The Human Angle
By Anuja Abraham
Acquiring skilled workers in the industry is as tough as retaining them. Over the years, the role of logisticians has earned them respect in the industry, as well as their scope of work has improved dramatically.
It is a well-established fact that supply chain managers have acquired a strategic role in the functioning of corporates. Earlier, what seemed like an unrewarding job is now the brainchild of many cost-effective concepts and inventions in the back-end. “Logisticians, say 20-25 years back, did not have as an important job apart from making travel and material arrangements,” says Mr. Dharmendra Gangrade, Head-Logistics, Pidilite. “Now their scope of work has expanded to managing the supply chain, inventory management, storing of materials, and transportation management.”
Logisticians are responsible for organizing, scheduling, and managing the distribution of materials. This career grew rapidly in the mid-1980s as manufacturing firms shifted to Just-In-Time delivery.
Many shipping, distribution and user companies have noticed the importance of having skilled logistics professionals within their teams. Their remuneration is at par with industry standards. “In FMCG companies in India, sales and marketing are the highest paying jobs, with logistics coming a close second,” says Mr. Gangrade. “It is a mistaken belief that a job in supply chain and logistics does not pay well.”
Cost-cutting measures are essential to any company in order to focus on profits. “Cost reduction in any of the processes of supply chain affects the bottom line of the company”, adds Mr. Gangrade. “Hence it is essential to retain such talent.”
The constant experimentation, innovation and cost-cutting measures have brought the logisticians to everyone’s notice. “Logistics is no longer a backroom activity, it has become a boardroom activity,” explains Mr. Gangrade.
A renowned company like Apple, where innovation is the core of its philosophy and the raison d’être of its success, is headed by Tim Cook, a logistician. Many big retailers like Tesco and Wal-Mart are run by supply chain professionals. It is the effective operation and deliverance of value at low cost that ensures the company creates brand value and maintains brand loyalty among its consumers. “Logisticians and supply chain professionals have made it to boardrooms in almost all companies in India. Their job and responsibilities count on operational as well as managerial skills,” elaborates Mr. Gangrade.
Better With Technology
IT has played a very important role in creating efficiency in the back-end of the supply chain. Tools like Transport Management Systems (TMS) and Warehouse Management Systems (WMS) have employed methods to manage transportation and warehousing needs. Technology and software solutions like Oracle and SAP have created job opportunities for IT trainees.
As information is freely available all the time, logisticians can benefit from making smarter choices and faster responses. Technology has replaced a lot of manual paperwork, and smart automated storage and retrieval systems (AS/RS) have improved stacking, picking, loading, unloading and other processes in the warehouse.
Implementation of IT in supply chain has also opened up many job opportunities for IT aspirants. “We recruit engineering graduates and provide cross-functional training. They are then absorbed into key supply chain roles as per their capability,” says Mr. Sudhir Mehrotra, COO-Contract Logistics, Future Supply Chains Solutions Ltd. “We give them essential training, guide them and provide them with additional resources to equip them to deal with technology infusion in supply chain.”
Training Gen Y
A Logistics Executive global survey 2011-12 states that 14.97 percent of the total respondents indicated that it is difficult to hire recruits in the spheres of Transport and Logistics. This was followed closely by 10.66 percent in the supply chain area. In the 2010-2011 report 13.35 percent of the total respondents indicated that Transport and Logistics was the most difficult area to recruit in. The survey results for the last four years suggest that very little has changed in the areas that suffer with a skills deficit.
The 2011-12 report also states that whilst career development remains the highest driver of employment decisions at 26.89 percent, salary follows closely at second place at 20.84 percent. Job security and company values follow at 15.32 percent and 15.22 percent respectively. These four drivers outweigh all the other results and are the most important reasons why people join organizations.
Education in supply chain management has largely influenced young minds to overlook the obvious choice of managerial positions. Logistics and supply chain activities provide immense scope for improvement at all levels.
Young trainees are recruited and exposed to all aspects of supply chain: to learn, understand and assess their aptitude against the requirements on the job. They are often expected to travel extensively, to visit factory units, or look after shipping, customs or collaborate with service providers. This continuous diversification in various activities prepares the apprentice to face the real rigours of the job.
“The training will give them exposure to end-to-end supply chain, make them aware of various IT tools, and give them a deeper understanding of the processes that culminates in delivery (the last mile). It also gives them hands-on training and opportunities to look at cost reduction and prepares the trainees to the world of supply chain,” adds Mr. Gangrade.
The performance of employees is evaluated from time to time to ensure consistency and better productivity. “In contract logistics there are visible and measurable performance parameters to assess the various parts of operations like fixed cost, variable costs, service levels, inventory accuracy, customer orientation etc. and hence the evaluation is science-oriented and easily understood, thanks to technology which makes measurement easy,” notes Mr. Mehrotra.
Human Resource Concerns
Another survey by Logistics Executive shows that 27.29 percent of the total respondents indicated that the desire for a fatter pay packet was a key reason that enticed more professionals to leave their organizations. Interestingly, 21.77 percent of the total respondents indicated that executives also left for career advancement reasons.
The all-encompassing role of a present-day logistician is finding many takers in the market. As the numbers of manual unskilled laborers is in abundance in India, attending to the paucity of skilled and intelligent supply chain professionals in India is the need of the hour. With the advent of technology, more professionals are required to concentrate on production planning, inventory, storage, sales and after-service.
It is, thus, crucial that companies take note of concerns over remuneration and job satisfaction, to prevent the loss of skilled talent to competitors. Companies must also take initiatives to ensure the issue of skill gap is addressed.
While opportunities are enormous within the industry, it is difficult to retain employees. “Human resource management, too, plays a crucial role in ensuring proper communication, building interpersonal relationships, defining employees’ career path and providing compensations that are at par with the industry. These are some of the things that go a long way in addressing key employee issues,” adds Mr. Gangrade.
The other common complaints pertaining to HR include remote location of warehouses, difficult operating ambience, cost constraints, and lack of skilled manpower at all levels as the warehousing industry is still in the nascent stages of evolution.
“To control attrition, we continuously build up resources, there is no other choice. Contrary to common belief, since this is the fastest emerging service sector, the growth in career is fastest here as there is a real paucity of talent,” says Mr. Mehrotra of Future Supply Chains Solutions Ltd.
Women On The Field
The uneven ratio of women and men in supply chain is due to the fact that career growth is highly skewed in favor of men. Women are not easily given responsibility in warehouses. “Women are good at administrative jobs. They have a keen, analytical bent of mind. Hence, they produce good results in inventory management and production planning,” adds Mr. Gangrade.
It is an unspoken belief within the industry that women are better sorters since they pay more attention to detail. Women are also better at translating knowledge into action to ease the task at hand.
Padmini Pagadala, General Manager, TPG Consulting, shares her experiences when she taught best practices in warehousing to employees of an American warehouse. According to her, women are more attentive to detail and seemed to welcome ideas about how they could work smarter, instead of harder, to improve their efficiency. The men on the floor, however, had a more lukewarm attitude to the ‘working smarter’ best practices. The concept of having to work less on the floor so they could have more physical energy left, didn’t seem to interest them much.
“We work on both sides of the world. In the US we have found that women perform exceptionally well throughout the supply chain and some of the best performing DC’s I have ever visited or worked within have had very large (majority) female workforces. It seems like there is a great untapped opportunity waiting in India for the country to recruit more women into the supply chain arena,” says Steve Mulaik, Partner, The Progress Group and Director, TPG Consulting Pvt Ltd.
But the Indian warehousing industry is still to accept women on the floor. As noted by our guest authors in their columns, with improved work conditions and increased gender sensitivity among male counterparts, warehouses can become more conducive for women to work in.
Mr. Mehrotra maintains his organization does not follow the norm. “Women take up all kinds of roles in our organization – shop floor operations, systems design, MIS, supervisory roles, stock management, project planning, SCM, management, HR and all support functions. They have extended themselves in almost all functions in the warehouse. This balances the working ambience, less IR involvement & better output,” he clarifies.
The dire need of the hour is to recruit more skilled and efficient professionals in this field. The implementation of IT in the back-end will eliminate the need to employ unskilled laborers to operate the warehouse. Irrespective of the nature of work, women must be given equal opportunities as men, to perform at operational as well as managerial levels.