Challenges for Supply Chain Human Resources
Sourcing and finding talent in the Pandemic era has posed significant challenges in most every industry. Supply chain human resources partners have been tasked with an additional burden of finding top-tier talent that can adapt to a rapidly changing field and work place. What are some of the most common challenges facing supply chain HR partners and how can they overcome them without missing out on the best talent?
Supply Chain Talent Shortage
As the Pandemic settled upon the world, everything came to a halt. We all remember the twilight zone-esque feeling of not knowing what was going to happen next. It seemed that when the NBA canceled basketball season, we were in a world of trouble. But, the supply chain world had been feeling this for longer than the rest of us. Southeast Asia slowed manufacturing and production as the COVID-19 virus started spreading there before anywhere else. But soon enough, the downstream effects hit everyone everywhere.
In the wake of these shutdowns and massive disruptions, the world changed. Employers who are desperate to find and retain the best talent have made almost universal concessions to the global workforce. Those who can work remotely are doing so now. The shift from tactical to strategic to anticipate and avoid disruptions has also accelerated a need for more managerial and technically specific skill sets. When combined with the aging out of the work force and associated “brain drain,” supply chain human resources specialists continue to struggle with hiring and retaining supply chain talent.
The supply chain has always been rife with disruptions, given the nature of the beast. However, a talent shortage is just another to add to the pile of interruptions.
Spike in Technology, Automation and Digitization
Supply chain has been a leader in technology innovation and adaption. However, this became more of a priority in a Pandemic world with a shallow talent pool to include front-line workers within distribution and manufacturing facilities. While Warehouse Management Systems (WMS), Transportation Management Systems (TMS) and Enterprise Resource Planning (ERP) software are common to see in most companies, additional platforms are rapidly advancing ranging from inventory tracking to advancing planning & scheduling to robotics, artificial intelligence and machine learning. Even freight forwarders have been advancing their use of technology, which has optimized efficiencies and streamlined operations. While these technological advancements have helped, they have also reduced the available, qualified talent pool.
This has also led to an exodus in what a lot of employers are calling the “skill-loss cycle.” Key employees who understand and can use advanced systems proficiently have too much on their plates and not enough personnel redundancies exist to spread the work around. This can create burnout, which puts the supply chain human resources staff in more of a bind.
Remote Working Trends
Demands being placed on supply chain HR include the recent uptick in remote workplaces and hybrid/flexible work environments. It’s an adjustment for employers to include these stipulations in compensation packages. It also creates new challenges in management effectiveness and team building when you have some employees onsite and others working from home. Additionally, some positions can’t be remote. Certain onsite requirements demand that supply chain leaders, and especially front line personnel, be present. The spike in desired remote and flexible workplaces has added an additional talent shortage to the already shallow supply chain talent pool.
Interestingly enough, increased technology and automation have allowed for more remote opportunities. But, the highly specialized skill sets required for these positions offers similar challenges to sourcing top tier candidates.
Increasing Competition and Hiring Costs
The competition for top talent has fueled significant spikes in compensation as well. In addition to strong increases to both hourly and salaried wages, we’re seeing increases in short-term and long-term incentives, as well as other forms of bonuses ranging from sign-on bonuses to retention bonuses. Much of this can be attributed to basic supply and demand, as there are more supply chain jobs than candidates to fill them. The most sought after candidates command top dollar, are constantly being recruited, and when they do start entertaining other job opportunities, it’s common for them to receive multiple offers to choose from. They can be picky about which offers they accept and are in the “power position” from a negotiation perspective, which commonly leads to multiple rounds of counter offers and ultimately obtaining above and beyond compensation packages, perks and the like. Obviously, this fluctuates by industry, geography and job function. For instance, strong logistics executive with solid experience in technology and automation will command a higher price tag than someone with a background in manual environments with older technology. The same applies for procurement. Candidates with solid strategic sourcing skills at the global level operating in a digital procurement environment will command higher compensation than those working in a more tactical and manual environment.
Generalist vs. Specialized Supply Chain Recruiters
Another challenge faced by supply chain human resources is settling on the right recruiter or executive search professional. How do you know which firm will best suit your supply chain talent needs?
There are advantages and disadvantages to both large agencies who don’t focus on a specific industry or function versus highly specialized boutique firms, like SCM Talent Group, for example. If you’re trying to fill high-volume roles quickly, then perhaps a generalist search firm works best. However, there are likely more cost effective routes like posting on specialized supply chain job boards which can attract these types of candidates.
Boutique executive search firms typically are better able to leverage their networks, relationships, and subject matter expertise in a highly focused manner. Supply chain recruiters are able to screen candidates in a much more disciplined manner than the generalist firms and can cut through the high level of ambiguity that exists within supply chain. Their in-depth understanding of supply chain helps them to source and present candidates that other firms may not be able to. Additionally, many of these boutique firms are filled with former supply chain practitioners, who worked in various functions on the corporate side, and speak the complex supply chain language that many generalist firms are not fluent in. Additionally, these firms have memberships in supply chain associations such as CSCMP, ISM, MHI and the like, which can be strong sources of candidate referrals.
It is also recommended that human resources personnel utilize specialized job boards over more general ones. Sure, the Indeed.coms of the world will help to get your exposure out there to highly active candidates that work in all professions known to mankind. But, is Indeed going to attract the most talented strategic sourcing professionals that can optimize your procurement teams? Hard to say. But if you know that there’s a supply chain job board, built by supply chain experts for supply chain employers, chances are your applicants will be of a higher and more specialized caliber. Casting a wider net does not always guarantee you get the best fish. Sometimes, it means you only get a lot of what you don’t need.
There is no quick fix to solving the supply chain talent shortage. Human resources personnel in supply chain are faced with unique challenges that run the gamut of a shifting workplace environment to heightened and more complex skill sets to compensation packages that far exceed budgets. The best way to navigate these waters is to find a captain who’s been there before, so to speak. Engaging with specialized supply chain talent professionals can provide you better access to the highly sought after talent pool that your supply chain organization is going to need in order to stay competitive.