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Creating COEs For High End Talent in a High Demand Market · Speaking of Supply Chain

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You're listening to Speaking of Supply Chain, a meboch podcast. This is a
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show for logistics professionals looking to learn more about the latest innovations in supply chain.
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Each episode will feature a conversation on topics such as mitigating supply chain disruption
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and reducing risk, current automation trends, sustainability initiatives, and more. Let's
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dive right in. Hello everyone, and welcome to Speaking of Supply Chain,
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where we explore trends, current events, and innovations impacting logistics and supply chain
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industries. I'm Ellen Wood and welcome. Today we're going to be talking with
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Sa Morales again and Andrew McCarley from KOPA, and we're going to be talking
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a little bit about supply chain technology maturity and the people and talent aspects specifically.
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So what we're going to talk about today is obviously supply chain, but
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we're going to really focus on the talent retention and and the labor market's really
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hard right now, So what's what's going on out there that that's making it
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so hard to keep people? So I think that there's been a significant investment
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in the recognition that in the industry of digital digitizing or supply chain. So
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the demand in general has an increased significantly over the years, especially since COVID
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happened in a lot of the disruption, So I think that plays a big
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aspect in it. And then you look at just the ability of organizations to
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have people working at home and other things, and so you see that certain
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individuals are tend to want to go towards organizations that are more aligned with their
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values or where you can work from home. And then you compound that with
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the high demand in supply chain and specifically and technology, and I think when
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you take all those things together, it creates one I would say the market
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they're what is generally being paid for some of this talent is higher and so
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you're seeing you're seeing this a lot of people moving from company to company right
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now, and the demand is by So that's what we we tend to notice
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right now. I fully agree Andrew. I think since COVID hit and then
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supply chain went to the top of organizations agendas, then all of the sudden,
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the money for investment became available, and with that the demand for experienced
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people in supply chain it also raised. And then of course when we look
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at people with experience, say with eight years of experience, nine ten plus
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that it's a very limited group of individuals. So then people have plenty of
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more options where to go these days. Yeah, the only thing that's going
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to change that is more time. Indeed, but in the meantime they're fighting
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over these limited labor resources. Yeah, they are. It can be very
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disruptive, especially if you know, a lot of this town is working on
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very you know, critical initiatives, you know that have high impact in terms
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of the organization, So when an individual leads, it can be very disruptive.
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I mean, I think we're trying to do is talk to a lot
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of our customers and if they ad you know, one or two individuals only
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working on these types of initiatives, to augment them with a managed service provider
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or other things so that they can add some continuity throughout if somebody does leave,
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also good capability building for the organization as well. You know, organizations
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have one or two modelers or you know, I feel like they're they're a
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risk just because of the dynamics of that and the importance of the work that
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they're doing. Organizations, and especially since as you had mentioned, their their
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companies fighting for people, and people are trying to find the organizations that align
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with their values. So the the work from home is obviously something that's important
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to many people, and it doesn't it's not always conducive with being able to
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get the work done as effectively as it needs to be. So are are
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we seeing a lot of poaching when it comes to this talent? Are people
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jumping because other companies are offering something different or something better? I mean,
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what's that risk look like for organizations? Yeah, so we're seeing a lot
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of coaching from other companies for sure, And so I think that's one element
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of it. The other is that, you know, when there's high demand,
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people can be more selective, and they're going to be more selective,
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and a lot of times it's going to be based on organizations going to organizations
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that are really investing in digitizing or supply chains that are doing something exciting that
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are going to be having career paths for these individuals, you know, and
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they want to be working on digital twins, They want to be working on
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you know, more cutting edge things, not doing design the way that did
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ten years ago, but looking at more continuous design and other things and so
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that that's some of the elements I've seen, and I'm sure either has a
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really good perspective because of the town that they have there as well. Yeah,
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so we do see how that has impacted our services directly. So we
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have a really high demand right now for staff agumentation, and I think one
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of the reasons for that is because since people are moving so quickly, so
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often organizations are not prepared to ramp up and train resources as quickly as the
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consulting industry. So in the consulting industry we are more used to turnover because
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it's a higher although me back, it has one of the lowest in the
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industry, I have to say, but we are used to this ramp up
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quickly of resources. We have the structure, the training in place, like
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the Center of Accidence that I lead, and basically we are set up for
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such situations. But big corporations or organizations in general are not prepared for this.
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So and I think the other challenge when it comes to digitizing the supply
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chain is the profile of people or talent that is required for this, because
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you need almost like an unicorn, you need somebody who understands supply chain.
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You need somebody who understands data. You need somebody who understands systems and that
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somehow can bridge all these different components together. And sometimes to find all of
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these expertise in one single individual it is quite difficult. So oftentimes what organizations
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need to do, or at least that's the way I see it, is
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to complement different individuals to have a more complete team that have the whole set
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of talents. So either you do it with a team, or you do
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it with externals with a consulting partner that helps you in a specific pillar of
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the ones I'm mentioning. So I think also those two things that I would
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say, lack of experience or structure to ramp up new people quickly, and
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then difficulties in finding is very unique profiles that supply Chaine digitilization requires. Yeah.
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One of the other benefits of the consulting partner like me book is that
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they've probably seen a lot of these similar problems or challenges or use cases and
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other companies as well, in other industries or in the same industry, so
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that you know they're they're able to leverage some of their you know, knowledge
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and help Really I think ramp up a lot quicker in general. So I
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can only imagine that there's a limited number of those unicorns out there in the
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industry ready and looking for a job right now, because I'm sure a lot
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of them have found that place where they want to be. Um, being
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a unicorn, you have that that ability to say yes to the things you
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want and know to the things you don't want. But then when it comes
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to either for a company to either you have to find and recruit and you
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know onboard that unicorn or replace them with issa as you were saying, like
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two or three people that are knowledgeable and capable in multiple different areas so that
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you can build a coe. What else is there that companies can do to
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kind of mitigate that, because that's a long process for either one person that's
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a unicorn or three people that are just great. So we do see a
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high demand right now in our services that reflect that issue. And what we
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see in big companies that have trouble retaining modelers, which is probably the most
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specific and highly demanded profile, is that companies are turning to manage services for
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the modeling role. So we have set up with clients where they outsource the
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modeling, so the technical part, the data ingestion, the conversion of the
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data to the model, but then the COE on the customer end, they
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have project leads that are experts in the business, experts in talking to the
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people that have the information, and basically they are that single point of contact
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to our modelors and to drive those projects in the organization. So I think
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that this setup of managed services for modeling specifically, it's a it's really on
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the rice, you know. I think that in addition to that, I
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think a lot of it depends on where you are from a CEE maturity standpoint.
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So companies that are really starting to go on that journey invest in cooees
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oftentime you're going to have a smaller number of resources that time. It's important
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to really either, you know, I think that it's important to start off
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with a consulting partner that can help really accelerate that path, and then hiring
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in somebody experience that has that supply chain knowledge and that technical capability in the
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modeling capability because you know, as Thesa said, it is like a uniform.
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As you continue to mature as a COOE organization, it's important to start
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to build, you know, planned, you know, progression planning and a
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career path for individuals. And that's when you start to see companies start to
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go and say, I want to start recruiting from university. It's right in
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different programs, and you know, you'll start to see that there's a lot
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of like there's for example, a lot of universities that use are software in
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their program right, so they're coming out of school with experience in our software
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and they're able to kind of hit the ground running. So you start to
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see as organizations mature that they're starting to have some experience individuals and investing in
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some of that talent um. So so there I think that there's it depends
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really where you want the maturity standpoint. I do think where you are in
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the maturity standpoint, it's important to work with a consulting partner early in this
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in your journey. A lot of it from a continuity standpoint, from accelerating
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value so that you can build traction in your organization and get you know,
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really get the traction behind building out the SEWE and maturity and getting the investment
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in that. I think it's im as you continue to progress, I think
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it's important to bring that in because you can almost think of them in this
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innovation armor. Sometimes they're seeing challenges in other industries and they can come in
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and say, having thought about this, or we see this opportunity. And
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also it's a great way to build a talent on your individual team because generally
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they're going to have a lot of experience and a lot of talent and they
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can really help elevate that team. Indeed, I think that the talent portion
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of a team, and we also advise our customers when they are setting up
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that organization or the structure of their center of excellence. I think it's really
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important and we see this pitfall I would call it quite frequently and is to
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set up a COE as if it were an analytics team, a supply chain
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analytics team and a supply chain design COE goes way beyond being a supply chain
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analytics team. This is these are teams that are making huge transformational decisions that
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are suggestion where the come and you should go next, next, where they
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should invest. So this team it shouldn't be set up exclusively as a group
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of analysts, and then that team should be also enabled to growth within the
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team, similar as in a consulting setup where you start maybe as an analyst
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consultant, and then as you gain more experience, then you have more responsibility
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in leading this type of engagements. So I do see clients that maybe start
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on their own, that start setting up their cegos as an analytics team,
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and then after a couple of years, the people who are on the team
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they want to move on to a different role because they want a promotion and
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they can only access that promotion outside of the CEOE. So I think that's
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also critical to include when you are designing your supplies in design Center of Excellence.
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Yeah, I agree. I think there's two other things on as so.
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While the career path and being able to grow is important and developed,
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So if an organizations are investing in that career path in the development, then
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they're going to go external to get that. So I think that's that's the
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one key aspect of what you were just talking about. The other one goes
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to you. They want to be able to go to an organization where they
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can make an impact. Sometimes sewees can be almost standalone and isolated from the
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business, and what you see in more mature series, the series that are
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able to retain talent the ones they've been able to be more mature in this
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area. They have a governance kind of model where the business and the sewee
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are very integrated, and in that there's partnership with a business in terms of
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how can the modeling team help answer questions for the business as a business has
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other questions? Hows it kind of a closed loop process that's coming back you
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know, how can the modeling teams doing building the infrastructure, the modeling,
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doing the modeling to answer the questions in the output that they can receive and
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actually action within their their day to day processes. And then it's a feedback
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loop. And that's you see in the more mature company. When you don't
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have that governance process, you start to see that they're isolated and they're making
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decisions, they're not being action, start to feel disempowered, not very excited,
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and then you end up leaving. That's what we see a lot.
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That's why I think to your point earlier Andrew, that it is advisable to
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work with a consulting partner that has seen organizations what has worked, what has
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not worked, and when we set up new ceoes for clients, we take
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care of two things. So we understand that a newly created COOE needs to
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bring value quickly because they need to prove why this team is important for the
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organization to back up the investment and so on. But at the same time,
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you need to set up all the processes, all the governance races,
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et cetera, et cetera that supports the team in the long term so that
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it is successful in the long term. So when you're launching this initiative,
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you know, I think some certain support is required so you can tackle both
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things at the same time, bring your value while building a solid foundation.
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Yeah, I agree. It's a journey too, right, So sometimes it
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seems overwhelming when we just talk about some of the things that make it successful
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in the long term. But it's a journey. And then I think that
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the consulting partner is the way it can help you with those journeys, the
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pitfalls, and how to make that successful. So that's one key thing is
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that the organizations that have been successful in this, it's not been something that
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you just snap your fingers and overnight you've got a robust matures the area,
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right, It's been something that they've built out and you know, most of
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them that we've seen have worked with consulting partners that have gotten there, so
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I know historically it's it's often been it's either labor or technology. You're either
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going to hire more people to do it, or you're going to buy a
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technology solution that's going to, you know, enable a lot more capability.
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How does technology fit in with building these coees that have these elaborate career paths
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for people. I think that it's not mutually exclusive. I just think that
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it brings having those two together at the right level, it brings the maturity
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to a different level. So for example, at the beginning, you might
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have or you might spend fifty percent of your project in data collection, data
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cleansing, and setting up your model and repeating this over and over again.
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There is certain inefficiency. Once you bring technology in, then you reduce that
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portion that you that you spend in cleaning data and setting up the model,
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and then you have the people, so the individuals spending more time in the
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portion that we add value the most as humans critical thinkers, which is in
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defining scenarios and applying thought leadership to what the models or what the technology is
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bringing to the table. So I think that technology facilitates, It creates more
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speed, it creates more efficiency so that the people that are on the team
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can spend their time in the things that add value the most as opposed to
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mechanical or data cleansing type of activities. Yeah, I agree, and I
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think that in space is where you have where you have technology and then you
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you're not as dependent on the how or the capability of individuals. It tends
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to be when you're doing something more repetitive as pass it's repetitive that you know,
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you're doing the same things over and over again. The problems and supply
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chain change daily, and I mean you just look at the last couple of
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years, how different they are. Right. So when you're talking about modeling
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and you're trying to model different use cases, you really need to have the
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right talent that can take those business problems, develop a model that answers those
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questions and then is working to you know, improve that over time, and
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then as a new problems come up, they can work and develop an attack
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those problems. So you know, if you just have technology alone, maybe
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you can stand it up to answer a specific question and work through that and
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you know, you can have some money from a consulting sampoint come in and
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say, okay, we're going to do all the data clisal stuff and it's
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going to answer this one question. What happens when the something changes in that
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you know, as new constraint comes up, a new problem comes up,
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of court shuts down, there's a labor strike, you know that there's a
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new geopolitical risk that pops up that now you have to look at something and
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analyze different or what if there's new problems that come up in our priority of
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the organization. It's important to have that talent now that at the same time,
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if you have that talent and you don't have the right technology, then
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you're gonna have a hard time retaining talent because you know, some of these
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really strong capable you know, individuals are not going to come to an organization
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to work and excel, right, They're going to come in they want to
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work in the right technology, you know, the best product. It's good
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for the resume, in intellectually stimulating, and they're going to enjoy the work
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more So, I think both of them are very important together. You're not
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going to get the true value out of the technology without the right people in
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the space, and you're not going to get the right people without the right
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technology. So is it a one plus one equals three when it comes to
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the people and the technology that together they're going to you know, accelerate that
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result that much faster or that much better. One plus one equals ten.
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But yeah, wow, Okay, who doesn't want to tend that's right?
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No, I agree, And I also time back to your point, ellent,
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that with talent retention there's also a risk at some point and tying it
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to what Andrew was saying that it depends on the type of activity or the
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type of questions that we're answering. So while all of these strategic things and
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specific supply chain problems, you will always need a talented individual behind the technology
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behind the machine. There are also other types of problems that are or not
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necessarily problems, recurrent activities that you can automate and there you can standardize.
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So for example, doing the annual budget, Yeah, you have a model
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of your supply chain and the annual budgeting process is always the same. Yeah.
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So in this case, bringing in technology to automate as much as possible
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will actually free app capacity in a talented individual that has knowledge of the whole
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supply chain to do another activity that brings even more value to the organization.
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So all these repetitive processes on the strategic or tactical planning, budgeting, I
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don't know, inventory deployment, so things that come in cycles and that are
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regular. I think there you have an opportunity to automate, make it more
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people independent, and then leave the people for these specific challenges and questions that
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are Andrew mentioned earlier. So does having that technology also eliminate some of the
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risk of these people leaving or or when they leave, it's not so disruptive
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to you know, to as they're building their cooe and as people are you
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know, making choices about what where they want to work and what they want
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to do. Obviously, having all of that automation in the background gives companies
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a little bit of a buffer. I think that it does in those specific
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problems that you're trying to solve. I think that, you know, the
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more companies have started to invest in digital twins and building out, you know,
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a digital representation of their supply chain, you start to rely less on
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kind of the individual's knowledge and you start to build up the right level of
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the right knowledge within the organization, the team, and in the technology that
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you can start to bring in people and you're not so reliant on that.
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The other thing I think that is important that you know, the think of
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the thing that we see is that it comes down to if people viewed design
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the way that they did ten years ago, they're not going to be successful
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with retaining talent, they're not going to be keeping up with their competitors,
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and they're not going to be able to build out a success to the weak.
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You know that that's where Gore's problems nineteen years ago was, I've got
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a specific you know, I want to evaluate my network right, which is
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something that everyone does right and will continue to do. And that's important and
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that's what was done, and that's when a lot of modeling was done at
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that point in time. You really need somebody to have the knowledge of your
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company's supply chain specifically or specific in the industry, your reliance s typically on
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individual's expertise. As you start to mature into more continuous design, So how
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can we apply modeling techniques to solve you know, weekly operational challenges, monthly
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problems, etc. And you start to build out a roubust digital twin,
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you start to not have to rely so much on individual your knowledge, and
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you can start to really build out a sewing that's mature, and you can
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really start to advance and accelerate and value your receiver. Yeah, it's not
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a set it and forget it anymore. It's it's constantly having to reevaluate or
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update or or understand what's what's changing and adapting to it. Yeah, you're
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not starting from scratch each time. I think that's the thing. Great.
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So when you when you start with scratch, you have to know the data,
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like all the different elements of it. You know all the intricacies of
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that company's data, So you have to understand the supplighting the business questions.
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If you're starting from scratch every single time, when you look at it the
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way it was sent ten years ago, and that when some organizations still today,
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I have to say, yeah, no, you be shocked. You'd
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be shocked at how many organizations are still operating that way and with. What
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would keep me up at night if I was back in the industry is you
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know, what are their competitors doing? Because we have a unique we both
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have a unique lens here when it comes to this, because we see a
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different companies they're doing, and you know, you see some companies that I
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think you're gonna to really kind of leaf have had in some of their competitors
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in spased on what they're doing and how they're viewing this versus some other companies
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that may have been really strong in space are really strong that are are not
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investing or just not even thinking about it and looking at it in a different
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ways they did, you know, teen years ago. Aside from just benchmarking
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yourself against competitors, how do you measure the success of that supply chain Cooe?
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Yes, I think a very good schema to evaluate your maturity is the
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five stage maturity from Gartner for supply chain planning teams. And within that maturity
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you have five stages. But then the components of that maturity are one processes,
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two KPIs three people or talent, and then the third one is technology.
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And then within those five different stages of maturity, each of those components
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go at the next level. So I think identifying at which stage of maturity
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you are and each of those four components are where you want to be,
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it should give you a roadmap on what should be your next steps to achieve
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that next level. All right, any any closing thoughts. I appreciate the
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time. It was a great conversation. I think it's timely. You know,
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we're seeing more and more organizations starting to kind of jump on board and
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looking at things in a new way, and it's exciting time to see them
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go in this journey. Hopefully we'll see more and more start to go down
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this path soon. I also appreciate a lot of this conversation and hopefully people
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that are thinking about setting up a COOE or that are part of a COOE
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can take something from this conversation. And also, I think it's super important
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to highlight talent yeah, and how critical it is in the journey of supply
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chain to talization and specifically also in supply chain design. Center of excellences.
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So thanks, thanks, thanks for this conversation. Yes, it's it's been
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a great conversation today. Thank you so much Andrew and Issa for joining us
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for this interesting discussion on cooees and modeling talent retention. We hope you enjoyed
26:30
the conversation, so please rate our podcast five stars would be lovely as always
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