Supply Chain Frontiers issue #42
Developing a talent pipeline to meet the profession’s current and future needs is one of the most pressing challenges facing supply chain management. Nowhere is this challenge more visible than in Asia. Led by organizations such as the Malaysia Institute for Supply Chain Innovation (MISI), the region must develop new employment models for Asia and the profession as a whole based on the concept of resilience.
To gain a better understanding of the challenge, we focus on Southeast Asia, an area that captures the essence of the talent management problems that plague Asia in general. Interestingly, many of Southeast Asia’s talent issues are rooted in the region’s economic vibrancy. The ASEAN nations generate $1.7 trillion work of trade annually, and are expected to maintain growth rates of around 5–6% over the next few years.
ASEAN countries plan to establish a single market, the ASEAN Economic Community, by 2015. Such a community could eventually rival established economic zones such as the European Union. But to achieve these goals the region must build world-class supply chains, and that requires skills that are a scarce commodity in these highly dynamic economies. This is a complex challenge with a number of underlying causes.
- Poor practical skills. Varying educational standards and a general lack of supply chain expertise in the region mean that new recruits often lack the ability to apply the knowledge they acquired as students.
- Skilled labor in high demand. Competition for talented professionals is intense in ASEAN economies. Finding and retaining top talent is a major issue for companies.
- Generational issues. The aspirations and attitudes of the new generation of employees are different in a number of ways from those of older employees. Many young recruits want to achieve a certain work-life balance, for example.
- Special supply chain needs. The skills shortfall is exacerbated by Southeast Asia’s specific supply chain management demands, such as complex tax regimes and a patchwork of regulations.
- Inter-regional differences. Profound cultural and language disparities separate ASEAN countries. These differences have very real consequences. For example, collaborative efforts can be problematical when multiple trading partners are involved.
- The profession’s low profile. Supply chain’s comparatively low status in the corporate world is a global problem, but is particularly severe in Southeast Asia where the profession is less mature compared to the west.
- Lack of an educational infrastructure. The ASEAN region urgently needs more first-rate industrial/engineering supply chain schools. An encouraging trend is the emergence of alliances with top educational institutions in the west. MIT recently established such a partnership with the government of Malaysia to create MISI.
The all-important question is whether or not companies can overcome these obstacles even if they are afforded enough time to address the issues. Some solutions, such as job rotation programs that enhance employee skills, are well established in the west.
Ongoing education is particularly important in Southeast Asia, where there is an unquenchable thirst for new knowledge. Therefore, the importance of educational initiatives such as MISI cannot be underestimated. A core part of MISI’s charter is to address the region’s inadequate educational infrastructure, as well as the profession’s low profile and lack of practical skills. MISI will offer a variety of courses and programs to achieve its goal, including executive education programs later this year, master’s degree programs in August 2012, and PhD programs possibly in 2013.
Above all, companies in Southeast Asia must develop employment models that are attuned to extremely dynamic labor markets. The concept of a resilient supply chain in an operational sense is well known in the profession; now we must develop talent-resilient supply chain organizations. The sudden loss of a valued manager can be just as disruptive to operations as a supplier failure or a weather-related delay. Moreover, the principles behind the remedies are similar. Building flexibility and redundancy into organizational structures by training people to be multi-skilled is one example.
The work to develop this type of resilience has barely begun. However, Southeast Asia – and the supply chain profession in general – must innovate and create new models to remain competitive in a world where talent is at a premium and career paths take many twists and turns.
This is an abridged version of a column by Dr. Mahender Singh, Rector, MISI, which was published in the September/October 2011 issue of Supply Chain Management Review (www.scmr.com). Contact Dr. Mahender Singh for more information.