Very few women choose careers in manufacturing and supply chain operations. And that’s a problem, for two key reasons.
First, manufacturing and supply chain are critically important, because it’s these functions that will lead companies into the digital business of the future. And second, there’s a growing skills gap in manufacturing and supply chain that companies will be able to fill only if they hire from among the growing ranks of female college graduates.
In other words, if manufacturers want to succeed in the Digital Economy, they’ll need to hire and promote more women.
The digital economy calculus
Only 35% of the supply chain workforce is women, according to a recent Gartner study. That number drops precipitously as you move up the corporate ranks, with only 7% of executive vice president and chief supply chain officer spots occupied by women. In fact, 38% of companies actually reported zero female supply chain senior directors or vice presidents.
There are several reasons that’s a problem. The first reason is that more and more college graduates — those most likely to be qualified to move into leadership positions in manufacturing — are women. In fact, for the first time ever, U.S. women are more likely to earn a college degree than men, according to the U.S. Census Bureau. In 2014, 30.2% of American women had a bachelor’s degree or higher, vs. 29.9% for men.
Why is that an issue? Because the simple calculus of talent supply vs. demand dictates that manufacturers will need those female graduates. The skills gap in industries dependent on science, technology, engineering and mathematics (STEM), while debated, is well-documented. But as manufacturing and supply chains become more digitized, manufacturers will especially feel the pinch — as recently enumerated by the Brookings Institute. If women don’t enter and remain in careers in manufacturing and supply chain, there simply won’t be enough qualified talent to meet demand.
The second reason is that manufacturing and supply chain are crucial to the future of business. Why do I say that? Because these functions are on the vanguard of the Digital Economy. Manufacturing and supply chain are pursuing Internet of Things (IoT), artificial intelligence (AI), digital networks, and other forward-leaning strategies more aggressively than any other business function. If you fail to embrace the Digital Economy in your manufacturing and supply chain, you can’t expect your business to succeed.
Getting digital leadership right
The solution will have to be multifaceted. In the long term it will probably be necessary for industry to partner with government to encourage girls in high school — or even earlier — to engage in STEM subjects. But in the short term there’s much that companies can do to bring women into manufacturing and supply chain, and then to ensure they have opportunities to advance to leadership roles.
For example, here at SAP we’ve implemented the Leadership Excellence Acceleration Program (LEAP), which gives female employees opportunities to develop portable skills and a leadership mindset. The goal is to achieve 25% female leadership by 2017. We’re already approaching 24%, a five percentage point improvement in less than five years.
For manufacturing and supply chain, we’ve established programs to encourage women to enter and grow in these mission-critical and exciting fields. As one example, SAP has guided the creation and development of Business Technology Early College High School (B-TECH), a six-year high school in Queens, N.Y., that offers a technology-focused curriculum. As another example, a recent initiative supports Girls in Tech, a 50,000-member nonprofit focused on educating and empowering girls and women in high-tech careers.
Companies that get digital leadership right are more diverse, they’re more engaged, and they perform better, according to a recent study by SAP SuccessFactors. “Digital Winners” have more mature programs for building diversity (56% vs. 48%) and hiring skilled talent (85% vs. 64%). Their employees are more satisfied (87% vs. 63%) and more likely to stay in their jobs (75% vs. 54%). And they’re 38% more likely to see strong revenue and profit growth.
Women are pivotal to this success. “Digital Winners have a higher proportion of female employees than other companies,” the SAP SuccessFactors study found. There’s no question: if you want to join the ranks of the Digital Winners, you’ll need more women in manufacturing and supply chain.
Learn more about women in the supply chain. Join SAP at the Supply Chain Women’s Network Lunch Reception, held November 3 during the International SAP Conference on Extended Supply Chain Management in The Hague, Netherlands.