In a special section of the Wall Street Journal (registration required) earlier this week, a duo of supply chain management professors warned that changing global market dynamics require new supply management skills and approaches that most companies lack.
Such findings are not news to the Supply Excellence audience. (Indeed, most of you are feeling the pinch of the talent crunch first hand.) Yet, the article does provide some strong facts that can help you build a business case for recruitment and training budget and resources. The scholars also offer recommendations for solving your skills dilemma in the near-term: staff augmentation.
The professors from the business and management schools of Florida State and North Carolina State University note that managing the supply chain in the face of globalization, offshoring, and an ailing economy “requires a broad skill set that many managers simply don’t have right now.” (This prognosis was echoed in the recent Aberdeen Group CPO Agenda study, in which 74% of senior supply management executives said they “need people with different job skills” on their teams. Download a complimentary copy of the report here.)
Specifically, the scholars’ joint study of supply chain managers found that the following skills or approaches are required to effectively manage supply in today’s global economy:
- “Big Picture View” — with an emphasis on strategic cost reduction and a greater focus on total cost in supplier selection.
- Building teams — particularly strategic relationship management with internal and external “customers” and partners.
- Managing technology — especially electronic procurement and reverse auctions.
- Finding suppliers globally — especially managing complex outsourcing agreements and developing sound global sourcing strategies. The study found that companies had particular challenges in understanding “the nuances of vital [supply] markets around the world.”
In light of the current economic pressures and the need to expand and compete globally, the professors recommended “If [a company’s supply management team] can’t do it all themselves, they must hire people who can do the job for them,” including the use of the “number of consulting companies that have sprung up to supply this global market intelligence.”
This advice echoes the strategy I have heard recently from several CPOs. Consider these comments from the head of global procurement at one of the world’s largest beverage companies: “Grain and commodity prices are killing us right now. We need to rapidly expand our global sourcing efforts and reach new markets across all categories in order to meet our cost savings targets for the year. I can’t train or hire people fast enough to manage this internally. Instead, we are looking to [outside] experts to help meet our sourcing and savings goals.” (more…)
