Logistics Leadership: Secrets to Success
Ready to elevate your logistics career to the next level? Here are the skills and knowledge you need to take you to the top.
Strong leaders are important to any business function, but logistics management demands unique leadership capabilities. Because logistics represents a large investment for most companies, a strong leader must develop innovative solutions, and optimize logistics and supply chain strategy and operations to gain competitive advantage.
"The unique challenges of logistics and supply chain management make having the right leader a critical part of achieving results," says Don Firth, president of
"Part of the reason is that logistics covers a broad area. Good leaders must be able to address executives at a boardroom level just as well as they talk to truck drivers and warehouse workers," Firth notes. "They also need intimate knowledge of the entire supply chain, because logistics professionals work across functions within the organization, with business units throughout the company, and with partners across the supply chain."
Because logistics encompasses a wide scope and is a key profit center, the right leader can be a critical component to a company's success today. But it wasn't always that way.
"Ten years ago, many people didn't understand what supply chain was, even within their own companies," says Chuck Franzetta, a supply chain management consultant at Boalsburg, Pa.-based Franzetta and Associates. "Today, however, supply chain touches almost every aspect of a company, and affects many levels of an organization. Most companies now have a chief supply chain officer or an equivalent position who takes a seat at the boardroom table."
Learning to Lead
Successful supply chain leaders get involved with industry organizations and follow current events to help stay up to date on issues affecting the logistics sector.
"In the past, each company tended to operate as if it were an island," says Firth. "But to be successful today, managers have to look at the whole supply chain, and fine-tune the operation, secure better services, reduce costs, and make partnership agreements work to their company's advantage.
"I can't overemphasize the importance of listening," he adds. "Sometimes logistics departments operate in a silo, without collaborating with other departments. This can be a detriment to the supply chain and its effectiveness. Logistics professionals often confine themselves to focusing on peripheral logistics issues, and they don't see the upstream or downstream effects. To be successful, logistics leaders have to see the whole picture."
Grasping the supply chain's role in the organization can be challenging, even for experts. "Leaders have to recognize that logistics is part of a broader picture of supply chain management, and see how that relates to the company's bottom line," adds Franzetta. "Good leaders design and apply detailed processes for managing day-to-day activities—including the ability to react to contingencies—because things can and will go wrong."
Knowing the latest technology systems is also critical, because the entire industry has become more technology dependent. "Good leaders need to recognize that technology is key to supply chain efficiency," says Firth. "They have to know what technology is available, and how it can add value."
Having a broad vision, communicating well, anticipating future trends, and staying competitive are among the secrets to leadership success.
See the Big Picture
A chieving success in logistics requires two levels of skill, according to Andrew Goetz, who has been a professor at the University of Denver for 25 years and was part of the group that started the Intermodal Transportation Institute (ITI) in the 1990s. The first level includes basic skills or core competencies such as writing, communications, and quantitative analysis. The second level involves skills specific to the logistics sector.
For instance, the ITI program at the University of Denver, which awards a Master's of Science in Intermodal Transportation Management, emphasizes educating students about the logistics sector's structure, and the variety of companies and industries involved.
"It is important for leaders to not only know their own company and industry, but also to be familiar with other companies and industries, and how they all interact," Goetz says.
The ITI program at the University of Denver emphasizes management, leadership and values, law and regulations, economics, finance, quantitative tools, freight systems, and global trade.
"Understanding industries around the world and how they operate is critical today. Twenty years ago, that was not the case," says Goetz. "Possessing a grasp of international laws, regulations, and policies improves how logistics professionals direct their companies globally."
The rapidly changing role of technology in supply chain operations represents another vital topic for logistics leaders. "The extent to which technology is now used in everyday logistics activities is amazing," Goetz observes. "It has revolutionized the industry."
Supply chain professionals who want to move into leadership positions should watch industry trends carefully to help anticipate changes that could affect their own company. Continuing education is another good way to develop this vision.
"Improving your educational profile is important," Goetz says. "Certificate programs and workshops can help you prepare for the future."
Goetz directs his students to focus on projects that would be of direct value to the company or agency for which they work. "Real-life problem-solving is a practical approach to developing experience," he says. "We encourage our students to apply their university knowledge to the problem; it moves them one step closer to becoming a good leader."
Stop Texting, Start Talking
Having a big-picture perspective is one vital component of logistics leadership. "Good logistics leaders need to be advanced in their thinking about supply chain visibility," says Lora Cecere, whose enterprise software blog, Supply Chain Shaman, focuses on using enterprise applications to drive supply chain excellence. "They should be able to think about the supply chain holistically."
Communication and math skills are also vital, although they represent areas of weakness among logistics leaders, according to a recent talent survey by Supply Chain Insights, the Baltimore, Md.-based research firm Cecere founded.
"Communication is difficult for many people, but it is so important to success," notes Cecere. "Young leaders, in particular, may be more comfortable texting than talking face-to-face. But listening and communicating are crucial to effective supply chain management."
It's also up to logistics leaders to keep supply chain operations visible within their companies, and ensure that logistics isn't treated as an isolated, behind-the-scenes function.
Keeping up with the sector's fast pace is also essential. "In the past, logistics systems moved slower, with fewer routes or need for customized services," Cecere says. "Today, data is more real time. Good leaders must be able to move quicker, too."
Stay One Step Ahead
There is a significant difference between leadership and management, according to Dave McClimon, who has led Con-way Freight Inc., Con-way Western Express, and Con-way Central Express during his 35 years in transportation and logistics, covering both private and public sector senior and executive level management and leadership positions.
"Many people are good managers, but not good leaders," he notes. "They get too involved in day-to-day issues, and don't look out far enough. Being a good leader means being able to see around the next corner."
McClimon views good leaders as people who can blend four key skills: they are able to plan, organize, motivate, and control. They also need to be very collaborative. "Supply chain touches every corner of a company," says McClimon. "Good leaders must be able to appreciate, understand, and collaborate with those areas.
"They also need to recognize the importance of having good talent on their team to help drive innovation and change," he adds. "Good leaders surround themselves with people who are strong in areas where the leader may be weak."
Looking out for others in the organization is also important. For example, many new college graduates are smart but have no real-world experience. "Because the logistics sector is set for significant growth, and more jobs than it will be able to fill, we have to figure out how to help new graduates gain exposure," McClimon says. "Good leaders will find a way to mentor them, because giving back and helping position young employees for the future is crucial."
Staying attuned to what's happening in the marketplace is also a leadership skill. "Carve out time in your day to read newspapers and trade magazines," McClimon advises. "Attend industry conferences, expose yourself to new ideas, and see how other logistics professionals address challenges similar to yours. Good leaders cannot operate in a vacuum."
Finally, familiarity with analytics and technology is vital. "Supply chain management has become more analytical over the past decade," McClimon notes. "Also, technology is allowing much greater visibility within the supply chain. Today, we are all dealing with an overload of information. A good leader has to be able to analyze and draw meaning from all that data."
Get Competitive, Play to Win
During his 35 years in transportation and logistics, Tom Finkbiner has witnessed considerable shifts in the skills and experience required of supply chain professionals. "The logistics field has changed a lot in the past 20 years," says Finkbiner. "Experience used to be all you needed. Leaders would rise up in an organization through a series of blue collar jobs.
"Today, employees start at a level where they have decision-making capabilities and a real impact on a company's bottom line," he adds. "Education and a quantitative background are vital."
Because companies now use supply chain management as a competitive advantage, "good leaders need ingenuity to differentiate their supply chain solution and make it optimally competitive," Finkbiner notes.
"For a long time, supply chain was simply an expense item," he says. "You control expense items, but you don't manage them. Companies such as Walmart have made supply chain operations a strategic element of their business, taking it from a practical application to a science."
The challenge is that the supply chain has grown and widened. Businesses have consolidated, creating more volume to manage, while globalization has created geographic issues.
"When a company moves from domestic to international distribution, the challenges multiply because it must deal with different laws, a variety of shipping modes, and multiple countries," Finkbiner says. "Managing international freight requires different sets of skills and experiences, and leaders need to be prepared.
"It's not just knowledge of geography that's important, but also understanding different transport modes, and how to optimize the supply chain by using the correct mode or combination of modes," he adds. "Globalization has changed logistics and supply chain management and, as a result, the qualifications required of leaders in the field."