LONDON (PRWEB UK) 28 September 2012
Supply chain executives in large companies are struggling to hire and retain talented white-collar employees in China, according to SCM World’s annual Chief Supply Chain Officer Report, published today.
A global study of almost 1,400 executives co-led by highly respected supply chain academic Dr Hau Lee found that rising labour costs and poaching are the biggest concerns in China, and that the country is regarded as by far the riskiest market for talent worldwide.
Almost two-thirds of those surveyed are concerned about the rising cost of knowledge workers in China, with respondents in the hi tech, industrial, chemicals and retail sectors particularly worried. It’s a similar picture on staff retention, where more than half (55%) of supply chain executives say they are concerned about poaching of their most talented employees.
Survey respondents based in the Asia-Pacific region (almost a quarter of the sample) are even more concerned about both issues than their counterparts in the Americas or Europe. On rising costs, 72% say this is a problem in China, while on staff retention the figure is 63%.
Overall, China was ranked as by far the riskiest country to operate it from a human resources standpoint, well ahead of other emerging markets such as India, Brazil and Mexico. And China ranked well behind the United States, and slightly behind Germany, in terms of value for money.
Kevin O’Marah, Head of Faculty at SCM World and co-author of the report, said the findings suggested that companies could be nearing a tipping point. “China is clearly no longer a low-cost country in the traditional sense. The implications for talent management in a global supply chain strategy include a need to diversify away from Asia, and China in particular."
“A move back toward high-wage countries make sense for organisations working to balance their talent portfolio.”
Other key findings of the survey:
Digital and eCommerce. The steady growth of online shopping is increasing supply chain complexity at many levels and forcing those closest to the consumer to adapt.
Strategy alignment and value creation. Firms look to their supply chain functions for smarter product launches, greater customer loyalty and higher sales – not just operational excellence.
Commenting on these findings, Dr Hau Lee, Chairman of SCM World and Thoma Professor of Operations, Information and Technology at Stanford University, said: “Our research shows that more and more companies are using supply chain excellence as a means to create value and competitive advantage. Those that still view supply chain management as a supporting function, or see it only as a way to reduce operating costs, have a lot of catching up to do. They are missing great opportunities.”
Capitalising on these opportunities, Dr Lee added, demands close alignment between supply chain activities and business objectives. “A value-creation view of supply chain management requires supply chain executives to work closely as an integrated part of the company’s top executive team. The supply chain function is not in the background in driving the company’s strategic performance; rather, it becomes part of the steering team in the executive suite.”
NOTES TO EDITORS:
About the research
A total of 1,385 supply chain, operations, procurement and other executives completed an online SCM World survey in July 2012. They work in a wide variety of sectors – the biggest being hi tech, consumer packaged goods, industrials, food & beverages, healthcare, pharmaceuticals, chemicals, logistics & distribution and retail – and are based across the major regions of the world: 38% each in the Americas and EMEA, 23% in Asia-Pacific. Half of the companies they represent have annual sales of more than $5bn.
The research was sponsored by E2open, a leading provider of cloud-based, on-demand software solutions enabling enterprises to procure, manufacture, sell, and distribute products more efficiently through collaborative execution across global trading networks. For more information, visit http://www.e2open.com.
About SCM World
SCM World is the leading global community and think-tank for senior-level supply chain executives. More than 150 companies from across multiple industry sectors use SCM World’s programme of end-user-led webinars, live events and research reports to enhance supply chain learning and development. They include Nike, P&G, Unilever, Cisco, HP, Starbucks, Nestlé, GlaxoSmithKline, AT&T, Shell, DuPont, BASF, Philips and Intel. For more information, visit http://www.scmworld.com.
To request a full copy of The Chief Supply Chain Officer Report 2012, or to arrange an interview with one of the authors, please contact:
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