Juggling act

Juggling act

Your mission, should you accept it: Bring 1 million T-shirts from Guangdong province in China, all the way to the Port of Baltimore - within 15 weeks. You will begin by deciding where to source those T-shirts. You will evaluate local Chinese partners not only on the basis of their productivity, reliability and pricing, but also their compliance with child labor laws or other global regulations. You will then negotiate land and ocean transportation for those shirts - from the factory in southern China through an appropriate Chinese port, and onto Baltimore - on time and within budget. You will also manage and monitor documentation for compliance with Chinese and U.S. regulations, and meet security standards everywhere along the route. Finally, you will prepare for surprises - a strike by dockworkers, piracy on the high seas, officials demanding payoffs and maybe even a typhoon sweeping across the South Pacific.

It sounds like the job description for a high-paying, highly demanding senior position in global logistics. However, this exhausting list merely outlines a simulated, 15-week-long exercise undertaken by students at Fashion Institute of Technology's bachelor of science program in international trade and marketing for the fashion industries. To meet rising demands made on today's global logistics managers, the FIT program provides broad academic grounding in such disciplines as economics, cross-cultural studies and comparative political systems as well as highly focused practical training in the real-life challenges of working in the fashion industry.

Although the FIT program uniquely focuses on the needs of one industry sector, its demanding requirements reflect today's approach to logistics education. "These days, you need to understand all the pieces in the puzzle: regulatory (regimes), trade agreements (including market access), licensing, intellectual property, and so forth," said Donna Sharp, executive director of Pace University's World Trade Institute, which offers a 10-course certificate program in international trade management. "Even site selection and economic conditions are becoming part of the job. We used to just ship boxes; we never had to worry about those things."

Less than a generation ago, a career in logistics did not require extensive academic education, Sharp said. "Most people fell into logistics one way or another. It was not glamorous. It was back room. It did not require a high level of education or expertise. You could learn it on the job. Now, however, you need to be fairly educated to perform well."

Maria McIntyre, executive director of the Council of Logistics Management, agrees. "Before transportation rates were deregulated in 1979, there was no such career path as 'logistics manager.' There were traffic managers who had books they used to look up rates. There was no flexibility in that job." When established in 1963, McIntyre's organization was known as the National Council of Physical Distribution Management. Only in the mid-1980s did the pre-eminent group of executive training in this industry change its name, reflecting the sector's growing role and professionalism. "By then, the job wasn't just about distribution and traffic. It had evolved into 'logistics,' (a word) that had a more military connotation. The responsibilities were growing beyond warehousing into customer service, inventory, and so on."

Now, after a wave of mergers and acquisitions "companies are thinner, and the responsibilities of logistics (managers) are broader," McIntyre said. "Logistics has grown to be more inclusive of the supply chain. We are now managing more activities, and with fewer people." Nowadays CLM's professional membership includes logistics professionals who are "knowledgeable about sourcing, procurement, product design, security, international planning, finance and accounting," McIntyre said. "It is much broader in terms of key responsibilities."

Today's Web-based tools allow logistics managers to share current data with other departments, and play a role in shaping strategy - not just managing the flow of goods. "Logistics management has become more strategic," Sharp said. Gradually, the word has spread that logistics provides the key competitive advantage for many of today's most profitable companies. The huge success of Wal-Mart, Dell Computer and others is widely attributed to their mastery of the supply chain, not skill at product innovation.

"Lee Scott, at Wal-Mart, came up through the ranks as a logistician," adding further prestige to the career path, McIntyre noted. "Before, logistics people were off in left field, doing their own thing. Now they have an important role. For example, at ConAgra, the senior VP of integrated logistics now reports to the CEO."

No wonder logistics education is getting more academic and more practical. These days, logistics professionals "need to know enough about other people's jobs to ask them the right questions," Sharp said. "We give people the confidence to ask the right questions, and make things better."

Sharp's curriculum at the World Trade Institute aims to provide a balance of basic academic knowledge and specialized skills. The curriculum consists of 10 courses, including five core subjects. "We had to be very selective. The top 10 things people need," she said. Everyone takes the five core courses - on imports, exports, global logistics, trade finance and marketing and sales. Many students already have a degree, but they want to change their career mid-stream. "Some students are people with MBAs who want specific skills," Sharp said.

Patrick Yanez, the Chilean-born economist who heads the FIT program, said it focuses on preparing entry-level professionals for the rigors of a long-term career. "Our students deal with real situations. They have to get real price estimates. They learn about all types of containers. Some teams visit ports. None of us are academics, and we are not required to publish. All of our teachers are practicing professionals. It is not generic. Everything is contextualized to the fashion industry."

Thanks to the Internet, students can collect a great deal of information online that used to be available only on-site. At FIT, that means frequent visits to Web sites with details that logistics managers visit on-the-job. "They can go to the Web site of the port and study the roads and the regulations," Yanez said. "If the factory is 60 kilometers from the port, they have to figure out a way to bring the garments by railroad or road. They have to find out the wait time. It's a little like medical school, where you learn with dead bodies." Not perfect, but very useful, in other words.

Internships at local garment companies add to the practical impact, Yanez said. Students must spend at least 12 hours a week as interns for one semester. "Almost 50 percent of the interns are offered jobs," he said. For example, former interns are now international license coordinators at Donna Karan and Rampage Clothing. Moreover, FIT's advisory board brings together industry executives, customs officials, attorneys and other international trade professionals to help students. "If a team is stuck, they can call up a lawyer or business owner," Yanez said. An advisory board "keeps the curriculum up to date. It keeps us on our toes."

Despite programs like FIT's, Sharp argues that "there is a lag, and the educational community has yet to respond" fully to the needs of the logistics sector. Although more U.S. business schools now offer logistics courses, "there are very few logistics degree programs." Moreover, many business school deans "still think of export-import as technical or vocational training, even though it has gone beyond that. 'Distribution' is still merely one chapter in many marketing textbooks. It is hard for higher education to know where to put us," Sharp said.

A strong supporter of the FIT approach, Sharp argues that logistics education "needs to be a balance" between the academic and the technical. Current academic programs - including business schools - tend to be more practical, while vocational programs are becoming more academic, "blurring the lines" between the approaches. "A lot of MBAs have unrealistic expectations," she said. For all their theoretical knowledge, these graduates lack the simple entry-level skills that many employers are looking for - including "how to fill out a letter of credit," Sharp said.

In the long run, she predicted, "Logistics will become an outgrowth of business schools. Logistics will merge with business schools." In so doing, logistics will follow in the path of other disciplines that were once deemed too practical or vocational for elite academic institutions - including public relations, marketing and advertising.

Equally important for the industry are the CLM's efforts to upgrade professional standards by providing mid-career training to logistics managers and chief executives who cannot enroll in formal certificate or degree programs. To fill in the gaps of their education, many logistics professionals enroll in seminars that the CLM provides throughout the year. Over the next six months, for example, the CLM will provide two-day "Fundamentals of Supply Chain Management" seminars in Chicago (September), Atlanta (November) and New Jersey (January 2005). Its next annual conference, in Philadelphia in October, will involve 350 speakers covering 29 training tracks, over the course of three-and-a-half days. "CEOs can use professional organizations to train their people relatively inexpensively and quickly," McIntyre said.

The nonprofit CLM also runs educational seminars that help chief executives understand how logistics works - and why it can be so important. "In the early '90s, many CEOs didn't truly understand the impact of logistics," McIntyre said. When those companies cut their logistics budget and staff, "they learned quickly that it was like cutting your nose off." For all that, some chief executives still don't "get" logistics. "That's why we provide training for CEOs," McIntyre said. "FedEx and UPS get it, but it's not just big companies that get it; it's not a question of size. Some small companies get it. It's thought process."

In other words, it's a matter of education.