The technology giant strengthens its supply chain talent pool by focusing on geographic, cognitive, skill, and generational diversity; its unusual approach to leadership development has created a deep bench of internationally savvy managers.
Contributing Editor Toby Gooley is a freelance writer and editor specializing in supply chain, logistics, material handling, and international trade. She previously was Editor at CSCMP's Supply Chain Quarterly. and Senior Editor of SCQ's sister publication, DC VELOCITY. Prior to joining AGiLE Business Media in 2007, she spent 20 years at Logistics Management magazine as Managing Editor and Senior Editor covering international trade and transportation. Prior to that she was an export traffic manager for 10 years. She holds a B.A. in Asian Studies from Cornell University.
Lenovo, best-known for its laptops, also makes and sells desktop and tablet computers, smartphones, and servers. Because the company serves customers in 160 countries, its supply chain organization values a diverse, international workforce.
Supply chain executives in North America who are faced with human resource challenges can take heart: they are far from alone. According to Nicole Jefferies, executive director, worldwide fulfillment for the technology giant Lenovo, the supply chain talent shortage and its attendant difficulties in recruiting, developing, and retaining supply chain professionals is a global phenomenon. "It's a very competitive talent marketplace everywhere we do business," she said in a presentation at the Gartner Supply Chain Management Executive Conference, held in late May in Phoenix, Arizona. That is saying something: Lenovo, which provides computers, smartphones, and servers, has customers in more than 160 countries, and employs more than 55,000 people.
As a truly global business—the company even has two headquarters, one in the U.S. and one in China—Lenovo seeks to capture the business benefits of its employees' diversity while minimizing barriers like language. That approach gives the company "access to innovation and thought leadership globally," not just at corporate headquarters, Jefferies said.
The company values other types of diversity beyond geography, she added. One is generational: About 8 percent of Lenovo's employees are baby boomers born between 1946 and 1960; 32 percent are Generation X, born between 1961 and 1980; and 61 percent are millennials born after 1980. Like the talent shortage, intergenerational conflict seems to be a nearly universal problem. Jefferies related a recent conversation with a Brazilian plant manager, who contended that millennials were his "biggest problem." In her view, managers' attitudes are the problem; they don't understand how to relate to and get the best out of their younger employees, she said. Jefferies offered some recommendations:
Millennials are easily bored. They like to multitask and are more productive when they have a lot of projects and variety in their work.
Adjusting the standard 9-to-5 workday to accommodate millennials' desire for flexibility makes a big difference in their job satisfaction and their level of engagement.
They will play by the rules, but only if you define those rules and clearly communicate specific expectations.
Lenovo also values and pursues cognitive, skill, and functional diversity in its global supply chain workforce. Thirty percent of supply chain employees are engineers, valued for their ability to solve problems, analyze supply chain networks, and manage automation. Fourteen percent focus on customer experience; their performance is measured based on customer satisfaction, Jefferies said. The remaining 56 percent fall under the foundational "plan-source-make-deliver" functions.
Talent development occurs through a combination of formal learning, learning through relationships, and "learning by doing." For example, employees may take a class in lean manufacturing processes in the morning and then put what they learned into practice in the afternoon. This lets them get experience immediately, rather than waiting until after a months-long program has ended, Jefferies said.
Lenovo's supply chain organization uses techniques like pairing an experienced employee with a newer one who has "a beginner's mind," a Zen Buddhism term for someone who is completely fresh to an idea or situation and thus has no preconceived notions. Both can learn from and spark ideas in each other, Jefferies explained. Another is a "mentoring circle," a group of about 10 people with similar functional responsibilities and skills. They meet regularly to share ideas, concerns, and advice with each other, an approach that builds a supportive peer group and "allows you to scale up one-on-one mentoring," as opposed to the time-consuming responsibilities of individual coaching, she said.
To develop managers and executives who are comfortable with the global nature of Lenovo's business, the company developed a mid-career rotation program that sends candidates to work in Europe, the Americas, and Asia. "This program helps [participants] to learn how to manage teams everywhere, not just in their home countries," Jefferies said. For such international programs to succeed, she added, companies must pay special attention to how the program is structured and candidates are selected. Lenovo sends its managers overseas with specific objectives for building relationships and gaining expertise. To help ensure a successful experience, participants are paired with a local mentor in each location. Assignments last eight to 10 weeks—"long enough that they will be viewed as colleagues and learn a lot, but not so long that it's disruptive to the individual and the local organization," Jefferies said.
A separate program is targeted to managers with executive potential who are already experts in their particular field. Launched seven years ago, the program sends high-potential employees on a trip together; as they travel, they work on building leadership skills, problem solving ability, empathy, and a network of peers. According to Jefferies—a member of the inaugural group—the program has been effective in identifying strong executive candidates and in improving retention. Currently about 40 percent of program graduates are Lenovo executives, according to Jefferies.
The practice consists of 5,000 professionals from Accenture and from Avanade—the consulting firm’s joint venture with Microsoft. They will be supported by Microsoft product specialists who will work closely with the Accenture Center for Advanced AI. Together, that group will collaborate on AI and Copilot agent templates, extensions, plugins, and connectors to help organizations leverage their data and gen AI to reduce costs, improve efficiencies and drive growth, they said on Thursday.
Accenture and Avanade say they have already developed some AI tools for these applications. For example, a supplier discovery and risk agent can deliver real-time market insights, agile supply chain responses, and better vendor selection, which could result in up to 15% cost savings. And a procure-to-pay agent could improve efficiency by up to 40% and enhance vendor relations and satisfaction by addressing urgent payment requirements and avoiding disruptions of key services
Likewise, they have also built solutions for clients using Microsoft 365 Copilot technology. For example, they have created Copilots for a variety of industries and functions including finance, manufacturing, supply chain, retail, and consumer goods and healthcare.
Another part of the new practice will be educating clients how to use the technology, using an “Azure Generative AI Engineer Nanodegree program” to teach users how to design, build, and operationalize AI-driven applications on Azure, Microsoft’s cloud computing platform. The online classes will teach learners how to use AI models to solve real-world problems through automation, data insights, and generative AI solutions, the firms said.
“We are pleased to deepen our collaboration with Accenture to help our mutual customers develop AI-first business processes responsibly and securely, while helping them drive market differentiation,” Judson Althoff, executive vice president and chief commercial officer at Microsoft, said in a release. “By bringing together Copilots and human ambition, paired with the autonomous capabilities of an agent, we can accelerate AI transformation for organizations across industries and help them realize successful business outcomes through pragmatic innovation.”
Census data showed that overall retail sales in October were up 0.4% seasonally adjusted month over month and up 2.8% unadjusted year over year. That compared with increases of 0.8% month over month and 2% year over year in September.
October’s core retail sales as defined by NRF — based on the Census data but excluding automobile dealers, gasoline stations and restaurants — were unchanged seasonally adjusted month over month but up 5.4% unadjusted year over year.
Core sales were up 3.5% year over year for the first 10 months of the year, in line with NRF’s forecast for 2024 retail sales to grow between 2.5% and 3.5% over 2023. NRF is forecasting that 2024 holiday sales during November and December will also increase between 2.5% and 3.5% over the same time last year.
“October’s pickup in retail sales shows a healthy pace of spending as many consumers got an early start on holiday shopping,” NRF Chief Economist Jack Kleinhenz said in a release. “October sales were a good early step forward into the holiday shopping season, which is now fully underway. Falling energy prices have likely provided extra dollars for household spending on retail merchandise.”
Despite that positive trend, market watchers cautioned that retailers still need to offer competitive value propositions and customer experience in order to succeed in the holiday season. “The American consumer has been more resilient than anyone could have expected. But that isn’t a free pass for retailers to under invest in their stores,” Nikki Baird, VP of strategy & product at Aptos, a solutions provider of unified retail technology based out of Alpharetta, Georgia, said in a statement. “They need to make investments in labor, customer experience tech, and digital transformation. It has been too easy to kick the can down the road until you suddenly realize there’s no road left.”
A similar message came from Chip West, a retail and consumer behavior expert at the marketing, packaging, print and supply chain solutions provider RRD. “October’s increase proved to be slightly better than projections and was likely boosted by lower fuel prices. As inflation slowed for a number of months, prices in several categories have stabilized, with some even showing declines, offering further relief to consumers,” West said. “The data also looks to be a positive sign as we kick off the holiday shopping season. Promotions and discounts will play a prominent role in holiday shopping behavior as they are key influencers in consumer’s purchasing decisions.”
That result came from the company’s “GEP Global Supply Chain Volatility Index,” an indicator tracking demand conditions, shortages, transportation costs, inventories, and backlogs based on a monthly survey of 27,000 businesses. The October index number was -0.39, which was up only slightly from its level of -0.43 in September.
Researchers found a steep rise in slack across North American supply chains due to declining factory activity in the U.S. In fact, purchasing managers at U.S. manufacturers made their strongest cutbacks to buying volumes in nearly a year and a half, indicating that factories in the world's largest economy are preparing for lower production volumes, GEP said.
Elsewhere, suppliers feeding Asia also reported spare capacity in October, albeit to a lesser degree than seen in Western markets. Europe's industrial plight remained a key feature of the data in October, as vendor capacity was significantly underutilized, reflecting a continuation of subdued demand in key manufacturing hubs across the continent.
"We're in a buyers' market. October is the fourth straight month that suppliers worldwide reported spare capacity, with notable contractions in factory demand across North America and Europe, underscoring the challenging outlook for Western manufacturers," Todd Bremer, vice president, GEP, said in a release. "President-elect Trump inherits U.S. manufacturers with plenty of spare capacity while in contrast, China's modest rebound and strong expansion in India demonstrate greater resilience in Asia."
Even as the e-commerce sector overall continues expanding toward a forecasted 41% of all retail sales by 2027, many small to medium e-commerce companies are struggling to find the investment funding they need to increase sales, according to a sector survey from online capital platform Stenn.
Global geopolitical instability and increasing inflation are causing e-commerce firms to face a liquidity crisis, which means companies may not be able to access the funds they need to grow, Stenn’s survey of 500 senior e-commerce leaders found. The research was conducted by Opinion Matters between August 29 and September 5.
Survey findings include:
61.8% of leaders who sought growth capital did so to invest in advanced technologies, such as AI and machine learning, to improve their businesses.
When asked which resources they wished they had more access to, 63.8% of respondents pointed to growth capital.
Women indicated a stronger need for business operations training (51.2%) and financial planning resources (48.8%) compared to men (30.8% and 15.4%).
40% of business owners are seeking external financial advice and mentorship at least once a week to help with business decisions.
Almost half (49.6%) of respondents are proactively forecasting their business activity 6-18 months ahead.
“As e-commerce continues to grow rapidly, driven by increasing online consumer demand and technological innovation, it’s important to remember that capital constraints and access to growth financing remain persistent hurdles for many e-commerce business leaders especially at small and medium-sized businesses,” Noel Hillman, Chief Commercial Officer at Stenn, said in a release. “In this competitive landscape, ensuring liquidity and optimizing supply chain processes are critical to sustaining growth and scaling operations.”
With six keynote and more than 100 educational sessions, CSCMP EDGE 2024 offered a wealth of content. Here are highlights from just some of the presentations.
A great American story
Author and entrepreneur Fawn Weaver closed out the first day of the conference by telling the little-known story of Nathan “Nearest” Green, who was born into slavery, freed after the Civil War, and went on to become the first master distiller for the Jack Daniel’s Whiskey brand. Through extensive research and interviews with descendants of the Daniel and Green families, Weaver discovered what she describes as a positive American story.
She told the story in her best-selling book, Love & Whiskey: The Remarkable True Story of Jack Daniel, His Master Distiller Nearest Green, and the Improbable Rise of Uncle Nearest. That story also inspired her to create Uncle Nearest Premium Whiskey.
Weaver discussed the barriers she encountered in bringing the brand to life, her vision for where it’s headed, and her take on the supply chain—which she views as both a necessary cost of doing business and an opportunity.
“[It’s] an opportunity if you can move quickly,” she said, pointing to a recent project in which the company was able to fast-track a new Uncle Nearest product thanks to close collaboration with its supply chain partners.
A two-pronged business transformation
We may be living in a world full of technology, but strategy and focus remain the top priorities when it comes to managing a business and its supply chains. So says Roberto Isaias, executive vice president and chief supply chain officer for toy manufacturing and entertainment company Mattel.
Isaias emphasized the point during his keynote on day two of EDGE 2024. He described how Mattel transformed itself amid surging demand for Barbie-branded items following the success of the Barbie movie.
That transformation, according to Isaias, came on two fronts: commercially and logistically. Today, Mattel is steadily moving beyond the toy aisle with two films and 13 TV series in production as well as 14 films and 35 shows in development. And as for those supply chain gains? The company has saved millions, increased productivity, and improved profit margins—even amid cost increases and inflation.
A framework for chasing excellence
Most of the time when CEOs present at an industry conference, they like to talk about their companies’ success stories. Not J.B. Hunt’s Shelley Simpson. Speaking at EDGE, the trucking company’s president and CEO led with a story about a time that the company lost a major customer.
According to Simpson, the company had a customer of their dedicated contract business in 2001 that was consistently making late shipments with no lead time. “We were working like crazy to try to satisfy them, and lost their business,” Simpson said.
When the team at J.B. Hunt later met with the customer’s chief supply chain officer and related all they had been doing, the customer responded, “You never shared everything you were doing for us.”
Out of that experience, came J.B. Hunt’s Customer Value Delivery framework. The framework consists of five steps: 1) understand customer needs, 2) deliver expectations, 3) measure results, 4) communicate performance, and 5) anticipate new value.
Next year’s CSCMP EDGE conference on October 5–8 in National Harbor, Md., promises to have a similarly deep lineup of keynote presentations. Register early at www.cscmpedge.org.