This study is authored by Dr. Albert Tan, CPIM-F, an Associate Professor at the Asian Institute of Management in the Philippines.
The need for supply chain professionals
The aim of this research is to identify the supply chain skills required by supply chain managers and leaders in Asia, and suggest the key skills and competencies that all supply chain professionals need to acquire. Supply chain executives used to be experts at managing supply chain functions such as transportation, warehousing, inventory management, and production planning. But the supply chain process extends end-to-end within the firm and even outside the firm, including the relationships with suppliers and customers on a global basis.
Leading firms now see the supply chain functional leader as the necessary executive to coordinate the end-to-end supply chain process, even though he or she does not control it all. The battle for top supply chain talent must be focused on acquiring people with process expertise, not simply functional competence. The mental shift to supply chain-as-a-process leads inevitably to the shift of the role of the supply chain executive from a functional focus to process focused, and to supply chain leadership becoming part of the executive team.
Supply chain managers and leaders can enhance or upgrade their skills based on the findings from this research while HR managers can include these competencies when recruiting new staff for supply chain professionals. We have conducted both quantitative and quality research for this study. For quantitative research – We have conducted online survey for 8 countries targeting 300 to 400 supply chain managers with more than 5 years of experience. Meanwhile, for qualitative research – We have conducted 1-to-1 interview with supply chain managers to confirm the essential skills and competency to be successful. We have also be extracting the skills requirements as listed from job advertisements posted in Linkedin.com. This triangular method have helped us to converge the essential skills and competencies required to be a successful supply chain manager.
This is the first time that we are attempting to identify the skills and competencies from Asia countries as most of the studies are conducted in USA and Europe. Mckinsey consultancy report in 2020 believes that leaders should take this moment not just to fix their supply chains temporarily, but to transform them. Reimagining supply chains to avoid past traps and meet future needs will require a more comprehensive approach in reskilling the supply chain professionals to build new competency for the new norm.
The questionnaire is divided into 3 skill categories, namely supply chain competency group, managerial competency group and IT competency group as shown in Figure 1. Lastly, we will extract the skills requirements from the job advertisements for supply chain managers from Linkedin.com. Due to space limitation online, we will report the findings from 1-to-1 interviews conducted.
Overall findings from the interviews
Logistics industry is a very cost sensitive and customer oriented industry. It tries to keep its costs low while meeting customer expectation. From Table 1, we can see the need to automate the logistics processes using technologies to improve productivity and reduce costs. During the pandemic, more workers are advised to work from home but the warehouse operations need people to move cargoes. Thus, the logical option is to explore automation in the warehousing together with warehouse management system. With automation, there will be more data available for analysis to optimise its operations. Data analysis becomes another critical skills for this industry to identify performance gaps and improvement. Soft skills are also important to deal with clients as well as motivating employees. This is a labour intensive industry and soft skills are needed to handle conflicts and manage expectation with clients.
In addition, problem solving skills and customer oriented are 2 other competencies that the industry is expecting from the employees. They are troubleshooting issues every day and the problem solving skills are essential part of the skills to resolve the issues. Since some of the issues will affect the clients, they also need to build good customer relationship. Thus, they need to be customer oriented to retain the clients as the switching cost is low for the logistics industry.
Manufacturing industry is faced with material and labour shortages due to the lockdown to prevent the spread of the virus. Most of the interviewees have indicated data analysis as one of the key skill set to better understand about their processes and customers as shown in Table 2. Some of the interviewees have indicated that need to use the data for machine learning and AI application. The data will help to identify sales trends and automate simple decision makings to improve productivity.
Many companies are using the data from their ERP system to analyse consumer behaviour and automate their processes in line with industrial 4.0. Soft skills are also important to manage client expectation and collaboration. It is becoming critical to collaborate and jointly forecast with customers and suppliers during this pandemic period where the demand is uncertain. This will ensure a reliable supply chain while attaining a reasonable pricing. The increase in ocean freight rate to the USA ports is an example where some of the supply chain partners are taking advantage of the containers shortage to increase their prices.
Trading and retailing industries are impacted by the disruption in the supply chain. Many of the trader and retailers are running short of inventory due to late delivery. Thus most of the interviewees are indicating the need to have proper inventory management during this period as shown in Table 3. The need to constantly review and adjust their inventory policies and supplier reliability are critical for survival as indicated by the interviewees. Most of these companies are using inventory systems to monitor and plan their inventory. With thousands of SKUs to monitor, it makes sense to implement inventory system to manage their inventory and establish policies within the system to optimise the inventory level. Most of the ERP systems today are able to perform complex inventory planning and execution.
For future skills, some of the interviewees believe the data stored in the ERP are currently under-utilised and they can use data analytic for more accurate forecasting and better decision making. Sales history and costs data are examples of data that can be analysed for these purposes. In fact, more advance Artificial Intelligence tools and Machine Learning are now being deployed to allow supply chain managers to make better decision on utilising their resources and inventory.
The analysis of data and the ability to implement advanced technologies are essential skills as indicated by all the interviewees. The ability to keep supply chains optimized and future-ready is essential to uninterrupted functioning and expansion of businesses worldwide. Nothing has helped supply chains leap ahead in this endeavour like data has.
Smart sensors, AI, and various business intelligence (BI) tools help ensure supply visibility, shipping at low costs, forecast demand, and control inventory. Business intelligence and data analytics, when used strategically, can enable cost reduction and boost efficiency across business functions as indicated by most of the interviewees. Supply chain, for instance, is one such function that can benefit enormously with the use of data analytics and this can help you make informed and strategic decisions in times of uncertainty.
The findings from our study are beneficiary to human resource managers for their new hires, while policy makers and educational and training bodies can also use the findings from this research to design new courses which are necessary to facilitate skill and knowledge development for the future supply chain professionals.
List of companies we interviewed
A.P. Moller MaerskVietnam Ltd, Cargill Vietnam, Future Group, Giant Hypermarket, Green Renewable Organic World Centre, GS1 Malaysia Berhad, PKT Logistics Group, Procter & Gamble Vietnam, Siam Cement Group Logistics, Sitics Logistic Solutions Pvt. Ltd., SNT Global Logistics, Sri Trang Gloves (Thailand), Unilever Thai Trading Ltd., Zespri, Zimmer India.
The author would like to thank to the following researchers who have conducted the interviews for this study.
- Dr. Janya Chanchaichujit, Associate Professor, Prince of Songkhla University, Thailand
- Dr. Juliater Simarmata, Vice Rector, ITL TRISAKTI, Indonesia
- Ms. Nguyen Thi Hong Hanh, Faculty of Business Administration, Ton Duc Thang University, Vietnam
- Dr. Siti Norida Wahab, Senior Lecturer, Universiti Teknologi MARA, Malaysia
- Dr. Sreejith Balasubramanian, Senior Lecturer, Middlesex University, Dubai
- Prof. Sumit Mitra, Professor, IIM, Kozhikode, India