This site depends on JavaScript to run. Please enable it or upgrade to a modern browser that supports it.

SAVE up to $150 on the ASCM CONNECT Annual Conference by registering before midnight CST, August 15!

ASCM Insights

Episode 42: A Deep Dive into ASCM’s 2022 Supply Chain Salary and Career Report

title

Bob Trebilcock: Welcome to The Rebound where we'll explore the issues facing supply chain managers as our industry gets back up and running in a post-COVID world. This podcast is hosted by Abe Eshkenazi, CEO of the Association for Supply Chain Management, and Bob Trebilcock, Editorial Director of Supply Chain Management Review. Remember that Abe and Bob welcome your comments now to today's episode.

Bob: Welcome to today's episode of The Rebound, a deep dive into the ASCM 2022 Supply Chain Salary and Career Report. I'm Bob Trebilcock.

Abe Eshkenazi: I'm Abe Eshkenazi.

Bob: Hey, just a couple of weeks ago, we had Kevin Burns as our guest on The Rebound. For our listeners, Kevin is an executive recruiter who specializes in placing senior-level supply chain leaders in new roles. We called that episode 'it's good to be a CSCO'. Based on Kevin's experience, senior leaders are as in demand, as beachfront property on Marco Island. That's why we're calling it really good to be a CSCO. Today, we're going to revisit that theme since ASCM just made public its 2022 supply chain salary and career report, and hey, based on a quick read of the results it really is really good to be a supply chain professional. Let's kick this off with a high-level overview. Abe is the CEO of ASCM. What's your take on the results, big picture?

Abe: Bob, really interesting data points that we're finding here. First, supply chain professionals are in demand. We saw this prior to the pandemic, Department of Labor Study indicated for every six openings, we had one qualified candidate, traditionally career-oriented individuals. As we see it now, the job openings are from entry-level, mid-career, and senior leadership so that's first.

Secondly, the demand for qualified and competent supply chain professionals has never been higher given the awareness of supply chain in the field right now, as well as it's almost every home right now is a supply chain challenge so that's a very interesting data point. Compensation is up, satisfaction is high, placement for individuals coming out of supply chain programs second only to engineers.

There's a lot of positive data points that we see here, and we also see a lot of challenges in terms of recruiting and retaining a demographic workforce. We see a lot of positive aspects from career satisfaction to job opportunities, as well as recognition but we also see some challenges that have been systemic and historical in our field.

Bob: Before we dig into the specifics of the report, I thought we could get a little reporting from the ground. Now you just attended and presented at an event in Chicago, last couple of weeks. I've been at events in Dallas and Orlando. What were you hearing about the profession this week in Chicago? What was the mood and were there any takeaways?

Abe: Yes, absolutely. Bob, I think first, there's a lot of pent-up demand for individuals to get together. I think we're seeing that in a lot of different industries, the opportunity to collaborate and share and exchange information with counterparts and colleagues, and I think is a lot of demand in that market space. From what I saw, it breaks down into two different themes. First, the response to the disruptions: help me respond, help me prepare, help me ensure that I am capable to respond to the various disruptions in the field. I think what we're seeing is the variety of disruptions have really caused a lot of challenges for supply chain professionals.

Resiliency, visibility, transparency are among the key topics for a lot of organizations, their ability to respond. At the same time, it's interesting that there was quite a bit of atheme on ESG, much more systemic issues and long-term issues that we're seeing within supply chain. It's an interesting dynamic that we're talking about our response to a lot of the disruptions and at the same time, we're saying we have a higher calling in supply chain to prepare for the future. That, or among the key themes moving forward, a lot of focus on talent development as well as digital transformation, combining the investment that organizations are making in technology with their investment in people.

There's been quite a bit of challenge in that balance, getting competent individuals to take advantage of the investment that organizations are making in their technology. Those were the key themes that I saw. You attended a couple of events as well, Bob, give me a sense of what you're hearing similar or different from what I experienced.

Bob: It's interesting. I'm going to echo what you just said because those were among the two big takeaways from the last two events. For instance, when I was in Dallas, a lot of VP, senior VP of supply chains from some major organizations and almost all of them focused on the lessons they learned and how they got through the last two years. I remember going there thinking, "Well, my gosh, aren't we tired of talking about that” except that, new things keep popping up and we're not through it.

The second one was this notion of ESG. I'll come back to that in a moment and the third was talent development. As an example in Dallas, the chief supply chain officer for Walgreens talked about how they've worked with people with disabilities in some of their distribution centers, brought in people with autism, for instance. Now, that's something they've been doing for some time, but they've really made it a best practice.

On the ESG front, came up at both events that I attended, what struck me is one, it seems to be a renewed and intense focus. I remember 2018, I think, at ASCM, you had Yossi Sheffi, who had just put out a book that was basically, I'm going to do poor Yossi some harm here, but the title of the book was basically Green, Who Needs It?

I remember a young woman came up to him afterwards and was telling him all of the things that she has done around sustainability in her organization and Yossi pointed at me and he goes, "Talk to him and he'll write an article about it, but you didn't do a damn thing.” It was interesting and yet, it really is part of the conversation and it's no longer struck me just energy savings and carbon footprint, but what does it mean to be a sustainable organization?

People talked about what it means around supplier relationships, customer relationships, diversity and inclusion and just being a good citizen, and then, of course, things related to carbon. It seems as if procurement or supply chain are going to be where the rubber hits the road in many organizations. I think supply chain is struggling to figure out what all of that means for supply chain. Those were my big takeaways.

Let's dig into the survey - overall compensation, which I think means salary and benefits was up by an average of 12%. Total median, I think it was the median compensation was just under $100,000. Who are we surveying? In other words, what are the demographics of the survey entry-level, mid-level senior level, how do you describe that?

Abe: The really interesting point in that if you take a look at it historically, Bob, I think one of the areas that we were a little bit behind the curve on was the academic programs within the supply chain field. If we dialed the clock back to the '90s and just before 2000, we maybe had a dozen programs in the world that had a supply chain program. As we sit here today, we can count over 500 baccalaureate programs within supply chain.

Bob: Wow.

Abe: Obviously, the awareness and the criticality of this position has obviously been recognized within the academic field. When we take a look at the demographic on the respondents, 50% have a baccalaureate degree, 30% have a master's degree, so these are career-oriented individuals that recognize the opportunity to get into the supply chain field so that's first. Secondly, the areas of study, I think this is where we're seeing the most significant change for individuals. Historically, within supply chain, the individuals came out of engineering and business and/or finance, predominantly white male fields.

Not surprisingly, when you take a look at the demographic and the tenure of supply chain professionals, you tend to see an imbalance with senior leadership being older white males with the demographic coming in a very diverse gender and people of color. Also, the areas of study, most of the historical or leadership did not come out of a technology-based environment while most of the individuals coming into the workforce now are very comfortable with technology and machine learning and the digital world that we're all encountering right now.

When we take a look at it, these predominantly are career-oriented individuals that have responded to the survey and that are predominantly within the field already so that they have graduated and they are on their way to a supply chain career. I think that's also one of the areas that is a positive and a negative is the career pathways for a lot of the individuals. When we talk about the individuals coming into the workforce, these are the tenured individuals are looking for supply chain jobs.

More importantly, the variety of supply chain jobs is a benefit and it's also a challenge because we have a variety of career pathways, not a career pathway. While it's positive that individuals can get a variety of jobs and as we've seen in the response, the job titles are dynamic within the field. I think that's been a benefit, but it's also been a challenge to explain to individuals what a career pathway to a chief supply chain officer or a global supply chain officer looks like.

Bob: I'm going to come back to that trajectory in a moment, before we get there, there was another high-level takeaway that I thought was important. Frankly, it's one that I think is reflected in other surveys, but also the faces I'm seeing at events as an example, when I would meet women at supply chain events, they were historically in marketing. You and I have had women from GE Appliance for instance, who are dirt-under-the-fingernails VPs in manufacturing and distribution, and logistics. I moderated two panels at the Dallas event.

One was a woman from Corning in engineering, had a supply chain degree from MSU and the other one was a woman of color from Disney, in a VP role in trade management. I'm seeing the starts of this diversity. Here were the things that struck me. One is the gap is narrowing for women and people of color at public companies and the other, as you and I were talking earlier, is the fact that women under 40, and I'm guessing that was public and private companies are out-earning their male peers. There's a lot packed in there. I'll let you unpack it.

Abe: No, really great data points, Bob, that we're still continuing to see a trend here. First, they pay the gap for not only entry-level but for tenured individuals. As you pointed out, pay for women under 40 is now outpacing men, that's for a couple of years now. I think it reflects the challenge of recruiting a diverse workforce. Organizations are willing to pay more for individuals diverse, specifically demographic to get them into the organization. We're not surprised that organizations, specifically public organizations are being held to the reporting requirements in terms of what their demographics are.

Being accountable and having to report out, not surprising that organizations are willing to pay more, but more importantly, the chase for talent is high. If you want qualified confident individuals, you need to pay them accordingly. We're pleased to see that women are out-earning men, but the challenge that we have is that the longer they stay within the workforce, that pay gap inverts, men earn more than women. Now, there's a couple of data points that are leading to that. First, historically, women have started off at a lower salary than men and have not caught up in terms of their tenure, that's first.

Secondly, women may not be given the opportunity to lead within organizations because either family issues or perception that they can't provide the time or the commitment necessary for that job opportunity. They may not even be given the opportunity to lead within an organization and then lastly, I think we're seeing the historical imbalance of finance and engineering professionals in leadership positions versus the women that are now within the workforce. There's some positive indicators there on the recruitment side.

We've got to do quite a bit more on the retention side, specifically for women and people of color, giving them more opportunities for advancement and more opportunities for leadership, providing mentorship role models for organizations for women and people of color. We're very pleased in terms of the move towards a pay gap equity, but it also, it reflects the challenge on talent. There is a huge crush of talent demand right now for supply chain and as we indicated in the number of scenarios before.

Prior to the pandemic for every six openings, there was one qualified candidate and that was for career-oriented supply chain jobs. That's now extended to entry-level mid-career as well as late-stage career. That search for talent and qualified competent individuals right now is significant and not surprisingly, public companies that are accountable to report out and are held to hire reporting requirements tend to lead relative to DE&I.

Bob: You are talking about job trajectory a few minutes ago. I ran a story a few years ago that was titled something like Supply Chain; the DIY Career, because there wasn't a clear-cut trajectory. That actually came up in 2017 in a panel that I moderated at ASCM where someone in the audience, one of the younger people in the audience raised their hand and said, "Everybody wants me to do this and that and that and I do that."

Then I asked, "What happens next?" She goes, "Cricket, meaning that everybody's telling me I need to do these to get ahead, but nobody's telling me where I can go next." You have a slide in there that wasn't directly related to salaries, but two job trajectories. I wondered is, are we now seeing a path that you start in whatever, category management, you go to inventory management, you go to facility manager, are those things developing?

Abe: Yes, that's a really great point. I think this reflects the challenge, as well as the opportunity that we have within supply chain, is the diversity of the jobs. If we dial the clock back to the '70s and '80s, you were within a silo. You were in the procurement function or you were within the warehousing function, or you were within the manufacturing function, rarely did you just pop from one function into another or a job title.

I think what we're seeing now is the convergence or the alignment of supply chain activities within an organization is now planting those opportunities and the ability to jump or transition from a role within procurement into planning or into warehousing. The job titles that we've seen right now from basic manager, all the way to chief supply chain officer or chief operating officer, again, I think we've got some challenges relative to common definition of role responsibility.

While we may see different jobs within different industries, the job titles may not be reflective of the role and responsibility. I think this is where we've got to focus on what are we asking these individuals to do? While the job title is important, more important is what's your role and responsibility for an organization? What are the competency requirements? What are the educational requirements? What are the experience requirements to lead in an organization?

This is where organizations can take a significant step up within their own organization to identify what are the job opportunities, what are the promotion opportunities and where can you make a difference within the organization and then provide those opportunities for the entire workforce? I think in some cases, we challenge ourselves because of the diversity within the job titles. Within the deck, we have a breakdown of job titles based on the SCOR reference model.

I think it's something like almost 25 different job titles that exist within the SCOR framework. That's a lot to embrace. If I'm a CFO, if I'm an accounting professional, I know my trajectory to be a CFO within our industry, supply chain, multiple entry points, multiple competency and capabilities, and multiple exit points to get to that leadership position.

Bob: It seems also with the senior leaders I've spoken to whether it's VP, SVP, CSCO, many of them have had multiple roles. I think of the CSCO at Gap who started out as an engineer, became a facility manager, then became manager over all of their DCs, then became a transportation manager, then had global transportation, then went into procurement, and then had global procurement and then he even took on the stores and then he became CSCO. It was almost like, "Oh my God, I've got to do it all, to get to that level," as opposed to as you say, you start out in accounting or finance, and you move up to there and you move up to there and then you might get to CFO.

Something else I was really interested in and I had a theory, but I'm happy to be disavowed of it, that was the difference between the public and private gap. My theory has always been particularly when it came to benefits, maybe more so than salary, is that public companies always have deeper pockets. One of my colleagues at Peerless, her husband works for Disney at ESPN. He's in an editorial role, his benefits, nothing against my employer, his benefits are far more generous than our benefits. We compete on salary, but when it comes to things like vacation and health insurance and things, smaller companies are often at a disadvantage. How do you explain that gap? What's the working theory on that?

Abe: Yes. I think you've identified a couple of areas from our perspective, and we saw this on ESG as well, that public companies hold themselves to a higher standard in terms of reporting out than smaller and medium-sized companies that don't have that reporting requirement. As we've seen with organizations being held accountable, you want to walk the talk and I think this is one of the areas that we're seeing a significant change for public companies.

Almost every company has a DE&I initiative or a sustainability initiative. If you don't have it now, you are woefully behind the curve in terms of, at least, recognizing your responsibility. Now, the question is, what are you doing about it? I think this is where public companies are held to a higher standard than private companies in terms of, "Okay, if this is what you're going to put out as a metric for your organization, how are you doing against that? What is your trajectory? What is your history as an organization? Are you making any progress?" Similar to sustainability, oftentimes, the rhetoric does not match, or the actual work effort doesn't match the rhetoric.

In this particular case, we are seeing it within the public and the private, the pay gap. Public companies, again, being held to a higher standard, are willing to pay more. I think we also have to recognize the chase for talent right now, Bob, it is as high as ever right now, especially for qualified competent individuals. Wage inflation, obviously, across the board has been significant, but when you take a look at the pay increases for supply chain professionals, they've outpaced almost every other industry right now.

It reflects the gap that we have prior to the pandemic, but also the criticality of the positions today in terms of enabling organizations to respond to the disruptions and positioning themselves for future sustainability, both economic, environmentally, as well as ethically,

Bob: Just two more here. One that I was similarly fascinated by, which was the Great Resignation and it was related to company culture, but the Great Resignation slide, which basically said, "Supply chain? Ah, not so much." I think what you found was that people changing jobs was only up 2% from the previous year. Given how crazy our jobs are and the pressure that supply chain is under, how do you explain the fact that, in comparison to other industries, we didn't get whacked too bad from the Great Resignation?

Abe: Yes, really interesting data point that we saw a couple of years ago, and that was job satisfaction. Individuals are very satisfied within the supply chain field. It's interesting. I'm going to dial a clock back at almost 15 years, Bob. When I joined the organization back in 2006, this is an industry that had gone through a significant transformation from outsourcing digital transformation, as well as the computer age, coming in 2000s and having a dramatic effect on supply chain, specifically, the globalization of supply chain.

This, historically, has been a field that has been in transformation, especially in the workforce effort. When we take a look at the individuals within the field, I was surprised by the passion that these individuals had for the field. It was almost second to our frontline healthcare workers. These individuals were committed to their organizations. They didn't leave their organizations.

A great example is what you brought up on the individual who went through all those variety of jobs within a company. Imagine an individual staying in the same job for 40-plus years right now, that's a relic of the past. When you take a look at job satisfaction for supply chain professionals, commitment to the job, and seeing an opportunity to make a difference, I think that's why we're not seeing the resignation in the supply chain field at the same level as we are in other industries.

We also have to recognize that individuals are staying for a variety of reasons. Pay is one of them, but also job opportunities to make a difference, professional development. Organizations committing to ongoing education for their employees is a critical part of employee job satisfaction today. Especially when you take a look at the job requirements today, historically, it used to be sufficient that you were a subject matter expert or a functional expert within a field in supply chain, now, that's the price of entry.

Now, we're looking at collaboration communication. What were referred to, in the past, as soft skills but I think most of us recognize that these are not soft skills, these are significantly challenging opportunities for individuals to enhance their career opportunities. I think that's why we're not seeing the term, the Great Resignation, within supply chain relative to other fields that we're seeing.

Bob: I'm getting ready to do our annual salary survey for July, but in years past, job satisfaction has ranked high in our survey. Don't quote me, but my memory is that the average length in the job was 10 years. It was, you didn't see as much job-hopping as you would think. Last, we see this as well, you're a certification organization, you had some pretty good results in terms of what extracurricular education does. We have seen this in our surveys as well. Just talk about that, the importance of professional development as revealed in the survey.

Abe: A really interesting point here. I think if you trace the trajectory of a lot of the academic programs, you can see why certification matters. We've been playing catch up on the academic side relative to the curriculum that a lot of schools are teaching supply chain professionals today. There was a study done a number of years ago about what are the competencies that organizations are looking for from graduates versus what are the capabilities of the individuals that are coming out of school? It was interesting.

Where were we overweighted? We were overweighted in technology and data. That means that the capacity and the capability of our technology solutions far outpaced our utilization of it. We were underweighted in critical thinking and real-world experience. You put those two dynamics together, Bob, where you have a technology solution with an individual who can't critically evaluate the information that's not only being input but being output from the systems and that's a very difficult dynamic in terms of the capabilities for these individuals.

Also, when you take a look at the capabilities, this is where certification pays off, academic programs provide a great foundation that organizations are looking for more. They're looking for the capabilities and the functional knowledge that certifications provide. From our study, individuals with at least one credential experience a 17% increase in their salary. If they had our certification, it was on average 25% higher than their counterparts. This is a significant pay differential and why? It's not just because they have the certification, it's because they're enabling their organizations to succeed.

Organizations, pay for performance, as we've all known. When you see that organizations are willing to pay more for the APICS certifications, it's because of the value and the capability and the competency these individuals bring to the job. We're not surprised by the certifications and the recognition of higher salaries for these individuals, they contribute to organizational success and sustainable companies.

Again, we're heartened by the recognition of this. I think more relevant content is a critical aspect of supply chain today. We no longer have the luxury of time, Bob. Supply chains historically were in the back rooms. Now, they're in the front office and they're in that kitchen table, which is often the boardroom table today. Supply chain is everybody's business right now and more importantly, it's a people business. I think we're seeing that in terms of not only the pay but the recognition for individuals that are committed to the supply chain fields in earning their certifications or their recognition.

Bob: One little point going to the out of time or the time factor now, I had a conversation this week with the new director of CAPS Research. One of the things he was saying is that CAPS, as bread and butter, for years has been doing these big-involved surveys and reports that might take them a year to do the research and the writing. He said, "That will always be at the foundation of what we do, but we're realizing now also, we've got to figure out a way to be more reactive and do some things quicker that we do in a month because people want the information."

It seems as if we're at this crossroads where you're always going to have to have certain functional capabilities that are foundational, they're basic. They're going to take the time that they take to learn those, but we're also going to have to, across supply chain, figure out how to bring other skills up quickly to respond.

Abe: No, absolutely. Bob, I think if you take a look at one of the reports in one of the slides in there is technical versus leadership skills and where the focus is. Technology on the technical skills was the last. It was fifth out of all of the responsibilities. Then you take a look at the leadership skills, collaboration, critical thinking, big picture, troubleshooting, problem-solving, time management, those are the hallmarks of successful professionals within the field.

Technical skills are expected and it's no longer a question of your technical skills, they're already there. The question is, can you use those technical skills on top of your collaboration, and what are considered soft skills in the past? I think this is an extraordinary opportunity for people to not only embrace the technical side but the leadership side as well.

Bob: Well, thanks, Abe. That's everything I wanted to talk about today. Why don't you take us out?

Abe: I appreciate it, Bob. We hope you'll be back for our next episode of The Rebound. In the meantime, if you enjoyed this episode, be sure to listen to our episode with Kevin Burns, It's Good to Be a CSCO, to hear what he's seeing in the marketplace for supply chain executives. More importantly, if you want to download the ASCM salary report, you can see the link on the notes in the program today. For The Rebound, I'm Abe Eshkenazi.

Bob: I'm Bob Trebilcock.

Abe: All the best. Thank you again, Bob.

Bob: The Rebound is a joint production of the Association for Supply Chain Management and Supply Chain Management Review. For more information, be sure to visit ascm.org and ascmr.com. We hope you'll join us again.

 

Use of Cookies

We use cookies to personalize our website’s content and ads, to provide social media features and to analyze our traffic. We also share information about your use of our site with our social media, advertising and analytics partners who may combine it with other information that you’ve provided to them or that they’ve collected from your use of their services. You consent to our cookies if you continue to use our website.