Lining Up the Supply Chain

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A look at the state of the 2023 supply chain from Canada’s leading professional organization for supply chain specialists, Supply Chain Canada

Canada's supply chain enables over a trillion dollars’ worth of goods’ movement and is ranked among the top 20 nations in the World Bank Logistics Performance Index. The leading professional association for the discipline, Supply Chain Canada (SCC) covers the entire depth and breadth of supply chain such as: sourcing, logistics, inventory, transportation, distribution, operations, sustainability, replenishment, contract management, and service management.

Of SCC’s 7,500 nationwide members, over 20% belong to the Alberta chapter, known formally as the Alberta Institute (SCCAB). “The standard of living that we enjoy here is directly linked to the professional practice of supply chain management,” said Provincial SCC board member and one of the leaders of SCCAB, Stephanie Forbes. “This is extremely evident in Alberta.”

According to a recent Statistics Canada report, 55,000 new supply chain jobs will be required in Alberta by 2026. “We’re very fortunate the Alberta Institute has many industry, Government, and educational partners that truly support our vision, mission, values, and innovation,” she enthused. The provincial government is committed to working with SCCAB to make sure the base knowledge systems, people, processes, and technology are developed to help fill those jobs, she stressed. “Their support isn’t just important, it’s foundational.”

Canada's principal and most sought-after professional classification for those entering the supply chain profession and those wishing to advance as leaders in the discipline, the Supply Chain Management Professional (SCMP) designation, is granted by the SCC. Fifteen years before her appointment to the national board, Forbes was instrumental in defining and standardizing the curriculum for that role.

We recently spoke with Forbes about the most pressing issues in the supply chain space, and what leaders should be focusing on in 2023. “Five years ago, supply chain was maybe ranked 15th on a CEO's list of priorities,” she explained. “Today it’s consistently ranked in the top three.”

Digital tools are redefining the practice of supply chain management (SCM), a trend that will continue indefinitely in the increasingly connected world. Forbes expects a pair of critical tools to be the basics of the best SCM toolkit: robotic process automation (RPA) and machine learning (ML), both of which have significant impacts on cycle time for processing traditionally manual tasks such as purchase order release.

The procure to pay process, for example, has a number of opportunities to introduce RPA and ML with definitive impacts on cost cycle time, fraud reduction, and related activities when used to streamline basic tasks, especially those related to delegations of authority, cost control, governance rules, fraud protection and detection. “These fantastic technologies are absolutely revolutionary for supply chain organizations,” she said. “And in my view, supply chain has not caught up to where other industries are in terms of technology adoption.”

Creating robust strategies for minimizing supply chain disruption is a vital focus for the Institute. Forbes noted that in 2019, roughly 3,700 disruptions were recorded, and that number has effectively doubled every year since. Dealing with this continuing pattern requires a close examination of the supplier relationship and risk management aspect, especially in a trio of key areas: managing supply shortages, risk-based supplier management, and integrated procurement practices.

Successful alignment, she noted, starts at the very beginning of relationship or project development, and involves several of an organization’s key players, such as the procurement or contracts group and the company owner, or players in other key roles such as design or construction. The calibration can take place at the beginning of a project, facility turnaround, or the beginning of a manufacturing cycle. “You need to do that and do it consistently. You need to leverage more than current ‘request for’ practices, not just sending out three bids for a buy,” she advised.

For SCCAB, industry bridges the gap between academia and industrial requirements for their specific niches. Industry leaders in Alberta’s most prominent industries, including energy, manufacturing, and agriculture, come to the organization and share their needs. “Whether it's an innovation item, a technology item, redevelopment, or the deployment of new skills, they've been really vocal about what we need to augment so that we provide individuals with the appropriate skill sets to deliver high-value strategies and outcomes at the industry level.”

The organization's academic partners are instrumental in providing the group with the latest research methodologies and conduits to the next professionals. “Academic partnership is actually one of SCCAB’s mandates,” she said. “Networking, membership, and education are our three mandates as an organization. Under the educational tenet, we want to empower the profession with lifelong learning.” To that end, the Institute has a comprehensive platform of professional development programs in addition to offering the basics.

When it comes to environmental, social, and governance (ESG) reporting, the entire supply chain and the requirements of sub-suppliers and sub-contractors within that supply chain are required to report on how their policies impact the customers, workforces, and communities they work in. “Canadian supply chain professionals are responsible for a trillion dollars’ worth of goods, not to mention services, and then we've got $66 billion of GDP,” she stressed. ESG reporting as it relates to goods is primarily channeled through supply chain, supplier relationship management, or risk management, so suppliers must reveal their requirements and reporting cycles as part of the qualification process.

So how is supply chain helping manage those ESG reporting requirements, and how good are they?

Recent rulings in fines by the SEC have precipitated a variety of organizations to work toward creating a standardized, auditable framework, the most notable being the International Financial Reporting Standards. SCC champions this endeavor, referencing standard accounting practices to create metrics and a framework that is, in Forbes’ words, “more robust, more deliberate, more auditable, and hopefully steer away from some of these greenwashing or marketing campaigns as opposed to true reporting. This will be an even more important requirement as Bill-S-211 passes its third reading.”

The Taskforce on Nature-Related Financial Disclosures Canada is working on a framework for organizations to report on environmental risks such as biodiversity loss and ecosystem degradation so they can be integrated more accurately into the decision-making and reporting process. “How the organization quantifies and manages risk as it relates to parameters is going to be a major objective in public reporting in the very near future, if it isn't already at the board level,” she said.

In addition to significant upstream and downstream impacts, new tech trends, and regulatory policies are moving supply chain from its former linear arrangement to a complex, networked value chain. “This requires a much more strategic view of how you're going to move through these changes,” she said. “As leaders in the industry, myself or participants within the supply chain space, we have to pivot to meet the new demands by our clients and consumers to fulfill the needs of everyday business.”