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How HR Impacts Supply Chain Management

August 25 2022 - A business needs many departments to function, and each department has to work with all others for this to be possible. The human resource department is concerned with employee lifecycles. This means the recruitment, training, onboarding, and firing of these employees. The supply chain management department is responsible for everything to do with the creation and delivery of the product to the customer. This department can source products and materials, help ensure timely delivery of raw materials and finished products, the storage of materials and products, and so much more. Because of how different both of these are, how does HR affect supply chain management?

Hiring

The most obvious and significant way HR impacts supply chain management is through hiring. HR is responsible for finding the right talent, interviewing, hiring, and then onboarding successful candidates. They do this for all departments, including those involved in supply chain management.

If HR makes a mistake when hiring a candidate for departments that handle any aspect of the supply chain, they risk crippling the supply chain, especially if the candidate was meant to hold a position significant to the functioning of the supply chain such as a supply chain or sales manager.

Even when the business is not hiring for managerial positions, HR has to assess the level of knowledge candidates who will be involved in the supply chain system have about it.

Training

The human resource department is fully responsible for the training of the employees, including those who work in supply chain management. This is geared towards ensuring employees keep "leveling" up so they are more efficient and productive in their respective roles.

The HR department is responsible for who trains employees and how these employees are trained. This responsibility ensures that, at the end of training, its employees acquire knowledge and skills they did not have and can apply these new skills and knowledge in their work going forward.

Because of how quickly supply chain management changes, employees have to stay updated on best practices. This often starts with the assessment of how things are currently going and finishes with employees being trained during the implementation of the strategies that come out of the assessment.

For all this, businesses hire supply chain consulting firms that do an assessment and analytics of current supply chain practices, develop a plan based on this assessment, and then implement the plan. These consulting firms can implement these strategies on their own or with the collaboration of the HR department.

The result is a streamlined supply chain operation.

Salaries and Benefits

Even though not the primary factor, salaries and benefits affect how people do their work. If people feel like they are not being compensated adequately, they may feel unhappy about their work, and this shows in their output and performance. HR is responsible for these salaries and benefits so it can impact supply chain management in this way.

Additionally, ensuring better compensation can ensure lower employee churn, thereby minimizing the impact such turnovers have on different parts of the business, including the supply chain system.

Conclusion

While it may not look like it at first glance. HR has a significant impact on supply chain management. This is especially true when you consider the quality of employees hired, their level of training, and how happy they are with their jobs.

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