- Information for:
- Future Students
- Current Students
- Employers & Industry Partners
- Alumni & Friends
- Faculty & Staff
Global supply chains are in distress – you only need to turn on the evening news, pick up a newspaper or read any of the literally hundreds of news reports online to realize that. From videos and images of the flotilla of ships moored off the coast of Southern California – where two of our country’s biggest ports of commercial entry off-load much of our nation’s cargo coming from the Far East – to frenzied warnings about a 2021 Christmas that only a true Scrooge could love, people want to know what’s happening, why it’s happening and when it will all change.
Unfortunately, much of what we are hearing is largely uninformed, sorely lacking the kind of meaningful insight that only trained professionals with deep, research-backed supply chain management expertise can provide. Supply chain has suddenly become in fashion – the new hot industry – and it seems that everybody is feeling the need to weigh in. This off-the-cuff commentary does little to inform either the public or the businesses that serve them about the causes, remedies or timelines for the eventual resolution of these very real issues.
Harbert sat down recently with two of the world’s recognized experts on supply chain management – Chair of Harbert’s highly ranked Department of Supply Chain Management Glenn Richey and Brian Gibson, Wilson Family Professor in Harbert’s Department of Supply Chain Management and Head of Research for the Center for Supply Chain Innovation at Auburn – to get some research-based insight into what’s really happening and the role higher education can play in the development of more efficient and effective global supply chains.
|Harbert:||Let’s start with what’s actually happening, and why.|
Some of the world’s supply chains have become choked at key points for a wide range of reasons – only some of which have been amplified by the pandemic and efforts to emerge from it. The lack of widespread appreciation for the interrelationships that make up a smooth-running supply chain is certainly one nagging issue at play, but that’s not the only factor by a long shot.
Human resource challenges in manufacturing and trucking, poor labor relations and relatively low productivity at our ports, aging U.S. rail infrastructure, outdated just-in-time manufacturing focus, misplaced emphasis on lean inventory management, spiked growth of e-commerce, panic buying – these all have had a major impact. You can blame corporate management, unions, government, customers – everyone involved in supply chains (and that means “all of us”) – have contributed in some way, shape or form to this problem.
To be sure, each of these groups contributes to the persistent challenges in many supply chains. Just like the COVID-19 virus, everybody is implicated in and impacted by this situation. And just like the pandemic, these supply chain problems haven’t gone away as quickly as we would have hoped.
But let’s not buy into the false narrative that commerce has come to a complete stop. While productivity is hampered and flows are slower than desired, manufacturing is occurring, ports are operating, trucks are moving and most store shelves are stocked – at least for now.
|Harbert:||Some of the commentary we are hearing seems focused on what are claimed to be simple, short-term fixes – stock up on essentials, buy Christmas gifts now before stores run out, expand port offloading hours, hire more longshoremen and truckers, call in the National Guard. How helpful are these recommendations?|
Not very helpful, really. In fact, much of what is being recommended by these “experts” actually serves to compound an already fragile supply chain. Panic buying only serves to exacerbate shortages, further straining the already scarce availability of products on store shelves, many of which are stuck in a slow-moving manufacturer-to-consumer delivery process. And short-term government intervention can't possibly solve what are, in the end, complex commercial issues.
An all-too-common solution that is being bandied about to improve port off-loading and ground transportation bottlenecks is to simply hire more truckers. This oversimplifies the myriad of issues involved. Sure, hiring more long-haul truckers seems logical – until you realize that there has been a shortage of truckers for quite some time, well before the pandemic hit. Despite the recent rise in wages, demand exceeds supply – there just aren’t enough truckers out there.
One viable resolution to the shortage of truckers is to expand the pool of (predominantly male) truckers to include more women. Beth Davis-Sramek, Gayle Parks Forehand Professor in supply chain management at Harbert, wrote about this earlier this year suggesting that an often-overlooked pool of potential trucking talent – women – could serve as at least a partial solution.
The bottom line is that a wealth of supply chain expertise is out there, and here at Harbert, we’re doing our best to add more and more of that expertise in the form of highly qualified business school graduates with a dedicated focus on supply chain management. Businesses need to recognize – as we did long ago – that supply chain management education and training are must-haves for new hires and a priority for up-skilling existing managers.
I couldn’t agree more. Few of the proposed short-term resolutions to the current crisis address the systemic supply chain issues that have been simmering under the surface for some time. That said, in the spirit of being a glass half full observer of the supply chain industry, let’s talk about some positives that are highly deserving of greater attention.
First and foremost is the unwavering effort and creativity displayed by supply chain professionals throughout the pandemic. These in-the-trenches go-getters have shrugged off the criticism and handled each disruption with poise.
|Harbert:||As extensively credentialed experts in supply chain management – and given your roles in educating the next generation of business professionals – what steps do businesses need to take to improve and manage their supply chains in advance of the next challenges?|
One thing businesses should be doing -- individually and collectively – would be to educate and inform their customers and supply chain partners on what’s really going on and the measures available to them to reduce supply chain strain going forward. We’re talking increasing visibility about their inventory strategy – traceability about where product is in the channel – for example.
We’re also talking about hiring and supporting supply chain management professionals who have the requisite education and hands-on experience that comes from a partner-engaged supply chain management education. I can’t imagine a business that can afford not to consider supply chain curriculum or internship experience when choosing the next generation of business managers.
Another thing we can do collectively is to note the extraordinary examples of key players leveraging their supply chain expertise over the past year or so. One needs to look no further than the efforts of the pharmaceutical industry to gain an appreciation for the creative and collaborative approaches being used to solving supply chain issues.
During his general session at this year’s annual CSCMP EDGE Conference a few weeks ago, Jim Cafone, vice president of strategy and business operations for Pfizer, detailed the challenges the company faced and the essential role of internal and external collaboration in bringing its mRNA-based COVID19 vaccine to market and into the arms of people in just nine months. Already this year, Pfizer has distributed more than 1.5 billion doses of its vaccine thanks to its adoption of parallel development processes, miniaturization of production operations and innovations in cold packaging. The successful distribution of those vaccines has been instrumental in curbing the impact of the pandemic.
|Harbert:||As we close, what words of wisdom do each of you have for businesses impacted by current supply chain issues?|
|Richey:||Stop listening to the so-called experts you see on TV – the issue isn’t as simple or as short-term as they might lead you to believe. Supply chain management is a complex undertaking. The good news is that higher education has a role to play – and you need to take advantage of the next generation of supply chain-trained business graduates from leading colleges as well as the opportunities those programs offer in terms of engaging young professionals in your business through internships and sponsored research.|
I keep coming back to my glass half full mindset. Instead of succumbing to the “woe is me” mentality, recognize that those businesses who devote substantial time, energy and resources to improving their own supply chain infrastructure and building resident expertise are those that will not only survive the current disruption, but will also be much better prepared for what’s to come.
To be fair, I do need to acknowledge that major news media is beginning to come around. In a recent New York Times article entitled “How the Supply Chain Broke, and Why It Won’t Be Fixed Anytime Soon,” global economics correspondent Peter S. Goodman confesses that his paper – one of the leading business publications in the world – “didn’t even have a logistics beat before the pandemic. Now we do.”
The glass appears to be getting fuller.
Glenn Richey is the Harbert Eminent Scholar in supply chain management and research director in the Center for Supply Chain Innovation.