Logistics activity is thousands of years old, dating back to the earliest form so organized trade. As an area of study, however, it first began to gain attention in the 1900s in the distribution of farm products1. Since logistics is a broad, far-reaching function that significantly impacts a society’s standard of living, logistics competencies and skills are challenging to master.
In the current day and age, we take it for granted that when we go to our favourite shopping centre, we will find our favourite food, clothes, and other items conveniently. This won’t be possible without the logistical systems and people with the right logistics competencies and skills. Effective logistics management has recently been recognized as a pivotal opportunity to improve organisations’ profitability and competitive performance. Therefore upgrading logistics skills is top of the agenda. It is also one of the critical expenditures in the Profit & Loss statement as a support cost.
Logistics Competencies
Logistics people not just perform material or information transitions but also support marketing function, product development, price promotion, and bringing new ideas to provide customer service. They ensure that firm should provide fast, accurate, and quality service. Competent logistics professionals drive increased revenue, create opportunities for major cost savings in operations, and simplify the complexity of the distribution network. To make all this happens, they acquire or should acquire the following logistics competencies and skills to perform their job function at the highest level.
1.    Distribution Design, Sourcing, and Management
Distribution Design, Sourcing & Management is the knowledge of best practices in setting up and managing distribution centers and networks, including value-added services such as kitting and reverse logistics. This logistics competency includes analysing and designing new distribution networks and optimising existing ones.
This logistics competency also required benchmarking best practices on how to run a warehouse. To help you with this issue, we have designed Warehouse Operations Assessment
This Self-Assessment type Warehouse Audit Tool also:
- Encourages employee involvement and responsibility in driving warehouse improvement.
- Encourages staff to reflect on their role and contribution to the vital warehouse processes.
- Allows staff to see and reflect on their peers’ assessment of their contribution.
- Focuses on the development of employees’ judgment skills
Skills Required:
- Develops specifications for warehouse management systems appropriate for varying businesses.
- Works with distribution partners to establish a distribution center and network.
- Designs business processes with distribution partners that support the SIOP process.
- Provides distribution-oriented analytical support for projects and new business opportunities and proposals.
- Maintains adequate inventory levels in distribution channels.
2.    Global Trade Compliance
Global Trade Compliance is the knowledge of the physical movement of products and the process by which goods enter and leave a country in compliance with all laws and regulations to manage and mitigate the risks of international business.   The competency includes the basic understanding of the duties and responsibilities within the area of import/export for an organization and the role of the government in mandating trade compliance
The Supply Chain Information Systems
How to Choose and Select the Right Digital Procurement Technology
Supply Chain Sustainability
Skills Required:
- Works closely with internal teams, third-party logistics providers, brokers, freight forwarders, and trade advisory consultants to ensure global trade compliance.
- Optimizes the logistics network to affect a controlled flow of goods in an efficient manner.
- Ascertains the correct application of duties and tariffs and country of origin.
- Analyzes the impact of security requirements and regulatory trade compliance on the movement of global goods and on business costs.
In my personal experience, this is the most difficult competency to acquire out of these 6 logistics competencies. As this is requirement changes country by country and with political circumstances!
3.    Sourcing and Supplier Selection/Management
Sourcing and Supplier Selection/Management is the knowledge of commercial purchasing practices including foreign currency fluctuations, duties and tariffs, quality standards, legal/regulatory requirements, and cultural differences that affect the commodity purchase transaction. This competency includes the ability to effectively source supplier products and services as well as manage the performance of the selected supplier
Skills Required:
- Demonstrates understanding the factors and key influences affecting sourcing activities and supplier management.
- Understands and utilizes the supplier management processes and measures during the sourcing process.
- Interacts with key customers (internal and external) and understands their requirements that affect sourcing activities.
- Develops strategic sourcing and savings plans.
- Describes the major features of selected supply markets and channels.
4.    Supply Chain Continuity Planning
Supply Chain Continuity Planning is a structured and synergetic process that seeks to optimize supply chain strategy, processes, human resources, technology, and knowledge. Supply Chain Continuity Planning controls, monitors, and evaluates supply chain risk, which serves to safeguard against new uncertainties that may emerge affecting profitability.
Skills Required:
- Assesses supplier continuity risk along with other risks and mitigation alternatives in the standard sourcing product development and manufacturing processes.
- Develops and determines mitigation plans for high commodity risks, products, parts, and supplier processes.
- Identifies affected high-risk events, products, and/or parts.
- Leads and coordinates supply chain actions based upon mitigation plans at the time of an event that impacts continuous operations.
5.    Transportation Sourcing & Management
Transportation Sourcing & Management is the knowledge and ability to streamline the flow of goods and to select timely and cost-efficient modes of transportation for all incoming and outgoing shipments as well as storage of goods.
Skills Required:
- Demonstrates an understanding of the factors and key influences affecting transportation sourcing activities at a high level of accomplishment.
- Interacts with key customers (internal and external) and understands their requirements that affect sourcing activities.
- Monitors contract compliance of carriers and logistics service providers.
- Evaluates trade-offs between transportation costs, inventory costs, and service levels to design collaborative transportation solutions that are efficient and effective.
- Provides transportation-oriented analytical support for projects, new business opportunities and proposals.
6. Contract Management
Contract Management is the knowledge of solid and consistent architecture of supply chain contracts and agreements including terms, timing, and language. It includes the ability to develop complex business arrangements and to manage major company purchasing contracts.
Skills Required:
- Resolves most contractual problems and is fully familiar with firms’ terms and conditions.
- Develops complex high-value contracts for key suppliers on a national and global basis.
- Implements and monitors contracts on a local, regional, or national basis within firms’ ethics policy.
- Works with law department or supply chain liaison to accomplish tasks.
In addition to the above Logistics Competencies and skills, we recommend you to take Paul Denneman’s course on Modern Warehousing & Distribution Centers
What You Will Learn in Warehousing and Distribution Course
- History of the Industrial Revolution
- eCommerce Impact in Warehousing & Distribution
- Material Handling: Equipment for Running an Efficient Warehouse
- Technology Developments: Internet of Things, Blockchain, Drones & Robots
- Future of Fulfillment
If you are upgrading your CV for promotion, you will find our blog on How To Create A Logistics Resume – Tips & Examples, helpful.
Conclusion
Like most things in life, no one expects supply chain folks to be super good in all of these logistics competencies and skills. And Of course, like anything, these competencies can be taken too far. Those who overuse it are in danger of focusing exclusively on the logistics elements and don’t see the full supply chain picture and at times, unintentionally demotivate their teams. So while you are focusing on these logistics competencies, you must ensure other supply chain competencies are acquired over time.
Although crucial, creating the new and different is balanced by the other competencies of focusing on action and outcomes and inspiring others. Together these competencies are crucial for Supply Chain Professionals who are being asked to do more and contribute more, not only in terms of the supply chain agenda but to drive change across the organization.
Which Supply Chain competency is your favourite of the above?
Or do you want to add any more technical Supply Chain competencies I have missed?
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Reference
John F. Crowell. Report of the Industrial Commission on the Distribution of Farm Products, vol. 6 (Washington DC: U.S. Government Printing Office, 1901)
Supplementary Supply Chain Best Practice Content You Should have in your SCM PlayBook.
Supply Chain Self-Assessment Tools to Identify Area of Improvement:
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About the Author-Â Dr Muddassir Ahmed
Dr MuddassirAhmed is the Founder & CEO of SCMDOJO. He is a global speaker, vlogger and supply chain industry expert with 17 years of experience in the Manufacturing Industry in the UK, Europe, the Middle East and South East Asia in various Supply Chain leadership roles.  Dr. Muddassir has received a PhD in Management Science from Lancaster University Management School. Muddassir is a Six Sigma black belt and founded the leading supply chain platform SCMDOJO to enable supply chain professionals and teams to thrive by providing best-in-class knowledge content, tools and access to experts.
You can follow him on LinkedIn, Facebook, Twitter or Instagram
References