Supply chain professionals have played an important role in their companies' success over the last couple of decades. Globalization has been possible in good measure because of their ability to connect and manage supply chain nodes around the world. The term "supply chain" has seeped into popular usage—how often do we hear it or read it in news reports these days?—yet the profession remains largely unknown.
Joel Sutherland, who has had a remarkable career in logistics and supply chain management, made note of that a few months ago when he accepted the Council of Supply Chain Management Professionals (CSCMP) 2009 Distinguished Service Award.
Sutherland remarked that as he left his hotel that morning, he had mentioned to the doorman that he was on his way to a supply chain conference. The doorman wondered just what that was all about. Like most people, he had no idea that everything he touched came to him via one supply chain or another.
Sutherland's conversation with the doorman reinforced something most of us already know: The field of logistics and supply chain management has a long way to go to get the recognition and respect it deserves. It is a profession that touches everyone and has made vast improvements in our daily lives, yet for the most part, it's invisible to the general public.
Not only is it invisible to the public, but the profession—and its role in corporate success—often goes unacknowledged in the executive suite. In a recent issue of consultant ARC's online publication Logistics Viewpoints, Adrian Gonzalez observed that CEOs and managing directors have historically viewed logistics as more of a cost center than a competitive differentiator. That's why many are willing to outsource logistics operations to 3PLs. He added that the true test of whether top executives value logistics is their willingness to invest in it.
Gonzalez argues that there's more to persuading senior management of the value of logistics and supply chain management than simply translating that value into financial terms. "Most [CEOs] are supply chain and logistics illiterates," he writes. The only way to get them to understand supply chains, he suggests, is to get their hands dirty—picking orders in a DC, working on a dock, riding along in a truck—to see first hand what's involved. At the very least, Gonzalez says, you ought to bring executives along to some of the major industry conferences.
It's a great idea, although I'm not sure how practicable it is. The CEOs who should go are the ones who don't understand that they need to go. The ones who do understand probably don't need to go.
Some do understand, of course. And theirs are among the most successful companies of the past decade or more. They recognize that lean inventory, short cycle times, and even accelerated cash-to-cash cycles depend on transparent and reliable supply chains—and on the men and women who make them work.