In a previous post, I pontificated on what a Supply Chain Engineer (SCEng) does. What I didn’t go into is the idea of the making of a Supply Chain Engineer.
Training a Supply Chain Manager
In general, when we talk about a supply chain management professional, we think of the Buyer, or the Logistics Specialist, or the Inventory Manager, etc. While many of the practitioners out there learned their profession on the job, more and more, employers are looking for SCM professionals trained through more formal education – Bachelor’s, Master’s, even Doctoral degrees. In some cases, a general background in finance and accounting, economics, and business administration is enough. In others, training specifically focused on supply chain management, logistics, operations, and procurement is preferable. In any case, these programs are business administration degrees. That is to say, they concentrate on the business of managing the flow of goods and services from raw materials to finished goods delivered to the end customer.
Training the Supply Chain Engineer
The SCEng’s training is somewhat different in that it is geared toward developing a business-savvy engineer. The product of this training is a thorough knowledge of analytic methods, engineering practices specifically focused on designing and synchronizing highly complex regional, national, and global supply chains, coupled with enterprise management and professional practice skills. Here, in addition to business courses related to SCM, the areas of study include:
- Supply Chain Analytics
- Machine Learning and Data Mining
- Supply Chain Cost and Financial Analysis
- Optimization Methods
- Designing Logistic and Warehousing Systems
- Supply Chain Information Systems and Technologies
- Supply Chain Design
The approach is much more technical. The Supply Chain Engineering degree is usually (although not always) a Master’s-level degree in Applied Science. It is a true Engineering degree.
Now for the Crazy Idea
The Master’s-level SCEng degree generally consists of around 30 credit hours of training. Come to think of it, a Bachelor’s degree usually requires about 30 credit hours of courses in the Major. And even an Associate’s degree requires around 30 credit hours in the Area of Focus.
Hmmm. It seems to me that given 30 credit hours of time with a given student, I could likely teach the same material independent of the setting. To put a sharper point on that idea, I could teach the same student the same material whether he/she was attending an Ivy League Graduate School, getting a Bachelor’s at a State College or even an Associate’s at a local Junior College. It may not be quite a nuanced and as detailed at the undergrad level as the graduate program, but fundamentally the same
See where I’m going with this?
So, if they all get the same training, what’s the difference to the student? Well, after four years of undergrad work and then an MASc from the Ivy League school, the student graduates with knowledge of supply chain engineering along with around $300,000 of student loans. The State College undergrad graduates with the similar subject matter knowledge and about $125,000 of debt. But the Junior College student graduates with the same core knowledge and little to no debt.
And how does that impact the company that hires these grads? Well, let’s assume that the starting salary of a newly minted SCEng runs around $70k and that we place the State College grad at that salary. The Ivy Leaguer would need to earn at least $95k to have the same disposable income after paying his/her student loan debt. But the Junior College student could live just as comfortably at around $55K. So, from a hiring company’s point of view, what is the advantage of paying 20 – 40% more for the same knowledge? From where I stand, not much. Alternately, you could pay them all the same base rate (i.e., $70K), but the likely result is that those with the higher student loans will need to move on to better paying positions faster than those with lower overhead.
Finally, how does this benefit the profession? Two ways immediately come to mind. First, it allows skilled engineers to go into the field quickly and replace other, less skilled and less trained individuals masquerading under the title of Supply Chain Engineer. Just as the guy who picks up your trash each Thursday is not a true “sanitation engineer” (or likely any other type of engineer for that matter), neither are most of the people presenting themselves today as Supply Chain Engineers genuine engineers. And the longer they can pose as such, the more it damages the image of the SCEng.
Second, the whole point of an Applied Science degree is just that – for the practitioners to apply their science. Sure, if you want to be an academic you need to dive into higher ed for the long run. You need to memorize the names. You need to know the details of the profession’s history. You’ve got to really grasp the theories that underlie the science and technology. But, if you want to be an engineer, you want to do only one thing – apply your science. So, by making SCEng an undergrad program we provide more people the opportunity to enjoy the satisfaction and sense of contribution that engineering offers.
The Icing on the Cake
I recently discussed this idea with Todd Larson, AVP & Asst. Director Corporate Services at Amica Insurance. Todd posed an interesting concern: will new employees with an undergrad degree be more inclined to ‘jump ship’ quicker than new hires with advanced degrees after they get some experience under their belts? Indeed, most companies look at a two to two-and-a-half-year breakeven point on new hires. If these new engineers are going to come onboard and stay only long enough to get a new line in the experience column of their resumes, that’s going to be a problem.
Thankfully, the US Government helped to provide a little insight. According to the Bureau of Labor Statistics[i], “The median number of years that wage and salary workers had been with their current employer was 4.2 years in January 2018, unchanged from the median in January 2016.” Against that baseline, we then look at the median years of tenure with current employers for employed wage and salary workers by educational level and we find that overall those with Associate’s, Bachelor’s and Doctoral degrees all have the same median tenure, 5.1 years. And when comparing the youngest group, those 25 to 34 years old, the Associates Degree holder had a median tenure of 3.1 years, 2.9 years for Bachelors and 2.8 years for Masters. So, there is no significant difference in early tenure based upon attained education.
To further enhance longevity, some businesses in the US and UK have professional or engineering apprenticeships. These programs involve hiring a new employee into the apprenticeship at an intermediate or other level. This could be the case of someone currently working the business side of SCM, somebody with some college, or a military veteran with military technical training. The employer hires the employee to work in their Supply Chain Management Department, pays them a salary and, so long as they stay with the employer and in the apprenticeship program, for their degree. As the apprentice progresses through their apprenticeship – from Intermediate to Advanced to Higher Apprenticeship to Degree Apprenticeship – both their income and experience increase until they finally graduate and become a full SCEng.
So, there you go – my crazy idea. Supply Chain Engineers can be trained in an undergraduate environment and done under an apprenticeship program to the benefit of the employee, employer, and the profession. You know, when you think about it, it might not be all that crazy after all.
[i] US Department of Labor, Bureau of Labor Statistics, September 20, 2018 New Release, “Employee Tenure in 2018”
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