At the time of writing we seem to be teetering on the edge of a combination of global financial meltdown and a situation where, across the world, banks are effectively nationalised. It’s enough to make Marx and Engels dance a jig.
So, at the time you read this, it may have all settled down or you may be reading it by candlelight as you wait to take your place in the queue at the soup kitchen.
However it turns out, we are extremely unlikely to avoid a prolonged period of very difficult trading for any business to business service.
The UK logistics sector has, over the past two decades, led the world in effectiveness and supply chain performance. In most parts of the economy, supply chains have moved from production-dominated, stock-heavy, supply-push distribution systems to consumer-led, agile, demand-pull systems. There is no doubt, that this process (significantly led in the main by our customers) has enabled vast amounts of working capital to be taken out of the system to the benefit of all.
However, it could be argued that those system-led benefits have, in the main, been achieved in spite of a skilled workforce rather than through a skilled workforce. As more and more sophisticated technological solutions have come along, we train the relevant parts of our workforce to use those systems but mainly, only to use those systems.
As the degree of automation increases (eg RFID and Satellite Navigation), then we risk de-skilling the basis of many jobs in the sector and will have to face up to the dangers of producing an institutionalised ‘assembly-line’ mentality among our workforce.
Many years ago, during my time at NFC and shortly after we were privatised, we had somewhere in the region of 1,000 separate operating facilities, each of which was run as a profit centre. We came to the conclusion then that really we were like a whole series of cottage industries, each very dependent on its people.
For all the current sophistication I think this still applies to large parts of today’s logistics sector. The dependency on people and their general skill levels is still there but the investment in those general skills is sadly lacking, except in a few shining exemplar organisations.
Inevitably, severe trading conditions put pressure on training budgets. Even the large players will inevitably cut back as they retrench to fight recession. The difference between the very large players and the smaller ones however, is that the former are extremely unlikely to stop training and development altogether. Their systems of professional development are too fully embedded to pull out completely.
For the smaller companies however, the step to put in such a ‘bomb-proof’ infrastructure from scratch is too great to contemplate so the gap will inevitably get wider between the haves and the have-nots. This in turn will damage the whole sector as the large players are very dependent on the small players to function.
At Skills for Logistics, we are currently working up a system through our network of Regional Logistics Academies (whether directly supported by the government or not – again written before the decision is announced!) The Academies will offer direct support to all those companies that cannot afford the training and development infrastructure enjoyed by the bigger players. Watch this space.
What is certain is that, if you’re brave enough to go for it, then the next couple of years are the time to do it.
Seasoned financial specialists will tell you that the time to invest is when the market is at the bottom. Warren Buffett’s famous quote: “be fearful when others are greedy and be greedy only when others are fearful” can also be applied to training and developing your people. If you develop the skills of your people when your competitors are not, you will strengthen your ability to climb out of the abyss.