Supply chain executives are typically experts at securing materials and moving goods. Traditionally, they have earned degrees in business administration, planning or logistics. They have worked their way up the corporate ladder, succeeding in lower-level positions before attaining the top job in an organization’s supply chain.
Then came the Covid-19 pandemic, and suddenly, they had another role—member of the C-suite. And that role required a bit more knowledge. It was no longer good enough to know how materials moved from one location to another. They needed to know about advancing technology. They needed to know about managing people. They needed to know negotiations.
In short, the supply chain manager suddenly became more than a logistics specialist, they became a second CEO. That comes with a powerful voice to advocate for investment in the supply chain, but it also comes with more scrutiny. To effectively leverage that power, though, supply chain managers need to know more than the basics.
“Supply chains are the lifeblood of every business that manufactures or distributes products. Professionals managing logistics and supply chains perform critical functions, overseeing the smooth flow of goods that gets a company’s product to the right buyer, in the right place, at the right time,” noted a blog from the University of Tennessee Knoxville’s Global Supply Chain Institute. “That is why supply chain management professionals must be involved in—if not drive—executive decision-making and planning. Business planning that doesn’t incorporate the wisdom of the supply chain is missing key information and that can slow growth.”
UTK’s Dan Pellathy published a series of articles on leadership development, laying out some of the challenges facing supply chain and how to overcome them when developing the next-generation of leaders. In his final article, Pellathy noted some of the required experiences planning leaders needed, including exposure to functional areas across the supply chain; operational experience in tactical planning; understanding of forecasting systems, and experience in commercial, sales or business development areas.
He also pointed to two additional areas.
- Significant experience in cross-functional business processes, especially sales and operations planning, integrated business planning, demand-supply integration
- Significant experience engaging with critical supply chain partners, including suppliers, customers, and third-party providers
It is these areas that are critical to developing successful supply chain leaders. And it is exposure to a wide array of experiences and experts within an organization that allows a leader to effectively advocate for it. It takes a thorough understanding of the business. This cross-functional knowledge makes answering the CEO’s questions a bit easier, whether that is related to technology investments, hiring practices, customer relations or internal key performance metrics.
Here are some areas to focus on and develop for a broader understanding of your business:
- Know key numbers such as forecasts, cash flow and projected costs/profits
- Know your customers, their challenges and their key attributes
- Study your competitors and what they are doing well (or not so well) within their supply chains
- Understand the organization’s strategy and goals and how supply chain fits in those
- Study the industry through trade journals, industry conferences and peer networking groups
- Know what resources are available, including those from the wider organization that can be leveraged
- Study your strengths, but also your weaknesses
- Stay abreast of the changing regulatory environment
- Stay on top of operational efficiency, including sourcing of product and delivery to the end customer
- Know your people and maintain an awareness of employee satisfaction.
- Study the current risk environment, both yours and that of your customers
- Stay informed about new technologies, but also how you are using current technologies.
There are many more areas where executives can focus their time, and in many cases, that work can be delegated to others on the team to build out a broad knowledge base, but the time of a supply chain executive knowing only the logistics aspect of the operation is long over.
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