Supply Chain Managers Remain “Risk Averse”

Has the risk/reward scenario become more balanced for today’s supply chain manager? Not if job security is to remain a priority, says one prominent analyst.

“This question is one that cannot be really answered objectively,” said Dr. James Giermanski, Chairman of Powers Global Holdings, Inc. and President of Powers International, LLC, an international transportation security company.

“First, there is a stark difference in knowing something and doing something,” he said.  “My experience with some incredibly large national and international firms shows that the question of decision making based on risk, especially in today’s economy, will not easily be made.”

In an interview with SCMR, Giermanski said that job security – especially in the middle to upper-management, administrative are – could be jeopardized.

“These managers do not want to make a decision based on risk because if it turns out to be wrong, it may impede their movement up the management chain or may even cost them their jobs,” he said.

Regarding “security” in general, Giermanski observed that shippers, carriers, 3Pl, 4Pl and consignees all have shown a serious degree of ignorance in improving the bottom line by utilizing supply chain security systems and methods which are readily available off the shelf. 

“If it is not ignorance, failing to benefit from these systems and methods must be the result of being afraid to make the decision to use these systems based on one’s position, movement, and future within the company,” he said.

“Instead of investigating and trying these supply chain mechanisms, carriers, 3PLs and 4Pls simply say ‘my customer won’t pay for it,’ or ‘how much will it cost?’ 

He added that for most supply chain managers, the first thought is “cost,” not “benefit.”

“It is unfortunate that while the EU, China, and even South Africa are moving to supply chain security software to generate more revenue and provide security, U.S. firms are timidly standing by to see what works,” he said.