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Supply Chain Matters Highlights from ISM 2016 Conference- Part Three

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Last week, this supply chain industry analyst attended the Institute for Supply Management (ISM) 2016 annual conference held in Indianapolis. This is the conference where global purchasing and supply management professionals from large and smaller organizations alike gather for added learning, education and insights related to supply management and in particular, its role in contributing to required business outcomes.

Readers can view ISM 2016 conference highlights in our prior Part One and Part Two postings.

During our second day at the conference, this author had the opportunity to participate in a press conference and hear from five of this year’s 30 Under30 Rising Supply Chain Stars, a program introduced by ISM and ThomasNet last year.  In previous postings, we have shined a light on this program along with its designees.

During the special press event, ISM CEO Tom Derry indicated that the organization could not be more pleased with the success and visibility has garnered among the purchasing and supply management community. Representatives from program co-sponsor ThomasNet expressed similar equal praise for the ongoing visibility of this program. With an average age of 27 and delivering more than $10 million in cost savings from just a single individual, this year’s recipients span industry settings ranging from manufacturing to education, medical devices, IT and government.

During the interactive press conference, the panel of five recipients who attended the conference indicated that their generation is less concerned with an 8 to 5 work week structure favoring more a flex time schedule that allows for required family and personal time.  I asked the panel whether mentorship from an older or experienced generation was considered important. The response was that this is absolutely essential, but clarified as to sponsorship rather than mentorship. Having a sponsor to be able to bounce ideas or ask open questions was noted as very essential to their current accomplishments in their roles. They further described themselves as a generation without borders, not encumbered by organizational barriers.

On the topic of technology, the panel indicated that often, their biggest challenge is access to data, particularly involving resident ERP systems that are “older than me.” They articulated that timely information is needed to make informed decisions, that current information cycles are far faster requiring more timely data and information which is often frustrating to find.  The panel further indicated that their generation prefers knowledge on-demand, utilizing micro-learning and E-learning on the fly to gain knowledge of unfamiliar processes or product areas.  They therefore seek and expect an environment that provides such forms of knowledge management tools.

We continue to be impressed and blown-away with the scope of responsibilities being managed by these Millennials.  Job responsibilities of all 30 of this year’s designees include roles as Contract Administrators, Managers, Program Managers, Buyer and Senior Buyer, Sourcing Managers, Team Leads, Improvement Leader, Category Analyst, Logistics Support Supervisor or Director, Global Change Management Lead, or Director of U.S. Operations among others.

Readers can gain an overview of all of this year’s 30 Under 30 Rising Supply Chain Stars by clicking on this dedicated program web site.

 

This Editor had the opportunity to once again conduct an interview with ISM CEO Tom Derry. Our conversation touched on a number of today’s burning topics for supply management professionals. Derry noted that the procurement role has indeed become more strategic to businesses and ISM continues to work on continuous learning and training programs that include more strategic business and broader supply chain management competencies.

He reiterated the announcement at this year’s conference, of the ISM launch of an online learning initiative termed eISM, a program designed to support the increasingly busy lifestyles of today’s procurement professionals. The offering features a number of distinct learning options, varying from self-led learning modules to guided learning sessions with instructors, fostering more convenient learning in a way best suited to personal learning style.

From a broader skills perspective, our interview included the need for added competencies in driving environmental and social supply chain sustainability efforts and we both touched upon efforts shared by PepsiCo, Fed Ex and others at this year’s sessions.

We discussed this year’s J. Shipman Award winner, Tim Fiore, one of the most prestigious ISM recognition awards for procurement. This year’s recipient provides an example of a role model beyond cost savings, which Derry believes is becoming more desired across various industry settings. He reiterated that Mr. Fiore holds two masters degrees along with life-long learning in procurement transformation which he believes is becoming more of the model among today’s leading chief procurement officers.

Unfortunately, because of the schedule constraints involved with last week’s array of simultaneous conferences, I was forced to miss the final day of presentations at ISM 2016.

We encourage readers who attended this year’s ISM 2016 to share their own perceptions as well.

Bob Ferrari


Supply Chain Matters Highlights from ISM 2016 Conference- Part Two

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Last week, this supply chain industry analyst attended the Institute for Supply Management (ISM) 2016 annual conference held in Indianapolis. This is the conference where global purchasing and supply management professionals from large and smaller organizations alike gather for added learning, education and insights related to supply management and in particular, its role in contributing to required business outcomes.

In our previous Supply Chain Matters Part One posting,  I primarily focused on thoughts related to the sustainable business presentation that was presented by PepsiCo. In this Part Two commentary, I provide some additional highlights and takeaways of the conference.

One intriguing presentation that caught my eye was a panel discussion within the People conference track focused on the topic: What Private Equity Expects from Sourcing Leaders. With so many private equity takeovers and activist actions that have occurred across multiple industries, subsequently impacting various industry supply chains, this author was especially curious to hear the perspectives of representatives of private equity. This year’s conference organizing committee deserves praise for the bold move in including such a panel under a personal skills learning tract.

The panel itself consisted of executives representing firms Apollo Global Management, Centerbridge Partners and The Blackstone Group. For the most part, the panelists indicated that current PE strategies typically involve a 5-6 year investment window with the objective to move earnings and shareholder return to a much higher value. They stressed that where-as 5-10 years ago, PE was more “financial engineering” driven. Today’s focus is on operational intervention and improvement.

Most all of the panelists reinforced that supply and operations management has now become the prime target for leveraging such value rather quickly. Firms focus on leveraging buying power across the entire direct and indirect materials value-chain seeking both quick near-term as well as longer-term opportunities to leverage material cost reductions.

A full spectrum of business process, technology and supplier management tools are expected to be deployed, including supply facing electronic auction capabilities. The PE focus is in driving value over time in working capital reduction. One panelist bluntly indicated that procurement professionals are expected to have demonstrated direct experience in auction tools and in generating meaningful cost savings. Others on this panel pointed to seeking and recruiting procurement professionals with broad, across the board skill sets, including strong linkages and acumen with finance in the u understanding of line-of-business expected bottom-line financial outcomes. For PE, the focus remains of continuous working capital reduction.

Consistent readers of this blog are probably very aware that this Editor is not very keen on such strategies, which includes the short and long-term havoc imposed on supply chain capabilities and relationships. But, with the realities of the current business environment being what they are, and with so many firms now under the PE looking glass, procurement professionals need to be aware of such expectations of continuous working capital cost reductions that are to be expected.

Be forewarned and be prepared, since those possessing or prepared with these skills can reap some short-term financial and other rewards.

In our Part Three posting concerning ISM 2016, I will highlight two other sessions that I found noteworthy and insightful.

Bob Ferrari

 

 


Supply Chain Matters Impressions of QAD Explore- Part Three

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Last week, this industry analyst attended and spoke at mid-market focused ERP provider’s QAD Explore 2016 conference. In a prior Part One Supply Chain Matters commentary, I shared overall impressions regarding QAD’s current applications software and technology activities along, and in a Part Two posting I shared additional impressions related to interactions.

During Explore 2016, I have the opportunity to contribute to a panel discussion. The Manufacturing Skills Gap in the Gig Economy.  In addition to this author, the panel further consisted of:

Nick Castellina, Research Director, Aberdeen

Kaye Swanson, Chief People Officer, QAD

Sharon Ward, Senior Director Marketing, QAD

Our panel began with Nick Castellina sharing recent Aberdeen research pointing to an aging workforce in manufacturing. According to recent survey data, 67 percent of the manufacturing work force is between the ages of 31 to 50 years old. An additional 11 percent is between the ages of 51 to 60 years old. Nick summarized the findings by indicating that manufacturing expertise is at a premium and top performers continuously recruit and utilize best-in-class technology to help train and retain needed talent. What struck this author was survey data indicating that 69 percent of respondents felt that new graduates lacked practical skills, i.e. their skills were considered too academic. As a contrast, 34 percent of respondents indicated that their employers were not willing to invest in additional training of new employees. Somewhat of a dichotomy.

I was addressed to highlight some root causes. I pointed to far faster clock speed of business today coupled with an era of industry digital transformation and disruption. While senior management awareness to availability and retention of needed skills is a universal concern, approaches tend to vary. Meanwhile, today industry supply chains have moved into an era of high complexity, increased risk, and the need for faster, more-informed and timely decision making capabilities. This is where advanced technology is increasingly playing a role, but new advances in technology are outdistancing current organizational skill levels.

Kaye Swanson of QAD addressed the steps that should be included in strategic workforce planning and described example of how QAD is addressing its skill requirement needs. What was interesting as well as informative was Kaye’s description of global based workforce recruiting that factors different business cultural and geographic considerations. Kaye later addressed the notions of today’s Gig Economy, where many people now exist as independent contractors and specialists in given business processes or technologies.

I was asked if there is really a skills gap or is it actually a training gap? My response is that it is both, in terms of sheer numbers of Baby Boomers retiring over the next decade as well as the need for existing people to be able to constantly upgrade their skills in the use of newer technology enabled processes. There remains a perception problem for careers in manufacturing and supply chain processes which comes from a full understanding of roles and contributions, as well as how supply chain teams are making a difference in enabling required business outcomes.  In terms of other factors, we all have to keep in-mind that many jobs being created did not exist 1-2 years ago. The majority did not exist 5-10 years ago. Thus, when creating a job requisition, rather than past years of experience and deep functional knowledge, it may be far better to express needs in relation to required hard and soft skill sets, both currently and in future growth dimensions. Many leading-edge employers are finding better results with skills-based requirement with an understanding that certain people can be recruited on the basis of adaptability to changing business and process needs.

In an earlier Explore keynote titled The Future of Manufacturing, Lean thought leader and author Jim Womack addressed the future as the ability to manage and leverage information flowing across the product value-chain and to be able to manage collaborative decisions regarding that information. That certainly applies in the context of skill needs.

Sharon Ward addressed how QAD’s ERP technology is being channeled to address training and skills gap needs.  She noted that an ERP system should be focused on user productivity and ultimate ease-of-use that new users can quickly adapt to, along with the ability to attach work instructions such as videos, motion graphics or drawings to steps in workflow routing. If should further provide mechanisms to document when and why prior decisions were made and provide collaborative interaction tools, beyond just social media, to support joint decision-making with contextual and pertinent information.

Questions from our audience were direct and astute, reinforcing how difficult it is to retain skilled employees when demand exceeds available supply. One specifically inquired into whether apprentice-type programs were pertinent to address manufacturing skill needs. Another raised the issue of access to training opportunities especially related to independent contractors.

I would like to once again take this opportunity to thank QAD for the invitation to participate in such a diverse panel discussion. For those readers who are QAD customers, my understanding is that the panel session was recorded and will be made available for convenient playback.

Bob Ferrari

© Copyright 2016. The Ferrari Consulting and Research Group and the Supply Chain Matters® blog. All rights reserved.

 


Next Week- Join Bob Ferrari at QAD Explore 2016

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Next week, ERP technology provider QAD will be conducting its QAD explore 2016 annual customer conference being held in Chicago.  The conference kicks-off with a welcome reception on Monday evening, May 2nd, with general sessions beginning on Tuesday May 3 thru Thursday, May 5.

The conference agenda includes a number of sessions focused on specific industry challenges, technology trends, and updates and new releases related to specific QAD applications and services. Current conference registration is nearing 800 expected attendees.

We would like to call attention to one specific panel discussion: The Skills Gap and the Gig Economy, scheduled for Thursday, May 5 at 11am local time. This Editor and independent supply chain industry analyst has been invited by QAD to be a panelist to address this important topic.  Other panelists include:

Nick Castellina, Research Director at Aberdeen Group

Kaye Swanson, HR Skills Director, QAD

Sharon Ward, Senior Director Solutions Marketing, QAD

There is little question that manufacturing and supply chain talent development and retention has become a top of mind multi-industry challenge. Many organizations express frustration in their efforts to find talent with correct skills.  Challenges often relate to the large increase in Baby Boomer era retirements, image problems related to manufacturing and or supply chain careers, and means to attract and retain millennials. Desired skills include embracing the flood of new technologies making their way into manufacturing and supply chain business processes, understanding of global business cultures and facilitating organizational change. The reality is that business, technology and supply chain business challenges are out-distancing current skill and talent needs.

Our panel will highlight current organizational challenges and trends in this important area along with root causes. This Editor will address various industry developments and differing perceptions related to either training or skills gaps that are currently impacting industry supply chains. All of the panelists will also address specific questions from our audience.

In addition, Supply Chain Matters will be featuring specific coverage of QAD explore 2016 that will include takeaways and insights derived from a panel discussion on skills and talent needs along with key themes derived from the conference.

I look forward to meeting or speaking with our readers who are part of the QAD community attending next week’s event. Please say hello if you get the opportunity.

Bob Ferrari


Noteworthy Senior Supply Chain Executive Changes at J.M. Smucker

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We at Supply Chain Matters are always on the lookout for important supply chain related learning, insights and accomplishments. Thus, what caught our eye was a recent announcement related to senior supply chain leadership changes at consumer foods producer J.M. Smucker.

The company announced the pending retirement of Senior Vice President, Supply Chain Logistics and Operations, Dennis J. Armstrong following 37 years with the company.  Mr. Armstrong will retire from his corporate officer role in September.

How extraordinary is that in today’s world of ever changing job roles and continuous employers.

Noted is that Mr. Armstrong has served in a number of leadership roles that have spanned logistics, operations and purchasing during his long career.

According to the announcement, Mr. Armstrong’s supply chain leadership responsibility will be assumed by two other existing J.M. Smucker executives.

James R. Ray will assume the role of Senior Vice President of Operations. Day, with 27 years at the company, was the Vice President of Coffee Operations for the past seven years and thus assumes the new senior operations management role from a line-of-business background. For readers unfamiliar with Smucker’s coffee business, it includes the retail production and distribution of Dunkin Donuts branded coffee, among other brands. Prior operations management roles for Mr. Ray were within consumer and natural foods businesses.

Robert D. Ferguson assumes the role of Senior Vice President Supply Chain.  Mr. Ferguson is currently Vice President, Integrated Business and Program Management and came to Smucker from the 2015 acquisition of Big Heart Pet Brands. Integrated business and program management responsibilities usually connote organizational transformation leadership roles. In today’s consumer goods focused supply chain, transformation remains continuous.

Both Mr. Day and Mr. Ferguson will now report directly to Smucker’s soon to be President and Chief Executive Officer, Mark Smucker, and thus will be members of the executive leadership team. Senior leadership changes included other executives as well leading to a revised executive leadership team.

Thus, yet another example of the strategic importance that operations and supply chain has garnered in supporting and delivering expected business outcomes.

While we often write about such leadership shifts, we believe it is important for Supply Chain Matters to be able to reference actual occurrence, especially in an industry that is dealing with significant business strategy challenges affecting products and changing consumer needs.

As for Mr. Armstrong, we extend our best wishes for an enjoyable and rewarding retirement after what looks to be rewarding operations and supply chain leadership career at a single employer.

Bob Ferrari


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