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Supply Chain Execs Say Talent Shortage is Blocking Innovation

March 20, 2014
The talent shortage is being felt by 65% of the respondents to a new survey who indicated that process, technology and skill set gaps exist within their company.

The top two top strategic priorities of executives are supply chain analytics and multichannel fulfillment, according to a new study released today by MHI and Deloitte Consulting LLP titled “Innovations That Drive Supply Chains – The 2014 MHI Annual Industry Report.”

Preventing innovation in the supply chain are both a talent shortage and a continuing focus on cost reduction.

The talent shortage is being felt by 65% of the respondents who indicated that process, technology and skill set gaps exist within their company. This becomes especially problematic with the 1.4 million new jobs that will be created by 2018, according to MHI’s recently published report, “The U.S. Roadmap for Material Handling & Logistics.”

On the cost side of the challenges, cost reduction is still the No. 1 priority for many supply chain executives. More than 70% of respondents across industries said that controlling costs is a top priority for their companies and their customers.

In fact this focus on cost-cutting in the supply chain is squeezing out innovations in sustainability, even though executives believe these investments are important. Nearly four out of five respondents (79%) felt that sustainability was at least “moderately important.” More than 60% of respondents indicated that significant capability gaps exist in their companies and clients that may prevent them from effectively implementing sustainability programs.

One innovation that will impact the supply chain is Mobility and Machine-to-Machine (M2M) technologies which can improve responsiveness and customer service by providing supply chain workers with the information they need – whenever and wherever they need it. Nearly three-fourths (73%) of respondents said their companies will continue to invest in this area, with nearly half planning to increase their investment over the next three years.

However another innovation, 3-D printing, is not yet on the radar for supply chain executives. Only 17% of respondents view 3-D printing as a strategic priority, with 70% reporting that 3-D printing is not a key consideration.

About the Author

Adrienne Selko | Senior Editor - MH&L, IW, & EHS Today

Adrienne Selko has written about many topics over the 17 years she has been with Endeavor Business Media and currently focuses on workforce development strategies. Previously Adrienne was in corporate communications at a medical manufacturing company as well as a large regional bank.

She is the author of Do I Have to Wear Garlic Around My Neck? which made the Cleveland Plain Dealer's best sellers list. She is a senior editor at Material Handling & Logistics, EHS Today, and IndustryWeek. 

Editorial Mission Statement:

Manufacturing is the enviable position of creating products, processes, and policies that solve the world’s problems. When the industry stepped up to manufacture what was necessary to combat the pandemic, it revealed its true nature. My goal is to showcase the sector’s ability to address a broad range of workforce issues including technology, training, diversity & inclusion, with a goal of enticing future generations to join this amazing sector.

Why I Find Manufacturing Interesting: 

On my first day working for a company that made medical equipment such as MRIs, I toured the plant floor. On every wall was a photo of a person, mostly children. I asked my supervisor why this was the case and he said that the work we do at this company has saved these people’s lives. “We never forget how important our work is and everyone’s contribution to that.” From that moment on I was hooked on manufacturing.

I have talked with many people in this field who have transformed their own career development to assist others. For example, companies are hiring those with disabilities, those previously incarcerated, and other talent pools that have been underutilized. I have talked with leaders who have brought out the best in their workforce, as well as employees doing their best work while doing good for the world.