Solving the Talent Crisis

The automotive industry is facing a threat to its future.

The threat is not about product innovation, technology, safety recalls or supplier shortages.

It’s about people - specifically supply chain talent, and the rapidly growing shortage that could put the brakes on the sector’s ability to grow and prosper.

Why is the Supply Chain Talent Shortage so worrisome?

Consider this scenario:

Situation: An automaker planned to launch a complex new vehicle, and produce the car in four different global locations based on its platform strategy. Two of the four locations were in emerging markets, where lack of infrastructure and availability of skilled supply chain managers complicated an already difficult launch.

Problem: Lack of supply chain expertise in the two emerging markets ended up causing multiple points of failure in the automaker’s supply chain. Supplier capacity management, supply chain network design, production line parts/ component sequencing and supply chain risk management - none were up to the complex task.

Impact: Supply chain costs exceeded budgeted program costs by more than 15 percent. The OEM was forced to use premium freight transportation to ensure continuity of supply.

Even so, final product launch was delayed three weeks, which ultimately resulted in a 5 percent drop in market share that year in the two new markets.

Lessons like these are painful reminders of what happens when a supply chain fails. Such failures will become more common if companies lack sufficient supply chain expertise, as a growing number of OEMs, suppliers and their supply chain partners are realizing.

To secure its future, the industry must tackle the supply chain talent shortage head on and develop more effective talent acquisition, development and retention strategies.

This white paper explores this issue, what it means to the automotive industry, and discusses five core strategies companies can deploy to address the problem.