An article posted in Bloomberg Economics speaks to one of the more vivid revelations associated with the pandemic; that is the need for effective supply chain management. As the lifeline keeping companies stocked with products to sell and ways to move it from here to there, supply chains and companies’ strategic management thereof can be the difference between positive or negative margins, especially during times of disruption.
While some may think that the pandemic is a once in a lifetime event (we can all hope), it has quickly refocused many (if not all) companies on the risks from all sorts of potential disruptions (e.g.; natural disasters, geopolitical conflict, changing regulations, etc.). Ironically, the supply of talent in the field of supply chain management is currently lacking.
‘Procurement experts were center stage in the rush to secure alternative sources of household essentials, medical gear, raw materials and components to keep factories running when Covid-19 first struck. Now chief executive officers are looking to those same managers for more strategic vision and ways to shock-proof supply chains for corporate survival….From auto makers to food processors, manufacturers that have relied on a strategy of low-cost supplies and minimum inventories are rethinking such an approach given the combination of the pandemic, trade conflicts and harsher natural disasters.’
It is of course no surprise to anyone following Mercator Advisory Group’s commentary during the last several months (and just about anywhere one picks up informed insights) that a palpable shift towards digital process transformation is the post COVID-expectation. We have already seen examples of this shift in progress, most notably regarding card acceptance, something that makes perfect sense when one considers the speed of settlement versus checks (or not getting paid at all). The same thing is happening in supply chain management.
‘When the coronavirus hit, it took some companies three to four weeks to understand the ripple effect on areas like procurement and logistics….Those firms are now in the rebuilding phase, with one eye on what digital tools and other technology they need to stay on top when the the next crisis comes, according to Kristian Park, a risk advisory partner at Deloitte in London….“There’s been a 50% increase in people coming forward who have realized they didn’t have the information they needed,” Park said. “As always with these things, it takes one seismic shift to change people’s perception of the risks.” ‘
The author goes on to provide a couple of examples around company tactics. He also provides some insight on the job market for those recent graduates, facing a bleak jobs market, who may find an opportunity in the field. The piece is worth a quick read to stay abreast of real-time change.
‘Two decades ago less than 10% of companies had a supply chain director, according to Jan Godsell, a professor of operations and supply chain strategy at the University of Warwick. The number now is closer to 50%, with the role of a chief supply chain officer becoming more common in the past five years….As the jobs become a bigger part of a company’s strategic management team, he says more lucrative salaries will follow. “The demand for talent is going to be significant on the backside of this,” Eshkenazi says. “We’re seeing skills and expectations for supply chains increase exponentially.” ‘
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group