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Diversity in Supply Chain Roles

Diversity April 8, 2021

Diversity in Supply Chain Roles
Thomas C

Content Developer

Contributors

Arpit Bankawat
Arpit Bankawat

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Motivated by ethical concerns, global firms are trying to address long-held gender and racial imbalances. The supply chain and logistics sector aren’t immune to these changing winds. The supply chain and logistics sector has earned the unwanted reputation of being a ‘boy’s club.’  In 2019, women accounted for just 39% of the supply chain workforce.

The sector performs poorly not only in gender diversity but also in terms of ethnic diversity as well.

Among the 1,040,000+ profiles analyzed by Draup across the U.S. Supply Chain talent pool, we found only 22.9% women, 9.8% Blacks, and 11% Hispanic representation.

These worryingly low figures indicate that the supply chain industry has much introspection to do vis-à-vis hiring for diversity.

Gender Diversity in Supply Chain: Lip Service Won’t Cut It

Gender equality needs to be more than just a matter of political correctness or social responsibility. It is an added lever to growth and profitability that needs to be used judiciously.

A 2017 study showed that less than 15% of women held CSCO, EVP, SVP, and CPO positions in supply chain companies. The woefully inadequate representation of women in leadership roles is the first stumbling block to making the supply chain industry more diverse. It is no secret that to nurture a new generation of female talent, mentorship is crucial.

Draup’s 2021 survey into gender diversity in the supply chain industry reveals that the ground reality has not improved by a lot.

Even in MSAs such as the Greater New York City Area, women account for only 35% of the talent at the entry-level. This figure drops to 24% for Manager & Director level and to a depressing 22% at the Executive level

In the interest of transparency, this study was conducted across 1,040,000+ profiles in the U.S. for roles that cover end-to-end supply chain operations.

A Gender-Diverse Workforce is the Future of Supply Chain

Technology, as opposed to muscle-power, is driving the future of supply chain. In supply chain & logistics, the traditional image of a brawny man moving heavy objects or drivers driving inhumanely long distances to deliver goods is being replaced by tech-savvy entrepreneurs developing robotic exoskeletons, IoT-powered sensors and driverless vehicles.

It has become imperative to ensure that the next generation of supply chain executives will need to be technically proficient, skilled in soft competencies, and are overall good managers.

While studies have shown that women have a significant advantage over women when it comes to soft skills, and companies value them for such, they are yet to gain proper recognition for their technological prowess.

This is now changing thanks to an increasing number of women being trained in emerging technologies such as A.I., RPA, ML, Computer Vision and others by NGOs and CSR schemes. Even several upskilling and reskilling initiatives also prioritize women from disadvantaged backgrounds or women returning from an extended period of childcare.

It would be short-sighted for an industry staring at a talent gap of over ~26% (and increasing) to ignore this growing talent pool.

How to Foster Gender Diversity in the Supply Chain Industry

While initiatives can vary from company to company, at a very high level, the following steps have been successfully shown to encourage women in other industries:

  • Run focused upskilling programs to pull more women into supply-chain roles.
  • Institute more mentorship programs. This also has the added advantage of inspiring more women to climb to the corporate ladder. Initiatives like Girls Who Code are a prime example.
  • Catch them early. Establish focus groups to source female talent right from the university stage. The I.T. & Automobile industry have implemented this with resounding success. Although, one may have to get really creative here.

The supply chain industry has the responsibility to be more inclusive to women and lead the way to attract and retain more talent at every level.

While making room for more women is a first step in widening the talent pool, the next obvious step to recruit more talent from minority talent pools.

Minority Supply Chain Talent: A Major Problem

The scene is not so rosy with ethnically diverse talent in the supply chain industry as well.

Even among top players in the U.S. market such as FedEx, our analysis has shown that Blacks account for 15% of the talent and Hispanics, a much lower 8%. The trend continues among other players such as UPS, Target, Boeing & Amazon.

Drilling down further across roles, at the entry-level, Blacks account for ~14% and Hispanics ~17%.

Predictably, in Manager & Director roles, Blacks account for a measly 9.2%, with Hispanics at a not-much-better-off 11.8%.

At the Executive level, this figure drops even further to 7.6% & 10.5%, respectively.

Why Supply Chain Companies Need More Ethnically Diverse Talent

As rapid advancements in technology keeps integrating the traditionally separate logistics & distribution roles, the need for a consolidated job title to manage end-to-end supply-chain processes becomes apparent.

This means that the traditionally employed workforce in this sector is woefully short of the skillsets to meet the future of Supply chain logistics.

By actively hiring women and targeting recruitment within an ethnically diverse location, enterprises can cast a wider net to increase the odds of landing the right talent.

Moreover, talent hotspots are shifting to tier 2/tier 3 cities and companies are no longer reluctant to hire from these locations. These are the regions where minority talent is abundant. So it makes sense from both a skills perspective and a talent acquisition perspective to actively scout these regions for minority Black and Hispanic talent.

Hopefully, this search will not just be restricted to entry-level roles.

Replacing an Ageing Workforce with Diverse Talent

The supply chain industry is famous for consisting of a workforce that mostly skews towards the older demographic. In 2016, the U.K. Commission for Employment and Skills (UKCES) found that just 9% of those working in the supply chain and logistics sector were under 25. Nearly half — 45% — were over 45.

At the risk of sounding ageist, most enterprises would rather hire fresh talent knowledgeable in emerging tech rather than up/reskill this mature talent pool. While re/upskilling initiatives do exist, enthusiasm seems to be muted from both companies and employees.

However, if other industry trends are taken into account, it’s evident that the wind blows more in favor of scouting for talent from tier 2/tier 3 locations.

Diversity Done Right: Successfull Case Studies

Industry observers note that by leading a successful pivot to more diverse talent in the supply chain industry, key players have increased employee satisfaction, decreased attrition rates and dramatically reduced their cost of talent acquisition.

A North American retail giant found that by actively running returnship programs for women who quit the workforce, they were able to increase their long-term talent acquisition costs by ~27%.

Another Norwegian freight company, a crucial provider in the supply-chain infrastructure, rerouted their hiring efforts to minority talent hotspots in Africa & Asia. The result was that open positions were filled within 2 weeks whereas on average it used to be about 2 months in this highly specialized field.

How to Use A.I. to Solve the Diversity Problem in Supply Chain

Nurturing diversity is a process that begins right at the very beginning of the recruitment pipeline. This involves not just identifying minority talent but also identifying hotspots for the right minority talent.

For example, our study zeroed-in on Houston, Texas, as an ideal location to scout for diverse supply chain talent. The population of Houston is 25% Black compared to the national average of 13%. Hence the city has a larger supply of black talent. Target, Amazon, Schlumberger are some of Houston’s top employers in supply Chain Job Functions who have taken advantage of this demographic data.

In other words, to increase diversity – both gender & ethnic – your recruitment process has to be focused right from identifying the skillsets to identifying the location to hire for these skillsets.

However, this involves comparing, contrasting, analyzing, and extracting information from 100s of data sources, each with its own unstructured/structured data format and metrics.

But with the rise of AI-powered talent intelligence tools like Draup, talent management teams can now identify global talent hotspots ideal for hiring minority/diverse talent right from their dashboards.

The requirement can be specified across job roles unique to the supply chain industry and even expanding to cross-industry roles. Stakeholders can also identify emerging talent hotspots before their competitors and focus their hiring efforts armed with comprehensive location data that involves CoL, Hiring Costs, University Ecosystem & a host of other data for that location.

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