A chief supply chain officer's salary may be high, but it's money well spent, says GT Nexus

© Gajus

By Gavin van Marle

 16/02/2016

Less than a quarter of US manufacturers are operating with a chief supply chain officer (CSCO), a new survey from supply chain technology provider GT Nexus has revealed.

Just 24% of the 250 respondents to the survey have a CSCO in their organisations. Another 32% reported they employed someone to be responsible for their supply chain, but these executives were below management board level.

While a further 2% said although their organisations did not have an equivalent role, there were plans to introduce one, 41% said they did not have a supply chain officer or plans to create the role.

“This very behind-the-scenes finesse is what makes a company win or lose when it comes to supply chain, and this is driven by having someone in place to oversee it and having a networked approach,” said GT Nexus.

“If you’re still not convinced supply chain is a critical and strategic domain that’s churning out new heads of companies, take a look at who runs Apple and Walmart – hint: they got their start in supply chain.”

While it is true that current Apple chief executive Tim Cook and previous Walmart chief executive Mike Duke began their careers in supply chain departments, for many companies appointing a chief supply chain officer may be easier said than done – especially given that many management boards rarely understand much about their supply chains, other than what they cost.

According to the GT Nexus survey, 41% of respondents said their number-one supply chain priority was to reduce costs, which may not go hand-in-hand with increasing HR budgets to hire a chief supply chain officer – wages can vary considerably of course, but the sums are not inconsiderable. According to salary.com, the average wage for a C-level supply chain officer is $230,000 a year, while glassdoor.com cites an annual salary of $250,000 for the EMEA supply chain director for British-American Tobacco.

GT Nexus argues that, in the long-term, companies would be better off investing in senior staff rather than focusing purely on cost levels. Vice-president of corporate marketing Greg Kefer said: “It’s clear in the report that manufacturers expect to face major supply chain challenges in 2016 stemming from external factors beyond their control.

“The data suggests their execution roadmap may be misguided, being focused more on cost cutting, for example, than more mission-critical things like having a senior supply chain leader in place.

“76% of respondents said they currently operate without a chief supply chain officer. With almost half of manufacturers reporting a disruption that impacted business in the past 12 months, this gap in strategic direction to address broader supply chain agility is a concern,” he added.