The following Supply Chain Matters blog is part of our ongoing series of deep dives into each of our previously unveiled ten 2017 Predictions for Industry and Global Supply Chains.

At the start of the New Year, our parent, the Ferrari Consulting and Research Group along with our Supply Chain Matters blog as a broadcast medium, provide a series of predictions for the coming year. These predictions are shared in the spirit of assisting industry specific and global supply chain cross-functional teams in helping to set management objectives for the year ahead. Our further goal is helping our readers and clients to prepare supply chain management and line-of-business teams in establishing impactful programs, initiatives, and educational agendas.

The context for these predictions includes a broad cross-functional umbrella of supply chain strategy, planning, execution, product lifecycle management, procurement, manufacturing, transportation, logistics and customer service management.

In an earlier Supply Chain Matters blog postings, we provided deep dives related to:

 Prediction One- Subdued World Economic Outlook and Heighted Uncertainty to Test Industry Supply Chain Agility.

Prediction Two- A Challenging Year in Procurement

In this third-deep dive series posting, we drill down on Prediction Three.

 

2017 Prediction Three: A Supply Chain Talent Perfect Storm

For all functions that make up the umbrella of today’s supply chain management capabilities, we predict a supply chain talent perfect storm, one that is sure to occupy more of the management attention of supply chain and business senior leadership. The perfect storm is increased skills demand meeting limited available skilled talent supply. As Bloomberg BusinessWeek declared in late December 2016: “Right now the problem isn’t too many workers who can’t find jobs. It’s too many jobs that can’t find workers.” The coming year may well provide a period where lack of skills and talent will take on a discernable and visible impact on required competences.

The perfect storm will come from the confluence of even more demands for supply chain agility and responsiveness to unprecedented business changes across industries, demanding that supply chain teams take on a more strategic advisory or business partner role concerning key decisions in manufacturing and component sourcing, supply chain network design or customer fulfillment changes. Taking on a more business advisory focus requires that supply chain leaders have more depth in their respective organizations to support simultaneous strategic, tactical, and operational support needs, coupled with augmented technology applications that enhance decision-making.

As noted in Predictions One and Two, the continued need for added people and process productivity along more with data-driven decision making capabilities will add to needs for supply chain digital transformation, which has a strong dependency on talent and organizational readiness. Organizations that are driven more by digital transformation capabilities imply self-directed teams, consequent avoidance of barriers among supply chain functional and line-of-business teams with tighter decision feedback loops. Not all organizations are prepared for this level of change.

One of our 2016 predictions noted that the widening of supply chain talent and skill gaps would require organizations to be more innovative and purposeful in recruitment, training, retention, and career planning. We expected organizations and recruiters to more broadly define and recruit employees from skill based dimensions and in expected performance parameters for both current and future organizational needs. We felt that individuals who possess required cross-functional hard and soft skills, including in-depth technology prowess will continue to experience a seller’s advantage.

In 2016, we expected manufacturers, retailers and supply chain services firms would encourage broader training, benchmarking, multi-business, and multi-geography opportunities.  We trusted that supply chain leaders would confront or at least influence the other elephant in the room, namely that of compensation plans related to required supply chain management skills and roles tied to performance, teamwork, and skill achievement objectives. We were hopeful that there will be more of such innovative compensation programs unveiled in 2016.

Regrettably, feedback indicated that many employers currently seeking highly skilled and in-high demand candidates, often offer the low-end of compensation levels. In-demand candidates were savvy enough to figure-out that their skills are drawing higher compensation in other firms or industries, thus recruiters began counseling employers seeking in-demand skills to lead with far more attractive compensation offers from the start or risk candidates quickly moving to other offers.

With the prospects of 2017 providing even more overall pressures to reduce supply chain costs, supply chain, procurement and product management related executives will be faced with difficult choices regarding the existing workforce. Executives who previously established multi-year plans to broaden skills and talent will face the reality that talent needs are more immediate.  With upwards of 10,000 baby boomers turning 65 each day, the skills and experience flight becomes ever more challenging. We expect supply chain teams to further explore phased retirement programs such as that practiced by Steelcase where retiring employees can opt for phased part-time work schedules to mentor and transfer knowledge.

Existing workers do not have the tools and training opportunities because business investment activities continue to lag. That obviously must change in 2017 and open question remains how or if this occurs.

As with 2016, those individuals possessing broad supply chain cross-functional process knowledge coupled with technology savviness and the soft skills needed to influence adoption and change to more advanced decision-making concepts will continue to be in very high demand. Efforts to increase U.S. or North America based manufacturing capabilities will once again face the reality of a lack of available skilled manufacturing talent.

Finally, we must state that existing supply chain focused professionals who have acquired many years of experience need to double their efforts to create awareness and interest for careers in supply chain management among secondary school and college candidates. Many supply chain focused professional organizations such APICS, CSCMP, ISM and others have been stepping-up career outreach efforts and resources, and such efforts could not be more timely. Consider adding your voices and influence.

For our part, we will continue to search out and highlight innovative supply chain talent recruitment programs and initiatives that are delivering meaningful results.

 

This concludes our Prediction Three drilldown in our series of 2017 predictions.  In our next posting of this series, we dive into Prediction Four that calls for increased anti-trade geopolitical forces providing added challenges for industry supply chains.

If readers or clients require further clarity, or wish to contribute additional thoughts related to what to anticipate in the coming year, you can contact us via email: feedback <at> supply-chain-matters <dot> com. Our final blog commentary of the series will include a summation of additional contributed thoughts for what to expect.

 

Bob Ferrari

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