Crimson & Co on 'Generation Y's impact on your supply chain'
Written by Dave Alberts, Director of supply chain consultants Crimson & Co
The biggest headache for many supply chain leaders regardless of what sector they are in, or what geographies they cover is finding good quality people, and this is especially true in emerging markets. Then, once you have found them there is the problem of trying to keep them which increasingly is about building trust and loyalty and not just by offering better remuneration and financial incentives – as somebody else will always be willing to pay more!
Another challenge is that all the capability has traditionally been focused within manufacturing and production. Typically that’s where the best people can be found, and often the rest of the supply chain, including the vital customer contact points like logistics have been outsourced.
Those of us working in supply chains are well aware of the need to have the right people in the right place doing the right things, but as a profession, we urgently need to fix the problem of the chronic shortage of talent – but where do we start? Well probably not by recruiting functional specialists with deep technical skills. We need to start by finding people with a strong grasp of the financial basics as every supply chain decision has a financial impact. Then combine this with good analytics and mathematics capabilities, as increasingly working in the supply chain is all about working with lots of data. And finally, top it off with good communication skills that enable you to shoot the breeze with senior and junior folk across the extended supply chain and globally.
The raw talent is definitely out there, it’s just that the supply chain isn’t very attractive to today’s ‘Generation Y’ employees - employees that are characterised by:
- Having good analytical skills and liking jobs that give them the opportunity to use these skills
- Being very confident in their own ability - so they expect a lot from employers in terms of job satisfaction (pay, location, independence)
- Needing lots of attention such as feedback, ratings, action plans – for example they really benefit from mentoring
- Not being career focused – they expect a positive life/work balance, and move jobs regularly
The problem is that most of our supply chain roles tend to be the opposite of this, involving long and unsociable hours, not very glamorous locations, and only reasonable pay.
So, unless the supply chain industry can become more attractive to ‘Gen Y’ employees, then the problem is likely to get worse. To create the leaders of the future, organisations need to not only attract the raw talent, they then must have the relevant processes to ensure development.
EU and US agree end to Airbus-Boeing supply chain tariffs
The EU and US have agreed to resolve a 17-year dispute over aircraft subsidies, suspending tariffs on billions of dollars' worth of goods that have plagued procurement leaders on both sides of the Atlantic.
Under an agreement reached by European Commission Executive Vice-President Valdis Dombrovskis and US Trade Representative Katherine Tai on Tuesday, the tariffs will be halted for a period of at least five years.
It will bring an end to punitive and disruptive levies on supply chains that have little to do with the argument, which became embroiled in the trade battle. Businesses on both sides of the dispute have been hit with more than $3.3bn in duties since they were first imposed by the US in October 2019, according the EC.
The US imposed charges on goods upto $7.5bn in response to a World Trade Organisation ruling that judged the EU’s support of Airbus, its biggest aircraft manufacturer, unlawful. A year later in November 2020, the EU hit back. The WTO found the US had violated trade rules in its favourable treatment of Boeing, and was hit with EU duties worth $4bn.
In all the tariffs affected $11.5bn worth of goods, including French cheese, Scotch whisky, aircraft and machinery in Europe, and sugarcane products, handbags and tobacco in America. Procurement leaders on both sides of the fence were forced to wrestle with tariffs of 15% on aircraft and components, and 25% on non-aircraft related products.
Boeing-Airbus dispute by the numbers
- The dispute began in 2004
- Tariffs suspended for 5 years
- $11.5bn worth of goods affected by tariffs
- $3.3bn in duties paid by businesses to date
- 15% levy on aircraft and 25% on non-aircraft goods suspended
Both sides welcome end to tariffs
European Commission President Ursula von der Leyen branded the truce a “major step” in ending what is the longest running dispute in WTO history. It began in 2004.
“I am happy to see that after intensive work between the European Commission and the US administration, our transatlantic partnership is on its way to reaching cruising speed. This shows the new spirit of cooperation between the EU and the US and that we can solve the other issues to our mutual benefit,” she added.
Both aircraft manufacturers have welcomed the news. Airbus said in a statement that it will hopefully bring to an end the “lose-lose tariffs” that are affecting industries already facing “many challenges”. Boeing added that it will “fully support the U.S. Government’s efforts to ensure that the principles in this understanding are respected”.
The US aerospace firm added: "The understanding reached today commits the EU to addressing launch aid, and leaves in place the necessary rules to ensure that the EU and United States live up to that commitment, without requiring further WTO action."
This week’s decision expands upon a short-term tariff truce announced in March this year. The EC says it will work closely with the US to try and further resolve the dispute, establishing a Working Group on Large Civil Aircraft led by each side’s trade minister.
Airbus last month signalled to suppliers that post-pandemic recovery was on the horizon, telling them to scale up to meet a return to pre-COVID manufacturing levels. “The aviation sector is beginning to recover from the COVID-19 crisis,” said Airbus chief executive Guillaume Faury, adding that suppliers should prepare for a period of intensive production “when market conditions call for it.”