The manufacturing sector reaped the benefits of an improving U.S. employment picture in 2017, but many organizations continue to cite a lack of qualified workers as a key barrier to growth in the coming year. Despite 14 straight months of growth in manufacturing employment, as reported by the Institute for Supply Management (ISM) this month, hiring problems remain – on the factory floor as well as in the front office. In a survey of more than 100 purchasing and supply chain executives conducted by the industrial buying group Prime Advantage earlier this year, 40% cited finding qualified workers at all levels of the business as a key challenge for 2018 while more than 90% said they need to increase headcount in the new year to meet their business goals.
The hunt to fill those jobs is highlighting the need for skills improvement and continuing education across the manufacturing spectrum. On the supply side of the equation, procurement professionals are taking a closer look at how they can sharpen their supply chain management skills to create value and help their organizations meet broader corporate goals. It’s all part of an effort to become a leaner, more productive, and ever-evolving organization.
“Smart supply managers spend a lot of time making sure that what they are doing aligns with [their company’s] corporate strategy,” says Nora Neibergall, senior vice president, certification and professional standards for ISM, which represents more than 50,000 purchasing and supply professionals around the world. Neibergall is also a Certified Professional in Supply Chain Management (CPSM) and Certified Professional in Supplier Diversity (CPSD). “It’s all about value – measuring where value comes from, where innovation comes from and articulating that [at the corporate level].”
To that end, Neibergall points to five skill areas purchasing and supply professionals will focus on for professional development over the next few years, ranging from traditional purchasing skills such as sourcing, finance, and negotiation, to broader issues such as sales and operations planning. ISM is in the process of evaluating and updating its CPSM program, and as a result has been conducting research with thousands of members on their needs and key concerns for the short and long term.
“The bedrock of supply doesn’t change that much from year to year or decade to decade,” Neibergall explains, pointing to sourcing, cost-price analysis, negotiation, supplier development and supplier relationship management as top issues for supply managers and purchasing professionals alike. “More recently – and due to the global environment we all work in –[purchasing and supply professionals] have developed an even greater need to understand the broader supply chain process, including logistics, warehousing, and materials management … And other trends are rising to the surface as well.”
Here’s a look at five areas Neibergall points to as prime objectives for buyers and supply managers over the next few years:
Improve Traditional Skills. Buyers always need to hone their sourcing, finance (cost-price analysis), negotiation, and supplier relationship management skills, Neibergall explains – and they will continue to do so in the years ahead, as organizations of all sizes look for ways to streamline their supply chains and reduce costs.
Hand-in-hand with those skills, purchasing and supply managers also have been expanding their knowledge of the logistics, warehousing, and materials management processes in recent years –another trend Neibergall says she expects will continue as purchasing pros develop “an even greater need to understand the broader supply chain process.”
Sharpen “Soft Skills.” Becoming a better leader and learning how to collaborate with internal and external business partners are also high on the list – especially for those looking to advance into management or executive-level positions. Continuing education programs that focus on management skills, interpersonal relationships, communication strategies, and conflict resolution can make a big difference.
“Training in softer skills remains high in demand,” Neibergall explains. “Collaboration and understanding what you need and how to get it are critical.”
Improve Category Management Skills. Although it’s been around for awhile, category management remains a hot topic as organizations seek to improve the way they manage spending across different areas of their business. Spend analysis, cost-reduction strategies, and outsourcing considerations are all a part of the conversation--and it’s beginning to trickle down through all levels of the supply chain.
As Neibergall explains, “for leading-edge organizations [category management] is like oxygen, but it has now permeated all the way down to small organizations, too.”
Manage Risk. Managing the risks that stem from natural disasters as well as shortages caused by other types of business disruption is another constant for buyers and supply managers. Learning to identify, analyze, and anticipate those risks has taken on an even higher profile in today’s global business environment. And it’s creating the need for greater visibility throughout the supply channel.
“There’s just no getting around it: Everyone does global sourcing, whether directly or indirectly,” Neibergall explains. “Their supply chains are global, so [it’s vital to have] visibility through the supply chain to understand where the risks are, what your total costs are, and so forth.
“Supply managers have to always be on top of that game.”
Understand Sales and Operations. One of the newest needs in continuing education is sales and operations planning--an issue that speaks directly to purchasing’s need to better understand the entire supply chain process. Going forward, programs that help buyers understand their organization’s strategic goals from planning, through production, and ultimately to the end user will help the purchasing department develop a better, more well-rounded supply chain education.
“Sales and operations planning has really become another competency [that] sourcing, procurement, and supply management [professionals] need to understand and be engaged in,” so that they have a better understanding from the customer all the way through to the supplier, Neibergall explains.
Developing that better end-to-end understanding can help buyers and supply managers accomplish a key strategic goal in today’s business environment: Identifying those suppliers that have the potential to bring improvement or innovation to the entire organization.
“That’s the kind of thing that gets CEOs and other leaders excited – when a supply management team can bring that type of value to the organization,” Neibergall says. “It’s not just [about] cutting prices [or saving money]. It gets back to providing a competitive edge.”