Restless Nights For Supply Chain Executives

All the Ambien in the world may not be enough to keep some executives in Zzzzs.

The latest report from Michigan State University, in conjunction with the APICS Supply Chain Council, found that a half dozen key issues keep executives up at night, with an emphasis on challenges that loom as sinkholes for costs.

Among the most prevalent issues, for executives across the more than 50 firms that were surveyed, included capacity and availability of resources. In this instance, market growth — anticipated and real — is a good thing.

But, to the respondents to the survey, there are real costs involved in realizing that growth as old equipment must make way for new equipment and new processes must take root. There’s also the intent to avoid outsourcing, noted the survey, even as growth may be stellar, as it also places demands and strain on the supply chain. As one respondent noted: “A supply chain is a living, breathing thing, and one needs to think about it as dynamic and impermanent. Is there a point where the supply chain becomes inappropriate for where we’re going and we need to build a different kind of supply chain?”

With supply chain growth and need for new systems come the need for data system capacity, with an eye on data accuracy and appropriate staffing levels that move beyond mere hiring and focus on continuity planning.

That segues directly into the competition for talent, noted the survey. Executives worry about keeping new hires on board and also helping that new talent develop. Talent development is a long-term endeavor, said the respondents, with fruit yielding only a year after new people come on staff — a challenge in an age where millennials typically job hop.

Within the supply chain itself, the complexity of the relationships between products, the suppliers who offer them and the people who work at the suppliers presents knotty challenges, too, said executives. There’s always the challenge of leverage and price negotiation. Supply chain risks remain top of mind, with worries over natural disasters and other unforeseen events.

As one executive noted, supply chains can have their own crises, as “it can be an issue with a supplier, an issue with the production process or customers. The supply chain network, in terms of responsibility and risk, is in the middle. So, we could have many reasons to stay awake at night. If there is a recall of batches, crisis in the country or war, we are the ones called upon to make it right.”

Compliance remains a key concern, especially in terms of effective time management. Government actions are on the rise. And, as for pricing pressures, those issues remain ubiquitous, with health care costs a keen worry.