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How Important are Knowledge Workers to a Supply Chain?

By Herb Shields | 06/15/2011 | 12:40 PM

Several weeks ago I participated in an interesting discussion with a group of middle managers who work in supply chain roles here in Chicago.  Most are APICS certified practitioners who deal with supply chain issues every day.  Several people had lost jobs and found jobs during the last three years.  We all agreed that most companies have eliminated a significant number of middle managers and knowledge workers.  Several of the participants are carrying a broader responsibility because the next few cubicle or offices that used to house other people are vacant.

 Two recent reports helped me decide to address this question in my blog.  Thompkins Associates issued a new report on the top priorities for consumer products supply chains.  The list includes many important topics – i.e. outsourcing, globalization, China, inventory/SIOP, etc.  It is a good list but what is not mentioned is any priority having to do with people in an organization. 

 Wharton management professor Ethan Mollick recently published a paper that addresses the issue of knowledge workers in what he calls “knowledge based companies” in industries such as high tech, gaming, and biotech.  His advice: “Pay closer attention to your middle managers. They may have a greater impact on company performance than almost any other part of the organization.”  While Professor Mollick does not include consumer products, some of us would agree that knowledge workers are essential for the success of that industry and supply chain processes in general.  Having managed a very effective supply chain organization myself, I credit my managers for most of our success.

 I spent the last few years of my corporate career with Unilever and observed the following: as Unilever consolidated three separate companies into a North American consumer products business, many knowledge workers ended up leaving the company.  Those leaving included many scientists, process engineers, and supply chain professionals who had spent their careers in specific disciplines of value to consumer products companies. The majority of those people are now applying their knowledge elsewhere.

 In the years prior to the recession of 2008/9, there were numerous articles and internet commentary on the coming shortage of trained professionals to replace the baby-boomers as they retired.  With unemployment still in the range of 9%, and the significant consolidation that has occurred in many verticals, that topic is now passe’.  Most economists continue to project recovery through 2012.  As the economy continues to improve, I think that Professor Mollick’s position on knowledge workers will become an important priority for consumer products and supply chain organizations.

 What do you think?

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About Herb Shields

Herb Shields

Herb Shields has run Chicago-based HCS Consulting since 2000, helping clients across multiple industries and in higher education improve their supply chain strategy and execution. Shields has more than 30 years as an operations executive for capital equipment, automotive, electrical machinery and consumer products companies. As vice president of materials management at consumer goods company Helene Curtis, Shields led the supply chain organization that helped Helene Curtis win "Vendor of the Year" awards from Wal-Mart Stores and Target Corp. Shields has a B.S. degree in Electrical Engineering from Clarkson University and did graduate work in business at Bowling Green State University.


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