Supply chain disruptions at the beginning of the COVID-19 pandemic have provided a likely glimpse of the future. As a result, new terms such as sustainability and resilience are being used. Indeed, in decades past, the terminology signified a shift in the skill set expected of professionals working in these types of services.
While policies, processes, and information technology are important elements in supply chain services, these alone are not sufficient to improve an organization's performance. A supply chain business group that adds value to its organization begins with people, their skills, and capabilities.
Acquisition Skill Set
There are a number of skills you need to master to ensure your business thrives. Skills such as:
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Strategic planning skills: This involves project scope, goal setting, and execution.
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Technical skills: supply research and analysis.
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Financial Skills: which deals with cost accounting and business case structure.
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Global Environmental Skills: Working with legal issues, contract drafting, and risk mitigation.
In recent years the market indicated that additional skills were required, such as:
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Consulting and implementation of outsourcing and offshoring, including the effects of FTAs.
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Supplier relationship management, including the development of internal suppliers and customers.
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Finance skills: This includes financing supply chains, cash flow, and working capital requirements throughout the purchasing cycle.
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Contract skills: This is about contract planning.
Collaborative problem-solving is required to respond to the challenges of uncertain supply markets and the digitalization of supplier companies.
You should be up to date on the sample diagram on the BASF site.
Because it is a producer of products made from a primary industry input: natural gas. For many companies selling products in markets such as food and beverages, automotive, cosmetics/hygiene, construction, food packaging, pharmaceuticals, and electronics, a closure at the BASF complex would affect their supply of inputs from Tier 1 suppliers. However, many of these companies would not know that BASF is a Tier 3 or 4 supplier because there is no visible connection within their supply chains; only when intermediate items do not arrive from a Tier 1 supplier.
There's also a return loop from BASF to agriculture. Since ammonia is a high-volume product, the company produces from natural gas, converters primarily use ammonia to produce fertilizers. If ammonia production is reduced, less nitrogen fertilizer is available for agriculture, which reduces crop yields. Therefore, the tonnage available to producers, processors, and manufacturers in the food supply chain is reduced.
In this scenario, the supply market sees the need to include the fertilizer input supply market, which leads back to the natural gas supply market. Due to ongoing uncertainties, most companies need to understand the concentration, availability, prices, and trends of applicable commodities that could affect their business. However, it's unlikely that you possess all the required skills at a professional level.
Supply analysis is a necessary skill
Recent disruptions to supply services have further highlighted the need for procurement professionals to have a deeper understanding of their organization's supply businesses. It's important to note that an organization will document this understanding in its network design map.
In addition, it is a digital representation of the physical network, which contains: locations and details of nodes and links, including delivery times, inventory form and function, costs and risks, among others.
The input to the map is the supply market plan, which provides intelligence and analysis on supply markets. The plan will require knowledge of the geographies that support a supply market.
Advantages and disadvantages of different regional geographies
It's important to know that, as a logistics service, there are advantages and disadvantages in specific countries compared to others. These may be due to political, social, and infrastructure issues, as well as government regulations and laws. This also applies to national laws regarding local content and sustainability, as well as compliance requirements.
In some cases, due to the country's import and export regulations, intelligence, and analysis of supply markets. This may be due to the most recent alarm in supply markets, which is the potential disruption to the chemical supply market, due to uncertainties regarding the supply of gas delivered to Germany from Russia.
Creative problem-solving skills
Digital fluency is a competency that requires comfort using digital tools at a proficient user level. However, to have a digital business with ToolRides, users do not need to be digital experts. To develop a business, you only need to be a proficient user. However, understanding laws and policies is increasingly important today. Procurement results must be consistent with all relevant international and national legislative, integrity, and policy requirements.
Category management is an additional skill required within the business, and contract skills encompass the ability to plan "lifelong" contracts but extend to include project management. While data analysis and tool use are important elements, it is interpersonal and communication skills that influence people's behavior for effective performance.
To support collaborative problem-solving across functions and within teams, Procurement skills must include people skills and interactions, including leadership capabilities. Subsequently, once successful digital development, planning, and business management are achieved, all supply chains begin to operate successfully.
