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What is the future of Logistics in Asia? Is the industry slowing down or is there still room to grow? What type of skillsets are in high demand? And what new focus areas does HR need to address to attract the right talent?
With a network of 5 offices covering Asia Pacific, our team at Morgan Philips asked some of the industry experts and leaders for their feedback. These interactions combined with in-depth market research have allowed us to draw 5 trends that will shape recruitment in the industry in 2016.
#1. Consolidation impacts the job market
In the 3PL world, the last 12 months have brought about significant acquisitions. FedEx bought over TNT, Japan Post purchased Toll, DSV took over UTI, XPO acquired Con-way logistics. And the list is expected to continue over the next months and years. In the process, a number of top executives from the acquired company have left or are expected to leave, having sometimes a ripple effect in the management pool.
Moreover, some of the bigger supply chain regional organizations are increasingly looking into adding more contractual staff instead of full time employees. And moving some of the resources from regional HQs like Singapore or Hong Kong closer to the manufacturing hubs, mostly in countries like Thailand, China or increasingly Vietnam. Especially for consumer, electronics, hi-tech and even healthcare sectors.
As a result of these movements, the job market will see a pool of highly qualified and competent candidates become available. And facing the challenge to find a suitable role that can fit their credentials in the same geographical area.
#2. Localisation of the workforce
Localization will continue to be a focus throughout 2016 and organizations are trying as much as possible to find local residents to fill key positions. More and more expat contracts have been reduced in an attempt by companies to cut their costs and balance internal equity. In Singapore for example, as the Ministry of Manpower has taken steps to restrict foreigners, employers find it harder to take on new staff from overseas and an increasing number of visa renewals are being turned down.
Even in emerging economies like Thailand, Vietnam, Philippines or Indonesia the first priority is to find local talent that can drive the business growth. Even if that means looking for them outside of the Asia continent.
In this context, Morgan Philips has been approached by 3 companies in the last 6 months to scout for local talents working in US and Europe to return home. And fill the skills gap in the job market.
#3. New technologies, specific skill-sets and talent gap
Disruptive technologies such as 3D printing, advanced robotics, big data analytics, the Internet of Things (IOT) and supply chain operating networks are revolutionizing the way organizations run their supply chain. Deloitte forecasted that by 2020, 70% of companies will use advances such as predictive analytics and wearable technology in their supply chains. This shift will have a profound impact on the roles and skillsets required. Companies will need candidates who bring a holistic understanding of business, IT systems and analytics to effectively integrate the emerging technologies and add value to their supply chain.
Moreover, economic developments across Asia have seen a lot of development in contract logistics and consolidated distribution centers. Take for example Singapore where modern warehouses have mushroomed in the last years. DB Schenker, DHL, Kuehne Nagel, SDV, Toll, YCH, are only a few of the companies who have already built or are building mega hubs. All these facilities come with a higher and higher degree of automation. Which means highly critical skills demanded in the market are automation and industrial talent, as well as solution design experts.
Healthcare logistics skills are also quickly getting in high demand too. Especially in cold chain development, the lack of talent is wide. And this spreads across the region, in countries with a history of healthcare, like Korea, Japan, Singapore, but also emerging countries like Thailand or China.
In these specific niche areas, the trend is opposite localization. With companies being forced to look abroad and import foreign talent.
#4. Focus on employer branding
The supply chain and logistics profession is confronted with an image that’s sometimes less than ideal. Work in warehouses, on ships or in trucks and trains tends to be associated with unpleasant working conditions and a less than attractive career path. In 2016 and years to come, HR leaders will have to look at implementing new initiatives to make their organizations’ brand known in the market. And find attractive ways to capture the interest of the industry’s most talented individuals. Whilst usually the correlation to the business is hard to count in dollars and cents, more and more, a powerful employer brand will be crucial to attracting the best people to develop the business.
#5. Build a talent pipeline
In China, where the sector is booming, today there are 284 universities offering logistics management. 58 of them launched logistics labs where students get to know the advancing state of technology in logistics, such as: forklifts, high-rack stackers, high-bay racks, pick by light or pick by voice or RFID. A couple of year ago, DHL and The Logistics Institute – Asia Pacific of the National University of Singapore (NUS) established the S$3 million Sustainable Supply Chain Centre of Asia Pacific (SSCCAP). It is the region’s first best-practice hub and intellectual property engine to drive sustainable supply chain development in the Asia Pacific region. Companies like Apple, Heineken and Infineon have very strong internship programs designed to engage the young talent early and identify the next supply chain leaders. This is key to building a healthy talent pipeline needed to sustain the growth most companies are experiencing in Asia.
As a conclusion, we expect to see interesting market dynamics in 2016.
Companies have to learn to adapt faster to market changes, embrace technology to stay relevant and invest long term in their brand to stand out to ever more demanding candidates.
Candidates need to be prepared to face the reality that the supply chain world is in a phase of consolidation, be flexible to embrace new technologies and ready to shift gears. And if necessary countries.
The world is spinning faster than ten years ago. He, who adjusts his futures competence to this reality, will also have most gains.
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