Cost or Asset: The Need for Talent in the Supply Chain 

When it comes to the supply chain, efficiency is the name of the game. The smoother the interaction between the links, from start to finish, the more profitable everyone is along the line. Companies have been furiously analyzing every facet of the chain, from transportation routes to in-house technology and processes in terms of the financial efficiency. In short, if it can give an advantage, improve the system, or help to cut down operating costs in any way, it’s typically touted as a good thing.  But when it comes to investing in that efficiency, where is the best place to hedge your bets? Is it in technology? A consulting firm? While all of these are important, is any one of them hiding the real key to success.

The Un-Correlated

Given the many different assets a company could hitch their hopes on, it would seem like one would rise above the rest, right? If nothing else, given the size and scope of the transportation industry, there would at least be a trend towards one process over the other. While it makes perfect logical sense, the truth of the matter is, there really isn’t a direct correlation between investment and success in the industry.

“Despite all the ads at airports and pretty PowerPoints by consultants, we cannot find support for the claims of ‘Best Run Companies Use Technology X’ or ‘Manufacturing Companies Using Consulting Services With Company Y Have Better Results.’  …or a single instance of Enterprise Resource Planning (ERP) drives better results,” says Lora Cecere, the founder of Supply Chain Insights.

Companies think that they are managing costs and inventory better through technology investments, but they are not.

“Across the industry, we find that companies think that they are managing costs and inventory better through technology investments, but they are not. Through graphing the financial metrics, we find that 90% of companies are stuck at the intersection of operating margin and inventory turns. With rising complexity, they are unable to make improvements in a balanced scorecard,” she added.

Talent Makes the Difference

When it comes to controlling costs, the only constant for improvement is the investment in supply chain talent. According to the survey taken by Supply Chain Insights, it was the companies who could manage their talent better than their peer groups that gained the cost advantage. This played out in three different metrics: Operating Margin, Profit Margin, and EBITDA as a percentage of Quarterly growth. In all three of these metrics, it was proper talent management that proved to be the most effective.

So what are these companies with better talent management doing that their peers aren’t?

So what are these companies with better talent management doing that their peers aren’t? There are six aspects or gaps in particular that these companies are focusing on.

“Belief in the company, appreciation for work, the need to be a part of a talented team, admiration for leadership, training and professional development and flexible work schedules. Empowered workers make a difference. With the flurry of M&A, industry consolidation, outsourcing, and downsizing, the gaps for North American manufacturers are increasing,” says Cecere.

 Provide a job where your employees feel appreciated, and are given the tools they need to not only succeed, but grow, and you’ll have a more dedicated workforce.

Provide a job where your employees feel appreciated, and are given the tools they need to not only succeed, but grow, and you’ll have a more dedicated workforce.

“Most companies have an endless cycle of cost-cutting. The cost-cutting is more severe in the back office than the front office teams of sales and marketing. Companies are often so busy pinching pennies that they miss the greater opportunity. With slowing growth, as companies end the year, many teams face draconian cost-cutting efforts. When faced with these choices, just remember that empowered employees drive a competitive advantage. Our take? Talent matters,” Cecere adds.

The Reality of the Human Asset

Human talent will invariably become more valuable than any physical asset, including technology.

Investing in talent is about much more than merely cutting costs down the road. Human talent will invariably become more valuable than any physical asset, including technology. A study conducted by Korn Ferry and the Centre for Economic and Business Research, a British economic consultancy shows just how valuable people are to any organization.

“The study found that globally, human talent—people, labor, knowledge—will be worth as much as $1.2 quadrillion over the next five years whereas physical capital— inventory, real estate and technology—will be worth an estimated $521 trillion, showing human talent, intelligence and capital is far more valuable than physical capital,” the  22nd Annual Third-Party Logistics Study reports.

“Human talent is also the greatest value creator available to organizations. For every $1 invested in human talent, $11.39 is added to GDP, proving that investing in people can generate value for the organization over time that significantly exceeds initial financial outlay.”

While automation and new technology might replace some facets of the industry, even truck drivers, there will always be a need to have highly skilled professionals on the roster.

When you consider the rapidly evolving nature of the industry, it’s easy to see just how vital talent is to any company. While automation and new technology might replace some facets of the industry, even truck drivers, there will always be a need to have highly skilled professionals on the roster. Providing them with the right technology and opportunities to grow will not only enable them to sharpen their skills but also increase their value and subsequently the value of your business.

Your Supply Chain Talent Is Readily Available Here

There is no need for companies to search for more supply chain talent. BlueGrace has 100s of talented people with the skillsets to help improve or develop your supply chain. Imagine that you had 3 more people working on optimizing your freight for each single employee you have in-house. That is the value the team at BlueGrace offers. Let us monitor your costs, communicate with the carriers and lower your overall freight spend year over year. Contact us at 800.MYSHIPPING to talk with an expert today or fill out the form below.

Are You Part Of The Available Supply Chain Talent?

Are you part of the supply chain talent pool? Are you eager to work with a company that helps simplify businesses across the USA? Do you feel a sense of accomplishment when you can cut costs for a customer? If so CLICK HERE to see all the positions available throughout the country at BlueGrace. We are constantly awarded a best place to work and love to see our employees succeed!

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