The Global Supply Chain Management Industry
Have you ever wondered how different products that you use every day – from televisions to your morning cup of coffee – are delivered to you? Where they come from and how the process works? On this page, you will find an overview of the supply chain management industry, how Washington state is positioned regionally and globally within the industry, and about some of the many career opportunities available in supply chain management and logistics.
What is Logistics Management?
Logistics is the part of a supply chain that plans, implements, and controls the efficient flow and storage of goods between the point of origin and the point of destination in order to meet the requirements of customers or corporations.
For individual companies, an effective supply chain management system requires careful planning and operations administration and often involves sophisticated coordination and communication between a diversity of partners. As such, supply chain management professionals can be engaged in every facet of the business process – planning, purchasing, production, storage, distribution, information technology (IT), and customer service. Many well-known international corporations with headquarters here in Washington state, including Amazon, Boeing and Starbucks, have large supply chain management departments and teams that contribute to their national and global success.
Supply chain and logistics management is important to the world’s leading organizations because it enables companies to build and deliver products better, faster, and cheaper. The supply chain itself is a network of retailers, distributors, transporters, storage facilities, and suppliers that participate in the production, delivery, and sale of a product to the consumer. Supply chain management links major business functions and processes within and across companies into a cohesive, high-performing business model. Supply chain management professionals are engaged in every facet of the business process: planning, purchasing, production, manufacturing and assembly, storage and distribution, customer service, and transportation/logistics.
What is Supply Chain Management?
Supply chain management is a "cross-functional industry that includes international trade, transportation, and logistics. It comprises all of the activities that take place to get a product in a consumer’s hands – from the time raw materials are extracted to the minute a consumer takes the final product home. Supply chain management links major business functions and processes within and across companies into a cohesive, high-performing business model" (Council for Supply Chain Management Professionals).
What does the next-generation supply chains look like?
Efficient, fast, and tailored. "The most successful companies have configured their supply chains for specific customer segments, adopted differentiating practices such as collaborative planning with customers and suppliers and reduced complexity" (www.pwc.com/GlobalChainSurvey2013).
What are the employment trends?
The U.S. is projected to have approximately 270,200 supply chain
management and logistics job openings that will need to be filled every
year from now through 2018 in order to keep with the projected industry
growth (Georgia Center for Innovation for Logistics report, 2013).
This trend is very apparent in the sampling of international
business and supply chain management occupations listed in a report
prepared by Economic Modeling Specialists International. This reports
shows that occupations related to international business, trade, and
supply chain management in King and Pierce Counties of Washington state
are expected to grow by 15.8 percent between now and 2022. The expected
growth rate nationally, among these same occupations, is expected to be
11.3 percent, illustrating the importance of these occupations to the
regional economy of the Pacific Northwest.
What is trade?
All international business is international trade: Aerospace, manufacturing, agriculture, retail, software, professional services, global health, international tourism, and international education.
The Puget Sound - A Regional Leader
No place in the U.S. may be better positioned within this emerging industry than right here Washington state. The Puget Sound region, including the metropolitan areas surrounding Seattle and Tacoma, is home to one of the leading international trade and logistics clusters in the world and functions as a premier national gateway for products, services, and people. World-class transportation infrastructure, including intercontinental railroads, highways, trucking corridors, and the nation’s largest ferry system,two major seaports, the Ports of Seattle and Tacoma. Together the ports represent the third largest shipping hub in North America (Source: WA Dept of Transportation). The Seattle-Tacoma International Airport is one of the busiest in the nation, according to both cargo and passenger data. Greater Seattle is only a nine hour flight from both Tokyo and London. The Puget Sound has a closer proximity to booming Asian ports and economies than any other in North America. The Greater Seattle area generates 72 percent of all exported goods and services in Washington State. Washington state is the most trade-dependent state in the country, and some one in four jobs here are directly related to international trade. Production of both raw material (for example, agriculture products) and finished goods (for example, airplanes) contributes to our robust export economy, fifth largest in the US, which has only grown stronger in tandem with the rise of markets in Asia (Washington state is the second largest exporter to China). Our geography, vibrant business community, and diverse and skilled workforce strategically positions Washington state to continue to develop and take advantage of this exciting industry.
Supply chain management is an emerging field characterized by significant technological trends. Those that are impacting the supply chain are enterprise resource planning (ERP) systems that link business decision making into a unified database. Radio frequency identification (RFID) technology has improved the way products are tracked and secured through the supply chain. Also, global positioning systems (GPS) provides better tracking of goods.
Half a million international tourists travel to Washington state annually. In 2010, Washington state posted a 32% increase in overseas visitor volumes over 2009, the largest increase in the country, compared to an 11% national average. International tourism accounted for $3.6 billion of Washington state service exports in 2010.
China is one of the biggest sources of our imports and our top export market…unless you remove aerospace. China is our largest source of foreign students and the fastest growing source of international visitors (48% increase from 2010).
The Trans-Pacific Asian free trade agreement is being negotiated by the United States, Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, Vietnam, Mexico, Canada, and Japan. The Asia-Pacific region is the largest market for U.S. exports (including 2/3 of U.S. agricultural exports). In 2010, 69% of Washington exports went to Asia-Pacific countries along with a large majority of imports.
Manufacturing and production companies, transportation companies, retailers, distributors and wholesalers, consulting firms, 3rd party logistics firms, supply chain services firms, universities and other educational institutions, government, and non-profit agencies
Exports accounted for $76.6 billion in goods exports in 2012. $7.6 billion of pass-through exports from other states. $23 billion in services exports. 325,000 direct jobs were supported by exports. 95% of consumers are outside the United States. 90% of exporting companies are SMEs. Washington state ports handle 7% of U.S. exports and Washington state is the 5th largest commodity exporting state (behind Texas, California, Florida, and New York).
Imports improve the quality of life of Washington residents: $47.6 billion in goods were imported in 2012; 145,000 direct jobs are supported by imports; imports increase the supply chain competitiveness for retailers and manufacturers; imports increase capacity for exports.