It is every retailer’s nightmare. In 1999, Toys R Us was unable to fulfill its online orders on time for Christmas and was forced to send out an email two days before the holiday to children and parents saying, “We’re sorry.”
When supply chain disasters like this occur, bad press is soon followed by lost market share, lower stock prices, and ruined reputations.
In fact, Toys R Us responded to the failure by contracting with then-fledgling online retailer Amazon for future fulfillment.
Companies are increasingly sourcing raw materials, manufacturing, and labor from all over the world forming a global supply chain.
How do companies ensure smooth operations in their far-flung supply chains and minimize the effect of inevitable crises?
Job Description: What Is Supply Chain Management?
The answer is through supply chain management. The supply chain manager coordinates the logistics of all aspects of the supply chain which consists of five parts:
1) the plan or strategy
2) the source (of raw materials or services)
3) manufacturing (focused on productivity and efficiency)
4) delivery and logistics
5) the return system (for defective or unwanted products)
The supply chain manager tries to minimize shortages and keep costs down.
The job is not only about logistics and purchasing inventory.
According to Salary.com, supply chain managers, “make recommendations to improve productivity, quality, and efficiency of operations.” Improvements in productivity and efficiency go straight to the bottom line of a company and have a real and lasting impact.
Related: Logistics Management’s 30th Annual Salary Survey
Good supply chain management keeps companies out of the headlines and away from expensive recalls and lawsuits.
Supply chain managers work in a variety of industries including manufacturing, aerospace, defense, and energy. They work for both large and small companies.
A classic example of a supply chain manager’s function might be finding the best price and quality for components in a consumer product like an iPhone. A supply chain manager can also oversee operations such as by managing processes for shipping and warehousing.
Because corporate headquarters, raw material sources, manufacturing, shipping, and consumers can all be in different countries or even continents, supply chain management often requires extensive travel and on-call hours to work among different time zones.
5 Ways to Fill Supply Chain Knowledge Gaps
Is your organization suffering from supply chain knowledge and skillset gaps? Here are five strategies to get back on track.
1. Executive Supply Chain Education
It takes on different forms, all of them aimed at a similar goal: to bring existing employees and/or new graduates up to speed on the fine points of managing today’s complex supply chain. According to Kouvelis, executive education is targeted mainly at younger candidates that already have graduate degrees in other fields (business, economics, engineering, or math, for example).
2. Supply Chain Certifications
Through the professional certification process, individuals gain knowledge, experience, and skills to perform a specific job. When the coursework is completed the student must earn a passing grade on an exam that is accredited by an association or organization that oversees and upholds the standards for the industry in question.
3. Peer-to-Peer Mentoring and Cross-Generational Collaboration
In some cases, enhancing supply chain knowledge is a task that can be handled within the organization, where a goldmine of knowledge and hands-on experience lies within the existing workforce. “With the Baby Boomers heading into retirement, and with a high number of supply chain job positions to fill, we definitely need to be mentoring younger folks and driving leadership within supply chain positions,” says Lisa Angell, department chair and instructor of supply chain management at Fox Valley Technical College in Appleton, Wisconsin.
4. Cross Training and Job Rotation
Sometimes all of the education and certifications in the world can’t replace the hands-on experience that supply chain professionals gain from cross training on different jobs. “It gives individuals different perspectives on the supply chain,” says Abe Eshkenazi, CEO at Chicago-based APICS.
5. Partnering with Universities and Colleges
When developing coursework for its supply chain programs, Portland State University reaches out to area organizations to find out what skills and knowledge would help them operate more efficiently in today’s business world. “We’ve built out our curriculum around those needs,” says Cliff Allen, academic director at Portland State University in Portland, Oregon, who advises shippers to use a similar approach to partnering with their own local universities and/or colleges.
Download the full article (including a list of Universities and Educational Institutions, Professional Associations, and Private Firms):
“5 Ways to Fill Supply Chain Knowledge Gaps”
Education and Training
Supply chain managers require skills in project management, cost accounting, e-business/e-procurement systems. They should also have global awareness, good business ethics, and an understanding of legal contracts.
Since supply chain management can involve working across silos and in many different cultures, soft skills like communication, effective presentation, and multicultural understanding area also important. The acquisition of these skills comes from both formal education and on-the-job training.
More than 75 percent of supply chain managers have either a bachelor’s or master’s degree according to salary.com and most companies require some level of experience, typically between 5-7 years, in a related or similar field.
This experience can range from management, e-business, purchasing, logistics, project management, or enterprise resource planning.
Degrees in economics, business administration, statistics, manufacturing, and management are common. Some colleges and universities also offer specialized degrees in supply chain management. Certifications like the CPSM, CPIM, and CSCP can also give job seekers an advantage.
Salary
The annual salary range for a supply chain manager falls between $50,000 and $135,000 with a median of $97,000. Bonuses are not uncommon in this field. With bonuses, the annual median compensation for a supply chain manager is $101,000 and the compensation range is $71,000 to $137,000 wth top performers able to earn much more.
The outlook for these jobs has been and should continue to be strong as business become increasingly global.
The Bottom Line
Top supply chain managers have joined the C-level of most companies and earned a place at the table with the chief executive officer, chief operations officer, and chief financial officer.
Corporations are now very aware of the impact that supply chain management can have on the operations and economics of a company.
This recognition has resulted in a strong total compensation package for these jobs.
Source: Investopedia
Related: 5 Ways to Fill Your Supply Chain Knowledge Gaps
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