CEO Executive Newsletters - January 2012 by Logistics Executive

CEO EXECUTIVE SERIES!

24 JANUARY 2012

Predicting 2012.... Talent trends in Supply Chain Greece wi! default. The Euro wi! survive. Employment prospects wi! improve in the USA. London wi! be wet and fo#y. Its the Year of the Dragon and the mixed bag of cha!enges in 2011 looks likely to become the norm in 2012 writes, Kimble Winter, Group CEO of Logistics Executive Group.

NEWS & EVENTS Upcoming Events World Cargo Symposium 2012

“Goodbye 2011, Windows 8, iPhone 5, Obama 2, and Recovery -1.....”

The 6th World Cargo Symposium continues its focus on moving the industry from talk to action. Attracting over 1,000 key decision makers from the air cargo supply chain, the 2012 event will feature sessions on S e c u r i t y, e - C a r g o , I n n o v a t i o n , Operations and Commercial aspects . Held in Kuala Lumper, Malaysia March 13-15, 2012.

(click here to find out more)

Logistics Executive Global News Supply Chain Expert boosts Logistics Executive Hong Kong

It’s only fitting that we begin yet another year of the nervous noughties by trying to predict what lies ahead. According to readers responding, some tongue in cheek, to a question posed by the Economist(1), there is a mixed bag of predictions: “A Brit and a Yank will sit at their local pub. (They will say) "Oh how great our imperialist adventures were!" Haggle over the bill, and (then) pay in Yuan.” “Greece will default. The Euro will survive. Employment prospects will improve in the USA. London will be wet and foggy.” “Goodbye 2011, Windows 8, iPhone 5, Obama 2, Recovery -1.” “Skilled, childless adults from Western Europe and America begin working remotely from countries with more favorable tax codes.” And it will be the Year of the Dragon…will this be the year we see China positively take the high road, play good global citizen and lead the world from the brink of economic disaster?....Or will it more likely to claim itself as a developing nation, setting the backdrop for a high-stakes trade and currency war not dissimilar to the popular Hasbro board game ‘Risk’.

Strengthening our Asia operations, we welcome Mark Millar to the Logistics Executive group. Leveraging 25 years of global experience, Mark is highly regarded for creating value for clients by improving performance in their logistics and supply chain activities in China and the Asia Pacific region. With extensive experience in the mainland China market, he has worked with, and for, many leading companies in the Consumer Retail, High Tech Electronics and Third Party Logistics sectors. Mark is widely acknowledged as an industry thought leader - clients have engaged him as Speaker, Moderator or Chairman at more than 200 industry events in 17 countries and his articles on global supply chain trends and China logistics are regularly published in five languages. Mark is based in Hong Kong and can be contacted on telephone +852 9468 5295 or markm@logisticsexecutive.com

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CEO EXECUTIVE SERIES! From a Supply Chain perspective, the challenges are ramping up with more uncertainty and a continued emphasis on global markets. Volatile challenges and exceptions now seem to be, what we have come to know as the “new normal”. Those big ‘global’ issues that are well beyond our control continue to influence business. In 2012, it is now a strategic imperative and not an operational reaction for businesses to raise the bar. In Logistics E x e c u t i v e ’s a r e a o f expertise, talent management, it would seem that despite the u n ce r t a i n a n d e v e n g l o o m y economic outlook, the demand for supply chain talent is to increase in 2012. According to the Logistics Executive’s 2011-2012 Global Employment Market Report, we reported that 58.1% of respondents indicated that they expect to noticeably increase head count in 2012. Market feedback would suggest that despite an economic softening that has been seen as a result of the Europe’s debt crisis and credit downgrades, employment growth towards the second half of the year is expected to remain strong, particularly in Asia. The survey also revealed that 62.5% of business leaders are finding it harder to source quality staﬀ. An underpinning reason for this is the expanding demands being made of suppl y chain professionals to either increase their expertise or to add new skills to their repertoire. Without question, 2012 is the time for the emergence of a more sophisticated supply chain

24 JANUARY 2012

Findings &om Logistics Executive’s Global Employment Market Report

professional. One that has taken on the mantle of business leader, responsible for providing competitive advantage by making companies agile through their strategic advantage. All of the signs for 2012 translate into more of a demand for supply chain professionals with a broader skills to tackle tomorrow’s business challenges. Profitability is going to be the major challenge of 2012 according to CEO’s in Logistics Executive’s 2011-2012 Global Employment Market Report with 91% of CEO respondents highlighting this as one of their greatest challenges. Margins are down, costs are up and wages demands remain. Leadership – according to the Logistics Executive report more that 77% of respondents indicated that this was a critical focus for 2012. This leadership mantle will require a whole range of soft and strategic skil ls. Further supporting this is a survey from Gartner(2) that now puts Supply Chain front and center at the Executive Leadership table. The report

identified that the percentage of supply chain executives reporting directly to the CEO has risen from 30% to 68% from 2005 to 2010. Business and financial experience will be increasingly required for supply chain executives who are being groomed for top management positions. Boards of directors will look for business leadership that can exploit complex supply chains to create value for customers and trading partners. Analytical and modeling data skills will be of focus as Exel spreadsheets no longer cut it in 2012 markets. The need for agility and a better understanding of the supply network takes precedence, which means that professionals who are talented in these areas will continue the trend of including predictive analysis such as is being used in c u s to m e r s e r v i c e a n d s a l e s functions to gain competitive advantage. Commodity volatility: There will be a continued refinement of technology to manage

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CEO EXECUTIVE SERIES! commodity volatility as the cost of raw materials continues to fluctuate. Professionals who are w e l l e d u c a te d a n d h a v e t h e expertise to lead in this area will be in demand. Emphasis on real-time information through technology, people development and process improvement. With 83.5% of respondents in the Logistics Executive’s 2011-2012 Global Employment Market Repor t indicating that Productivity is one of their greatest challenges in 2012. In the search to refine a timely and accurate fact based decision making process and to manage the avalanche of data now have at their disposal, supply chain executives are looking for a systematic approach to adapt to new patterns using modeling. Today’s real-time information and not yesterdays plans are now the emphasis. As well as ERP systems there will be a new demand for predictive analytics to work out profits. Supply Chain professionals and HR professionals will be emphasizing skills in process redesign, change management, user training and executive sponsorship to increase company agility and competitiveness. Social responsibility will increasingly be emphasized. With globalisation and the increase in community awareness, supply chain executives will need to factor the need for transparency in their market responses. Instead of pleasing board m e m b e r s , t h e y w i l l n e e d to expand this focus outward and meet consumer group expectations. In the Logistics Executive’s 2011-2012 Global Employment Market Report, 86.76% of CEO’s and Directors indicated that customer satisfaction would be a major priority in 2012. Therefore skills

24 JANUARY 2012 in social r e s p o n s i b i l i t y, communication and social media tools will increase. As an industry, Supply Chain is evolving as a highly educated sector. According to the Logistics Executive’s 2011-2012 Global Employment Market Report 88% of respondents had a degree or higher. However at all levels furthering their skills remains a priority. At the top level Supply chain leaders will continue to hone their skills, as their function becomes more company general. In the middle tiers, there will be a need for an increase in realtime focus with emphasis on systems, people management with a cross-cultural approach and processes that will enhance this. At the functional levels a need to train in new skills such as technology and communication will be favored. The over-riding message is that volatility is a fact of life. As industry continues to lean on supply chain leaders to manage them through change, there will be huge opportunities for leaders t a l e n te d i n a g i l i t y t h r o u g h process and technology improvement and leadership. If you combine these skills with a deep supply chain skill base, the oppor tunities become tr ul y exciting for supply chain professionals in 2012. For a final glimpse into the future, Gartner go on to predict that by 2015, at least 25% of new C E O ’s at Fo r t u n e 500 manufacturers will have a deep suppl y chain experience. A prediction we cannot help but concur. It would be interesting to hear our readers’ predictions for 2012. Drop us a line. 1 The

Economist is an authoritative weekly newspaper focusing on international politics and business news and opinion (www.economist.com) 2 Source: Gartner – Report: Predicts 2012: Supply Chain Predictions November 2011. Gartner, Inc. is the world's leading information technology research and

Logistics Executive www.logisticsexecutive.com Australia Sydney Phone: +61 2 8262 9800 Melbourne Phone: +61 3 9863 9488 Asia Shanghai Phone: +86 21 6427 6697 Singapore Phone: +65 6818 9745 Hong Kong Phone +852 3125 7654 India Phone +91 22 4090 7053 Middle East United Arab Emirates - Dubai Phone: +971 4 361 6275 New Zealand Wellington Phone: +64 4 496 6730

For a copy of the 2011 -2012 Logistics Executive Global Employment Report email: darrylj@logisticsexecutive.com or kimw@logisticsexecutive.com

Mr Kimble Winter Chief Executive Oﬃcer Logistics Executive Group The founder of the company, Kim is an acknowledged specialist in Executive Recruitment across Logistics and Supply Chain sectors. He has held senior executive positions within international Logistics, Supply Chain and Freight organisations during his 35 year career. Kim often speaks at international conferences / events and regularly contributes thought leadership to industry media. He has been involved in a number of Disaster and Humanitarian Logistics initiatives and is the founder of not for profit organisation www.oasisafrica.net.

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