Building the Foundation for Next Generation of Procurement Leaders CPO Network- Procurecon New York, NY

1. Building the Foundation for Next Generation of Procurement LeadersCPO Network-ProcureconNew York, NY November 4, 2013

2. 30-Second Commercial • Established a new Supply Chain Management and Marketing Science Department effective July 2008, with over 30 full-time professors focusing on end-to-end Supply Chain Management,  research, teaching and collaboration with industry.   • Since 2001, we have had a very successful Rutgers Center for Supply Chain Management currently with over 20 world class corporate partners participating. • World class research program focusing on sustainability, responsiveness and flexibility, and risk reduction. • In addition to our very successful MBA program, we have launched a new undergraduate SCMMS program in 2009-now have 500 UG SCM Majors-doubled in each of the last three years. • Rutgers SCMMS program ranked # 3 in US by Gartner Research and ranked #20 by US News & World

3. What is the Problem?

4. Today’s Staffing Environment • More than 25% of the working population will reach retirement age by 2015, resulting in a potential shortage of nearly 10 million workers • During the same period, the replacement pool of 35 to 44 year-olds will decline by 15%. • At the same time, employee commitment levels are also changing • Only 47% of Americans say they’re satisfied with their jobs, dropping for over 60% in a similar survey 20 years ago • Workers said they were dissatisfied with their workload, potential for growth, work/ life balance, performance review processes, and promotion policies in their jobs. • Failing to manage your company’s talent needs is the equivalent of failing to manage your business. And yet the majority of employers have abysmal track records when it comes to finding and retaining talent • Leaders must lead and manage their staffing needs and spend an increasing amount of time acquiring, developing and maintaining their talent.

5. Additionally, Skill Requirements Continue to Change .. and Your Organization Needs to Adapt • New processes that didn’t exist 10-15 years ago • Strategic Sourcing • Supplier Development • Spend Management • New tools & technologies • Strategic Sourcing Suites • eSourcing Tools • Spend Analysis • Contract Development, Maintenance & Compliance Tools • Supplier Identification Solutions • Changing markets • Local to Regional to National to Global • Increased factors that drive market volatility • Higher expectations from the Business and your Supply Chain organizations • The transition from transactional to strategic activities • Continued value contribution

6. The Role of the Procurement Professional has Truly Become More Strategic in Nature

7. 2% 6% 4% Other Strategic 10% 12% 15% New Product & Process Mgmt 10% 17% 22% Supplier Development 15% 22% 26% 43% Tactical Sourcing Strategy & Analysis 30% 20% Materials Management 20% 15% 11% Transactional Buying 2002 2007 1997 Source: Corporate Executive Board Research

8. Test Question

9. Which is the Best Recruiting Strategies for New Hiring? • Internal hiring - Supply Chain • Internal hiring - non-Supply Chain • External hiring • University Recruiting • External temporary staffing • Internal temporary assignments • Outsource non-strategic areas ALL OF THE ABOVE!!!

10. Which is the Best Recruiting Strategies for New Hiring? • Internal hiring - Supply Chain • Internal hiring - non-Supply Chain • External hiring • University Recruiting • External temporary staffing • Internal temporary assignments • Outsource non-strategic areas

11. First Partner with a University

12. The Supply Chain Talent Shortage is Real !!! “The increasingly visibility and importance of supply chain management show a crisis building with increased responsibility, complexity being driven in part by globalization, and university and professional programs struggling to independently interpret industry needs.” “Universities have an opportunity to take a leadership role.” “Supply Chain Talent: State of the Discipline” AMR Research, April 2008

13. Critical Success Factors for a Supply Chain Department

14. Partnering with Industry • Leverage a Center of Supply Chain Management (if Available) • Foster closer collaboration- close the gap between faculty research and business needs • Demand executive education programs on Campus and In-House • Visit the Campus Frequently-Guest Speaker, Lunch & Learn, Case Competition • Provide “win-win” internship, Co-ops and projects for students that leads to no risk hiring • Focus on end-to-end supply chain

15. Recruiting the Next Generation of Graduates • Leverage the “new breed” of Supply Chain Management and Global Procurement graduates • Many are dual degrees • Look for opportunities to “test the waters” through internships/Co-Ops or Projects • Different core values than other generations • Due to talent shortage will have more turnover • Will need a multi-prong strategy to make it work

16. Students(Rutgers SCM Majors) are in Demand

17. MBA SCM Summer Internships (Class of 2014) • 32 SCM Majors, 37% of the Full-Time class • All 32 Students or 100% had Summer Internships • Quite a Record-6 Years Running 100% (2008, 2009, 2010, 2011, 2012 & 2013) (Most of these Years were During a Recession!)

18. MBA SCM Summer Internships (Class of 2014) Companies • Novartis • J&J (PDLP)(3) • Bayer • Verizon • Colgate • Qianfang Holding • Kuehne + Nagel • JP Morgan • Dell • Pepsi • SBS Group/Siemens • Motorola • Ferrero • Corning • Mars • Ohm Laboratories (2) • Ashland, etc.

19. MBA SCM Full Time Jobs (Class of 2013) • 25 SCM Majors or 35% of the class (2 students not seeking) • 23 Students or 92% got Full Time Positions • Judged 90 Days after Graduation

20. MBA SCM Full Time Jobs (Class of 2013) Companies • Estee Lauder • Verizon (2) • Novartis • Pfizer • J&J (2) • Deloitte • Panasonic • Dell • MasterCard • Quest Diagnostics • Phillips Lighting (2) • Ralph Lauren • Lord & Taylor • IMS Health • Anbakam Metals

21. Getting the Most from Internships/Co-Ops • Formalize the Internship Program • Identify Jobs to be Filled • Set Compensation Plans • Prepare Relocation Plan (if applicable) • Recruit Interns and Fill positions • Manage Interns’ Activities and Progress • Add Sizzle to the Experience • Extend Job Offers and Fill Positions

22. After the Internships…..if it is a marriage Step 9: Offer a Full Time Job No Risk Hiring?

23. Now You Got them, What is Next?

24. Retaining Top Talent • Manage your High Potential People First, but … • Frequent Career Discussions • Retention Program for Key Employees • Rotational Assignments • Special Assignments • Top Management Exposure • Take Risks on People • Recognition is More than Money • Leave the Door open if they Leave

25. Summary :Building the Foundation for Next Generation of Procurement Leaders • Now and in the future, talent management will determine the success of your Procurement organization. • Next Generation of Procurement Leaders must come from all available sources, including universities • Students are In-Demand-Must have a robust Internships and Co-Op Program • Develop a formal strategy and program for retaining your best talent • Partner with a top Supply Chain Management university (Rutgers, of course…)

26. Thank You !!! Questions Don Klock Professor, Supply Chain Management Rutgers University 973-353-5678 dklock@business.rutgers.edu