The challenges faced by supply chains due to global disruptions and labor shortages are highly relevant to CFOs (chief financial officers) of organizations involved in the supply chain. CFOs are responsible for managing the financial aspects of the supply chain, including budgeting, forecasting, and ensuring cost-effectiveness.
In light of the current labor shortages, CFOs should implement strategies that can help them optimize their supply chain operations while keeping their workforce intact. This may include investing in supply chain management software to help them find suppliers with larger labor forces, analyzing their product offerings to minimize complexities and streamline operations, reskilling workers to meet new demands, and creating a supportive and employee-friendly company culture that attracts and retains workers.
By implementing new strategies, CFOs can mitigate the impact of labor shortages on their supply chain operations, reduce supply chain risks, and maintain a competitive edge in the market. Additionally, by investing in their workforce, they can build a strong and loyal team that is equipped to handle future challenges and opportunities—ultimately improving the bottom line of the organization.
For CFOs, implementing supply chain management software that allows them to find suppliers with big labor forces is paramount. This kind of transparency can optimize operations while connecting CFOs and other supply chain leaders with vendors that can minimize supply chain risks. Moreover, a digitized supply chain that includes accurate forecasting for various scenarios can mitigate future problems. This kind of cutting-edge technology can help supply chain partners across organizations solve current disruptions together, while also planning ahead to curb any future issues. Foresight like this can help CFOs spend the company’s finances as wisely as possible.
Analyze the Offerings
An important aspect for CFOis to ensure the cost-effectiveness of all parts of an organization’s offerings. To navigate the financial strain of labor shortages, CFOs should take a deep look into their company’s product offerings portfolio. If CFOs need to minimize complexities, with a limited effect on sales, then analyzing if there are any services they can cut might benefit their business overall. There could be a service the company is offering that isn’t doing well operationally or trade-wise that could be reimagined or cut from the company’s stack.
CFOs might also need to step back and look at the bigger picture of their supply chain to understand what is eating at costs. To mitigate these bottlenecks, they can consider moving the flow in their supply chain away from partners who have a minimal labor force and rerouting orders to other warehouses or manufacturers with more employees. It could also be beneficial to create new product designs to decrease the need for labor from more labor-stressed sectors of the supply chain.
Overcoming supply chain labor issues has been an on-going issue. For many organizations, utilizing mentorship or apprenticeship programs to teach employees new skills within the industry has been a successful alternative. These programs can be external to the organization, such as workshops that specialize in providing former incarcerated people or veterans with jobs. CFOs and other leaders can even find potential new workers from declining industries who are eager to learn a new future-proof skill. Technical and community colleges are good places for outreach as well.
Offering mentor or apprenticeship programs inside the company can be just as effective. To optimize costs, the opportunity to promote s or reorganize within their business can reduce employee onboarding time as the person will already be familiar with operations. These sorts of programs can also build loyalty, which in turn, builds retention; employees will see a clear path for growth within your company and could even refer new hires.
Be Employee Friendly
As a leader of their organization, CFOs have the opportunity to set the right tone when it comes to how they treat their employees. This seems like a no-brainer, but so many organizations fail to recognize what employees really want: competitive wages and good benefits. In today’s rapidly changing work world, it is vital to offer robust healthcare, paid time off, adequate childcare, and flexible scheduling.
Strong company culture is also key to retaining employees. Leaders should want their employees to feel like they’re creating something meaningful, together, with the support from their team members and managers. CFOs can have a hand in identifying a business’s mission and ensuring that this ethos flows into every aspect of company culture, from the C-suite to the interns.
Supply chains are facing myriad challenges due to global disruptions and labor shortages. These obstacles require CFOs to take a proactive approach to manage the financial aspects of the supply chain. By implementing strategies to optimize operations, minimize complexities, reskill workers, and create a supportive culture, CFOs can ensure cost-effectiveness and maintain a competitive edge. Investing in their workforce can build a strong and loyal team that is equipped to handle future challenges and opportunities, ultimately improving the organization's bottom line. As the supply chain landscape continues to evolve, CFOs must remain vigilant and adaptive to ensure success in the long run.