Supply Chain Education: Aiming High
The 6 essential competencies for gaining a foothold in a supply chain or logistics career.
Whether you attend business school, engineering school, or the school of hard knocks, there's more than one educational path to a career as a supply chain professional. Whichever route you take, you need to develop certain crucial knowledge and skills along the way.
Opinions vary on which competencies are most crucial—and, of course, the list also depends on the type of supply chain role you plan to take on. But after talking with leaders at some university programs and with corporate executives, we've compiled a list of six essential areas where graduates embarking on supply chain careers need to excel.
1. Nuts and Bolts
Obviously, you have to start with the essential concepts. "We want candidates to have a basic understanding of supply chain," says Kathryn Mullen, senior director of talent management at Atlanta-based third-party logistics (3PL) services company Americold. When Americold chooses applicants for its internship programs and early career positions, one criterion is a background in courses that teach supply chain processes.
Understanding logistics processes is also an important competency for candidates who apply to work at 3PL Dachser USA. "Those processes include the intricacies of transportation—in our case, international transportation—via air freight and sea freight," says Frank Guenzerodt, president and CEO of the Atlanta-based company. "They also include warehousing, contract logistics, and inventory management."
To give students that foundation, some programs take a broad, end-to-end approach. Penn State University is one such program. "Our students today see everything from planning and forecasting all the way to delivery at the final point of demand," says Robert Novack, associate professor of Supply Chain and Information Systems at Penn State's Smeal College of Business in State College, Pa. The program bases its curriculum on the APICS Supply Chain Operations Reference (SCOR) model, which encompasses six basic processes: Plan, Source, Make, Deliver, Return and Enable. Penn State offers an undergraduate major in supply chain management, plus MBA and PhD degrees with concentrations in that discipline.
The University of Tennessee (UT), Knoxville also uses the SCOR model to define the content areas covered in its supply chain management programs. Those programs include a bachelor's degree in business with a supply chain major and an MBA with a supply chain concentration.
"We take an applied, end-to-end approach," says Chad Autry, William J. Taylor Professor of Supply Chain Management and head of the business school's Marketing and Supply Chain Management program.
UT also teaches how supply chain components work together as an integrated whole. Of course, it's important to take a deep dive into individual disciplines. "But then, our emphasis in every course is on how your decisions influence other functionalities in the supply chain," Autry says.
As a professional, while you might concentrate on cutting logistics costs or eliminating damages, ultimately you must consider how your initiatives affect your company's balance sheet and income statement, he adds.
To teach students that holistic approach, UT uses digital and physical simulations, among other tactics.
"At the beginning of the program, we put students in an environment where they have to manufacture a product using Legos, marbles, or poker chips," Autry says. Students discover that if each group in the exercise perfects just the functions in its own silo, that hampers the overall system.
Later, students tackle more challenging simulations. "These allow them to figure out how to sub-optimize the functions in order to optimize the whole," he says.
In the W.P. Carey School of Business at Arizona State University, students in several supply chain and logistics programs get an overview of the industry in an introductory course, followed by courses on operations, logistics, and procurement. "Then we have a capstone class to tie that all together," says John Fowler, Motorola Professor of International Business and former chair of the Supply Chain Management Department at the university, in Tempe, Ariz.
Arizona State offers a BS in Supply Chain Management, a BA in Global Logistics Management, an MS in Global Logistics, an optional supply chain specialization within its full-time MBA program, and a PhD in Supply Chain Management.
2. Tools and Methodologies
Like their counterparts in business school, students in supply chain programs in engineering schools learn to combine all the components of a supply chain into a well-functioning whole. Engineering programs place special emphasis on mastering the tools you need to produce that outcome.
"The main core competency we provide is how to model supply chain systems," says James Noble, a professor in the Industrial Manufacturing Systems Engineering Department at the University of Missouri. His department offers an undergraduate degree with a concentration in logistics.
Missouri's program includes four courses that teach tools used in modeling—linear optimization, stochastic modeling, simulation, and data analysis. As part of their capstone coursework, industrial engineering students use those tools to conduct real-world projects for companies. About half of those students work on projects related to the supply chain.
Although the University of Michigan's one-year MS in Supply Chain Management is part of the Ross School of Business, it approaches the supply chain from both the managerial and the engineering perspectives.
"There are a lot of analytics involved in solving supply chain management-related problems, whether it's a network design problem, an inventory management problem, or something else," says Ravi Anupindi, David B. Hermelin Professor of Business Administration, professor of Operations Management and former faculty director of the Masters of Supply Chain Management program.
It takes specialized tools and methodologies to solve such problems. Students at Michigan learn optimization, statistics, and other techniques for extracting knowledge from data. The Ross School also partners with software provider Llamasoft to give students experience in modeling supply chain networks.
Students in Arizona's supply chain and logistics programs all take a business analytics course that covers data analysis, data mining, data visualization, and various kinds of modeling. They do much of that work with a tool called Risk Solver Platform for Education (RSPE), an add-on to Microsoft Excel. "Then we try to build upon that in the other classes by forcing students to use some of that knowledge," Fowler says.
The analytics class also provides experience with the SAP enterprise resource planning (ERP) system—not to learn that product in depth, but to become familiar with the capabilities found in that category of solutions.
At Pennsylvania's Lehigh University, the methodologies that students master include risk mapping. "We identify risks and then we look at the probability of occurrence, and the impact of that risk," says Robert Trent, director of Lehigh's Supply Chain Management program, which offers an undergraduate degree plus an MBA with a supply chain concentration.
Students learn to consider risks such as the chance that a supplier might go bankrupt, or that natural disasters or political turmoil can cause supply interruptions. They practice risk assessment skills in exercises that might, for instance, ask them to identify the supply chain risks a company faces, categorize those risks, and devise strategies for prevention or mitigation.
In addition, courses at Lehigh cover methodologies such as Lean Six Sigma, group problem solving, and value analysis.
Like their peers on many other campuses, supply chain students at Lehigh also learn how to extract sophisticated knowledge from the masses of information that businesses collect in the course of their operations. "Many students take the Business Information Systems minor, where we have a class on big data—predictive analytics," Trent says.
3. Business Savvy
Because a well-run supply chain is crucial to a company's success, supply chain professionals must understand not only the flow of materials, components, and finished goods, but also appreciate how that flow affects the business as a whole. To communicate with colleagues throughout the company, they have to speak the language of business and understand the workings of the businesses that employ them.
"Supply chain doesn't exist by itself; it's an integrator across the company," says Noble. Supply chain professionals should be able to show peers in other departments, in quantitative terms, how supply chain improvements will benefit the business.
The industrial engineering program at Missouri doesn't include business courses, but supply chain majors can take business electives. About one-quarter of those majors opt for a five-year program that lets them earn both a bachelor's degree in engineering and an MBA, Noble says.
Missouri's students further sharpen their business perspective when they work with companies on their capstone projects. "Over the course of one year, they work with managers, line people, engineers—the whole group," Noble says. "That in itself becomes very multidisciplinary."
UT's programs also integrate supply chain concerns with general corporate issues. "We see the supply chain through a business lens, rather than a purely operational lens," says Autry. Courses examine how supply chain decisions affect not only operational metrics, but all financial metrics.
"It's about total landed profit, rather than creating a better fill rate or reducing total spend—driving it all the way, as high in your organization as possible, financially," he adds.
Students aiming for managerial positions in supply chain must learn to think about how the supply chain interfaces with other elements in the organization, and also how the supply chain of one company interfaces with the supply chains of other companies. "Students need to learn about the challenges in managing those interfaces, which are more organizational challenges," says Anupindi. "How do you work with other people, how do you get other people to see your viewpoint?"
You can't work out those issues on a spreadsheet. "It's a managerial skill set that students learn," he says.
Along with risk management, financial management has emerged as an important new emphasis for the programs at Lehigh University. The school added finance to the curriculum because industry leaders now understand that supply chain management is central to a company's business strategy.
If a supply chain manager tells corporate executives that inventory is now turning four times each year instead of three, that won't mean much to the executives. It's much more useful to demonstrate the impact of that faster turn on a corporate indicator such as return on assets. "The language of business is finance," Trent says. "Corporate people aren't going to learn the language of supply chain; you're going to have to speak their language."
4. Global Outlook
In an increasingly global economy, a strong international perspective is crucial for anyone who wants to advance in a supply chain career. As an international 3PL, Dachser favors candidates who have a good grasp of geography and understand trade agreements, Guenzerodt says.
Even more than that, supply chain professionals at Dachser must appreciate how cultural norms vary around the world.
"Our people need to know how to deal with their counterparts in China, Europe, and Latin America," Guenzerodt says. "There are intricacies of day-to-day business that come from cultural differences."
Spending a semester abroad, or conducting a project that involves international travel, might give candidates an advantage. "But they should at least understand the cultural differences—for example, how you address people in Asia versus Europe," Guenzerodt adds.
Speaking a foreign language can be helpful—for example, learning Spanish or Portuguese in order to conduct business in Latin America, Guenzerodt says. Because English is the language of international business in Asia and Europe, students don't necessarily need to master Mandarin or even French. But they do need to understand the subtleties of communicating in English with non-native speakers. "They may say things that sound different in American English from what they actually mean," he adds. Real communication in such cases demands tolerance and flexibility.
Learning a foreign language, becoming familiar with other cultures, or traveling to unfamiliar places can all give a student an advantage in the job market, Autry says. The program at UT tries to push students into the international scene as early as possible, and nearly 50 percent of its students gain some kind of international experience before they graduate. That experience might come from a semester abroad, or it might come through one of the 30-day mini-courses the university offers overseas.
"You've got to get out into another country that makes you a little uncomfortable," Autry says, adding that a semester in Toronto, for example, might not deliver the necessary sense of dislocation. UT has been developing programs in South America, Central Europe, and China and has also sent students to Australia and New Zealand.
5. Soft Skills
For all the emphasis supply chain programs place on the mechanics of the supply chain and the tools you need to manage one, it takes something more to launch a successful career. "We look for leadership capability," says Mullen at Americold. "It's great if candidates have the hard skills. But if they don't have the soft skills and the ability to influence their peers, it's not necessarily a winning combination."
Autry agrees. "We hear from our industry partners especially, and also from students who come back after graduation, that soft skills still matter." Logistics professionals need to develop a high social IQ, become fast on their feet, know how to make presentations, and know how to negotiate or collaborate with a supplier. "Those are skills that business schools don't teach, but that businesses require in order for the supply chain to work," he says.
Professors in UT's supply chain program constantly look for new ways to help students develop those soft skills, Autry says. For example, students do exercises to learn how to develop relationships with suppliers or customers. "We try to get them to understand that just because you have an interest doesn't mean the other party sees it the same way," he says. "They need to work on that together."
Students also do simulation exercises that require them to work out issues in a cross-functional team. "We try to get people to see the world through the eyes of other people in their business," Autry says. "Students start out thinking that everyone is looking at an issue in the same way, and then they discover this is not the case."
At Missouri, professors spend a lot of time teaching supply chain students how to communicate and sell their ideas, both in writing and in person. To polish presentation skills, each student in the capstone course makes a presentation just about every week. "Sometimes they get graded on what they present," Noble says. "But they also get graded on the critiques they provide to other groups."
Students also learn to communicate concisely, paring a message down to three or four minutes—"learning, effectively, how to deliver a TED talk," Noble says.
Of course, students also face many opportunities to develop soft skills outside the classroom. An interviewer at Americold might ask a candidate about summer jobs, on-campus clubs, or other settings that gave them leadership opportunities. "We might also say, 'Tell me about a time when you were part of a group and you had to serve as an informal leader'—to be able to assess what people have done in real-life situations," Mullen says.
6. Real-World Experience
When you want to show a potential employer that you know your stuff, there's nothing like a resume that features experience with a company in your industry. A student in a supply chain management program usually gains that experience through one of two routes—doing a project for a corporate sponsor as part of the coursework, or working in a supply chain capacity through an internship or co-op.
Michigan's Master of Supply Chain Management program includes a course that sends teams of two or three students to work as consultants for corporations. "There are clear deliverables for the company's project outcomes," Anupindi says. The course is open to supply chain management students and to MBA candidates who are interested in the supply chain.
A few years ago, for example, a student team worked with Cummins Engine in Columbus, Ind., exploring whether a Cummins joint venture in China should modify its strategy for remanufacturing. "Also on the table was whether the China remanufacturing facility should have an import strategy, taking engines from that region, bringing them into China for remanufacturing, and sending them back," Anupindi says.
Among other things, students had to consider import regulations and whether to relocate the plant closer to a seaport.
A supply chain student who participates in Penn State's Schreyer Honors College may do a project for a company as a senior thesis. In one recent project, a consumer packaged goods company gave a student a summary of its freight bidding process—a spreadsheet 60,000 lines long and 24 columns wide. "They wanted her to develop what I call a post hoc analysis, to see how well they did on their bids," Novack says. "She found around $7 million in potential savings left on the table."
Americold sponsors nine-week summer internships, each with its own objectives for skills the intern should gain. "At the end, there's a capstone project where the interns have to present to a broad group about what they learned," Mullen says.
One recent internship focused on safety at the 3PL. "They worked on all types of operations in the facility, but they focused on what types of safety training we were doing," Mullen says. "Were we ensuring that all associates were trained? How could we improve the process and the tracking?"
At Arizona State, about 90 percent of supply chain students do at least one internship, says Fowler. Most of the others work part time while attending school, so nearly everyone graduates with practical experience.
Not only do students learn leadership skills through those experiences, but they also gain more appreciation for material they cover in class, such as the use of spreadsheets. "Their Excel skills almost always improve, because they end up doing projects in the company that require it," Fowler says.
In addition, once students see supply chain principles in action at a company, they return to class prepared to hold much richer discussions. "When they hear from each other about things they've done in internships, it can be more powerful than what they hear from the faculty," he adds.
The best university programs blend theory, practice, and practical experience to help students make a smooth transition to employment. Having gained essential knowledge about the supply chain and mastered crucial skills, these graduates are well-positioned to begin the climb toward rewarding careers.