Career Options After MBA

Careers in Supply Chain Management

- Ajita Kini

What is SCM? Today, there is an increasing recognition of the importance of Supply Chain Management. What exactly is meant by Supply Chain Management? Unfortunately, SCM is one of those terms that means different things to different people. Usually, none of them is really incorrect. It is more a case of five blind men describing an elephant what each of them describes is correct, but somewhere, picture is lost. the total

upply Chain Management refers to the coordination of p r o c u r e m e n t , production, inventory management, sales and distribution among the participants in a supply chain to achieve the best mix of responsiveness and efficiency for the market being served. The participants of the supply chain are the suppliers and the customers of the organisation whose supply chain is being studied. Management of the supply chain includes managing the flow of material, finance, and information across all the participants. As organisations and supply chains mature, the chain is usually expanded to include suppliers suppliers and sometimes customers customers. Need of SCM SCM becomes a key weapon for organisations facing competitive pressures. When organisations are structured by functions (Purchase, Production, Sales, Logistics, Stores, etc.) there is tendency for each of them to focus on optimising their own function. For example, the Purchase department may pride

itself on its negotiating skills and report on the rate reductions they have been able to achieve with suppliers. They may be unaware of the resultant deterioration in the

quality of raw material being delivered by those suppliers. Due to this quality deterioration, there would very likely be both quality rejects of what the organisation manufactures, as well as perhaps stoppages on the production line. The losses due to these quality problems could far outweigh the benefits of the rate reduction achieved by the Purchase department. The management of the company needs to ensure that departmental goals are tied to the efficient working of the entire supply chain. Besides cost reduction, the second reason SCM is important is because, by coordinating the activities of all the supply chain partners, it is

Career Options After MBA possible to respond faster to changes in the market. This is relevant both in case of new product launches, as well as regular products. With consumers increasingly spoilt for choice, it is difficult to forecast sales accurately. Companies need to be able to constantly monitor their sales and quickly replenish those products that are selling better than forecast, even as they avoid carrying excess inventory. In case of new product launches, organisations often have a very small window before the competition launches a similar product. Responsiveness to market demand, the need created during launch marketing, can be key to the success of the product. SCM Job Scene As may be evident by now, SCM is most relevant in the manufacturing industry. Within the manufacturing industry, SCM has been most extensively followed in consumer durables, FMCG, pharmaceutical, liquor and other consumer product industries. The concepts however are universal, and can be easily adapted to the service industry as well, to enhance responsiveness to customers. In fact, the restaurant business has its own equivalent, termed as Quick Service Response, or QSR. A few organisations may actually have SCM departments or coordination cells to play an SCM role. More often, functional departments continue to operate in organisations. The SCM concept is applied through regular crossfunctional meetings (monthly planning meetings, supplemented by shorter weekly or daily review and issue resolution meetings). Yet, knowledge and appreciation of SCM concepts ensures a better perspective in any of the supply chain areas of purchase, production, inventory management, logistics management, sales management and distribution. Often, organisations adopt SCM concepts as part of an ERP implementation. This presents more opportunities for individuals interested in pursuing a career in SCM. ERP product companies such as SAP, Oracle, PeopleSoft, JD Edwards, etc. are often interested in recruiting people with SCM knowledge. Organisations implementing an ERP package are required to depute some of their key functional experts to work closely with the ERP implementation team. After the implementation is complete, these people often become key resource people within the organisation, mainly because they have an in-depth perspective on how the modules of the supply chain work together. This ensures that the individual comes to the notice of senior management, a key pre-requisite for any kind of career advancement. Is SCM the right choice for you? SCM is the right choice for people who are implementation oriented, who like to have hands-on experience. It is not meant for people who like to indulge in armchair debates or cerebral exercises alone. There needs to be an ability to work with all kinds of people, from shop floor workers to the CEOs of supplier or customer organisations. This often requires a shift in the management style and even communication style. You need to empathetically understand the practical realities that face the operational staff, yet retain the conceptual clarity required to implement the new ways of working. The individual who would probably do well in an SCM role would be one who likes working with people, has some persuasive and teaching skills, can see the inter-linkages in the workings of different people or departments and how they each contribute to overall company objectives. Not too many management institutes seem to be offering specialised SCM courses. Certainly, some basic concepts are being incorporated in the course content, typically in Production and Operations Management courses, or in Systems and IT courses. For the individual who is interested in pursuing a career in SCM, the best route may be to start in any of the functional areas of the supply chain. After working a year or two, the individual could attend one of the 1 to 3 week long SCM courses (targeted at Middle Management) that are conducted by management institutes. NITIE, SPJIMR as well as the IIMs offer SCM as an elective for a student who wants to major in this field. The author (IIM-A 1989) worked for 14 years with consulting firms viz. Coopers and Lybrand, KPMG Consulting, CMC Limited and Infosys Technologies Limited and now freelances as a retail and Supply Chain Consultant.