Daily Archives: September 11, 2023

Sourcing and Supply Chain Jobs CAN NOT Be Automated

Raconteur recently published a great article that noted that the next big shortage to watch [is] supply chain skills, and they were entirely correct when they noted that it’s ironic that the profession struggles with its own supply of talent. They were even more on the money when they said walk into a meeting of supply chain managers and you might wonder whether you’ve stepped back in time several decades because the statistic published in 2021 by Logistics UK that 89% of people working in logistics and supply chain are men.

Furthermore, they scored the hat trick when they noted that employers are struggling to find talent, and that is because not enough talent is entering the industry. Why is this? That’s a good question, and unfortunately Raconteur stopped with the hat-trick because the rationale they gave for lack of new entrants is only part of the problem.

According to Raconteur, the reasons for the lack of recruits are:

  1. Procurement is high on the list of roles at risk of being automated to extinction
  2. The recent slew of media reports highlighting failures in important supply chains may be deterring potential new entrants away

And while constant claims of procurement automation and constant reports of failures are unattractive, it is not the core problem (but merely the manifestation of the problem).

The real problems are the continuing:

  1. Lack of Marketing by the Profession (and why a Procurement/Supply Chain Manager is someone who’s cool)
  2. Lack of Education in most/leading University programs

Corporations who value engineers do great advertising on how cool it is to be an engineer working for them (think Siemens). Oil & Gas and Mining industries who need geologists and specialists to find new deposits do great advertising on how cool it is to be an explorer in the modern world. SaaS / Social Media companies that need great software developers do great advertising on how it is super cool to be a techie. Have you ever seen any corporation ever make it super cool to be in Procurement or Supply Chain? Even Apple, which won on supply chain management, never advertised how cool it would be to be a supply chain manager for them. As a result, Procurement and Supply Chain only recently entered the general vocabulary, and most people only paid attention as a result of the massive failures that came to light under the pandemic*.

Most University programs, two decades after we needed courses on modern Procurement and Supply Chain Management, still only teach classical Operations Research and Logistics. Logistics is important, but the age of Logistics was two decades ago. As Will Smith told us back in 2002, no one wants to be in the old and busted driver’s seat (see the clip). They want to drive the new hotness, but all Universities want to teach them is how to drive the same old and busted processes and practices the Professors learned in the 1980s (which were taught to them by the Professors who invented them in the 1960s).

Since Universities aren’t modernizing, no one graduating understands what Procurement and Supply Chain really is, so when all they hear from the media is failure, why would they want to even look into a profession that is apparently as high stress and fraught with risk as a surgeon or a defense attorney? Furthermore, since companies aren’t even spending a dollar on promoting how cool it is, and how much they need these people, it’s not a stretch to believe that the companies aren’t promoting it because they plan to automate it.

But Procurement cannot be automated. Technology can automate tactical procurement tasks such as:

  • regular restock reorders
  • auto-PO generation and delivery
  • auto-invoice matching / auto-correction requests
  • third-party supplier data validation through APIs
  • auto-supplier discovery from third party networks
  • auto-supplier risk profiling from third party data feeds
  • etc.

because technology is good at the “thunking” — the semi-mindless processing of electronic paperwork to make sure the i’s dotted, the t’s crossed, and the request valid as per business rules. However, technology, especially technology powered by Automated Idiocy, is NOT good at the thinking. You need Procurement Professionals, Sourcing and Supply Chain Superstars for those tasks, which permeate the entire Source to Order and Order to Delivery supply chain cycles. For example, as a counter to the above, technology cannot

  • adequately adapt to highly dynamic demand changes (especially when it doesn’t know why)
  • determine when new products or services NOT in the system will need to be ordered to support one time projects, replace products that will not arrive on time due to supply chain disruptions, replace services where the provider loses the resource with the proper training and certifications, etc.
  • handle the negotiation on the 1% to 5% of invoices where the provider won’t correct the missing information or the pricing on an auto-request
  • be able to validate the API where a human has to call another human to get the necessary information
  • find new, innovative, suppliers NOT in the connected network
  • customize the risk-based vetting to the specific need and acceptable thresholds
  • etc.

So, yes, some of the accounts payable paper pushers are going to lose their jobs as the thunking takes over, but that’s NOT Procurement, and definitely NOT Strategic Sourcing and Supply Chain where a human IS desperately needed. And yes, you will need to be familiar with the best of modern technology as a new professional in our field, as the job will soon be impossible without it, and you will need the augmented intelligence it provides to be efficient, but the technology cannot replace you.

So join us. And run the modern world.

* Not brought on by the pandemic as it was bad supply chain design and management that resulted in the pandemic breaking supply chains. Had the supply chains been properly designed, all the pandemic would have done was slowed them down. So don’t blame the pandemic. In fact, if you want to place blame, then blame McKinsey and their peers which started the ridiculous outsourcing craze instead of helping us improve the home-source and near-source supply chains we had that were working great, and put us in the situation where we have to reconfigure global supply chains all over again.