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Hiring, retaining staff, and finding the right professionals is a key challenge for global supply chain management.

Supply Chain Management Staffing Challenges Require Innovative SolutionsARTICLE

By Christine Parizo

Hiring and retaining staff is a key challenge throughout the supply chain, and the problem of finding the right professionals for global supply chain management is compounded by an unprecedented labor shortage. According to the global 2016 Third Party Logistics Study, 79 percent of third-party logistics providers feel unprepared for the labor shortage’s impact on the supply chain.1

The supply chain management labor shortage is particularly acute in transportation and warehousing. According to the same study, the average age of a truck driver is 55 years old, and 37 percent of the demand for drivers is to replace these aging employees. Traditional driver recruitment methods haven’t yielded the employees needed to fill the gaps; as a result, the driver shortage in the U.S. stands at 38,000 and is expected to reach 175,000 by 2024, according to the American Trucking Associations.2 In the U.S., 70 percent of freight tonnage is moved by truck, and the lack of drivers can result in significant delays and lost profits.3

To address the labor shortage in these critical supply chain management processes, companies are using signing bonuses, paying for training and licensing, upgrading their fleets, and providing benefits like flexible routes and work schedules.4

Automation and Technology May Alleviate Global Supply Chain Management Staffing Woes

In U.S. warehouses and distribution centers, the inability to fill positions has become a major supply chain management risk.5 Accordingly, more companies are turning to advanced automation systems and robotics for tasks like sorting, picking and retrieving items. Warehouses may need to be redesigned to support new technology that automates bin storage, delivery and retrieval. There is also increasing use of data-capture technologies to improve efficiency, such as imaging solutions for quality checks and scanning devices for tracking the location of orders and items. Some companies are exploring the use of wearable devices that provide augmented reality and voice technology to help warehouse workers improve picking efficiency and order accuracy, according to a report by VDC Research.6

Senior Supply Chain Management Positions are Particularly Hard to Fill

Companies are also finding it difficult to fill senior supply chain management positions, due to factors including the growing complexity of supply chains and the requirement for technological expertise. Multiple jobs that were formerly handled within logistics and procurement functions are being consolidated into high-level leadership roles, requiring executives with wide-ranging skills.7

These high-level professionals can be extremely difficult to find; roughly three quarters of executives surveyed by Deloitte Consulting reported that they have difficulty recruiting senior leadership for supply chain management.8 These positions require professionals with broad backgrounds, global experience, and strategic thinking and problem-solving skills.

Finding New Ways to Recruit Supply Chain Management Professionals

Companies facing critical skills shortages are turning to non-traditional recruiting methods, according to Deloitte. For example, a major technology firm seeking to fill higher-level supply chain management positions targeted “passive job seekers” – people who were content in their jobs but might be persuaded to take a more attractive position.9

Technology is increasingly used to reduce the risks associated with hiring temporary workers to address labor shortages. Finding and hiring contingent employees through staffing firms can introduce vulnerabilities, including a reduced ability to appropriately track workers and their backgrounds. Vendor management systems can help companies gain visibility into these external workforces to make better strategic hiring decisions.10

The Takeaway

With declining unemployment rates and a demand for new skills at the upper levels of management, finding the right employees for supply chain management is not easy. Companies are using a variety of methods to address the skills shortage and increase the efficiency of their global supply chain management processes. These include a growing focus on automation and technology, as well as creative approaches to recruiting.

Christine Parazio - The Author

The Author

Christine Parizo

Christine Parizo is a professional writer specializing in business and technology. She's written for a variety of TechTarget sites, including searchSAP.com, searchSOA.com, and searchCloudApplications.com, as well as HPE's Infrastructure Insights and The Pulse of IT.

Sources

1. 2016 Third Party Logistics Study: The State of Logistics Outsourcing, Capgemini; http://www.3plstudy.com/downloads/previous-studies/
2. Truck Driver Shortage Analysis 2015, American Trucking Associations; http://www.trucking.org/ATA Docs/News and Information/Reports Trends and Statistics/10 6 15 ATAs Driver Shortage Report 2015.pdf
3. 2016 Third Party Logistics Study: The State of Logistics Outsourcing, Capgemini; http://www.3plstudy.com/downloads/previous-studies/
4. Ibid.
5. "Will 2016 Be the Year Warehouse Automation Fixes Your Labor Shortage?", Supply Chain 24/7; http://www.supplychain247.com/article/will_2016_be_the_year_warehouse_automation_fixes_your_labor_shortage
6. "The Warehouse of the Future", VDC Research; http://www.vdcresearch.com/News-events/autoid-blog/the-warehouse-of-the-future.html
7. "Companies See ‘Massive Shift’ in Search for Supply Chain Talent", Wall Street Journal; http://www.wsj.com/articles/companies-see-massive-shift-in-search-for-supply-chain-talent-1432327353
8. Supply Chain Talent of the Future: Findings from the third annual supply chain survey, Deloitte; https://www2.deloitte.com/content/dam/Deloitte/global/Documents/Process-and-Operations/gx-operations-supply-chain-talent-of-the-future-042815.pdf
9. Ibid.
10. "Leveraging Technology to Mitigate Global Risk", Logistics Management; http://www.logisticsmgmt.com/article/leveraging_technology_to_mitigate_global_risk

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