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Best Practices for Dealing with CPG Supply Chain Talent Shortages

Analyst Insight: The consumer packaged goods (CPG) industry is in the midst of a supply chain talent shortage across all functions, but particularly in planning roles. CPG companies have had to adapt many strategies to maintain an adequate level of supply chain talent in their organizations. Today, it is more important than ever for these companies to place a premium on retaining and finding supply chain talent. – Bruce Tompkins, Executive Director, Tompkins Supply Chain Consortium

Best Practices for Dealing with CPG Supply Chain Talent Shortages

Tompkins International completed a survey on the needs for talent in CPG companies, and the results offered valuable insights into how leading companies are enhancing their supply chain talent position.

For instance, leading CPG companies are evaluating and monitoring employee satisfaction closely as they are in high demand. Because companies are becoming more demand-driven, there is a need to retain and find supply chain professionals that more closely respond to customer demand.

Industry leaders are also bringing in international transportation staff that has experience in Incoterms, customs and direct relationships with carriers and non-vessel operating common carriers (NVOCCs).  Companies are taking the necessary steps to secure these resources.

Survey respondents identified China as an area critically short of supply chain talent. Companies should consider retaining outside help to identify and train local employees to fill supply chain needs in China.

There is also supply chain talent who may not be in the market for a new job. There is a battle for talent, and the best candidates are not necessarily actively engaged in a job search. These people can potentially save a company millions of dollars in supply chain costs. Companies should also consider developing a relationship with a recruiting /search firm that specializes in supply chain talent, as well as develop a relationship with top colleges and universities that have substantial supply chain programs at both the undergraduate and graduate levels.

The survey highlighted the importance of creating internal training programs and personal development certifications to train the supply chain organization “up.” Companies need to manage supply chain talent as diligently as they manage their supply chain. Put in place a talent planning process that is based on projected growth numbers, company initiatives and employee turnover. Evaluate this plan on a regular and frequent basis, and do not forget to create a compensation program to monitor and reward top producers.

The reality is that nearly three-quarters of CPG companies surveyed have experienced a significant organizational event (e.g., layoff or hiring freeze) in their supply chain ranks in the past 18 months.  This is compared to an overall industry average of 66 percent who experienced a significant event. These percentages speak volumes.

Turnover in CPG companies is lower than the average, except in manufacturing where it remains high.  CPG companies expect future turnover to be greater than in any other industry surveyed, so most believe the worst supply chain personnel shortages are yet to come.

                                                             The Outlook

There is a significant gap between the needs of CPG companies versus the supply chain professionals coming from colleges and universities who are formally trained. The best solutions may lie in cross-functional training of experienced, dedicated employees into the supply chain field as needed. Retaining and re-training of talented people is more cost-effective than recruiting and hiring practices. CPG companies must recognize the shortage of supply chain talent and take steps to overcome it.

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