2009 Salary Survey from Logistics Executive

1. 34 S U P P LY C H A I N
2009: A YEAR OF CHANGE
AND CONSOLIDATION
T
he 2009 Supply Chain and Logistics country managers, BD directors, CFOs and 4. Sourcing & Procurement
Employment Market Survey Report is the CEOs to drive new business models in order 5. Supply Chain
third consecutive annual report devel- to optimise growth and profitability during the 6. Manufacturing
oped for the industry by Logistics Executive next 12 to 15 months. 7. FMCG
Recruitment. The report highlights key issues “We also see an ongoing global demand 8. Freight Forwarding & Customs
that have influenced the wider supply chain for specialist proven executives, for employ- 9. Retail
and logistics industry during a year of change ment as consultants, contract and interim 10. Healthcare Medical
and consolidation. managers, with particularly high demand for 11. Mining & Resources
The survey has been undertaken against a senior talent across the FMCG, specialist retail, 12. Oil & Gas
background of the global financial crisis and healthcare, cold chain, contract logistics, spe- 13. Materials Handling
macroeconomic factors that have had a signifi- cialist warehousing, and freight management 14. Automotive
cant impact on the international supply chain sectors,” Mr Winter said. 15. Aviation & Aerospace
and logistics communities. “As we enter the second half of 2009,
According to Kim Winter, CEO of Logistics feedback from our global pool of senior candi- Career relocation & mobility
Executive Recruitment, there is strong evidence dates leads us to believe we are experiencing The results highlighted a significant increase
of the market continuing to see the recruit- the early stages of a slow and steady market in career mobility with over 45% of the total
ment and deployment of key executive talent recovery many predict for mid to late 2010.” respondents indicating that they have relo-
as pivotal to successfully managing through the cated in the last three years for their careers,
current recessionary environment. Key findings from the 2009 report either domestically or internationally (see
“During previous economic downturns our Executives from across 82 countries completed Figure 1.). Over 50% of that same group relo-
industry has proven more resilient than most the Logistics Executive Recruitment market cated internationally. In addition, over 88% of
and while it is clear that many companies survey, with the resulting report developed as an the total respondents indicated that they would
are under severe financial pressure, there
is evidence that the supply chain & logistics
industry is maintaining its fundamental core “HR and C-level staff agreed that the financial crisis
strength as a result of it underpinning almost
every sector of the economy,” Mr Winter said.
and fuel prices would have a significant negative
Mr Winter added that late 2008 and early impact in the coming 12 months.”
2009 were typified by a general lack of confi-
dence across the global business community
which resulted in a decline in activity across the executive summary of some of the key findings. consider relocation for their career in the
broader supply chain and logistics industry. The report is designed to share relevant infor- future. It was interesting to note that 35% of
“Downward customer pricing and yield mation with industry colleagues, offering an Australian-based HR Managers surveyed said
pressure along with world-wide, regional and insight into the dynamics influencing global they would hire from overseas, while nearly
local competition, has driven significant ratio- employment trends and to assist in business twice as many (62%) of C-level managers,
nalisation and integration of business units, as decision making. (senior executive managers), said they would
many organisations seek to achieve cost savings consider hiring offshore candidates.
and performance benefits from re-sized and re- Survey demographic The increase in career mobility identi-
calibrated operations.” The 2009 survey respondents represent a fied in the Logistics Executive Recruitment
There has been an inevitable rise in demand broader geographical sample than 2008 and Survey is reinforced by a significant increase
for career transition and outplacement services provide a useful insight into current trends of industry professionals returning to, and
as businesses seek to redeploy human resourc- in various regions from across the globe. applying for, management positions in
es within their operations and, in many cases, Approximately 32% of the total respondents Australia in the last 12 months. Logistics
to adopt short-term reduction of non-revenue were employed in Australasia, 17% in the Executive Recruitment Managers in the
generating personnel. Middle East, with next largest representations Shanghai and Singapore offices report an
As with past periods of rapid consolidation from Asia (15%) and Europe (14%). increase in ‘localisation’ of senior manage-
there is now emerging evidence that financially ment roles previously held by expatriates
sound international and regional tier-one and Industry types (often Australians), and their Dubai office
tier-two market participants are leveraging Respondents were employed in over 50 different cites soft economic conditions in the united
current economic conditions as an opportunity sectors of the industry, with the top 15 being: Arab Emirates as a core reason for an
to expand. 1. 3PL, 4PL increase in the number of executives return-
Rationalisation and M&A activity has 2. Logistics & Warehousing ing to Australia over the last 12 months.
increased demand for high-calibre VP’s, 3. Transport – Road & Rail
34 MHD SUPPLY CHAIN SOLUTIONS — SEPTEMBER / OCTOBER 2009

2. S U P P LY C H A I N 35
Figure 1.
Counter-offers
A gap between intentions of C-level Managers
and HR managers can also be seen in terms of
their tendency to make counter-offers to retain
staff who have been offered roles elsewhere.
In the report, 32% of HR managers said they
would counter-offer positions, whereas 25%
of C-level managers indicated that they would
consider counter offers. Contrary to the widely-
held view in the market that counter-offering
was a successful way to retain staff, both HR
managers (42%) and C-level managers (35%),
Macroeconomic factors 4. Customer Satisfaction believed those counter-offered would leave
The influence of macroeconomic factors can 5. Productivity anyway within 12 months.
be seen in a decline in the total respondents 6. Retention of Talent
predicting business growth within their organisa- A range of questions were asked about the Internal staff training
tion in the next 12 months: down from approxi- positive, negative or neutral impact of external The results also showed that HR was signifi-
mately 80% in 2008, to just over 55% of the factors to one’s organisation. As a rule, HR and C- cantly less convinced than C-level managers
total respondents predicting growth in their level staff agreed that the financial crisis and fuel that training was shown enough focus within
organisation over the next 12 months. While prices would have a significant negative impact in their organisation. (54% compared to 67%),
there is no doubt the wider economy has had the coming 12 months. What was a bit surprising whereas C-level managers saw HR as being
some effect on confidence across our industry, was - compared to current media on the topic much more aligned to the organisation than
the results also indicate that 50% of the respon- - is that changes in employment legislation were HR did. (73% compared to 64%). HR was
dents expect continued growth into 2010. This not seen as having a significant negative impact significantly more supportive of outplacement
is a positive sign for the industry. and were rated behind the global financial crisis, services than C-level managers (61% compared
Key challenges for business in the coming fuel and currency exchange fluctuations. Nearly to 41%), and with regard to the question: “Is
year were seen by respondents in order as: 10% of C-level responses showed either a critical the relationship between CEO and HR is critical
1. Profitability or high degree of impact on the business from to business success?”, HR felt this was the
2. Sustainability a shortage of skills, whereas HR only saw skills case 96% of the time and C-level managers
3. Leadership Management shortage as an issue to ‘some degree’ at most. only felt so 89% of the time.
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MHD SUPPLY CHAIN SOLUTIONS — SEPTEMBER / OCTOBER 2009 35

3. 36 S U P P LY C H A I N
Figure 2.
Education & qualifications program within their organisation.
Tertiary education levels were again a feature The responses clearly showed that C-level
of the survey (see Figure 2.), with statistics managers felt their organisation had a strong
showing a substantial increase in the propor- presence in the communities in which they
tion of 2009 respondents who hold undergrad- operated, and that a CSR program allowed com-
uate degrees (36%) and post-graduate degrees panies to do more than just generate a profit,
(33%). These figures show an increase of assisting with employee morale and public
11% and 12% respectively, compared to the image leading to improved employee loyalty.
2008 survey results, and suggest there is a The biggest barriers to CSR were seen as
strong trend upward in the number of industry costs and unclear benefits. Only 26% of C-level
professionals studying and graduating whilst responses indicated that an ROI was applied to
employed in our industry. This result may also their CSR programs. It may be if this percentage
indicate the fact that employers are increas- was increased, the benefits of CSR to an organi-
ingly seeking Degree qualification as a prereq- sation would become clearer.
uisite for employment.
Climate change
Corporate social responsibility Given the high profile of climate change over
Feedback from last year’s survey called for an recent years it interesting to note that there
investigation into the role of corporate social was a slight increase (over 70%) of respon-
responsibility (CSR) in our industry and we believe dents who felt that climate change had no
the results may be of interest to the increasing effect on their business compared to 2008
numbers of professionals involved in CSR. (approximately 65%).
Quantitatively, 76% of C-level responses
felt CSR was a focus for their organisation Industry representation
and a further 14% felt is should be, meaning at board level
that 90% saw positive reasons for CSR. The For the first time, the survey explored what level
primary reasons were to contribute to society, of representation the supply chain and logistics
support environmental and health and safety profession achieves at boardroom level, and it is
issues along with it being a part of good cor- of interest to note that less than 55% of the total
porate governance. Qualitatively, C-level staff respondents indicated that supply chain & logis-
felt that CSR rated 7/10 as an area of focus, tics executives have a seat at the board table in
so they were fairly convinced of its need in their organisation.
their organisations. These results were higher For more information contact Nick Stolp at
than the wider Australian results that showed nicks@LRS.net.au. A copy of the report can be
70% of organisations had a CSR program and downloaded from Logistics Executive Recruitment’s
a further 13% felt they should have a CSR website www.logisticrecruitment.com.au.
36 MHD SUPPLY CHAIN SOLUTIONS — SEPTEMBER / OCTOBER 2009