Supply Chain in Emerging Markets

How iSimPlan and DDMRP can be used to Overcome the Skills Gaps in your Supply Chain

The field of supply chain management is facing a skills crisis in both established and emerging markets, with demand for skilled supply chain professionals exceeding supply six to one [1]. This crisis is occurring at the same time as the field needs skilled professionals more than ever, as it is becoming one of the most critical areas for overall business success in all markets [2]. This situation has occurred because supply chains have become increasingly complex and customer-centric [3], the roles of supply chain managers changing [4], [5], and a large proportion of the expertise in this field being contained in supply chain personnel at or past retirement age [6]. This skills gap has been felt at all levels of the supply chain, from picker/ packers to senior management [7]. In emerging markets, this skills gap is exacerbated by lower literacy levels and limited access to education [8], [9]. In addition, those individuals who do receive supply chain specific education often gain the knowledge needed to understand the supply chain, but not the skills required to be effective supply chain personnel [5]. These have been addressed to some extent by both government and private upskilling initiatives, however, the success of these has been limited due to ineffective inter-departmental collaboration and bureaucratic delays [10]. In order to address the skills gap a succinct definition of the skills required at all levels of the supply chain is needed. The definition of skills has proved difficult in that many regions have different definitions of what a skill is, and in emerging markets the understanding of a ‘skill’ is further hampered by the fact that the word may not exist and/or be defined in languages other than English [9], [11]. To address this Kotzab et. al. (2018) undertook a study to identify the specific qualifications and competencies required in the field of supply chain management [11]. They identified five main skill types:

  1. Generic: Tasks performed in a wide range of occupations.
  2. Specific: Tasks performed in one or a few occupation types (cannot be defined generically).
  3. Cognitive: Tasks requiring thinking activities such as problem-solving.
  4. Interactive: Tasks requiring all types of communication and/or cooperation.
  5. Physical: Tasks requiring dexterity or stamina.
Supply chain professionals are now expected to be able to perform tasks within all of the above skill types, regardless of their role in the supply chain, and without access to the training required to learn them, particularly in emerging markets [2], [9]. The upskilling process is one which leading organizations are investing heavily in order to address the skills gaps within their supply chains [1], but this process takes time to provide a return on investment. Many organizations have not taken any measures to ensure the supply of skilled supply chain professionals within their organizations [1]. Those organizations which have taken no action to address their supply chain skills gaps can be considered to be at a significant competitive disadvantage, particularly given the scarcity of skilled supply chain professionals in the hiring pool [1], [5], [12]. In Africa, a supply chain role which has a very large skills gap is that of the Planner, where higher education and managerial skills are required, but the available employment pool consists largely of administrative personnel [13]. This results in the function of Planner being executed with far less proficiency than necessary, and ultimately in inefficient supply chains with either excessive inventory levels, frequent stock-outs or both. The bimodal inventory distribution described above is far more common than many industries would like to admit. Many supply chain methodologies exist to mitigate this effect, all of which have achieved success when correctly applied. The one caveat with these methodologies is that they either focus on pushing or pulling inventory through the supply chain [14]–[16]. This can lead to either demand or supply data being marginalized. For this reason, Ptak and Smith have introduced a supply chain management methodology that incorporates both push and pull; Demand Driven Material Requirements Planning (DDMRP) [17]. One of the major benefits of DDMRP is that the concepts that drive the methodology can be easily learned, regardless of the skill level of supply chain staff. DDMRP buffers are split into three color zones; Green, Yellow and Red [17]. This color system makes it extremely easy for Planners to identify inventory items for which inventory levels may become too low to address demand within the supply chain. Green is great, yellow you should look at your supply of the item, red you need to attend to the supply of the item immediately. Simple as that. Additionally, the instructive nature of this tool, where planners are prompted to order to the ‘Top of Green’ should the inventory level for a buffered item fall below a specific calculated level, makes using it even simpler than learning its’ tenets. Many technologies have emerged which are based on the concepts of DDMRP. These technologies can be used to harness the simplicity of the DDMRP buffer coloring to address the immediate problems created by the skills gap in supply chains. iSimPlan is one such technology, which has the added benefit of being developed in an emerging African market, for the emerging African market, where the supply chain skills gap is pronounced. iSimPlan is the first Driven Institute Compliant DDMRP software developed in Africa, with a specific focus on assisting organisations in emerging markets to overcome the skills gaps within their supply chains. At iSimPlan our primary design objective is the usability of the system. The iSimPlan software is intuitive and user-friendly, resulting in the upskilling of supply chain staff on its’ use, being quick and easy, irrespective of their initial skills level. We also understand the difficulties of implementing a new system, from both a skills and change management perspective. We have leveraged our decades of experience in implementing supply chain software in an emerging African market to design a unique change management and training approach for iSimPlan and the DDMRP tenets it is based on. This approach uses a combination of theoretical and practical learning to create a working version of iSimPlan for your organization while simultaneously upskilling staff and performing the initial system set up within your organization. An added benefit to organizations based in Africa is that iSimPlan support and training staff are close at hand when needed. These features provide organisations with a competitive advantage that will allow them not only to grow but to thrive in any market. Would you like to negate the negative effect of the supply chain skills gap on your supply chain?

Contact us to find out more about a Proof of Concept trial for your organisation

[1] Lisa Harrington, ‘the Supply Chain Talent Shortage: From Gap To Crisis’, DHL Trend Res.

[2] J. Mangan and M. Christopher, ‘Management development and the supply chain manager of the future’, Int. J. Logist. Manag., vol. 16, no. 2, pp. 178–191, Dec. 2005.

[3] Barloworld Logistics, ‘Embracing change for a sustainable future’, pp. 1–88, 2015.

[4] D. Noble, ‘The skills shortage facing global supply chains’, Supply Chain Digital, 2015.

[5] M. Allden, W. Niemann, S. Africa, W. Niemann, and M. Niemann, ‘Industry expectations of supply chain management graduates : Perspectives from third-party logistics providers in South Africa’, J. Transp. Supply Chain Manag., vol. 12, 2018.

[6] M. Harrist, ‘Supply Chain Talent Shortage: What’s An Industry To Do?’, Forbes, 2017.

[7] A. Mckinnon, C. Flöthmann, K. Hoberg, and C. Busch, ‘Logistics Competencies, Skills, and Training: A Global Overview’, 2017.

[8] UNESCO, ‘Literacy Rates – UNICEF DATA’, UNESCO Institute for Statistics global databases, 2018. [Online]. Available: [Accessed: 15-Nov-2018].

[9] W. Piotrowicz and R. Cuthbertson, Supply Chain Design and Management for Emerging Markets. 2015.

[10] R. C. Daniels, Skills Shortages in South Africa: A Literature Review. 2007.

[11] H. Kotzab, C. Teller, M. Bourlakis, and S. Wünsche, ‘Key competences of logistics and SCM professionals-the lifelong learning perspective’, Supply Chain Manag. An An Int. J., vol. 23, no. 1, pp. 50–64, 2018.

[12] L. Fransman, C. J. Savage, and A. K. Jenkins, ‘Understanding the effect of skilled labour resource shortages on supply chain sustainability: a review of the logistics skills gap in southern Africa’, 2015.

[13] B. van der Westhuisen and B. le Roux, ‘Personal Communication’. 2018.

[14] R. Miclo, M. Lauras, F. Fontanili, J. Lamothe, and S. A. Melnyk, ‘Demand Driven MRP: assessment of a new approach to materials management’, Int. J. Prod. Res., vol. 7543, pp. 1–16, 2018.

[15] R. Miclo, F. Fontanili, M. Lauras, J. Lamothe, and B. Milian, ‘An empirical comparison of MRPII and Demand-Driven MRP’, IFAC-PapersOnLine, vol. 49, no. 12, pp. 1725–1730, 2016.

[16] M. Christopher, Logistics and supply chain management, 4th ed. Pearson Education Limited, 2012.

[17] C. Ptak and C. Smith, Demand Driven Materials Requirements Planning (DDMRP). Industrial Press, Inc., 2016.