There’s a talent gap in logistics today and companies are dealing with it in different ways.
For KANE, that’s meant placing more emphasis than ever on hiring logistics workers from within. Recently, we caught up with KANE’s VP of Human Resources, Amy Wren, to discuss the subject.
Q: How bad is the talent gap in logistics?
A: I’ve read estimates that suggest that, in the near future, there could be as many as 9 slots to fill for every graduate with supply chain skills.
Q: Is it tougher to fill available logistics worker positions?
A: Well, for the hourly positions, the country is experiencing an historically low unemployment rate. That makes warehouse labor management a challenge. Also, the existing workforce is aging out. For example, the average age of a commercial truck driver in America is 55.
For salaried positions, it’s not easy to find people who combine operational skills with qualities like leadership, analytical skills and innovative thinking.
Q: To identify that hard-to-find talent, do most companies instinctively look outside the company?
A: Historically, across lots of industries, I think that’s been the reflex reaction. There’s an assumption that the new guy or gal from the outside is smarter or better in some way, or that bringing in an outsider can accelerate achievement of a business objective. But that’s often a mirage. A good analogy might be baseball teams that invest hundreds of millions in talent as a “quick fix” for a losing record. Actual performance results have shown that success, over the long term, is more likely when teams invest in their own farm systems and develop their own players.
Q: So, these are some of the factors that are driving KANE to emphasize hiring from within rather than from the outside?
A: The reality, in today’s hiring environment, is that you have to do both. But it makes sense to place more emphasis on identifying and developing the high-potential people in your own organization.
A: Well, logistics workers who don’t see opportunity where they are now will look for it elsewhere, creating an even wider talent shortage. Logistics companies have an obligation to offer opportunities and a clear growth path.
Q: What are some of the advantages of a Human Resources strategy that emphasizes promotion from within?
A: There are a number of advantages. For one, these hires know the company so there’s less risk. An outside hire may arrive and decide, after a time, that there’s just not a good fit.
There is also a financial incentive. It takes a lot of time and money to identify and train candidates – at least 20% of the new hire’s yearly salary. These costs largely go away when that candidate is also a colleague.
Finally, and most importantly, the strategy creates a fortuitous cycle. If you create a culture of learning and professional development, retention and morale improve as associates see their friends and colleagues acquiring new skills and advancing within the company. They begin to recognize that, as the company grows, their responsibilities and earnings can grow, too.
Q: Does KANE have any success stories in this regard?
A: Many. Our new Director of Operations for Sam’s Club began his career as a temporary associate in 2001. Today’s he’s responsible for three large distribution centers that process hundreds of millions of dollars in inventory daily.
Our Company trainer started as a forklift driver and was promoted to Supervisor. As an HR professional and trainer, he is as good or better than traditionally sourced HR directors with advanced degrees because of the experience-based knowledge and credibility he brings.
At any company, this kind of talent may very well reside within the current logistics workforce. But you have to invest to identify and develop these associates. It can’t be lip service. The commitment must be real.
Q: Do you find that all associates want these growth opportunities?
A: Frankly, no. And that’s fine. Some like what they do and aren’t anxious for change. Others don’t want the pressure of greater responsibilities. But we’re always on the lookout for logistics workers who want to grow AND have the talent to succeed in more demanding roles. These are our high-potentials.
Q: Do KANE’s customers, or the customers of any 3PL, care whether you source your talent from inside or outside the company?
A: They may not voice that desire, but I think they do. One of the things we know about our own customers is that they appreciate the KANE culture – the KANE Code – and how associates genuinely act as an extension of their teams. At the end of the day, success in this business comes down to individual people caring enough to do it right, every time. If more and more of KANE’s leaders are people who have grown up in the organization and who already know and embrace the culture, then the underlying customer service ethic stays consistent and strong. For customers, that translates into a greater comfort level and a feeling that, whatever the challenge, the job will get done.