Is your Supply Chain Manager Quitting this Year?

By Poornima Ramaswamy, Executive Vice President, Global Partnerships and Chief of Staff to the CEO, Qlik

We all know the retail supply chain woes of the past two years by now. Beyond not getting products to shelves, a new disruption is emerging, and it has nothing to do with logistics or shipments or the rise and fall of demand for things like masks and toilet paper. It’s a people problem. It has been found that supply chain managers are quitting their jobs in unprecedented numbers. Between the stress and mental toll of late, many are finding more lucrative employment elsewhere in terms of pay, but also in terms of tools to do the job. In fact, the hottest job in retail might just be the supply chain specialist.

One big contributing factor is that workers are less willing to stay at a firm that has outdated technology and processes. Employees leave when progress stalls and just over 1 in 5 employees believe their employer is preparing them for a more data-oriented and automated workplace (21%). Below I will discuss why it is imperative for businesses to make their systems more modern and commit to data literacy to attract and keep top talent.

We often talk about the importance of data in leading the decisions that organizations make. However, not bringing your employees along on the journey to your data-driven future can significantly impact the bottom line. G&A Partners estimates the cost of replacing a professional worker is 75% to 125% of that employee’s annual salary. And for a technical or supervisory role, businesses could spend as much as 150% replacing that employee. When thinking about a retail supply chain manager, for example, that is a big expense.

As you might suspect, the costs to replace a supply chain worker go beyond recruiting and onboarding. Organizations can lose business due to mismanagement of their supply chain, which is one of the real-life scenarios this situation presents. If the experience, headcount or technology needed to do the job well isn’t there, huge consequences will result. The rise and fall of Peloton’s demand, for example, is a weary tale that all retailers should pay attention to. At the onset of the pandemic, a huge uptick of consumers looked for ways to work out at home. As time went on and businesses began to open back up, interest in the at-home bikes cooled, and as a result the company struggled to adapt. It’s reported that shares were down nearly 80 percent in the past year. This ultimately led to Peloton overhauling operations and hiring a veteran supply chain executive who will in part, oversee information technology.

Though one singular issue can’t be pinpointed in this example, the costs of Peloton not having their supply chain operations in order are clear – and these led to colossal business implications.

The not-so-sunny outlook for outdated technology

The supply chain talent churn is retail industry’s red-flag. It is imperative for retailers to seriously commit to elevating supply chain operations and technology.

Ways to combat supply chain worker retention

Create the most sought-after job in retail

There are a few imperatives for me when I’m asked how customers might combat a supply chain worker-retention problem. The first is updating technology so that the employees have the best tools to do the job. This includes prioritizing data collection and management. There are too many scenarios in which employees are asked to make decisions based on outdated, siloed or internal-only data sets. It seems inconceivable to request that someone to make accurate forecasts based on inaccurate data with the issues that have been rocking the supply chain. Achieving active intelligence to make smart business decisions cannot be overstated from an organizational, but also an employee, perspective.

The second recommendation, and this really is a big one in terms of employee satisfaction, is automating repetitive tasks to free up people for more rewarding work. Now that we’ve moved past the image of AI taking over every person’s job and we better understand how technology can complement what a critically thinking human counterpart can provide, this is a no-brainer. It is much more efficient and rewarding for a supply chain manager to be doing the evaluation and analysis of data trends to support impactful business decisions instead of focusing their day on tasks like data entry.

The third is investing in data literacy. This is really the foundational pillar of it all. According to the Work Institute, career development – specifically, opportunities for growth, achievement and security – is the number one reason people leave (pg. 11). This is a trend they have seen repeatedly in their annual surveys. Working as part of a company that is dedicated to championing data literacy, I know this is a key way to engage and grow employees while empowering them to make smarter, data-driven decisions. I really can’t underscore how imperative it is to upskill your current employees to retain them better.

There are certainly more factors like compensation and benefits that come into play when looking at retention. However, ensuring your supply chain employees have the latest technology and skills to do their job well is a big component of employee satisfaction.

A cornerstone of the modern workplace is being data-driven. With a serious commitment to elevating supply chain operations and technology, retailers will be very attractive places for supply chain talent. Employee retention will indeed contribute to future supply chain operational success, and businesses needn’t worry about how to make it through the next big market event. They’ll have the people and processes in place to come out on top.