A billion-dollar industrial distribution company in Minneapolis is looking to hire its first chief supply chain officer (CSCO)—and candidates must clear an especially high bar. The ideal candidate needs a deep knowledge of supply chain best practices, industrial engineering principles, and network design, according to the job posting.

But they’re also looking for much broader experience, as well. The CSCO needs to work in a matrix environment, influencing and collaborating with departments outside the direct reporting structure, and building and maintaining strategic partnerships.

It’s a tall order—and hard to find. But tall orders are becoming increasingly common when it comes to what’s needed in today’s supply chain teams.

It’s not just supply chain leadership that needs a new set of skills but the entire supply chain organization. The past decade of disruptive events rocked supply chains off their traditional foundations. It just makes sense the supply chain workforce needs to change, too.

Businesses have learned they must move quickly to alternative suppliers when severe weather damages a manufacturing plant, or a global crisis knocks out a shipping route. They need to collaborate with suppliers to get environmental impact information on raw materials or proof of where they sourced the materials. In some cases, they need to form new partnerships with more diverse suppliers to meet new social or market demands. And they need to continuously adapt to new digital technologies that help them to make faster and better decisions.

The skills to carry out these demands rarely existed in supply chain circles five years ago.

“The industry has shifted so much that there isn’t a lineage of people with the skill sets to fill these new supply chain roles,” said Melissa Hadhazy, senior client partner at Korn Ferry in the company’s 2023 Supply Chain Talent study.

Not only that, but there’s a shortage of supply chain professionals overall. Some 64% of companies are experiencing a supply chain talent gap, according to the Council of Supply Chain Management Professionals. Some businesses are filling the gap with new technology, which many middle managers have little experience working with.

The path forward will be challenging. But we’ve gathered the latest data and expertise to construct a playbook on why skills need to change, the new expertise needed, and where to look for these skills or cultivate them internally, in a world where they’re scarce.

Why supply chain skills are due for a change

Today’s supply chain teams are being asked to handle a growing array of new responsibilities. This is due to three major trends reshaping the supply chain world today, according to Rupal Deshmukh, a partner in the strategic operations practice at consulting firm Kearney.

1. Market expansion to realize growth goals.

Some 90% of CEOs surveyed by Kearney indicate they are targeting growth in the next year or two, Deshmukh says. However, all economic indicators point to a reluctance to spend among businesses and consumers. As a result, organizations are going after new channels and customer regions, and they need to expand their supply chains to manufacture new products for these channels and deliver goods to these new regions.

2. A rethinking of global supply chain networks.

The COVID-19 pandemic exposed the risks of over-globalization, as did increasingly common catastrophic weather disruptions and geopolitical tensions that require fast supplier changes or last-minute shipment rerouting.

Strategic sourcing and procurement professionals, for instance, are scrambling to find secondary sources. “This is not like flipping a light switch,” says Rodney Apple, founder and managing partner at SCM Talent Group, a supply chain executive search firm. “There’s a lot of orchestration that goes on, and it changes our whole logistics network—transportation, warehousing, customs, freight forwarding. Everything is connected.”

As a result, supply chain operations are being restructured, from where products are manufactured to how they’re distributed. “Sources of supplies are being bought more locally, and companies are looking at operating in a much more efficient and responsive manner with the help of automation and advanced technologies,” he says.

3. Investment in new supply chain technologies.

Half of supply chain organizations plan to implement generative AI in 2024, according to a Gartner survey, and nearly all have some kind of robotics and automation program already in place. Supply chain leaders need to keep up with these technologies and understand how to leverage and manage them.

Beyond these trends are regional conflicts, global sanctions, and man-made disasters (such as cargo ships blocking trade routes) that are also contributing to the need for supply chain transformation. For example, U.S. sanctions imposed on some Chinese goods and materials meant key suppliers (or even the suppliers’ suppliers) couldn’t provide raw materials and components, leading to production shutdowns or supply chain bottlenecks.

Environmental, social, and governance factors are now a top priority, as well. Organizations need to reduce their environmental footprint throughout the supply chain, which requires more collaboration and information sharing. They also face social demands for product provenance and more diverse suppliers.

The new skills you need on your supply chain team

To navigate these cascading trends, supply chain leaders need very different skill sets now than they did just a few years ago. Here are a few essential skills to look for:

Entrepreneurial and strategy skills

Today’s supply chain leaders need the entrepreneurial and strategy skills to restructure the supply chain in the most strategic way possible, Deshmukh says. And once the course is set—flexible execution is key.

One example is a consumer-packaged goods company that struggled with ocean transportation and trucking shortages during COVID-19. Given those constraints, the company had to identify a limited set of products to focus on producing and shipping. Doing so would create more space in its distribution centers, allow for more efficient shipping, and reduce the number of manufacturing changeovers.

“The supply chain team had to partner with sales and marketing to make those calls,” Deshmukh says. “Then they had to reach out to their customers and ask—if I change my product mix, will that work for you? And above all, it had to be frictionless and fast. All customers want an immediate, Amazon-like frictionless experience.”

End-to-end thinking

Companies have traditionally structured supply chains based on the separate activities of planning, sourcing, manufacturing, and distribution. That model works well when building foundational capabilities. However, supply chain professionals now need a broader view of the supply chain.

Recruiters call these supply chain rock stars “end-to-end thinkers.” End-to-end thinking starts with the customer and then extends to the supply chain’s four components: plan, make, source, and deliver. “The best supply chain leaders understand the implications across that end-to-end supply chain, always starting with a customer-back view,” Deshmukh says. “They can anticipate needs before they happen.”

To do this, supply chain professionals need new levels of communication and collaboration with all parts of the business, plus the ability to build teams, wield influence, and develop relationships with supply chain partners. With these skills, these professionals can quickly find alternatives when challenges arise and avoid slowdowns from duplicate efforts or misaligned priorities between product management and supply chain planning teams.

They can also minimize unfulfilled customer orders or overproduction due to incompatible planning and production schedules and poor customer outcomes from siloed manufacturing and delivery metrics.

Kearney recommends that about 20% of the supply chain team have end-to-end and cross-functional expertise, while the remaining 80% continue to provide deep functional capabilities.

Knowledge of digitization and AI

Roughly two-thirds of supply chain leaders say their company is investing in digitization and expects the supply chain function to adapt, according to Gartner. This involves using data assets, such as AI, large language models, and augmented and virtual reality, to improve processes like demand forecasting, order management, supply planning, logistics, distribution, and sales and operations planning.

A logistics lead at a chemical company says this can sometimes lead to “choice overload,” referring to 50 different AI options to consider. Supply chain leaders will need enough knowledge to figure out which options will yield the biggest ROI.

Deshmukh provides the example of a food products distributor that uses technology for “demand sensing,” which is the ability to gather and analyze forward-looking indicators. For this distributor, demand historically could peak during real holidays or invented ones, like National Ice Cream Day or other social media-driven events.

But instead of relying on demand history, the company can now analyze data from TikTok and other social media platforms to see what’s trending, along with market indicators to sense demand. “If a change is on the horizon, a strong supply chain leader needs to have such a connected supply chain that’s going be able to react quickly,” she says. Planners need to be able to sense that change is coming, manufacturing and distribution need to know immediately where inventory is available, and they must be able to distribute those products to retailers and restaurants quickly.

Mastery of soft skills

Soft skills—such as the ability to communicate with internal staff, outside teams and partners—were not a must-have for traditional supply chain leadership. But the move from siloed supply chain systems to more networked models, coupled with consumer demand for more insight into sustainability and social impact, requires soft skills. Now, collaboration, communication, and the ability to work through ambiguity are critical for today’s supply chain leaders, Korn Ferry’s Hadhazy says.

Some companies are forming cross-functional teams that will require supply chain professionals to have higher-level soft skills. They will need to help product development teams, for instance, understand supply dynamics so they can create better products. Or they’ll work with sales and marketing to understand the effect of the supply chain on customer behavior. They can also help pricing strategists optimize pricing by understanding product and materials’ availability and costs, as well as production schedules.

Where to find the new supply chain talent pool

The demand for a new breed of supply chain professional will require a new method of finding people with the skills needed. For instance, more than half (57%) of respondents in the 2023 Korn Ferry study said they’re experiencing challenges finding talent with end-to-end supply chain knowledge.

While 41% said they intended to upskill current supply chain employees, 62% were seeking people in other areas of the organization, with plans to reskill them. Meanwhile, 65% said they were looking to hire externally, but within the same industry.

But when businesses keep the search within the supply chain or organizational ranks, they could miss out on a much larger talent pool with the new skills they need, not to mention much-needed diversity in supply chain leadership.

Other sources of supply chain skills can be found in the following ways:

DEI hiring

A growing number of supply chain organizations now consider ethnicity and race in their diversity, equity, and inclusion (DEI) strategies and objectives, according to Gartner.

In 2023, underrepresented races and ethnicities represented 48% of the total supply chain workforce, according to Gartner research. This includes:

• 48% of managers (up from 20% in 2022)
• 46% of senior managers (up from 15%)
• 50% of directors and VPs (up from 14% and 10%, respectively)
• 10% of CSCOs or equivalents (up from zero in 2022)

Although there has been progress in recruiting women into supply chain roles in recent years, the industry remains a heavily male-dominated field, particularly in manufacturing and logistics.

Women now comprise 41% of the total supply chain workforce, according to a Gartner study. At the frontline level, though, women make up only 31% of senior manager positions and 34% of managers/supervisors, up just one percentage point year-over-year in each category.

Young professionals

There’s a silver lining to the publicity supply chains received during the pandemic: it raised awareness of the function with young professionals. Many young professionals want to make an impact on the world, and they see the supply chain as a way to help minimize waste, find more efficient ways to distribute and ship goods, or choose renewable energy.

In a survey of nearly 200 young supply chain professionals under the age of 30 by the Council of Supply Chain Management Professionals, Penske Logistics, and Korn Ferry, 57% of respondents recognized the tangible effect supply chain roles have on business outcomes and feel their contributions are significant. Over half (58%) of young professionals in the supply chain field are attracted by the diverse range of opportunities available in the sector.

Five ways to upskill your supply chain team

Whether upskilling, reskilling, or hiring from the larger talent pool, these five steps can ensure businesses get the supply chain skills they need.

1. Develop a supply chain career architecture.

Businesses need to clarify the new roles, advancement opportunities, and career paths available in the supply chain organization. Creating internal career paths and reshuffling the deck of existing employees helps keep people excited about their careers within the company, Hadhazy says.

2. Provide a social learning environment in which people can learn through observation, imitation, and interaction.

Mentorship is important for professional and personal development in supply chain careers, especially when bringing in outside talent or hiring traditionally underrepresented employees.

In a Q&A about her career path from HR payroll clerk to director of contracts management and supplier diversity at Philadelphia Gas Works, Erica Patterson talks about her own personal and professional “board of directors” that included a mentor, an advocate, a champion, a peer (her sounding board), and a coach. Each one was instrumental in motivating her personally and professionally, she says.

3. Encourage technology exploration.

A good place to start is by learning about AI, which can be done by using an AI-based assistant for simple tasks. Businesses should also improve AI readiness and skills by training supply chain professionals to generate or interpret the data coming from demand forecasting and predictive modeling, according to an article by Jennifer McGee, Dominique Harris, and Tulika Vardhan of management consulting firm Kearney. Urge workers whose repetitive tasks are now done by AI to apply their experience in more strategic areas and activities to advance business outcomes, they write.

4. Build technical competence and instill a culture of curiosity.

Encourage employees to move away from using only intuition and past results as a foundation for decisions and instead move toward data-driven thinking, the Kearney leaders write. “Creating an inspiring culture of curiosity and continuous learning helps identify and prepare both the versatile and deeply knowledgeable staff supply chains need. It encourages people to look up from their job and learn more about what’s going on around them.”

5. Continue to cultivate soft skills.

This can include making presentations, writing blogs, and collaborating with other team members. As AI and other technologies make supply chain functions less personal, “it will make soft skills even more important,” Deshmukh says.