A growing number of companies are realizing the importance of developing supply chain expertise externally, yet many are faced with a giant obstacle on the way to achieving this goal—the shortage of trained supply chain management professionals at all levels.

Recognizing the severity of this problem, The Global Supply Chain Professional Development Committee—a sub-team within the Supply Chain Council that includes industry leaders like Procter & Gamble, Intel, IBM, and Boeing—commissioned AMR Research late last year to study existing supply chain management talent, sources of such talent, and the quality and proficiency of those educational sources. The research firm surveyed 198 organizations spanning 15 industries. Respondents were at the upper levels of their organizations, with 76 percent at the director level or above.

The results of that five-month exercise were recently published in a report titled “Supply Chain Talent: State of the Discipline” in which authors David Aquino and Lucie Draper reveal the key findings and then boil them down into five conclusions. In this supplement, we'll put these findings and conclusions into context to help logistics and supply chain professionals develop their own continuing education plan on the path toward supply chain excellence.

Recent analysis of AMR's Supply Chain Top 25 shows that an investment in these companies' supply chains yielded an average return of 17.89 percent last year, compared with returns of 6.43 percent for the Dow Jones Industrial Average and 3.53 percent for the S&P 500. “In other words,” say the authors, “if making more money is in your interest, then supply chain management expertise matters.”

The good news is that a growing number of companies have recognized that they need to develop this expertise. However, according to the report, the problem is that there is currently a shortage of trained supply chain management professionals at all levels And while universities and educational institutions are stepping up to the plate and helping to bridge that gap, their efforts don't seem to be enough to satiate companies' appetites for skilled supply chain professionals just yet.

Take Procter and Gamble, a company whose supply chain expertise must be well-honed in order to deal with its growing, worldwide business. “We're all in the midst of using changing business models,” says Jake Barr, director of manufacturing planning and logistics for Procter and Gamble in Cincinnati, “and we need both the numbers and depth of supply chain to help us deal with those changes.”

And while companies do have access to hires that have experience in planning, sourcing, making, and delivering products and services, Skip Grenoble, executive director of the Center for Supply Chain Research at Penn State University, says there's a clear dearth of talent in areas like customer management, new product development, strategy and change management, performance measurement and analytics, technology enablement, and governance. Concurrently, Grenoble says universities must also strive to attract more—and more qualified—students into their supply chain management programs.

“The core is being taught well at the university level, but there are gaps at the ancillary talent stations,” says Grenoble. “It's not an indictment of the universities, but it's due to the fact that these in-depth topics may only be covered in one or two lectures within one course that students take.”

According to the AMR report, universities have an opportunity to reverse this trend and take a leadership role in the development of solid supply chain talent. The research firm says academia must “push to extend its curriculum and training development beyond the current view of supply chain,” adding that industry leaders spoke passionately about the need to partner with academia to develop a “universal curriculum based on the intellectual property that is being developed at leading universities.”

After combing through the data gleaned from the 198 companies, AMR came up with the following five conclusions:

1. No two supply chains are alike. Very few companies define the supply chain in the same way. Of the supply chain leaders AMR spoke to, almost all had different spans of control. “This contributes significantly to a lack of clear priorities for standards and for consistent curriculum development at universities,” says David Aquino, research director for AMR's Value Chain Strategies Group.

2. Leaders view supply chain management as a business discipline. Overall, supply chain management is still very engineering centric. Few companies include manufacturing and new product development within the definition and span of control of supply chain, which is a differentiator among leading companies. The dearth of companies with this view also makes clarity of priorities a challenge, according to AMR. Barr concurs, and says that in the past most supply chain functions have been rated on their ability to achieve cost objectives. “Today, with speed of innovation to market being ramped up, the supply chain professional has to be more than a master of cost containment,” says Barr. “This person also needs to be able to deliver the next set of innovations to the marketplace twice as fast as before.”

3. Globalization has created urgency. A general flattening and global broadening of supply chain organizations has boosted the need for a more extensive set of complex skills and competencies within company ranks. In addition, a trend toward a more centralized supply chain structure has heightened the need for expanded skill sets and faster ramp-up time. “Supply chain professionals have a much broader set of responsibilities, and don't have as much time to figure it all out,” Aquino says. “That creates major challenges in terms of getting the sufficient numbers of talent and reducing the ramp-up time needed to put all of the pieces together.”

4. A common supply chain talent model is the foundation for improvement. For supply chain management professional development to evolve into a more universal body of capabilities, industries, and academia need to adopt a shared, modern, comprehensive model that incorporates the growing depth and scope of the discipline. “In order for companies to make progress, we have to give academia a framework to work with,” says Barr. “We have to peel it back and look at what core skills will truly be the focal point for the coming years. Getting the academic community focused on that will help create a model of progression for developing broader programs and degrees.”

5. Universities have an opportunity to take a leadership role. Schools can lead the way in providing more universal supply chain management skill sets. Truly comprehensive programs, covering the full talent attribute model, would gain strong support from the industry. This partnership model, with industry providing access for students to gain real-world experience, is a starting point for reducing the talent gap. According to AMR, it is clear that it is both critically important and not at all impossible to have candid discussions about moving supply chain organizations from cobbled-together activities to a more integrated, strategic discipline. “The framework provided will facilitate these discussions as well as contribute to the construction of the necessary curriculum that will support all organizations along their evolution continuum,” Aquino adds.

Grenoble is bullish on the future of executive supply chain education at the university level, and says he's encouraged by the fact that companies are doing their part by creating more formalized approaches to hiring and training such employees. Concurrently, universities and institutions are coming up with educational offerings that target shippers' needs and delivering courses in innovative ways (through online curriculum, for example). He sees the University of San Diego's recent addition of a 2-year supply chain education program as yet another positive trend, and expects more institutions to follow suit.

To companies, Grenoble says now is the time to enter a dialogue with institutions regarding specific supply chain education needs now, and in the future. “Talk to schools about what you're looking for in your supply chain professionals, and what's expected of these individuals once they are on board,” says Grenoble. “From there, we can all work collaboratively to close the gaps.

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