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10.1108@ejtd 09 2013 0093 PDF
10.1108@ejtd 09 2013 0093 PDF
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EJTD
38,1/2 Leveraging human resource
development expertise to improve
supply chain managers’ skills and
118
competencies
Received 9 September 2013
Revised 29 September 2013
Alexander E. Ellinger
Accepted 4 October 2013 Department of Marketing and International Business,
The University of Alabama, Tuscaloosa, Alabama, USA, and
Andrea D. Ellinger
Department of Human Resource Development and Technology,
University of Texas at Tyler, Tyler, Texas, USA
Abstract
Purpose – There is an ongoing shortage of talented supply chain managers with the necessary skills
and business-related competencies to manage increasingly complex and strategically important
supply chain processes. The purpose of this paper is to propose that organizations can create and
maintain competitive advantage by leveraging the expertise of human resource development (HRD)
professionals to provide a range of developmental and change-oriented interventions related to critical
supply chain manager skill sets that are currently in short supply.
Design/methodology/approach – This is a conceptual paper.
Findings – This is a conceptual paper.
Practical implications – Supply chain management (SCM) decisions significantly influence
financial performance since firms expend up to 75 percent of their revenue on supply chain activities.
HRD professionals’ intervention capabilities in training and development, organizational development
and change management uniquely equip them to disseminate a deeper and broader understanding of
the SCM concept within organizations, to help prioritize the development of supply chain managers
and to address the complex interpersonal issues associated with helping people to work together
collaboratively to foster operational innovation and make increasingly complex supply chain
processes function effectively.
Originality/value – The requisite skill sets for effective supply chain managers are described,
linkages between HRD and SCM are highlighted, and areas of HRD professionals’ expertise that can be
exploited to better develop supply chain managers’ skill sets and competencies are considered.
Keywords Change management, Organization development, Talent development,
Supply chain manager, Executive coaching, Managerial coaching, Strategic human resource development,
Supply chain management talent, Supply chain manager skills, Training and development
Paper type Conceptual paper
Introduction
European Journal of Training and Supply chain management (SCM) is the proactive management of supply chain
Development activities and processes to maximize customer value and achieve sustainable
Vol. 38 No. 1/2, 2014
pp. 118-135 competitive advantage through the cumulative effort of multiple entities. The SCM
q Emerald Group Publishing Limited industry is growing by more than 9 percent per annum and is poised for sustained
2046-9012
DOI 10.1108/EJTD-09-2013-0093 growth ( Joyner, 2012). Globalization, market turbulence and the increasing role of SCM
in firms’ strategic planning are intensifying the need for talented supply chain Human resource
professionals who can “view the supply chain holistically in terms of linked processes, development
manage critical relationships, understand the business model, engage in statistical
analysis and fact-based decision making, practice advanced cost management and expertise
understand electronic business systems” (Trent, 2004, p. 57). Yet, although
compensation for supply chain professionals is steadily rising (Bradley, 2013), the
SCM industry is experiencing a serious talent shortage that is predicted to get worse 119
(Cottrill, 2010).
The shortage of SCM managers with the requisite broad set of skills to satisfy
ongoing demand can be largely attributed to many firms placing more emphasis on
cost reduction and improving relationships with customers and suppliers than on
developing people to achieve SCM objectives (McCarter et al., 2005; Shub and
Stonebraker, 2009; Sweeney, 2013a). Relative lack of focus on the people dimension of
SCM may also be impeding “breakthrough operational innovation” like Walmart’s
cross-docking, Dell’s mass customization and Apple’s digital online product delivery
that Hammer (2004, p. 84) contends “can destroy competitors and shake up industries.”
According to Hammer (2004, p. 86), “the invention and deployment of new ways of
doing work” often begins as grassroots movements that are driven by a few people
who are passionate about change. However, such operational innovation is relatively
rare in organizations because senior managers tend not to understand, support and
encourage it (Hammer, 2004). Thus, Senge argues that supply chains “need employees
who are innovative – who have the skill and the vision to redesign products, processes,
and business models – and who understand the business context” (Prokesch, 2010,
p. 70).
The SCM talent shortfall is further exacerbated by the lack of resources and
strategic priority devoted to SCM in functionally oriented organizations where senior
level managers tend to have a limited understanding of SCM (Hammer, 2004; Slone
et al., 2007) and of the critical influence that supply chain decisions have on firm
financial performance (Timme and Williams-Timme, 2000). However, recent
prescriptions for achieving SCM excellence contend that acquiring and developing
the right SCM talent is the first component of supply chain transformational strategy
implementation (Dittmann, 2012; Slone et al., 2010).
To address the talent shortfall, SCM thought leaders suggest that firms must
become more proactive in the development of SCM personnel with the necessary skills
and business-related competencies to manage increasingly complex and strategically
important supply chain processes (Christopher, 2012; Cottrill, 2010; Dischinger et al.,
2006; Dittmann, 2012; Fawcett et al., 2010; Slone et al., 2010; Sweeney, 2013a).
Accordingly, considering developmental approaches for addressing and mitigating the
current SCM talent shortfall appears to be warranted.
This conceptual paper proposes that organizations can create and maintain
competitive advantage by leveraging the expertise of human resource development
(HRD) professionals to provide a range of developmental and change-oriented
interventions related to critical supply chain manager skill sets that are in short
supply. HRD professionals’ intervention capabilities in training and development,
organizational development and change management uniquely equip them to
disseminate a deeper and broader understanding of the SCM concept within
organizations, to help prioritize the development of supply chain managers, and to
EJTD address the complex interpersonal issues associated with helping people to work more
38,1/2 collaboratively to make increasingly complex supply chains function more effectively.
The requisite skill sets for effective supply chain managers are described, linkages
between HRD and SCM are highlighted, and areas of HRD professionals’ expertise that
can be exploited to better develop supply chain managers’ skill sets and competencies
are considered.
120
Supply chain management
Originally, introduced by management consultants in the early 1980s, SCM is the
“degree to which a firm strategically collaborates with its supply chain partners and
collaboratively manages intra- and inter-organization processes in order to achieve
effective and efficient flows of products and services, information, money and decisions
to provide maximum value to the customer” (Flynn et al., 2010, p. 58). SCM involves
“doing more with less” by integrating key business processes to maintain required
levels of service while reducing system-wide costs and sustaining cash flow.
Collaborative integration between supply chain participants reduces the cost of doing
business by better aligning incentives and reward systems to minimize inefficient
resource utilization and non-value adding activities (Narayanan and Raman, 2004). Up
to 75 percent of firm revenue is expended on supply chain activities (i.e. purchasing,
manufacturing, moving, storing, selling and servicing products) (Trent, 2004).
Therefore, SCM decisions significantly influence each of the key drivers of firm
financial performance (i.e. revenue growth, operating cost reductions, and working
capital efficiency) (Camerinelli, 2009; Timme and Williams-Timme, 2000).
SCM is based on integration and teamwork that involves “thinking beyond
established boundaries, strengthening the linkages between functions, and finding
ways for them to pull together” (Sweeney, 2013a, p. 3). Integration behaviors include
information exchange, proactive communication, sharing resources and risks, joint
development of supply chain processes, and coordinated planning and
decision-making within and among supply chain participants. Developing
co-operative relationships between supply chain participants is a pre-requisite for
creating customer value because “unity of effort” (Lawrence and Lorsch, 1967) between
interdependent entities is required to gain competitive advantage in the marketplace
(Alderson and Martin, 1965; Drucker, 1973; Porter, 1985). Supply chain integration
creates customer value because knowledge sharing connects sourcing and
manufacturing operations with market requirements to better match supply and
demand (Esper et al., 2010).
There are, however, relatively few firms with effectively integrated supply chains
largely due to the prevalence of functionally oriented organizational structures that
prioritize the goals and objectives of individual areas instead of the collaborative
teamwork and integration required for successful cross-functional service processes
(Liedtka, 1996; Trent, 2004). Cross-functional collaboration is unstructured, informal
communication that is dependent upon peoples’ ability to trust each other, build
meaningful relationships, and appreciate one another’s expertise that enables
functional areas to “converse, learn and work across the silos that have characterized
organizational structures” (Liedtka, 1996, p. 25).
However, in many firms, overlapping functional responsibilities coupled with
conflicting departmental priorities and mindsets continue to make service failure a
distinct possibility whenever customer order fulfillment entails crossing functional Human resource
boundaries (Kingman-Brundage et al., 1995; Shapiro et al., 2004). Research further development
suggests that internal integration enables external integration because firms that
effectively communicate, share information, and collaborate across functional areas in expertise
their own organizations tend to be proficient at doing the same with external supply
chain participants (Flynn et al., 2010; Zhao et al., 2011). A major reason for the lack of
integration and collaborative teamwork in many firms is lack of emphasis on 121
developing supply chain talent with the requisite range of skills for engaging in such
behavior.
Study Skills
Consistent with Cottrill’s reasoning, Slone et al. (2010) and Christopher (2012) provide
similar rationales for the skill sets proposed in their studies. Drawing upon
Leonard-Barton’s (1995) notion of T-shaped skills profiles, Christopher (2012) suggests
that such skill sets can be achieved by developing supply chain managers that have
in-depth expertise in one discipline combined with enough breadth to see connections
with others. In addition, Fawcett et al. (2010, p. 22) argue that “the indispensible supply
chain leader” is a cross-functionalist who “understands the key supply chain functions
and keeps them rolling in synch,” a choreographer who sees “the big picture while
understanding where individual pieces fit the pattern,” a coach who “teaches, mentors
and motivates others to contribute as part of a team,” and a champion “who establishes
credibility throughout all levels of the organization, thereby enabling the individual to
be an effective catalyst for supply chain change.” The next sections address linkages
between HRD and SCM and propose ways that HRD professionals can contribute
towards the development of supply chain managers with the requisite skill sets.
HRD expertise and the development of supply chain manager skill sets
In many organizations, HRD professionals are responsible for designing and
implementing training and employee development initiatives that improve employee
and organizational performance and facilitate change at individual, group and
organizational levels (Swanson and Holton, 2009). HRD professionals’ intervention
expertise would appear to uniquely qualify them to address the complex
interpersonal issues associated with helping people to work collaboratively to make
supply chain processes function effectively. However, a recent series of industry
reports that examine SCM talent development commissioned by the Council of
Supply Chain Management Professionals (CSCMP) suggest that improvements can
be made in terms of how training funds are allocated. Further the reports suggest
EJTD that current training and development programs for SCM personnel need to be more
38,1/2 thorough and strengthened. Thus, leveraging the training and development
expertise of HRD professionals to cultivate the skill sets for SCM managers
presented in Table I may be an appropriate approach for addressing these
challenges.
Citing the need to develop and enhance human capital, the CSCMP publication
124 examines the recruitment and acquisition of supply chain talent, training and
education, and some forward thinking issues like talent progression and succession
planning (Gibson et al., 2013). With regard to training and development, the findings
presented in SCM Talent Development: The Development Process show that funding
for the development and education of SCM personnel is often treated as discretionary
spending as opposed to an ongoing budgeted item. The study also reports that while
leading organizations understand the need for sustained investment in training to
improve SCM employees’ capabilities, not all organizations invest in training. The
research also indicates that there is considerable variability in the amount of training
provided based on management level. Training investment is highest for executives.
Yet, calls for the growth and development of supply chain personnel contend that the
skill sets of supply chain managers at all levels must be enhanced (Cottrill, 2010;
Dischinger et al., 2006).
The CSCMP research also reports that training methods employed are
predominantly hands-on (i.e. learning by doing), and suggests that, although
considerable progress is being made, more comprehensive training programs for
supply chain personnel are still needed (Gibson et al., 2013). The most widely
addressed training topics reported in the study findings include demand planning,
inventory management, purchasing, and customer service. More general training
topics addressed by respondent organizations include project management, process
improvement, and leadership. However, the most commonly addressed training topics
highlighted in the CSCMP study may not be entirely aligned with developing the
requisite skill sets for effective supply chain managers depicted in Table I.
Best practice firms treat personnel development as a “strategic need” (Gowen and
Tallon, 2003). Thus, Aguinis and Kraiger (2009, p. 466) suggest “organizations that are
able to realize the benefits of training [. . .] are able to move away from viewing the
training function as an operational function or cost center to one that is value driven”.
Given the variability of firms investment in training reported in the CSCMP study, and
the prevalence of informational and hands-on training for SCM personnel described in
Gibson et al.’s (2013) research, the development of supply chain managers may be
contingent on partnering with HRD professionals to ensure that the training and
development provided is more focused on growing the requisite skill sets shown in
Table I.
Extant research consistently demonstrates that training and development benefits
individuals, teams and organizations (Aguinis and Kraiger, 2009; Birdi et al., 2008).
Aguinis and Kraiger’s (2009) review of the training and development literature further
indicates that developmental interventions affect recipients’ declarative, procedural
and strategic knowledge and that the most effective training programs include
cognitive and interpersonal skills. The review also acknowledges that the benefits
associated with training extend beyond performance issues at the individual and team
levels to the organization. Aguinis and Kraiger state that studies support the
performance benefits of training to the organization that include “improved Human resource
organizational performance (e.g. profitability, effectiveness, productivity, operating development
revenue per employee” (Aguinis and Kraiger, 2009, p. 459) and also indirect benefits
associated with turnover, and organizations’ reputations. A number of approaches and expertise
strategies have been found to maximize the benefits of training including: needs
assessment and pretraining states, training design and delivery, training evaluation,
and transfer of training (Aguinis and Kraiger, 2009). With expertise in these areas, 125
HRD professionals may be able to improve existing training given some of the noted
shortcomings associated with existing SCM training programs.
Developmental interventions can be targeted toward individual supply chain
managers to expand and develop the requisite skill sets and competencies. At the
group and team levels, interventions designed to enhance supply chain managers’
influencing skills to help build teamwork and resolve cross-functional conflicts can be
implemented. At the organization level, HRD interventions to enhance supply chain
managers’ competencies as change agents would help to promote the cultural changes
and understanding needed to successfully implement the myriad of operational
process and technological initiatives characteristic of today’s supply chains.
Additionally, since systems theory and systems thinking are critical underpinnings
of HRD practice, HRD professionals may also contribute by helping to disseminate a
deeper and broader appreciation of the SCM concept within organizations to combat
the fundamental lack of understanding that is all too frequent among non-supply chain
(Trent, 2004) and upper level managers (Slone et al., 2010).
Table II presents a summary of potential HRD approaches that can be exploited to
grow the requisite skill sets of supply chain managers and more effectively
disseminate the SCM concept throughout organizations. The next sections elaborate
upon the four HRD approaches considered in this article.
Executive coaching
At the mid, senior, and executive levels, executive coaching is becoming an increasingly
prevalent skill-development intervention (Baron and Morin, 2009). Kilburg (2000, p. 65)
defines executive coaching as “a helping relationship formed between a client who has
managerial authority and responsibility in an organization and a consultant who uses a
wide variety of behavioral techniques and methods to assist the client to achieve a
mutually identified set of goals to improve his or her professional performance and
personal satisfaction and consequently to improve the effectiveness of the client’s
organization within a formally defined coaching agreement”. Similarly, Stokes and Jolly
(2010) suggest that executive coaching enables senior level executives to become more
self-aware thereby enhancing their effectiveness in leadership roles. Baron and Morin
(2009) identify a number of empirical studies that suggest executive coaching is
positively associated with self-efficacy, leadership, organizational commitment, conflict
resolution, and individual performance.
Although typically provided by an external coach or consultant, HRD professionals Human resource
are often equipped with the expertise necessary to help senior managers in need of development
executive coaching because of their consulting and change facilitation skills. Slone
et al.’s (2007) article entitled, “Are you the weakest link in your company’s supply expertise
chain?” provides a template of topics whereby executive coaching may help CEOs to
not “become unwitting weak links in their companies’ own supply chain strategies” (p.
117). Given the critical nature of supply chain operations in organizations, Slone et al. 127
identify seven areas influenced by CEOs: picking the right leaders, initiating
benchmarking and devising metrics, setting incentives for supportive behavior,
keeping up with supply chain technologies and trends, eliminating cross-functional
crossed wires, adding supply chain insight to business planning, and resisting the
“tyranny of short-term thinking”.
Slone et al.’s (2007) research provides a self-assessment tool for CEOs to evaluate
their level of supply chain leadership across the seven key areas as well as some
strategies to help CEOs address low scores on the self-evaluation. The recommended
strategies include hiring top supply chain talent, rewarding behavior that benefits the
entire organization, and investing personal time in learning about industry innovations
and new technologies. It is possible that executives and CEOs who are not sufficiently
“up to speed” with SCM may need some personalized development in order to fully
engage and ensure that they are not acting as “unwitting negative influences.” In such
instances, executive coaching may represent a developmental approach that can serve
to enhance CEOs’ understanding and appreciation of critical SCM-related strategic
issues and encourage the requisite behaviors and knowledge to leverage SCM for
competitive advantage.