Buffett’s Move Further Signals Importance of Supply Chain Management Profession, Says Johnson
By Lamar Johnson, senior associate director of the Supply Chain Management Center of Excellence Tight credit, global supplier risk, escalating energy costs, declining consumer confidence, unprecedented earnings pressure, high unemployment...oh my!
The result is a perfect storm for reducing the number of opportunities for college graduates in typical career paths. So this might be a time to consider a new direction.
What careers might flourish in these economic times? It’s never a bad idea to follow Warren Buffett’s lead, who recently acquired Burlington Northern Railroad. Does this mean we should all be looking to get jobs at a railroad company? Not exactly. But Buffett’s purchase, in addition to signaling his confidence in the American economy, provided a boost to those who are thinking about careers in supply chain management. Buffett is betting that because of escalating energy costs there will be a shift from road to rail in the near future for business transportation. And this shift will require an increasing need for logistics professionals who can manage complex supply chain processes that will result.
Actually, supply chain professionals have been playing an increasingly important role across all businesses for at least a decade, and are now recognized as key players in developing and implementing corporate strategy. Supply chain management, long thought of as clerical, technical, backroom functions, has emerged to be recognized as key to driving out waste, cost and inefficiencies from the point of final customer of the product or service all the way back through the system to the original suppliers.
The resulting system improvement can be directly correlated with business growth as costs decline and service improves. The most progressive companies now have a Chief Supply Officer that reports directly to the CEO. The CSO is responsible for all the cross-enterprise business processes including demand forecasting and management, order management, technology integration, warehousing and distribution, manufacturing and supplier management and procurement. Important for the integration of these disciplines is a seamless connection to sales, marketing and product design and development. Skills for supply chain leaders not only include analytical capability and process mapping, but also leadership, diversity and collaboration talents across all the business disciplines within the company and across those of the supplier and customer.
McCombs added a supply chain management program four years ago at the request of leading Austin and Texas-based companies like Frito-Lay, Texas Instruments, Dell, Advanced Micro Devices and Applied Materials. These companies recognized the emerging importance of supply chain professionals and yet understood the shortcomings in academia which taught the component skills of procurement, logistics and manufacturing but not the integration of these skills and how they relate to the overall business process. In four years, the number of supply chain undergraduates has increased fourfold, from about 25 to nearly 100 today. The supply chain concentration at the MBA level has enjoyed a similar growth.
A successful tenant of our supply chain management program is the Supply Chain Management Center of Excellence which brings together faculty, students and industry partners to enable scholarly research, facilitate the development of outstanding academic programs in supply chain management, enable real-world problem solving for our industry partners and encourage the development of future industry and academic leaders in this field.
Supply chain management may well be the hot career path of the next 20 years, and McCombs is well positioned to educate the best in the world.
Thank you, “Oracle.”