6 minute read 23 Mar 2021
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What enterprises can do to help solve the supply chain talent gap

By Regenia Sanders

EY Consulting US-Central Supply Chain and Operations Leader

Passionate about empowering women in engineering and other data-driven fields. Auburn University graduate. World traveler and adventure enthusiast.

6 minute read 23 Mar 2021

In response to disruption, companies should re-evaluate their supply chain organization's talent structures to enable speed to innovation.

Two questions to ask
  • What new skills should organizations be looking for in terms of mastering supply chain technologies?
  • What benefits can continuous learning and upskilling bring to your supply chain?

The COVID-19 pandemic is latest in a series of unexpected disruptions to strain supply chains. In response, companies are looking to automation and digital capabilities to build resiliency and agility. However, as futurists have said: Technology will make things possible; talent will make them happen. To fully unleash the power of digital investments, companies must re-evaluate their organization structures to organize themselves in a way that enables speed to innovation. Employee skill sets across the workforce need to be evaluated with plans to develop in-house mastery and drive adoption of new enabling technologies.

The challenge ahead

Amid the shift toward increased automation, companies are facing both a misalignment and shortage of skills needed to operate in a more automated, digitally enabled environment. In a recent EY survey “Reinventing the supply chain for an autonomous future,” only 44% of respondents said their employees were prepared for digital innovation in the supply chain. For a supply chain to operate optimally and continuously improve, technologies such as IoT, robotic process automation and machine learning must be guided and constantly managed by skilled professionals.

Analytics are the core to optimizing business processes. Your workforce should be able to synthesize data, identify outcomes and offer recommendations, requiring a fluency and comfort with information and processes that traditional-minded talent might find unfamiliar.

Meanwhile, talent within manufacturing, logistics and warehousing is aging, and the younger generation of tech-focused workers typically do not want to work in a plant, warehouse or factory. Not to mention, those with in-demand, specialized skill sets are proving difficult to recruit: one EY client spent 20 months looking for an affordable data modeler with experience in their industry, for example.

While it is hard to keep up with the latest tools and technologies, it is doubly difficult to train your people in-house to be ahead of the curve. However, in upskilling roles, they become more appealing to college graduates. The path forward to address this shift in skill sets likely relies on a mix of recruiting, upskilling, retooling and continuous improvement of your organization.

Solving the supply chain talent gap

Operating model changes, reorganization, managed services and in-house certification programs to develop mastery are big levers to resolve supply chain talent issues. Many organizations are taking a close look at what can be consolidated in regional/global hubs vs. what should stay close to markets and manufacturing sites. Ultimately, enterprises must consider tradeoffs between speed-to-innovation and scale for hiring/training vs. local agility. There is also an increasing use of supply chain technical centers of excellence (COE) to drive digital capabilities and advanced analytics within an organization.

Looking across various functions, supply chain leaders should create capability maps with the intent of assessing and improving current workforce skills, identifying core capabilities that can be centralized and leveraged across the organization, and other capabilities that can be outsourced or procured as a managed service. For instance, in demand planning, sophisticated statistical models and artificial intelligence-/machine learning-based forecasting engines can be managed and fine tuned by a centralized organization with the right skills to drive forecast improvement. This way companies don’t need to invest in hiring and training large demand planning teams that are spread throughout the organization and therefore siloed.

In demand planning, sophisticated statistical models and artificial intelligence-/machine learning-based forecasting engines can be managed and fine-tuned by a centralized organization with the right skills to drive forecast improvement.

A sizable multinational corporation may devote as many as 500 people across the globe to the supply chain planning function. Training on these technologies — even as they continue to evolve and shapeshift — poses a significant hurdle for supply chain leaders. You can automate and innovate faster through a planning COE that centralizes repetitive, globally common planning capabilities, such as statistical forecasting, analytics and data management.

Planners can then increasingly rely on these more automated capabilities and shift their focus away from putting out fires to more impactful activities such as addressing exceptions from integrated planning tools, making decisions and tradeoffs to drive better business results, and negotiating with internal and external stakeholders. With automation, planners can concentrate on value-added activities, without the need for potentially costly and error prone manual processes.

Upskilling and continuous learning

When it makes sense to upskill, enterprises should focus resources on strategic core functions, leveraging tools to enable virtual on-demand training and knowledge sharing. Companies can also enable a qualifications program to build in-house mastery, with rewards aligned to core functions, therefore creating a culture of continuous learning.

With automation, planners can concentrate on value-added activities, without the need for potentially costly and unnecessary manual processes.

Just like in supply chain planning, new skills are needed for manufacturing. According to a recent CNBC article, in a tight labor market, manufacturers are working hard to keep job attrition low. Many manufacturers have invested in automating processes and making equipment smarter using analytics, predictive maintenance and robotics, but similar investment must go into preparing their workforces for the future.

Traditional learning models are proving to be outdated and should be replaced by modules that are gamified, with badges, challenges and leader boards. Interactive training modules can even involve augmented reality for complex tasks. Evolved training models can account for how to engage the workforce across generations, factoring in different learning styles.

Companies might also consider exploring the “citizen developer” movement, which enables workforces to innovate and upskill from within, essentially incentivizing them to automate their own jobs. In a traditional approach, a company would ordinarily turn to a technology company to insert its digital knowhow into operations after it learns about understanding the culture, business and tasks involved — a time-consuming process. Through the citizen developer movement, that approach is turned upside down: your people learn coding, for example, and apply that knowledge to what they understand the best: their day-to-day roles.

The “citizen developer” movement is about empowering and enabling supply chain teams with no formal coding training to drive analytics, automation and innovation. Case in point, planners in Procter & Gamble planning centers were provided learning resources and incentivized to improve and automate parts of their daily work processes. Procter & Gamble  found this approach to be very motivational and engaging for their teams; not only did the consumer-packaged goods giant benefit from custom RPA and M/L applications their planners developed, but employee retention also increased. In fact, in a single year, the program staffed over 100 citizen developers and resolved over 90 business problems thorough use of automation and analytics.

Humans at the center of your supply chain

Supply chains need to be fundamentally reinvented to meet the demands of today’s digital world — yet, in doing so, humans should remain at the center of your business. A deficiency in talent also becomes a deficiency in the use of technology, no matter how much you’ve invested in the latter. With a mix of internal and external learning efforts and thoughtful reorganization, you can position yourself for the future confidently with the unified strength of brains and bytes.

Dheera Anand, Senior Manager, Consulting, Ernst & Young LLP also contributed to developing this article.

Summary

Following a series of recent disruptions that strain supply chains, it is more evident than ever that supply chains need to be fundamentally reinvented to meet the demands of today’s digital world. Companies are utilizing technology to build resiliency and agility. However, to overcome hurdles and fully unleash the power of emerging technologies, companies must put humans at the center of their ongoing efforts.

About this article

By Regenia Sanders

EY Consulting US-Central Supply Chain and Operations Leader

Passionate about empowering women in engineering and other data-driven fields. Auburn University graduate. World traveler and adventure enthusiast.