Guest Post

Supply Chain Industry Outlook for the 2020s

September 30, 2019

Written by guest contributor Megan Ray Nichols, a freelance stem writer and the editor of Schooled By Science. For more from Megan, you can follow her on Twitter or subscribe to her blog here

We don’t need to tell you how much of a key role the supply chain plays in the economy. What’s a little less cut-and-dried is the state of the industry into the 2020s. In plenty of ways, the supply chain will always be a familiar beast. In many more, it’s forcing companies and their partners to rethink assumptions and even reinvent themselves to answer the challenge.

Here’s a look at some of the changes, challenges and trends awaiting us as we contemplate the end of 2019.

Supply Chain Must Communicate Better About Opportunities

Young people today are holding themselves back from pursuing a future in this field, but not necessarily because they actively dislike it. It’s more because of a perceived lack of opportunities and the misconception that it’s unskilled work.

We know these things aren’t true. According to reporting from DHL, the biggest driver of what they call a global talent shortage crisis is changing skill requirements. To hear them tell it, even lower-level jobs require tactical thinking and a head for operational efficiency. However, DHL says nearly 60% of supply chain companies are struggling to find people with this combination of traits.

The U.S. supply chain is massive: It’s 44 million employees strong and accounts for 37% of all jobs in the country. Moreover, these jobs are predominantly good-paying and occupy a fast-moving and technologically rich industry. It’s an exciting time to be involved in this field, but we need better and more vocal advocates.

Supply Chain Provides Too Few On-Site Training Opportunities

Another of the problematic perceptions among millennials is that attending college is the only way they can pursue a meaningful career. College isn’t going anyplace, of course. Supply chain companies are finding now that not even college graduates always have the blend of strategic and tactical thinking the industry requires.

This means companies must expand their efforts to recruit and invest in less-developed candidates who demonstrate strong work ethics and a mind for details. In years and decades past, on-site training programs, mentorships and apprenticeships for motivated employees were common. The industry needs to ramp up these efforts again and assemble teams of invested, interested, loyal employees.

Supply Chain Needs Stronger Ties to Schools

Part of the responsibility for turning around the talent shortage and cultivating interest in this field lands squarely on the education system. Children tend to be taught to romanticize some jobs and not others. Elsewhere, kids don’t receive nearly enough guidance for their interests and talents, or are pushed down educational and professional tracks that aren’t a good fit.

Students in junior high and elementary school should be exposed early and often to industries like the supply chain. They should receive far more education about how the world works and how all the products we take for granted make it from Point A to Point B.

This is a communication problem. Companies can begin solving it by creating stronger ties with education systems and making themselves more present at local and school events and career fairs. They should help the public better understand that studying STEM skills isn’t just for people who want to write apps or land a desk job.

Supply Chain Must Become More Regional

Although the world is globalizing, the benefits of regional industry clusters are clear. The supply chain drives inputs for local businesses of all kinds, and benefits from developing co-location strategies to be closer to their partners. Assembling in this fashion helps improve the standard of living within communities and keeps wealth local.

The inevitability of regional supply chain clusters, and their benefits to competitiveness, are only underscored by the advancement of additive manufacturing. This will further reduce the distance between manufacturing centers and end-users.

Even as it provides greater choice and flexibility to customers concerning the variety and customizability of products, it will also create new challenges for the supply chain. Bespoke products and smaller-batch shipments will become more commonplace.

Supply Chain Must Embrace New Technologies and Opportunities

It’s important to talk about the technologies driving innovation and creating opportunities across the supply chain. Additive manufacturing is, of course, only one.

There are two seemingly incompatible trends currently helping shape the American supply chain and the U.S. economy as a whole. They are widespread labor shortages and the coming-of-age of automation technologies.

The advancement of technology is having a major impact on the present and likely future of the supply chain. This also presents the misconception that automation will displace more human jobs than it will create.

The truth is, a comprehensive rundown of the technologies impacting supply chains reveals just how many opportunities there are within this field for experts of all stripes and backgrounds. Here’s a truncated list:

  • Cloud computing drives operational efficiency and helps partners work more harmoniously together.
  • Big data systems provide the means to engage in accurate business forecasting and help partners exchange relevant information quickly.
  • Automated technologies in distribution centers and warehouses, such as autonomous pallet trucks, eliminate some tedious low-skilled work. They also make the workplace safer and create jobs for programmers, designers and human-machine interface experts.
  • Multiple industries are actively working to standardize blockchain and its role in business. The implications include far greater transparency and oversight and the ability to respond quickly and accurately to quality control issues and product recalls.
  • Smart manufacturing plants and distribution centers save energy and effort by automating machine operation and flagging maintenance items automatically. This frees human capital to apply their talents to higher-value work.

We see again the importance of investing in relationships with schools and showing the public why STEM skills are relevant in far more fields than people realize, including the supply chain. The industry is having some growing pains right now. However, strategic technology investments and improved communication with active job-seekers can ensure this field remains strong, vibrant and as relevant as ever.

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