Three core trends impacting UK supply chain skills in 2014, by BiS Henderson
Written by Andy Kaye (pictured), CEO of management recruitment company, BiS Henderson
The British economy is bouncing back. In January, the International Monetary Fund (IMF) revised upwards its projections for UK GDP to 2.4 percent growth this year, retail sales in December were reported by the Office for National Statistics to be up 5.3% on a year ago, and the CBI’s quarterly Industrial Trends Survey for the three months to January 2014 showed growth in new manufacturing orders was the strongest since April 2011. With encouraging signs of a resurgence in Britain’s economic activity, what are the expectations for supply chain careers in the coming year?
Unemployment across the UK economy is falling. Figures released in January indicate unemployment fell to 7.1 percent – the largest drop since autumn 1997. Such influences as a pick-up in demand for manufactured goods and a rise in retail sales, coupled with a tightening labour market, will undoubtedly result in greater competition for the best talent.
For those supply chain professionals with the right experience and skill set, the prospect of a rewarding career move are excellent. But there are provisos. The expectations of retail and manufacturing organisations are high and the demands of the job have changed significantly over the last five years. Although economic activity may have been subdued over this period, the world has moved on and several trends have influenced and impacted the very nature of the job and the skills required.
Globalisation takes a new spin
The sourcing of goods from distant locations was a trend well underway before the economic crisis of 2008, but in hard times the sophistication of supply chains increased as organisations sought to analyse the true costs of landed goods and the cost to serve. Complex supply networks are now deployed to offset inventory risk, balancing low production costs of far away places with short-lead time replenishment from factories closer to market. In the fashion sector an initial order may be made in the Far East and then supplemented by more local sources if sales demand.
Consolidation of consignments in distant locations is another trend gathering pace – so that containers can be received more frequently with smaller quantities of products across a whole stock range. Managing these processes and being up-to-speed on local laws, terms and conditions and customs are now all part of the mix for supply chain professionals.
E-commerce and international retail expansion
In the last few years there has been an explosive expansion of e-commerce activity, fed by consumer expectations of value and service. Tablets and mobile devices are driving retail sales and empowering the consumer through access to fast market information on the move. Omni-channel retailing has become the competitive differentiator between brands – who can deliver the best offering, fastest, and to where the customer wants it? The order profiles for distribution are now very different to those of traditional retail models – far more complex and challenging – leading to the wide adoption of automated warehouse technology. In addition, within this equation the fast and efficient processing of returns is now a crucial element in maintaining profitability.
Adding to the challenges of this seismic shift in retailing is the expansion of retail brands into overseas markets. Retail supply networks are now long and complex.
A broader skill set
Ten years ago the remit of a UK based supply chain director was broadly UK centric. Now in 2014 that person will be increasingly asked to understand and manage global supply networks that are hugely complex in nature – meaning they must know how to manage suppliers, production facilities and freight movements across a multitude of countries and time-zones. This requires skills in understanding and managing different types of individual contracts, getting to grips with working practices across borders and ensuring compliance across a multitude of issues, many of which are increasingly CSR related.
Recent tragic incidents like the Rana Plaza disaster in Bangladesh have placed increasing pressures on global brands to ensure their supply chains comply with corporate policies on the treatment and safety of those who work within their supply chains – right down through multiple tiers. Also, the coming into force of the US’s Dodd-Frank Act and the need for compliance on ‘Conflict minerals’ is an example of tightening regulatory requirements that are sure to be embraced by EU law makers in the near future. These are all issues with which supply chain directors now need to be fully conversant.
The supply chain professional looking to free themselves from the short-term contracts that were common in the lean years will be well positioned to take advantage of an enlivened jobs market in 2014. There is a very real shortage of supply chain professionals in the UK and there is not enough talent to go around, and this is beginning to be reflected in the salaries awarded. At the General Manager level salaries have risen over the last 18 months from £65,000/£85,000 pa to £100,000/£120,000 pa.
Skills will be in great demand in 2014. Those with skills in Sales & Operations Planning will be particularly sought after, and if those problem solving abilities are combined with experience in deploying and managing sophisticated automated warehousing technology, then they will be keenly pursued by leading businesses seeking to take advantage of an economic recovery that is fast gathering pace.
About the author
Andy Kaye is CEO of management recruitment company, BiS Henderson, and founder of The NOVUS Trust Logistics and Supply Chain BSc degree course.
DHL Claim Multi-Sector Collaboration Key to Fighting COVID
Since January, global logistics leader DHL has distributed more than 200 million doses of the COVID vaccine to 120+ countries around the globe. While the US and UK recently rolled out immunisation plans to most citizens, countries with less developed infrastructure still desperately need more doses. In the United Arab Emirates (UAE), which currently has one of the highest per-capita immunisation rates, the government set up storage facilities to cover domestic and international demand. But storage, as we’ve learned, is little help if you can’t transport the goods.
This is where logistics leaders such as DHL make their impact. The company built over 50 new partnerships, bilateral and multilateral, to collaborate with pharmaceutical and private sector firms. With more than 350 DHL centres pressed into service, the group operated 9,000+ flights to ship the vaccine where it needed to go.
With new pandemic knowledge, DHL just released its “Revisiting Pandemic Resilience” white paper, which examined the role of logistics and supply chain companies in handling COVID-19. As Thomas Ellman, Head of Clinical Trials Logistics at DHL, said: “The past one year has highlighted the importance of logistics and supply chain management to manage the pandemic, ensure business continuity and protect public health. It has also shown us that together we are stronger”.
Multisector partnerships, DHL said, enabled rapid, effective vaccine distribution. While international scientists developed a vaccine in record time—five times faster than any other vaccine in history—manufacturers ramped up production and logistics teams rolled out distribution three times faster than expected. When commercial routes faced backups, logistics operators worked with military officers to transport vaccines via helicopters and boats.
In the UAE, the public-private HOPE Consortium distributed billions of COVID-19 doses to its civilians as well as other countries in need by partnering with commercial organisations such as DHL. For the first time, apropo for an unprecedented pandemic, logistics companies made strong connections with public health and government.
“While the race against the virus continues, leveraging the power of such collaborations and data analytics will be key”, said Katja Busch, Chief Commercial Officer DHL and Head of DHL Customer Solutions & Innovation. “We need to remain prepared for high patient and vaccine volumes, maintain logistics infrastructure and capacity, while planning for seasonal fluctuations by providing a stable and well-equipped platform for the years to come”.
How Do We Sustain Immunisation?
By the end of 2021, experts estimate that we need approximately 10 billion doses of vaccines—many of which will be shipped to areas of the world, such as India, South Africa, and Brazil, that lack significant infrastructure. This is perhaps the greatest divide between countries that have rolled out successful immunisation programmes and those that have not. As Busch noted, “the UAE’s significant investments in creating robust air, sea, and land infrastructure facilitated logistics and vaccine distribution, helping us keep supply chains resilient”.
Neither is the novel coronavirus a one-time affair. If predictions hold, COVID will be similar to seasonal colds or the flu: here to stay. When fall comes around each year, governments will need to vaccinate the world as quickly as possible to ensure long-term immunisation against the virus. This time, logistics companies must be better prepared.
Yet global immunisation, year after year, is no small order. To keep reinfection rates low and slow the spread of COVID, governments will likely need 7-9 billion annual doses of the vaccine to meet that mark. And if DHL’s white paper is any judge of success, multi-sector supply chain partnerships will set the gold standard.