Supply Chain Talent Crisis: How To Win The Skills Race

Speakers

Host: Sarah Garrison & Shireen Garrison
Guests: Daniel Stanton & Hannah Kain

Shireen Garrison – 00:07
Welcome to Smart Supply Chain, a podcast for supply chain professionals who think and work smarter. I’m your host, Shireen Garrison, and today’s topic is identifying opportunities to prepare today’s workforce to meet the supply chain challenges of the future. We think this is a critical topic for any supply chain professional to help us dig in and understand all that’s going on around this topic. Our special guest today is Daniel Stanton. He’s widely known as Mr. Supply Chain and Daniel is an influential voice in the field of supply chain management and project management. He’s the author of Supply Chain Management for Dummies and the upcoming book Project Management with AI for Dummies. In addition to his writing, Daniel has developed highly popular supply chain and project management courses on LinkedIn learning, and he’s a lecturer sharing his knowledge worldwide in the online graduate program at the University of Arkansas. Daniel with so much going on in your life, we’re really grateful that you’re being able to give us some time today. Thank you so much for joining us.

Daniel Stanton – 01:07
Absolutely Shireen, thank you so much for having me.

Shireen – 01:10
I’m also proud to announce that joining Daniel today is our very own, Hannah Kain, she’s the founder, president and CEO of ALOM and an expert on all things supply chain as well. I’m thrilled to have you both today. Welcome Hannah.

Hannah Kain – 01:24
Thank you, and it’s so great to be here, especially with Daniel, who’s one of my very favorite people in the world. So we are going to have fun on this podcast.

Shireen – 01:33
I’m excited about it. I’m really glad that you guys are both here, and I know you both have a lot to share on this topic, but to start you off. I am curious about how you’re both thinking about building up employee skills in the future and attracting new professionals into supply chain. Hannah, do you want to kick us off?

Hannah – 01:52
Oh, absolutely. So listen, this is a critical area of supply chain, but when you look at the numbers, you really see how we have too few educated supply chain professionals. And the field is changing so far, rapidly, and supply chain is a relatively new field in some ways, and institutions just didn’t get started on supply chain. So we have some really good supply chain programs out there, and some people who are training the new supply chain professionals, and thank you, Daniel for being one of them. But in reality, we who are in supply chain really need to pay it forward and train the next generation. And so that’s part of what we are doing as a company. It’s part of what I think a great supply chain professionals are doing paying it forward, and so we really need to get going on this effort. The numbers I’m seeing just in the US is between 2 million and 6 million, too few people in supply chain over the next five to 10 years. And that’s a huge number to when we start thinking about it. So thank you, Daniel, for your doing in that space.

Daniel – 03:05
Why Hannah, thank you. As you know, it’s fun for me, I do think it’s really important. And you know, the thing that I’ll just share is, you know, for me, when I think about talent and the people that we need to make supply chains work, I actually think about that as being a supply chain of its own right, that you have sources of supply, places that people come from, and then you have various steps in the process, right? And you can kind of think about people going through their careers from, you know, their their first entry level job, and then as they, you know, progress up, and then at some point, we all leave eventually. And so as companies like ALOM, I kind of look at it, I say, Well, what’s your supply chain for talent? Where are you recruiting people? What are what are the criteria that you’re using? What are your requirements for those people coming into your talent supply chain? And then once they’re in your supply chain, once they’re part of your company, well, then their whip their work in process. So what are you doing to add value to that whip as it progresses through and so by thinking of it that way, you know, Hannah, I agree with you. I think there are not enough sources of supply. We have an imbalance of supply and demand. That’s a really tough position to be in as a business, right? Because as businesses, you want to be able to post a job and have at least three candidates to choose from, so you can find the best one. If you’re posting six jobs and only getting one application, it’s hard to even make the business work. It’s hard to retain people, because there’s so many opportunities, you know, that we steal talent from from one another inside of a large company. It can be a challenge because people move around, because qualified people have so many opportunities, they get stolen by other departments, and they don’t get to spend time in a particular position. But who that’s great for is supply chain professionals.

Hannah – 04:52
If we break up getting supply chain professionals through the channel, right, who do we recruit? And how do we get them on board, right? And then we have, how do we develop them such that they fill the positions of the future? And one of the things I love when I’m out speaking to young people is this notion that supply chain is such a broad field, right? You can really almost no matter what your interest is, you can go and you can work in supply chain. So there’s a digital supply chain, lots of data, higher level complexity for the nerds who like to manipulate the data and computers and so forth.

Daniel – 05:34
I resemble that mark.

Hannah – 05:36
We’ve got the financial supply chain right, and then we’ve got the physical supply chain, where we’ve got a lot of space for different type of people, people who are very good at conceptualizing things, but also people are very good at working with their hands. And so, you know, for me, that also speaks to diversity. And I know Daniel, that’s another area where you and I are totally aligned, that it’s, it sounds a rewarding field, because you can really give a lot of different people who otherwise maybe have a problem getting slots in their job market. We can give them a chance and give them a really wonderful job where they can succeed, where they that’s really speaking to their talents. And so, you know, I’m always saying to people, think about going into supply chain. And I’m doing this field, and so I’m hoping we get a big diverse group of people into supply chain.

Daniel – 06:33
I agree with that completely. Hannah and you guys do such an amazing job at ALOM, and it’s one of the reasons I always encourage my students to look for opportunities there. You know, one of the things you mentioned earlier that supply chain is a relatively new discipline. Well, I mean, if you think about supply chain, is basically commerce, right, making stuff, buying stuff, shipping stuff. We’ve been doing that forever, right? We’ve been doing that for basically the history of civilization, but supply chain management is a discipline you’re absolutely right. It’s pretty new, and where it came from is in the early 1980s consultants and professors who were studying businesses started to get a really profound understanding of the interdependencies between three particular functions in any business, and those functions are purchasing operations, which in a manufacturing setting is the factory and retail, it’s the stores and then logistics, storing and moving products. And what they realized is that in organizations, they tended to separate those three groups into different departments or divisions, purchasing department, operations department, logistics department, and each department would have its own goals. Purchasing shop was to get stuff as cheap as possible. Operations shop get the best utilization out of your capital equipment. And logistics was keep your inventory as low as possible, keep your transportation costs low, which means maximize capacity utilization, and that all makes sense on the surface, but what we realized was purchasing would go out and negotiate a deal with a supplier that would cut the cost of the raw materials. But how are they doing that? Well, they may have been going to a lower quality supplier. They may have been going to a supplier that’s much farther away, but had lower raw materials and labor costs, or they may have been buying in larger quantity, and so purchasing was absolutely meeting their targets of reducing procurement costs, but the things that they were doing were actually driving costs to manufacturing and logistics right, because if you buy more well, then you need a bigger warehouse to sort it if you buy it from further away. Now you’ve got to pay more for transportation, and by the way, that introduces a bunch of risks, because the further you have to move something, and the longer it takes, the more things can go wrong in the meantime, if they went to a lower quality supplier, well, that has a big impact on operations. Maybe the quality of the product, means you’ve got more defect a lower yield at the end of your process. And supply chain management as a term was introduced, I think, for the first time in 1982 or 83 by Tom Oliver. His argument was, we really have to look at these three functions in an interconnected way. It’s a chain of supply from procurement through operations and logistics, and if we’re not doing that, we’re going to have this constant battle within organizations around metrics and targets and goals. But if we develop a strategy around the supply chain, then it’s just a question of making trade offs between the goals of the objectives in the various divisions.

Hannah – 09:45
So I love that you are taking the big historic perspective, Daniel, and what has happened now is we have a spread globally. We have inserted a lot of complexity with as you mentioned Daniel, transportation, but also, of course, the entire compliance. So now all of a sudden, we get all this risk, both for not being in compliance, but also for disruption and other things. And that brings me to just to now get it back to what is the next step for supply chain professionals. And risk and compliance is a really big and growing area. And when I look at what are some of the areas where we don’t have a sufficiently strong pipeline, it’s in those areas. And so yes, we are on thinking that artificial intelligence will be able to help us to some extent and create some visibility, but we still need people to help with these functions and understand them and setting parameters, and in some cases, probably for at least in our lifetime, still we add to it right and so I see that as one of the big holes we have right now is risk and compliance, and I think organizations are struggling to catch up with that pipeline. What do you think then?

Daniel – 11:09
Yes, Hannah, I agree with that completely. Risk compliance technology are really, really important areas in the supply chain now, and look like they’re going to become more important for sure, and I would argue that is a place that probably we’re not doing a good enough job on the academic side, you know, certainly a lot is coming out focused on technology in general, but in terms of, you know, hands on, hit the ground Running, sort of of skills and knowledge around both compliance and technology, I would argue that universities, community colleges, don’t do a great job with that. I would also argue, though, that it’s maybe not their job to do that, that the specific requirements around technology at a company, what software do you use? How do you use it? What parts of your supply chain is it in, or the particular compliance issues that you have as a company? What are the materials that you work with? What are the industries that you work in, what are the countries that you deal with? Those are unique to the company, and so to expect a college or university to teach people everything that they need to know, to think around running with those skills is probably unrealistic. And Hannah, back to your point earlier, I think this is where it’s important for companies to recognize. Well, this is something that we need. These are skills that people have to have. We need people with these skills to run our business. And it really doesn’t make sense for a college or university to teach everybody these skills, because they actually don’t apply to every company, and they’re providing sort of a general education. So companies need to have mechanisms to identify what are the skills that are required, to identify the gaps between what people know and what they need to know, and then they have, you know, tools and processes in place to help close those gaps and measure the results. I love that you’re saying that. So some years back, we started the ALOM University, and part of that is to look at the skills gap when we get new people in or move anybody to a new position. But you know, I agree with you totally. It’s not about community colleges. It’s about having people who understand the concept of risk and risk mitigation and risk prevention and also can talk that language and conceptualize it right? Because again, I look back to both you and I have been in supply chain, Don that then we care to talk about right? And when we started, the entire concept of risk was not at the forefront. I mean, it was there, but really it was kind of a little bit on the back burner. And if we look at the last 10 years, risk, and different types of risk is really moving and compliance management really moving up that, because we have so many moving parts in supply chain, and there’s all the compliance issues and so forth. So, you know, I think risk is one risk and compliance one big area where we need to grow our own. But let’s hope that the educational institutions, and I agree, the higher educational institutions can sharpen that area.

Shireen – 14:26
This conversation with Hannah Kain and Daniel Stanton, Mr. Supply Chain is really interesting. Sarah, my sister and co host of the podcast has been listening in. Hey Sarah.

Sarah Garrison – 14:37
Hi Shireen.

Shireen – 14:39
This discussion about employees coming into the supply chain space and also upskilling existing staff has been really, really interesting, and just thinking about all the diverse roles within our space makes me think of our family. We’re three sisters. None of us studied with supply chain as our focus, and none of us started our career in supply chain, but we all ended up. Here, and we actually love it.

Sarah – 15:02
You’re right. It is strange that all three of us ended up somehow in the same profession. I did my undergraduate in business, and I don’t think the university I went to even offered supply chain as a major. But the opportunities for young people these days, the education is amazing. Shireen, share with everyone what you studied in college.

Shireen – 15:22
Well, I studied communications business and also television and radio, and back then, I really wanted to be a DJ. What sort of a DJ Did you think you wanted to be? Well, I wanted to do modern pop radio was my first choice. But then I really got into being an MTV, VJ, but I ended up being a nightclub DJ instead.

Sarah – 15:44
Well, I think you’re better at supply chain than you would have been at being a VJ, but Hannah did mention that whatever your interest, there was a need for it for that skill in supply chain. So I’m guessing you’re using your skills now with this podcast.

Shireen 15:57
Yes, that’s a good point. Now let’s get back to Hannah and Daniel’s conversation.

Daniel – 16:04
I absolutely agree that those are skills that we need to have in the supply chain, and I think there’s a responsibility for our educational institutions to try to stay abreast of what’s happening around risk and compliance and technology and sustainability so that we can provide current education for our students. So it takes universities a very long time to adapt and change. The clock speed that we see around issues related to technology and risk and sustainability and compliance is not in great alignment with the pace of change at universities, you know, to the extent that the things that you would teach a freshman about supply chain management and technology are likely obsolete or different by the time that they graduate, and so that is a ridiculously hard lift for universities. And Hannah, to your point earlier, what it means that is that as employers, we have to understand that and be prepared to take candidates from where they are and get them to where we need them to be. Hopefully, you know, we’re partnering with sources of supply, universities, professional associations, etc, that provide people where the gap is relatively small, but at the end of the day, you know, there’s going to be a gap that we need to be prepared to close.

Hannah – 17:31
One of the things I love about the younger generation is a willingness to learn and to really understand that you need to refresh all the time and go out and find the sources to do so, fearlessness of learning new things, and I think that that’s so important. And so this willingness to learn new things really important, and the willingness of employers to support that and really be fast at it. So again, when I think about my career, some of the data science elements, some of the data management thing, the understanding of, how do we store data, how do we think about data? How is data interrelated? How are we protecting data? How are we looking at privacy? All of those things related to data management, new discipline during my career, and super important and embedded in the supply chain. I mean, most of the products we produce have data embedded in them. And so, you know, we all in supply chain need to understand that. And you know, the entire modeling, understanding different regulations, again, back to compliance management that exist in different parts of the world. And so, you know, there’s so much new stuff going on all the time at accelerating speed. So, the ability to learn new things, and the willingness to learn new things, and the willingness to open up and say, Please, just learn. Just become the expert in this really key.

Daniel – 19:07
It’s hysterical when I look at it, how much my own workflow has changed in the last year and a half because of chatGPT. I may have told you this story that you’ve been a regular guest speaker at my college classes for years, and I love having you, and you get great, such great perspective to my students. And I’ve been fortunate over the years, I’ve really had excellent students. It used to be that part of my teaching method was I made my students write me a memo every week. It was a way of making sure that they internalize the concepts we were teaching and were able to communicate them back out, and it was giving them an additional skill, because by the end of the semester, all of my students could write good professional memos. This semester, after chatGPT was released, my students got so much better at writing me. Most miraculously, how much better at the same university, there was this step change, and I realized, actually, I can’t use that teaching method anymore. I have to change the way that I’ve been teaching for years and years and years, because this new technology really undermines the whole process. ChatGPT knows good answers to the questions that I’m asking.

Hannah – 20:23
But hey, it begs the question whether cheating is okay here, right? Because cheating, it is what happens in real life, and you’re giving away all my secrets to my good memos.

Daniel – 20:37
And the question is, is that cheating, or is that using the tools. I mean, is it any different than using a calculator to solve a math problem? That could be a long conversation, but, but I have enough of a pragmatist that at the end of the day, I’m like, it doesn’t matter the tool is there, to be honest, I want my students to learn how to use the tool, because I think it’s valuable. I want them to learn how to use it well, which means, you know, both in terms of ethics, right, being transparent about how you’re using it, but also at the end of the day, you know, one of the things that that is just a fact about large language models like chatGPT, is they sound really, really convincing, even when they’re lying to you. And so I have changed the way that I teach now, so that I give assignments where my students have to use chatGPT to do the work, but I make it clear to them that at the end of the day, their grade is going to be based on the quality of the work, and if it contains falsehoods, lies made up citations, chatGPT is not going to get a bad grade. They’re the ones that are ultimately responsible. What I’m trying to get them to do is to take the pieces that they’re learning from the class, figure out how to use prompt engineering right develop those skills of asking a question, looking at the answer, evaluating the answer, iterating again, improving the question, so that then they can get a result that is, I’ll say, maybe a really good first draft. You know that they can then go edit because I think that’s the way that most of us are now using LLMs like chatGPT to develop a writing you know, part of what I want then, as a professor is I want to be empowering my students with the skills to use the latest tools. But, you know, back to our conversation, hopefully I’m doing a good job, over the course of the semester, of getting them comfortable with using chatGPT in their own workflow. But if you were to come back with that same set of skills and then hire them four years from now, I’m not sure that that’s what they’re going to need to know anymore. So, to your earlier point, you know you got to get to a place that you’re proficient today, but then you have to constantly be updating and upgrading those skills. And Hannah, you well, know, for folks that follow me on LinkedIn, my favorite hashtag is #AlwaysBeLearning.

Hannah – 23:02
Absolutely and when I look at where the pop is going, and you know, again, we want to give people good advice, right to young people coming into the field, educational institutions, what should you focus on? Where’s the pop going? I mean, definitely in the entire data management, how we think about data, how we accumulate data, but also the entire visibility. So, when we look at what has the technological innovation been in supply chain over the last 10 years, it’s been very focused on visibility, 1020, years, right? I mean, we were pioneers in that we, you know, been following it very much, and we’re still very much at the forefront of it with visibility. But now we are getting into the next phase right, where we are not just doing visibility, but we are doing actionable stuff. We are and we are monitoring much more right, where we are going out and compiling data, right? One of the issues that we have in supply chain is the dynamic nature of supply chain, and the system’s not dealing with that dynamic nature. So, I’d still say, if I give advice to young people, I go, okay, the entire data management area, that’s really where there’s a huge, huge future. And of course, not just in supply chain, but in general. And then I do think that the entire risk compliance area is huge. But again, in supply chain, you can essentially find a slot for everybody, every interest you have, and have a very successful and growing career.

Daniel – 24:46
Absolutely. So, you know, you use the word data management. The term that I’m hearing these days is data governance. Where does the data come from, and how do we curate it and protect it? Lots of you know, I’m not even. Gonna say just that there are lots of career opportunities there, but more that that’s like a required skill set. It’s one of the things that you just have to understand, because it is, it’s gonna be part of your job, you know, around the whole visibility and responsiveness. This has been so interesting to me, because you’re absolutely right. I mean, to be honest, we got serious as a supply chain community about creating visibility in the supply chains not much more than 10 years ago. That’s really when, when serious work started going into building supply network maps so that you could see where were factories located, where were warehouses located. How much stuff did you have sitting in each one? What were the transportation nodes between them? Where did you have pipeline inventory along the way? And the first big challenge there was just getting access all of the data, because it was all in different systems that updated on a different frequency. And so how do you pull all of that information together in a way that you can even see what’s happening? You can have visibility. And the folks at Gartner, who do just such a great job of keeping track of supply chain technology, they created a new category, and the idea was very much like a air traffic control tower. We started creating these control towers for our supply chains so that we could see where we had things and where things were moving. Just in the last couple of years, I’m seeing that language shift from control tower to command center, and we see how critical that is. I mean, I certainly COVID and all of the supply chain disruptions that came with that were a big driver for the executive teams and organizations to understand why supply chain visibility and why supply chain flexibility are really critical. But you know, even since then, you know, we’ve had incidents like there was a cyber attack on the Colonial Pipeline, which provides gasoline, diesel and jet fuel to the East Coast, which affected me. You know, here in Charlotte, North Carolina, and for whatever was a week or so, you couldn’t get gas, you couldn’t get diesel, you couldn’t get jet fuel. I mean, from a logistics perspective, that means you can’t send a truck to the east coast because it won’t come back because it can’t get fuel. So, I mean, there, there’s kind of a crazy disruption. The invasion of Ukraine by Russia created all kinds of problems that you know, in particular for Europe, in terms of supply chains, needing to reconfigure. The Panama Canal not having water because of a drought. So all of a sudden now you’re losing a major shipping lane, and then the Suez Canal because of the tax on shipping by the Houthi rebels. So much trade travels through that Suez Canal. Basically the option now is to sail around Africa.

Hannah – 27:46
Where they even got weather disruptions, right? So on top of that, all of a sudden they run into very unusual weather when they do that.

Daniel – 27:56
Yep. And so to your point Hannah, understanding risk and understanding the complexities of our supply chains and really understanding the footprint of our supply chain. We may not in university be able to teach somebody exactly what ALOM supply chain looks like, but we can teach them how to think about it and what to look for, so that when they are employed by ALOM, they can ask the right questions. They know what holes they need to fill in so that they can understand what’s happening and then be able to identify, anticipate and hopefully mitigate some of these risks and or adapt when things change, right when new threats emerge, then you’ve got to be ready to move and you have to move fast. It does remind me of something that Francis Townsend said at the CSCMP conference back in I think 2008 and Francis was, I think she was the number two at the Department of Homeland Security, so she was in charge of emergency response, in particular to terrorist attacks. And the piece of advice that she gave all of us as supply chain professionals is when you’re dealing with a crisis, the most important thing is to find the bottom, fast right, figure out how bad it could possibly be, identify that low point and then build from there. Otherwise, if you try to downplay the severity, then you find this yourself, in this position where you keep coming back with worse news and worse news and worse news. But if you can find the bottom fast and then realize, oh, maybe things weren’t quite as bad as we thought, all of a sudden, it becomes a whole lot easier to get the resources and the support that you need to move beyond the crisis.

Hannah – 29:38
So I’m always saying when it comes to crisis, right? And, you know, I’m not doing emergency response, thankfully, but you know, it’s about anticipating 95% and then you can deal with and preventing the 95% and then you can deal, have really great people and deal with the 5% It. So that’s again, the lesson from companies that where the supply chain succeeded throughout COVID is if you had visibility good systems, and you were good at anticipating problems and dealing with them up front, you had resilience built into your supply chain, and then you had really great people to deal with their remaining 5%.

Daniel – 30:31
The other piece that I’d add into this, Hannah, and I, you know, I’ve watched you guys, and I paid close attention to what you were doing during COVID, and I think you did an amazing job of this. But part of having resilience in a supply chain is being very selective about who your suppliers are and who your customers are, and building trust in those relationships, right? Because there’s only so much that you can do as a company. There’s only so much that the individuals in your company can do. But if you’ve got the right relationships with your suppliers and with your customers, then for that 5% you’ve got a lot more options. You can get things done more quickly, and it will cost you less because you trust each other.

Hannah – 31:03
And this is all about collaboration, right? So one of the things that our supply chain organization, our permanent organization, did at the beginning of COVID, and I actually didn’t know they did this, but they called all our suppliers and asked whether they were in financial trouble, and should we prepare anything or pay you early such that they could pay their staff? So, you know, I think that’s part of the collaboration that we really need to have with our suppliers, and again, the strong relationships. I cannot emphasize that enough.

Daniel – 31:36
Yeah, well, the other thing that I want to talk about, you know, we talk about lifelong learning, and we talk about the role for companies in educating their workforce. One of the things that’s new is LinkedIn learning, which is this tremendous library of courses, online courses, covering so many of the skills that we need to have in the workforce. And I was actually a customer of LinkedIn learning. It used to be called lynda.com because I’d use it to, you know, teach myself how to do fancy things in Excel or Word. And about eight years ago, they reached out to me and they said, Hey, would you be interested in creating courses for us around project management and supply chain management? And so, you know, over that time, I’ve now got over a dozen courses translated into over 20 languages. And what’s great is, you know, it’s available to people that are individual LinkedIn subscribers. You can go and you can take those courses when it’s relevant for you, but they’re also available to a lot of companies. So you know, most of the companies that I work with these days have an enterprise license to LinkedIn learn. So it becomes much, much easier to say, okay, here are the skills that we need you to have, and here’s a class that you can take that we’ve already paid. When you’re done, you’ll get a certificate so you can move to us that you finished it. It makes it so much easier remove so much of the friction for everybody. So I think that’s an amazing opportunity. I know that lots of companies are taking advantage of that, but I want to spread the word about those CSCMP Professional certificates on LinkedIn learning.

Hannah – 33:04
It’s always fantastic to spend time with you, Daniel. I think we could talk supply chain for weeks, if not months, if not years. I think we really got to touch on some of the key areas today, with how we prepare the workforce for the next generation, and I’m very excited about what you’re doing online, Daniel, as well as your fantastic books, and we are very much committed to being part of the community that brings up the supply chain professional supporting what you’re doing, but also what other educators out there doing and creating our own supply of supply chain professionals.

Daniel Stanton – 33:47
Thank you so much. This was fun.

Shireen Garrison – 33:49
Thank you to Hannah and also to Daniel Stanton, Mr. Supply Chain, for being our guest today on Smart Supply Chain. Be sure to check out one of Daniel’s current books or his LinkedIn courses right now and check out his upcoming book, which is Project Management with AI for Dummies, which is going to be released early next year. Thanks everyone. We’re the Garrison sisters, and we hope you tune in next time on Smart Supply Chain.