Supply Chain Frontiers issue #7. Read all articles in this issue.
The supply chain discipline is becoming more diverse as managers adopt a wider range of skills to meet the needs of their changing roles. As two 2005 MIT Master of Engineering in Logistics (MLOG) students show, finance can now be added to the pool of professions from which supply chain management is drawing.
Eugene Takenaga is a certified public accountant and a CFA charterholder with 13 years of experience in finance and accounting. Prior to joining the MLOG program he was Director of Strategic Planning at distribution company Targus Group International. Randy Lynn Fike was Manager of Supply Chain: Supply Chain North America, International Paper, before becoming an MLOG student. He also held financial positions at the company including Senior Financial Analyst in its Pulp, Industrial and Fine papers business.
A decade or so ago switching from finance to supply chain would have seemed like an odd career move. Today such a shift is by no means common, but given the changes that have taken place in both professions, the cross over is no longer outlandish.
Automation and the outsourcing of routine work to overseas contractors are just two of the changes that have transformed the finance discipline, explained Fike. On a broader level, "in the old days manufacturing was allied closely to cost accounting, but that is not the case now," he said. Financial controllers--who are general finance managers and not specialists such as treasurers--still aspire to becoming chief financial officers, but the career options in pure finance have narrowed.
More importantly from a supply chain perspective, the finance professional of today offers skills and experience that are readily transferable. As a finance person "I understand how the system works, how data ends up in financial statements. I have an overview of the company that a logistics person, for example, probably does not have," said Takenaga. From this vantage point the finance specialist learns to appreciate how an action in one part of the organization causes a reaction elsewhere in the enterprise.
Proficient financial controllers are adept at modeling, since this is an essential part of the job. According to Fike this is extremely useful in the supply chain management arena where sophisticated modeling technology has become much more important and widely used. Similarly "designing supply chain metrics is a perfect role for a finance person," he suggested. Balancing service against cost is intrinsic to the finance function--and to supply chain management. Fike believes that professionals from this side of the desk are particularly well suited to the role of integrator on the supply chain side, where they can bridge the different disciplines that come together at the SCM "locus of control."
Still, the degree to which a financial background prepares an individual to make the transition differs from company to company. Fike said that in his former job financial controllers were routinely teamed with line managers in various departments including supply chain, exposing them to a multi-disciplinary environment. In the company that Takenaga worked for "there was no central supply chain function" he said, and fewer opportunities to gain experience in the field.
Both agree that MLOG is providing the knowledge and skills they need to take the next step in building a career in supply chain management. They considered MBA courses that offer relevant options, but these lacked the depth of the MLOG program.
The Master of Engineering in Logistics Program was initiated in 1998 by MIT's Center for Transportation and Logistics. For more information about the program, go here or email mlog@mit.edu.