With advancements in technology re-shaping the logistics industry, L&MH looks at the affect this is having on the workforce and what skills the logistics manager of the future will need to succeed.
The logistics sector has already started embracing emerging trends such as autonomous vehicles, Internet of Things, robotics and the overarching use of big data.
Tomorrow’s warehouses will look increasingly different to how they look today and the digital transformation across many industries has already started to take place. Coles recently announced plans to build two new heavily automated distribution centres over the next five years, an investment the company believes will deliver lower supply chain costs and higher service levels, improved efficiency and stock availability in stores, safer working environments, and enhanced business competitiveness.
Toll, Coles, Linde, Australia Post and many others are also investing heavily in new automated facilities. With this rate of technological advancement, the skills needed to manage and run these facilities are rapidly changing.
According to the Transport & Logistics Industry Skills Council, the logistics industry is expected to show strong growth over the next 20 years. The Council projects a 50 per cent increase in truck traffic, 90 per cent increase in rail freight and 150 per cent increase in containers crossing the nation’s wharves.
An astonishing 48 per cent of workers in the logistics industry in Australia are aged 45 years or older and 12 per cent of the transport and logistics workforce is 60 years or older, and looking to retire in the next five years.
The combination of an ageing and retiring workforce as well as projected growth in the sector, joined with a rapidly changing industry, could present the logistics industry in Australia with significant challenges through what is project to be a period of exponential growth.
For Dr John Hopkins, Programme Director for the Master of Supply Chain Innovation at Swinburne University of Technology, there is an increased need in more diverse skills, involving entrepreneurial thinking, data and automation. “The supply chain or logistics manager of today has a high-level view of business. In the future they will increasingly need to combine that with an ability to recognise opportunities more quickly, and know how best to act on them,” John says.
Data and automation
For John, there are two fundamental areas that skills need to be developed in. These are data and automation. “We are in an era where things are changing very quickly – people in the logistics industry need increasingly different skills. They need to know how to collect data, what data to collect, how to analyse it and how to make meaningful decisions based on that data.”
Additionally, with the increased use of data and automation across logistics, there may even be a need for logistics and supply chain managers to learn more programming skills.
“Supply chain professionals are aware of what new technologies are out there, and what potential they might have, but are often too busy with other things to have time to think of new ways in which they might be utilised to drive improvement,” John says.
Being based in Australia has the added advantage of utilising skills and experience from throughout the world, John says. “We have 18 students on our new course, and 16 different countries. It’s very diverse.”
In addition, John thinks that the logistics industry in Australia is unique. John is originally from the UK, and has worked extensively in industry and academic institutions in the UK, USA, Ireland and Australia.
“There is a big difference in Australia, compared with Europe. Geography is a big part of that. There is a relatively small population, on a large island, with a strong economy. In addition, whereas currently there is a lot of uncertainty in Britain and the EU around Brexit, there isn’t so much here.”
According to John, even though Australia’s geography is challenging, there is a distinct concentration of population and infrastructure in one area. “There is a clear population density in the Southeast so we should, in theory, so we should be able to be as advanced in that area as certain networks in Europe.”
However, there are some really strong examples of logistics companies in Australia leading the way, John says. “If you look at a model like Catch of the day, you can see state-of-the-art logistics and automation in action in Australia.”
John attributes much of the success in the logistics industry to the fact that Australia is not a manufacturing hub and has therefore been adapted to meet the unique demands. “If you look at how supply chain and logistics is taught in say Germany, it’s from a completely different perspective. We don’t really manufacture a great deal of products here here, by comparison, we import a lot of our products from overseas. It’s a different way of working and different kinds of knowledge and skills required.”
Lean and agility
With tech moving at a fast pace, product life cycles are now shorter, John says. “The shorter product life cycles mean that organisations need to be more reactive, they need to have a start-up mentality and a lean mindset.”
John kept all of this in mind when designing this new course and made sure that the course content included lean six sigma methodologies. “We have created a unit of study that equates the lean six sigma training, this gives students the practical elements as well as an industry accreditation.”
While many of the new skills needed are around automation and data, for John the importance of soft skills should never be dismissed. “Certain skills will always be valued: communication, leadership, problem solving – these will always be needed.”
Within this area, John believes there should be a focus on networking. “Networking is a great tool, both digital and offline. I use LinkedIn a lot to gather for content for my lectures. I have a global network of industry and academic content and case studies at my fingertips and I can use my digital professional profile to utilise that and communicate directly with thought leaders worldwide. The logistics professional of the future must too.”
Masters of innovation
This change in skills and shift in the industry has motivated John to set up a new postgraduate programme at Swinburne University of Technology. “Students can go to many different institutions and do supply chain management courses, but we wanted to do something different. We wanted to add a greater technology and innovation aspect to our course, as well as increase engagement with industry.”
The course launched earlier this year and, according to John, it invites students to think innovatively and creatively about supply chain management, to improve today’s supply chains, and equip them for the changing needs of the industry.
“As competition continues between global supply chains in response to customer demand volatility and increasing customer expectations, supply chain managers need to be increasingly innovative in order to gain competitive advantage. Having appropriately skilled people, who are equipped to make the right decisions, is essential, this is why we have designed this course,” John says.
A key aspect of the course is the industry-focused teaching and industry partnership. Every unit is linked with an industry partner. These include GS1, CILTA, CEVA Logistics and Coca-Cola Amatil. Students work with each of the companies on real-world projects and produce practical solutions for the organisation. “It’s very industry focused, there is a meaningful end-point for all students,” John explains.
The first cycle of entrants on the course will graduate in July 2019 and the course is aimed at working professionals. “We have based this course on skills that may not be available to businesses in-house. Many people in logistics and supply chain organisations need to keep pace with change and upgrade their skills regularly. We have an ageing workforce, and the industry is now almost unrecognisable to how it was when some professionals started out in their career in logistics,” John says.
For John, while the skills required are developing and diversifying, it’s an exciting time to be in logistics and he is looking forward to seeing how the young professionals of today will grow, develop and shape the future of the industry.