HUMAN RESOURCES HUMAN RESOURCES AS A RISK FACTOR AS A RISK FACTOR

FORFOR SUPPLY CHAIN SUPPLY CHAINS:S: POL POLISH EXPERIENCEISH EXPERIENCE

Danuta Kisperska-MorońDanuta Kisperska-MorońDepartment of Business LogisticsDepartment of Business Logistics

University of EconomicsUniversity of EconomicsKatowice, PolandKatowice, Poland

AGENDAAGENDA

1.1. NEW CHALLENGES FOR SUPPLY CHAIN NEW CHALLENGES FOR SUPPLY CHAIN MANAGEMENTMANAGEMENT

2.2. THE SPECIFIC CHARACTER OF SUPPLY THE SPECIFIC CHARACTER OF SUPPLY CHAIN MANAGEMENT QUALIFICATIONSCHAIN MANAGEMENT QUALIFICATIONS

3.3. OUTLINE OF PRESENT QUALIFICATIONS OUTLINE OF PRESENT QUALIFICATIONS OF SUPPLY CHAINN MANAGERS IN OF SUPPLY CHAINN MANAGERS IN POLANDPOLAND

4.4. CONCLUSIONSCONCLUSIONS

PPhenomena that seem to henomena that seem to account for the intensity and account for the intensity and

scale of changes:scale of changes:

– transforming political systems, transforming political systems, – emerging virtual networks of global influence, emerging virtual networks of global influence, – growing market competitiveness leading to a growing market competitiveness leading to a

surge of company mergers,surge of company mergers,– a new quality of customers’ expectations, a new quality of customers’ expectations, – shorter life cycles of products, shorter life cycles of products, – rapid development of the service sectorrapid development of the service sector..

COMPETITIONCOMPETITION

““FFreshness” of the offer: reshness” of the offer: •constantly changing constantly changing assortment, assortment, •newest fashion newest fashion •best opportunitybest opportunity

PRICE ?

Supply chain management is characterised by exceptional dynamics

TThe quality of human resourcehe quality of human resource

The leading The leading companies companies invested 44% invested 44% more into more into their work their work force than force than their their competitorscompetitors

NEW CHALLENGES FOR NEW CHALLENGES FOR SUPPLY CHAIN SUPPLY CHAIN MANAGEMENTMANAGEMENT

• SC SC more customer specific more customer specific and less and less static static– small orders, longer hours of business opening and small orders, longer hours of business opening and

seven days operation in three shiftsseven days operation in three shifts

• The future will belong to “lean” organisationsThe future will belong to “lean” organisations– team work, flexible, flat-structured, quality-focused, team work, flexible, flat-structured, quality-focused,

maintaining close links with their customers and maintaining close links with their customers and suppliers, and operating globallysuppliers, and operating globally

• Companies ready to abandon their vertical Companies ready to abandon their vertical functional organisational structure functional organisational structure – introduce horizontal and cross-functional frameworks introduce horizontal and cross-functional frameworks

supporting process management supporting process management

NEW CHALLENGES FOR NEW CHALLENGES FOR SUPPLY CHAIN SUPPLY CHAIN MANAGEMENTMANAGEMENT

• VVirtual corporationirtual corporation and and virtual leadership virtual leadership systemssystems

– The The amorphous character of virtual organisationsamorphous character of virtual organisations

– Performance evaluation on the basis of Performance evaluation on the basis of agility and agility and responsiveness responsiveness

• DDeparture from traditional resource management eparture from traditional resource management and simple report generation in favour of and simple report generation in favour of seeking improvement in performance by seeking improvement in performance by enhancing the actions of company personnelenhancing the actions of company personnel

SPECIFIC SPECIFIC QUALIFICATIONS OF SC QUALIFICATIONS OF SC

MANAGERMANAGER• The ability to look from the specific perspective of supply The ability to look from the specific perspective of supply

chain managementchain management – profound understanding of integrated processes within a profound understanding of integrated processes within a

business and between the partners business and between the partners – decison-making skillsdecison-making skills

• BBecome members of operating teams and exhibit an ecome members of operating teams and exhibit an exceptional capability of adaptationexceptional capability of adaptation (flexibility) (flexibility)

• SShould apply work evaluation systems, recognise hould apply work evaluation systems, recognise qualifications and delegate responsibilitiesqualifications and delegate responsibilities

• AAbility of non-standard thinkingbility of non-standard thinking • CCommunication skills ommunication skills ((ability to move effectively within ability to move effectively within

networks of virtual organisationsnetworks of virtual organisations))• Working in a fully automated logisticsWorking in a fully automated logistics

How distant is the actual pattern How distant is the actual pattern of qualifications of logistics and of qualifications of logistics and supply chain managers in Polish supply chain managers in Polish

companies from the ideal companies from the ideal concept of competecniesconcept of competecnies

and what risks and what risks

are associated with that are associated with that ??

Qualifications of supply chain managers Qualifications of supply chain managers (Polish case study 1997 & 2004)(Polish case study 1997 & 2004)

• Two main surveys: Two main surveys: – 1997 examined 473 respondents1997 examined 473 respondents– 2004 directed to 390 logistics professionals2004 directed to 390 logistics professionals

• The major direct decision responsibilities of The major direct decision responsibilities of surveyed employeessurveyed employees: : transport management, transport management, purchasing, customer service and purchasing, customer service and warehousing. warehousing.

• RRespondents espondents fromfrom various sectors and various sectors and branches; employed mainly branches; employed mainly inin manufacturing, manufacturing, distribution and service companiesdistribution and service companies

• Companies of all sizesCompanies of all sizes: : very large, through very large, through large and medium-sized, down to small large and medium-sized, down to small companies.companies.

STRATEGIC APPROACH STRATEGIC APPROACH TO SCMTO SCM

““supply chain orientationsupply chain orientation” ”

“ “the recognition by a company of the systemic, strategic the recognition by a company of the systemic, strategic implications of the activities and processes involved in implications of the activities and processes involved in managing the various flows in a supply chain” managing the various flows in a supply chain” (Mentzer and others, 2001)(Mentzer and others, 2001)

It depends on the attitude of managers:It depends on the attitude of managers: recognition recognition that if final customersthat if final customers are satisfied and are satisfied and

continue to buy the productcontinue to buy the product (or sales increase), every (or sales increase), every

link of the supply chain reaps the link of the supply chain reaps the benefitsbenefits..

Younger managersYounger managers

the age group of 21 – 38 years

1/3 of the sample in 1997 more than 1/2 of the sample in 2004

better educated workforce with modern qualifications

In car manufacturing, machine engineering, IT, electro-technical industry and distribution sector the employees of age 21 – 33 clearly prevail

Growing supply chain „awarness”

CAREER PATHCAREER PATH

Promotion path :

expert --> top expert --> section manager --> department manager --> branch manager --> vice-CEO --> CEO.

correlation coefficient between age group and level of career equal to 0.730445

new flat organisational structures

have not been adopted yet

Money, money, money … Money, money, money …

Positive correlation discovered between university education and the level of salary

Employees with genuine logistics or transport educational background

Employees with general business/economics education.

Level of educationLevel of educationThe share of employees with university degree

45 % in 1997 63% in 2004

• significantly improved in manufacturing (e.g. car making, electro-technical and metal industry)

• slightly deteriorated in distribution sector

Nature of educationNature of education1997

2004

6% 12%

The share of employees with professional logistics education

• The share of university graduates with economic and business profile was also higher

Technical and engineering education in SCM

does not dominate any more

CONSTANT LEARNINGCONSTANT LEARNINGshare of respondents taking part in various educational and training programmes

21% in 1997 nearly 30% in 2004

• Most of those programmes focused on logistics, transport, inventory management and warehousing (nearly in 45% of reported cases)

• Around 10% of participants of those programmes picked up general management, finance, negotiations or project management

• Interest in further studies: IT, professional forecasting and inventory management, managerial issues and other general business areas.

Additional professional Additional professional aspectsaspects

• AAlmost 57% of respondents lmost 57% of respondents claimed theclaimed they are familiar y are familiar withwith professional logistics professional logistics and supply chain literatureand supply chain literature

• OOnly 1/5 declared some nly 1/5 declared some forms of engagement in the forms of engagement in the activities of professional activities of professional logistics associationslogistics associations

QUALITY OF STAFF IN SMEsQUALITY OF STAFF IN SMEs

SME’s manager should be quite SME’s manager should be quite universal in his decision-making universal in his decision-making and and it requires profound knowledge of logistics and supply chain it requires profound knowledge of logistics and supply chain

management. management.

• 62% of responding SMEs focused on importance of quality, 62% of responding SMEs focused on importance of quality, education and skills of their personneleducation and skills of their personnel

• The most successful and innovative small companies managed in The most successful and innovative small companies managed in 56% by people with university diplomas and academic degrees56% by people with university diplomas and academic degrees

• Less successful SMEs: only 30% of top managers received Less successful SMEs: only 30% of top managers received masters or bachelors degreemasters or bachelors degree

• Companies founded during last two years: only 19% of managers Companies founded during last two years: only 19% of managers had university diplomashad university diplomas

STRATEGIC APPROACH STRATEGIC APPROACH TO SCM in SMEsTO SCM in SMEs

• 88% of respondents - the founders of their 88% of respondents - the founders of their companies - businesses companies - businesses “young” enough“young” enough

• focus on: focus on:

– satisfactionsatisfaction of customer requirements (90%) of customer requirements (90%)

– qualityquality of provided product and/or service (87%) of provided product and/or service (87%)

• only 17% mentioned the importance of only 17% mentioned the importance of effefficienticient

managementmanagement of materials and products flows of materials and products flows • aware of current market requirements but not of aware of current market requirements but not of

advanced coordinated effortsadvanced coordinated efforts through e.g. supply through e.g. supply chain management. chain management.

STRATEGIC APPROACH TO STRATEGIC APPROACH TO SCMSCM

Future trends that will influence SMB businessesFuture trends that will influence SMB businesses• increasingincreasing competition competition and the need to become more and the need to become more flexibleflexible • only 24% predicted a tendency of growing only 24% predicted a tendency of growing efficiencyefficiency of of

business operationsbusiness operations• only 43% concentrated on importance of only 43% concentrated on importance of new technologiesnew technologies • 51% - on growing level of51% - on growing level of certainty certainty of operations. of operations.

CONSENSUS ?CONSENSUS ?• most of SMBs has 3 founders, most of SMBs has 3 founders,

• almost 20% of firms has been founded by almost 20% of firms has been founded by

almost 5 ownersalmost 5 owners

CONCLUSIONS (1)CONCLUSIONS (1)

The level of logistics qualifications in the years 1997-2004 was far from what is really needed in modern SCM

The survey can serve as a basis for further improvement of educational systems in logistics and supply chain management

CONCLUSIONS (2)CONCLUSIONS (2)

There is a need to shape the following competencies among all levels There is a need to shape the following competencies among all levels of supply chain management personnel:of supply chain management personnel:

• line management abilityline management ability, i.e. their ability to manage day to day , i.e. their ability to manage day to day supply chain operations and meet goals established in terms of supply chain operations and meet goals established in terms of quality, productivity and budgeting;quality, productivity and budgeting;

• problem solving abilityproblem solving ability, , i.e. ability to anticipate and diagnose i.e. ability to anticipate and diagnose problems as well as to develop and apply new ways of cost problems as well as to develop and apply new ways of cost savings, service improvement and increased return on investment;savings, service improvement and increased return on investment;

• project management abilityproject management ability, i.e. the ability to structure and manage , i.e. the ability to structure and manage projects designed to improve the supply chain process;projects designed to improve the supply chain process;

• people management abilitypeople management ability, , i.e. the ability to develop and motivate i.e. the ability to develop and motivate their employees’ technical and management skillstheir employees’ technical and management skills

Thank you for Thank you for AttentionAttention