge workers will increasingly make up the core while the supply chain becomes more distributed and more visible across the enterprise through deployed technologies.
Attack the challenge of talent recruitment
The transformed supply chain depends on digital, data-centric skills such as data scientists and people who can use data and market signals to model different scenarios. These people are in high demand. Employees with these types of skills tend to gravitate toward R&D or product development more often than supply chain functions. Supply chain recruiters need to develop strategies to be competitive in the talent hunt. The environment has shifted somewhat in recent years to make working in supply chains more attractive. Amazon’s success increased the profile of supply chain and logistics management, demonstrating the way cutting-edge technology is used for supply chain transformation. Supply chain challenges have also been highlighted by the media during the COVID-19 pandemic, drawing attention to the function’s importance to the global economy. Since this need for recruitment involves new kinds of roles and skill sets, it also offers opportunities to build on diversity and inclusion goals.
Work with a partner
Even for high tech companies that are digitally fluent, the supply chain workforce transformation can be challenging. The promise of transformation is large, so expectations will rise accordingly. Between technology and the logistics of deployment as well as rearchitecting an organization, the speed to tangible value creation and ROI will be scrutinized up and down the enterprise.
Consider working with a partner who can help manage the transition. An experienced partner can increase speed to value creation by drawing on best practices, leveraging established relationships with technology vendors and providing expert resources to fill gaps as you modernize the supply chain function.
Conclusion
The supply chain is a foundational component of any business. Digital transformation can remake the function so you can move faster and respond to changes in the market environment ahead of the competition. However, that transformation involves people as well as technology and successful enterprises will invest in both. The right talent will be just as crucial as the right technology. Get started on both transformations together.
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