Who needs a PPD plan?

by Dr. Robert A. Kemp

Should we all have Personal Professional Development Programs?

Most of us believe supply management means creating and leading our supply chains to ensure continuity of supply, significantly enhanced service, total cost control and more involvement with suppliers or others to provide our customers expected results. I for one believe this is the absolute truth and that the key concepts for us are: to understand the current situation; be able to visualize the demands of the future state; and create and lead change in our organization to meet those anticipated demands. In most cases, simply applying current knowledge and practices will not meet the demands of the future. Therefore, we need to be asking ourselves, “What do I need to learn to ensure my ability to support my organization now and into the future?”

Fortunately, there are guideposts. Professors Larry Giunipero and Robert Handfield have identified the top trends in supply management for 2010. These trends (see Table 1) exist now and are expected to increase in importance. Some of these trends will shift and experience greater rates of increase than others. If our organizations and processes are really to become more agile and adaptable, we will need to be even smarter and faster than anticipated.   

Creative and effective response to these environmental pressures will require different skills than many supply management professionals have today.   

For example, the complexity of cost analysis changes completely when you go from analyzing “What does it cost?” to “What should it cost?” and “How can we reach the should-cost level?”

The corollary question of “How can we buy at should-cost levels?” is even more complex and requires improved negotiations, vastly better relationships and other improved skills. Most of us have studied some of these skills and have worked to improve our abilities in them, but we need to be better across the board. To do that, we have to consider the following questions:

1. Do we have a consistent strategic vision of what we must be in five and ten years to provide world class supply management processes for our organization, its customers and its supply chains?

2. Do we have a consistent multi-faceted professional development and professional education program individually and collectively in our organization with adequate budgetary support to support your vision?

3. Are we individually or collectively members of the most appropriate professional organizations to guide and challenge the needed professional development programs?

4. Do we have programs and processes to consistently address professional questions concerning our operations to improve individual and team performance?

5. Do we have a system of metrics and benchmarks to identify needs for professional development, measure, evaluate and report individual and team progress to senior leaders, individuals and teams consistently over time?

Degrees of education
The Institute of Supply Management (ISM) regularly surveys its members’ educational  progress. Table No. 2 shows ISM’s education demographics for 2003  (updated for 2004). The data shows that the percentage of professionals with a supply management degree has grown to 5.5 percent and the number with college degrees to 60.6 percent. Nearly 28 percent said they were C.P.M.s and plan to maintain that status. An additional 13 percent hold lifetime certifications. Forty-five percent plan to acquire the C.P.M. in the future. How does your company compare? 

Similarly, the average spend for education per supply management buyer, according to the CAPS 2004 Cross Industry Benchmark study, was $1,026. But that buyer spent about $19.95 million per year. The ratio of training cost to spend ($1,026/19.95 mil) is .00005 — an extremely small sum for education and professional development, but it’s a benchmark we can use.

Some estimates peg the number of supply management and related professionals in the U.S. who belong to supply management organizations at less than 150,000. However, U.S. Government statistics show about 600,000 people in supply management and 600,000 more are in related professions — a membership to market ratio of about 12.5 percent. Is this sufficient?  At least this 12.5 percent can be a benchmark.

Robert Kemp is a consultant, speaker and the former president of the Institute for Supply Management. He can be reached at kempr@mchsi.com. 

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