Today supply chain systems require new skills: an Interview with Professor Stefano Ronchi, Polytechnic University of Milan

Universities and business schools are enhancing their curricula to prepare the next generation of supply chain experts.

In this interview, Professor Stefano Ronchi, Director, Management of Engineering Programs at Polytechnic University of Milan, illustrates the skills needed to face the new global challenges.


How did the Polytechnic University of Milan training programs on supply chain management evolve in the last years?

The teaching dedicated to risk management has been strengthened. It is always an essential element in the supply chain field, which has become even more relevant in this period of the Covid-19 pandemic.

The Polytechnic University of Milan has been offering various high-level specializations in Supply Chain Management within the degree program in Management Engineering. From years, new courses in the Supply Chain are also provided by the Business School of Politecnico (MIP), in response to the growing demand for training programs in this area.

How have roles within the supply chain changed in recent years? Have new professional figures emerged?

In addition to the traditional roles such as those inherent in Demand Planning, Forecasting, Logistics Management, Data Analysts and Risk Managers are increasingly gaining ground.

The Data Analyst fits into all business functions and processes to manage and understand large amounts of data. These real-time data allow those who manage the supply chain to make timely decisions. Of course, his work must be supported by adequate and performing software.

The Risk Manager is responsible for defining the risk map, identifying the sources of possible errors, and mitigating any operational and financial risks. In particular, the field of risk management today is closely linked to all aspects of the supply chain’s financial, environmental, and social sustainability.

What are the most valuable skills to operate within supply chain systems today?

Indeed the data analysis. Not only are statistical bases needed, but it is also necessary to relate data, develop predictive studies, and use and understand machine learning algorithms to predict what could happen in the supply chain. It becomes essential to understand what the sources of the data are and how they have been processed.

For example, some time ago, in India, a washing machine manufacturer saw a growth trend near New Delhi, so based on the data collected, it decided to produce more washing machines to be shipped to that geographic area, assuming that they would be served for the hospitality sector, as in the past. According to history, the company knew that with a new demand for washing machines, additional demand for dryers would come, so the company began to produce more dryers. However, the orders for dryers did not arrive. This is because it was discovered that the washing machines were not intended for the hospitality sector, but for cheese manufacturers that used centrifuges in their production processes!

If I use the data, repeating it from the past and projecting it into the future, without updating, without understanding the new scenarios, I can make serious mistakes.

A second fundamental skill is to have a systemic vision, in other words, an holistic vision. Those involved in the supply chain must know what happens from the first upstream supplier to the last downstream customer.

A third capacity is that of relationship. Since the supply chain is a linked system, each actor must know how to communicate correctly with the other company functions, considering that each process has different objectives, and therefore it becomes essential to understand how to negotiate, given a great common goal.

Digital skills and, therefore, the ability to interface with modern software are undoubtedly necessary.

Last but not least is the financial one.

With the Lehman-Brothers crisis in 2008, we have realized how the financial dimension mattered much more than in the past. Many companies have gone bankrupt following this crisis due to a lack of credit and liquidity. Supply chain processes have impacted – and still impact – on liquidity (think of inventory management, delivery times, etc.). It is essential to have the right financial skills to optimize the supply chain working capital.

Transparency, visibility, and risk management: how are new technologies critical?

First of all, having end-to-end visibility is critical to managing risk.

At the technological level, we should remember that technologies are a means and not the purpose. I have often seen that business processes are mistakenly “bent” to fit technology rather than the other way around. Technology must be flexible, versatile. New softwares support increased visibility, transparency, and risk minimization throughout the supply chain, but they need to be adapted to the business processes.

In terms of transparency, I emphasize that one of the most relevant aspect, even more so than technology – and here I am talking again about relational competences – is that of negotiation. Not all actors along the same supply chain want to be transparent in the same way; it is necessary to know how to negotiate and identify the benefits of all the figures to achieve transparency.

Being a supply chain consultant: what companies appreciate most?

Again, an injection of all the skills mentioned earlier like holistic vision, process knowledge, interpersonal skills, technical skills, extensive data management, predictive skills.

I also add the possibility of presenting best practices. Companies want to see what other similar companies are doing and how to improve. In my opinion, a consultant who brings these skills and experiences or business case, can add value.