00:00:07 Introduction and role of education in supply chains.
00:00:38 Muddassir’s recent activities and SCM Dojo content creation.
00:02:08 Joannes’ thoughts on supply chain education and its pre-scientific state.
00:04:27 Muddassir’s survey on people ending up in supply chain careers.
00:07:07 Discussion on why supply chain education is still in its infancy.
00:08:00 Supply chain education compared to physics and math.
00:09:01 The ocean of opinions and lack of a core scientific approach in supply chain education.
00:10:31 History of supply chain and its core competencies from the 1980s to 2000.
00:12:26 Supply chain lagging behind due to leaders not adapting to technological advancements.
00:14:25 A Venn diagram of supply chain knowledge: core competencies, technology, and closing the knowledge gap.
00:17:01 Discussing the nature of knowledge and questioning its validity.
00:19:16 Challenging the fundamentals of supply chain knowledge and taxonomies.
00:20:47 Comparing physics and supply chain knowledge.
00:21:20 Arguing over the clarity of basic supply chain concepts.
00:23:41 Muddassir takes offense to the idea that supply chain knowledge is made up.
00:24:00 Research on supply development framework and its role in supply relationship management.
00:25:21 Disagreement on the statement that supply chain knowledge is made up and its relation to actual customer understanding.
00:26:02 Discussion on classification and taxonomy in supply chain, comparing it to zoology and chemistry.
00:27:56 The fundamental truth of the periodic table and its irreducible nature, compared to company departments.
00:28:58 The power and density of knowledge in supply chain compared to electromagnetism and other scientific fields.
00:30:05 Defining supply chain knowledge and its place in management.
00:31:43 Comparing supply chain to chemistry’s evolution into a science.
00:33:57 Applying scientific knowledge to improve supply chain efficiency.
00:35:37 The potential of scientific method to revolutionize industries.
00:36:45 Agreement on the role of technology in supply chain and hopes for the future.
Kieran Chandler interviews Joannes Vermorel, founder of Lokad, and Muddassir Ahmed, MEA Regional Planning and Operations Manager at Bridgestone, on supply chain education. Ahmed, who runs SCMDOJO, emphasizes the need for relevant content and solution-oriented approaches to help professionals improve. Vermorel believes the field lacks a solid scientific foundation, hindering its progress. They discuss the slow adoption of new technologies and the importance of incorporating them into supply chain education. Ahmed stresses the significance of soft skills and argues that supply chain education should focus on basic competencies, technology, and soft skills development. Vermorel questions the validity of supply chain “basics” and calls for more structured approaches to education.
In this episode, Kieran Chandler interviews Joannes Vermorel, the founder of Lokad, and Muddassir Ahmed, MEA Regional Planning and Operations Manager at Bridgestone, who runs SCMDOJO. The main topic of discussion is the role of education in supply chains and how the industry can attract great minds.
Ahmed highlights his work with SCMDOJO, focusing on creating relevant content for the supply chain community and providing solution-oriented content to help professionals improve in their current jobs. He mentions the supply chain courses and self-assessment tools he has developed for materials management, warehouse improvement, sales and operations planning, inventory management, and supply chain dashboards.
Vermorel shares his view that despite 70 years of modern supply chain research, the field is still in a pre-scientific age with a lack of a solid body of knowledge. He emphasizes the challenges of going beyond anecdotal evidence and educated common sense advice to create a deeper understanding of the subject.
Ahmed agrees with Vermorel’s view, noting that supply chain management is often a career people fall into by luck. He shares a survey he conducted on LinkedIn, where 60-70% of respondents said they ended up in supply chain by chance. He believes the industry has not progressed much in terms of education, with prominent institutions like APEX and CIPS still focusing on basic materials management, logistics, and warehousing.
Both Ahmed and Vermorel stress the need for influencers and leaders in the industry to change the mindset and improve the current state of supply chain education. Vermorel suggests that progress in scientific fields is often nonlinear and unpredictable, making it challenging to develop a structured education system for supply chain management. However, both guests emphasize the importance of continuing to work towards improving and modernizing education in the supply chain industry.
The conversation focuses on the current state of supply chain education and its potential shortcomings.
Vermorel argues that supply chain education lacks a core scientific foundation, comparing it to the pre-scientific era of physics, which was filled with contradictory theories. He believes that while age is not necessarily an issue for certain subjects, supply chain education is hindered by its reliance on opinions rather than facts. He cites safety stock as an example of an opinion-based concept rather than a proven fact.
Ahmed provides historical context, explaining that supply chain management has existed for centuries, with the modern theories emerging in the 1980s. He outlines the core competencies that have been established since then, such as materials management, sourcing, procurement, and inventory management. However, he notes that the progress in supply chain education has stalled since the early 2000s, contrasting it with the rapid advancements in digital marketing and fintech.
Ahmed identifies three areas where supply chain knowledge currently exists: basic supply chain competencies, technological understanding, and practical application. He argues that professionals need a strong foundation in these core competencies, coupled with an understanding of new technologies like IoT, AI, and blockchain. However, he notes that many supply chain leaders lack the expertise to utilize these technologies effectively.
The discussion revolves around the challenges in supply chain education, particularly the lack of a solid scientific foundation and the slow adoption of new technologies. Both Vermorel and Ahmed emphasize the importance of incorporating technology into supply chain education and the need for professionals to be well-versed in core competencies and technological advancements.
Ahmed stresses the importance of soft skills, such as presentation, communication, problem-solving, and emotional intelligence, in the supply chain industry. He believes that supply chain education should focus on three main areas: basic competencies, emerging and existing technologies, and soft skills development. This combination, he argues, will enable professionals to better utilize technology and apply their supply chain competencies.
Vermorel, on the other hand, questions the validity of the “basics” in supply chain education, comparing them to taxonomies in other fields that are seen as weak bodies of knowledge. He draws a parallel to the Middle Ages, when vast amounts of made-up knowledge were considered real, and highlights the problem of putting labels on concepts without truly understanding them. He argues that the field of supply chain is still in a pre-scientific state, with extensive catalogues of taxonomies that are largely arbitrary and lack fundamental knowledge.
Further, Vermorel discusses the lack of clear boundaries between supply chain management and related fields, such as statistics and algorithmics. This confusion, he believes, reflects the lack of maturity in the field and a need for more structured approaches to supply chain education.
Ahmed acknowledges some of Vermorel’s points but argues that comparing supply chain taxonomy to physics or chemistry might not be entirely appropriate. While he agrees that supply chain knowledge is not as structured as some scientific fields, Ahmed believes that there is still value in the current approach to supply chain education.
Ahmed explains his enhanced supply development framework, which is a small part of supplier relationship management within the broader procurement management sphere. He argues that understanding customers and receiving feedback is crucial for improving products and services, which aligns with the theory of supply development.
Vermorel disagrees with Ahmed’s approach, claiming that it is largely made up and lacks fundamental scientific truth. He compares supply chain management to modern science, emphasizing that classifications and taxonomies should have an absolute criterion to determine their validity. Vermorel uses the periodic table as an example, as it represents an essential, irreducible truth about matter in the universe.
However, Ahmed counters that Vermorel is trying to fit supply chain knowledge into the same mold as hard sciences like chemistry and physics. He emphasizes that supply chain management is a management discipline, taught in management schools rather than engineering departments. Leadership and management skills, unlike hard sciences, cannot be easily defined or organized into a periodic table-like structure.
Ahmed takes offense to Vermorel’s claim that supply chain technical competency has no scientific background, stating that the established supply chain knowledge is based on operations management research. He argues that soft skills and management are crucial for effective supply chain management, with 70-80% of the industry focusing on these aspects.
Vermorel counters this by drawing parallels to the development of chemistry and transportation, where scientific methods transformed the fields and led to significant advancements. He believes that while soft skills are important, they do not lead to the exponential improvements that scientific methods can offer. Vermorel cites Amazon as an example, where they apply scientific knowledge to optimize warehouse operations, resulting in productivity improvements beyond what could be achieved through leadership alone.
Ahmed agrees that technology and scientific methods can revolutionize supply chain management and appreciates Amazon’s example. However, he strongly disagrees with Vermorel’s dismissal of soft skills and people’s side of the supply chain competencies.
Kieran Chandler: Today on Lokad TV, we’re delighted to be joined by Muddassir Ahmed who’s going to discuss with us the role of education in supply chains and, in particular, what the industry can do to attract great minds. So Muddassir, thanks very much for joining us again on Lokad TV, and it’s been a while since we sort of just caught up. What have you been up to since you’ve last been on the show?
Muddassir Ahmed: Right, thanks Kieran and Joannes. Thank you for having me again. I really enjoy your content, actually, what you are doing on Lokad TV. I think you guys are doing a fabulous job in terms of content and production quality, so congratulations. I’m doing more of the same, actually, and trying to be better, especially with the SCMDOJO. You know, trying to create more content which is relevant to the supply chain community, to help them improve their current jobs and help them solve their problems, using my 15 to 17 years of experience and all the research I have gathered. So, more focusing on content which is more solution-oriented, which helps them in their jobs and improves. I think most importantly, since last time, what I’ve done is I’ve really focused on the supply chain courses. So, if you go to SCMDOJO, you will see courses on introduction to procurement, sales and operations planning, category management, and so on. And I have managed to develop a lot of supply chain self-assessment tools on materials management, warehouse improvement, sales and operations planning, and I’m about to launch on inventory management and supply chain dashboard. So, those tools, people can just go download and help themselves. Pretty exciting times.
Kieran Chandler: Nice, and we’ll come back to some of those supply chain courses a little bit later. Joannes, our topic today is all to do with education within the supply chain. What’s your initial overview?
Joannes Vermorel: My initial overview is that it’s actually tough. You know, there is this small joke which says, if you know how to do something, you’re just doing it. If you know a little bit about it, you’re managing it. And if you know nothing absolutely about the subject, then you end up teaching it. So, I started a few years back to try to teach supply chain on a limited manner on the Lokad website, mostly through knowledge-based entries. That was a series of articles of various lengths, and more recently, I’ve tackled a grander project of doing a world series of supply chain lectures. What is very difficult is that my perception is that, despite 70 years or so of modern supply chain research, we are still at a pre-scientific age in this field. So, it has this wall filled with difficulty. Obviously, supply chains are not just a field of study; it’s also a practice. But like any practice, you need to have a body of knowledge that is what you use to support your actions.
Kieran Chandler: The body of knowledge in supply chain is still pre-scientific and there are a lot of loose ends when you try to go beyond the anecdotal evidence. Would you agree with that, Joannes?
Joannes Vermorel: Absolutely. I think it’s quite difficult to have something that would be deeper, where you would be beyond the small recipe, beyond like the educated common sense advice. For world series of problems, there is not necessarily that much.
Kieran Chandler: Madison, would you agree with that idea of supply chain being in the pre-scientific age? What do you think of that?
Muddassir Ahmed: Absolutely, absolutely. I mean, this is a brilliant topic actually. Let me say that, and thank you for the opportunity for talking about this. I can talk almost all day, but I’m going to give you a few key testing points which I’ve recently done. I’ve recently done a survey on how you actually end up in supply chain career. So I give people on LinkedIn two choices: you either end up by luck or you plan to be.
Kieran Chandler: Right.
Muddassir Ahmed: When I was growing up, everybody who wants to be, let’s go for engineering or do MBA or become a doctor. People take those integrated choices, and even after that, people say, okay, they end up in the industry, and then they decide what to do. So, in my 16 years of supply chain career, which is predominantly in Europe and the Middle East, and in a small time in the USA, I’ve seen the same risk whether 60 to 70 percent of the people end up by luck. They were doing something else, and they end up in supply chain. And then they like it as a profession, and then they think about, okay, let’s go and educate yourself, right? And that’s probably the starting point of the problem.
Joannes Vermorel: The other thing is even the people who would start their career by education, which very much relates to the point where you know, Madison was making on, it’s pretty old, you know, it’s still we in the very much Kodak space, you know, we’re still talking about people. I have to name the two biggest brands in supply chain education, which is, you know, Apex or previously they were Apex-like Apex before, now they change their name, and the American Society of Supply Chain Management and then the SIPS in the UK. They’re still talking about the basic stuff, you know, materials management, logistics, warehousing, if you see their curriculum, and they’re selling it for thousands and thousands of dollars, same with the SIPS. So the supply chain core competency has not really moved on from the requirements of the industry because the requirements of the industry have changed. So, coming back to the poll, what I was saying, the people saying they end up by luck, and then they start learning, and they start from the basics, right? So what we as influencers and as leaders in the business, I think we have a huge responsibility to change that mindset. And that is the key agenda of what I’m trying to drive at SCM Dojo. And probably, we’re going to talk about that a bit more.
Kieran Chandler: So, why is it that the supply chain industry is still in its infancy, and why is structured education not that prevalent?
Joannes Vermorel: In my view, progress, especially scientific progress, is something that is completely nonlinear. While you can create stories to explain how we went from Newtonian physics to electromagnetism, then to relativity and quantum physics, the reality is very messy. There isn’t necessarily much logic or linearity in the sense of progress. The main problem I have with supply chain education is that it’s not about the age of the knowledge being taught; there’s plenty of math and physics that are centuries old but remain true and relevant. The issue with supply chain education is that it lacks core scientific properties. What we have is essentially a big catalogue of opinions, and some opinions disguise themselves as science because they have numbers and formulas. For example, safety stock is just an opinion, not a proven fact or law of physics. So, we have this ocean of opinions, which is quite unsatisfying. It took certain discoveries to crystallize scientific knowledge, but I’m not sure if we have a similar body of knowledge for supply chain, which is my biggest criticism when it comes to educating people about it.
Kieran Chandler: Let’s turn that question to Muddassir. If there are so many theories out there, as Joannes mentioned, and you’re teaching your clients about the dark arts of inventory management, where do you start?
Kieran Chandler: Actually, teaching them, I’m going to extend the, let’s call it, the philosophical concept. I mean, you just gave a very good example of the physics and the theory of physics. The basic is still valid, and you moved your argument towards the theory of relativity and the recent knowledge of physics, which is, you know, contemporary. So, I’m going to say this: the basic knowledge… let’s talk about a bit of history. Supply chain exists forever.
Joannes Vermorel: Going back to when people wanted to, or the emperor wanted to start a new city, they used to send soldiers to start a new city because the soldiers were very good at laying down tracks and the logistics of starting a new city. So the whole concept existed. If you talk about the army, there’s a huge amount of concepts they’re going to train people on logistics. So, this concept of logistics and supply chain exists.
Muddassir Ahmed: The theory actually started when the automotive industry grew in the late 50s and 1960s when they started using the word logistics management, and then it became supply chain in the early 80s. This is where the theory started, but then they focused on the core competencies of the supply chain. We’re talking about materials management, sourcing, procurement, strategic sourcing, warehouse logistics, trade management, demand forecasting, and inventory management. So, this is the core body of knowledge that has been established from the 1980s to around 2000.
What happened after that is that the progression hasn’t happened as it should have, let’s call it from the internet 2.0. Let me give you a relevant example of how the supply chain knowledge, as a body of knowledge and function, hasn’t progressed. Some people, who are old enough like me, graduated around 2001 when the internet was just starting. We began using Yahoo browser and such. Look at where marketing and finance functions are right now, from 2001 until 2021.
In 20 years, people are more focused on digital marketing. The only reason you guys and I know each other is basically the advent of internet 2.0, which is digital marketing, because we connected on LinkedIn, communicated, built rapport, and relationships. The same thing happened with fintech. The financial institutions and functions within businesses have changed, and there are new tools and software in place.
Unfortunately, that hasn’t happened in the supply chain, and the reason for that is because the leaders, or subject matter experts, have forgotten that there’s technological development happening, and we have to catch up to that. That’s one area where we are lagging. Now, everybody’s talking about AI, machine learning, blockchain, IoT, and cloud computing. I’ve been hearing this for the last five years, but when I talk to people, and most of the supply chain leaders, and I talk to a lot of people, only a very handful of them actually know how to use the available technology which has been there for the last five to ten years.
Kieran Chandler: Joannes, can you give us an insight into the specific applications of supply chain knowledge right now?
Joannes Vermorel: I see supply chain knowledge right now in three different circles, if I draw a Venn diagram. The first one is the basic supply chain competencies that have existed for the last 20-30 years. It’s a hygiene factor, the base knowledge. Without it, you wouldn’t be qualified to call yourself a supply chain professional. You should know everything in terms of technical competencies, both the theory and the practical side of it. If you’re a fresh graduate, you should know and then be able to apply it.
The second sphere is the technology part, so you need to understand what’s happening in the technology space, like the Internet of Things (IoT) or Industry 4.0. People talk about it, but what are the key applications? Is it more useful in the logistics environment or the procurement environment? For me, it’s more useful in the logistics environment where you’re moving goods around, tracking, tracing, and providing visibility.
The same goes for when you talk about supply chain digitalization. Understand where you should start and what your baseline is, then try to close the gap. The third sphere, which I think is very important, is the people and the soft skills. Seventy percent of the supply chain people spend time on this. We should focus on presentation skills, communication skills, problem-solving, networking, international exposure, and emotional intelligence.
I see many clever and competent supply chain folks who don’t know how to present their ideas. If you can’t present your ideas or improvements, you won’t get buy-in, and it will be demotivating. So, in the current supply chain education, we should spend 20-30% of the time on supply chain competencies, then focus on emerging and existing technologies and their application in the supply chain context. Finally, we should develop soft skills to utilize the available technology and apply basic supply chain competency. This would be my strong advice, and this is where my focus lies.
Kieran Chandler: Muddassir, would you agree with Joannes on the importance of soft skills and core fundamentals in the supply chain industry?
Muddassir Ahmed: I agree in terms of the importance of soft skills and core fundamentals. However, we have to assess the nature of the knowledge we have. Is it accidental, or does it represent a true understanding of fundamental elements of the universe? Sometimes, people have made-up knowledge. This was a problem during the Middle Ages with scholastic studies.
Kieran Chandler: Joannes, you have been a vocal critic of the so-called basics in supply chain management. Could you explain to us why you feel that way?
Joannes Vermorel: Yes, Kieran. I think we are in a pre-scientific time in supply chain management where what people call basics are, for me, just extensive catalogues of stuff, taxonomies that are pretty much made up. And there is no fundamental justification on why it’s even a good topic.
Kieran Chandler: Could you elaborate on that, Joannes?
Joannes Vermorel: Sure, Kieran. People were producing enormous masses of knowledge, and they were saying, “This is it. If you want to be a savvy person, you have to know all of that.” But, in retrospect, we see that it was all made up. For instance, there were 50 yarkies of angels in heaven, and the various properties and political organizations, and whatever. All of it was entirely made up, and that was considered real. If you knew all those things, you were considered knowledgeable. Obviously, with a more modern perspective, it seems ludicrous.
But the question is more general. Other scientists have taught us that these taxonomies, in general, are very weak as bodies of knowledge. It’s not because you put a name on something that suddenly you know anything about it. Just because you put the name “Pokémon sourcing extra” doesn’t mean you’ve described anything. There are some basic descriptions, but I challenge the fact that there is genuinely powerful knowledge. If I compare this sort of description of taxonomies to the four equations that define electromagnetism, there is a massive amount of knowledge in those four equations that can explain literally tons of things. In contrast, you can have a gigantic taxonomy that almost explains nothing.
An example of where this happens, maybe in a supply chain context, for instance, the fact that people would say, “Oh, we have purchasers, planners, forecasters, people that are in charge of procurement, or that there is sourcing or that there is a purchasing deficit decision division or that you have SNLP.” You have lots of terms that have more content in the taxonomizer than you have knowledge about the real world that is supposed to be attached to the taxonomy.
When you investigate, you will see that most of those things are very made up. There is nothing fundamental about them. That’s why, from my perspective, the basics are extensive catalogues of stuff, taxonomies that are pretty much made up, and there is no fundamental justification on why it’s even a good topic.
Muddassir Ahmed: Joannes, I agree with you. Taxonomies in supply chain management are not always scientific, and they are not always based on fundamental knowledge. However, I think we can still use them to develop practical solutions for supply chain problems. For example, we can use taxonomies to classify items or to group suppliers.
Joannes Vermorel: I agree with you, Muddassir. Taxonomies can be useful, but my point is that we should not consider them as the basics of supply chain management. There is much more to learn, and we need to develop a scientific approach to supply chain management. For example, in one of his books, Feynman has produced a world series of books about physics. When he introduced the notion of force in physics, he spent almost an entire chapter to think of all the possible alternatives to introducing the concept of force. He said we had 20 different ways to go about that, and in the end, we decided to have a very specific way to modelize a force and the mathematical representation attached
Kieran Chandler: So, what do you think about the current state of knowledge and technology in supply chain optimization?
Joannes Vermorel: Pre-scientific. I don’t say that there is no knowledge whatsoever, I just say it’s very confused. It’s very made up, it’s very accidental. A lot of that sometimes emerges of completely, you know, compliance of completely legal reason, which is not a justification at all. And so that’s my first concern. And then when people think about technologies, because they have not even really specified what sort of games are being played, are being solved, it’s super confusing what are the auxiliary sciences. And here, again, if we go back to supply chain, the situation is completely muddied. For example, when it comes to numerical models, you will find very confused descriptions on where does the statistics stop, where does the supply chain start, where does algorithmics, and where does supply chain modelling start. And so again, that reflects, for me, that all of that is kind of reflecting a field that, as a whole, is really lacking maturity. And there’s a long journey ahead of us to just put structures to the field so that there is something worthy of being taught. Okay, and that’s one of, I would say, a super tough challenge.
Kieran Chandler: Melissa, would you agree with that? Would you say that some of these concepts are very much kind of muddled, and there’s no clear clarity in some of those very basic subjects?
Muddassir Ahmed: You’ll notice a lot of things. I tried to follow, remember most of them, but let me repeat a few things he said, and I tell you what I agree or disagree. I think I agree before that he talks about the philosophy of the physics, which is fine. But then now you just try to say what he’s trying to say is the taxonomy of physics or chemistry, which you can define as a formula, right? Or the laws of gravity or things like that. Then that kind of, let’s call it a structured approach, it does not apply to supply in knowledge. And whoever comes up with it, does it, you say it does nothing. Can I finish the argument? Okay, I’ll come back to that.
So, Joannes was going about saying that the supply chain competency, which has been defined, your capacity planning, demand planning, master production scheduling, warehouse management, you know, the technical competency, which I talked about, is all made up. And it has no scientific background to it.
Let me tell you, there are two things. First of all, for someone who worked in the industry for 16 years in supply chains as a practitioner and learned then the research in supply chain, which I come back to that, is actually very offensive, and I took offense for that. And I, therefore, 120% disagree on what you just said because most of the supply chain knowledge has been established and has been researched based on the proper research on the operations management.
So, let’s take an example of the research I did. I did research on a supply development framework. So when you do research in this, so I have developed an enhanced supply development framework. So when you talk about supply development, which is a very tiny piece of the whole sphere of the supplier relationship management, right? The supply relationship management is a very tiny portion of the procurement management.
Kieran Chandler: Welcome to our discussion. Today, we have Joannes Vermorel, founder of Lokad, a software company that specializes in supply chain optimization, and Muddassir Ahmed, MEA Regional Planning and Operations Manager at Bridgestone, running the SCMDOJO. Let’s dive into the topic of supply chain management.
Muddassir Ahmed: We can start with procurement, and then discuss supply chain management, specifically focusing on supply development. In the field, we have 500 pages of literature and 150 research articles published in grade A journals discussing the best practices available for developing a supplier strategically or reactively.
Joannes Vermorel: As a supplier of software to companies for inventory optimization and forecasting, we can’t provide good customer service without understanding our customers and what they do. Customer feedback helps us develop our product, which is an aspect of supply development.
Muddassir Ahmed: I agree 100%. However, I must say that some of the theories in supply development are based on major misconceptions and can be offensive.
Joannes Vermorel: Let me clarify my point. When I say some theories are “made up,” I’m not suggesting they don’t contain a grain of truth. Modern science requires that we take risks with our statements. The problem with certain approaches is that they cannot be disproven. For example, if I come up with a classification and categorize companies as either cooperative or innovative supply chains, my issue is that this approach is merely descriptive and cannot be disproven.
Take zoology, for instance. Until the mid-20th century, it was plagued by the same issue. The way we sliced and diced observations was very arbitrary. It doesn’t mean the approach is nonsensical, but it lacks the fundamental correctness of a modern scientific approach.
Compare this to 17th-century chemistry. If substances smelled or looked different, they were considered different. Nowadays, we look at the atomic composition to determine whether things are different. This approach provides an absolute criterion for determining differences.
The periodic table, for example, is a taxonomy that represents a fundamental truth about the elements of the universe. It’s irreducible and not subject to change, making it an accurate classification. The same cannot be said for the aforementioned supply chain classification.
Kieran Chandler: So, let’s discuss the way companies decide to organize their departments, like having a marketing department, a procurement department, a sourcing department, and a purchasing department. Is there any fundamental truth to this organization?
Joannes Vermorel: I’m not saying it’s idiotic, but don’t be fooled into thinking that this organization has any fundamental truth to it. It’s largely accidental. It’s important to know what is being practiced as a custom, but don’t confuse a custom with a grain of scientific truth. If we compare the best of the best, like the four equations of electromagnetism, we see that entire industries derive from those four equations. But if I look at supply chain, I find entire books, fields, and taxonomies, but I can barely do anything with them. You see what I mean? It’s not the same power or density of knowledge.
Muddassir Ahmed: I’m reflecting on your point of view, and I can’t 100% agree. I think it’s about how you define supply chain knowledge. You’re trying to fit it into a science, giving examples like the periodic table and physics. But supply chain management is a body of management knowledge. It’s taught in management schools, not in the same departments as chemistry or physics. Supply chain knowledge is under the management umbrella, and management is about leadership, strategic thinking, and people skills. I can’t create a periodic table for leadership or supply chain competency, because it’s an evolving body of knowledge. In the industry, 70-80% of supply chain management is about soft skills and management skills, with only 20-30% being mathematical models. That’s where I profoundly disagree with your perspective.
Kieran Chandler: So Joannes, can you talk about how scientific knowledge is applied in supply chain optimization?
Joannes Vermorel: You see if you look at chemistry, chemistry has been practiced for the last 2000 years. People say it’s all about management. It’s an art, and literally, it was all about managing large teams of people that were crafting that as an art. And it was all about the right people, the right skills so that you can do that. But something spectacular happened during the 19th century. People realized that you can have scientific methods to it. And yes, there had been corporations for centuries that were essential to have the right leadership, the right management to have the way. And then during the 19th century, the chemical revolution emerged, and they realized that it could be a science. Suddenly, we went from chemistry being something that was not very capable to something that was incredibly civilization-changing. Literally, there is not a single thing in our daily life that has not been deeply revolutionized by chemistry. We have plastics all over the place. Even, you know, so my point is, again, if you look at most fields historically when they were in their pre-scientific age, people were saying at the time it’s all a matter of leadership, it’s a matter of management. And then the only way where you can literally multiply the effectiveness, the power of action by a factor let’s say a million was through the scientific methods where suddenly you transform.
Muddassir Ahmed: So you are saying that scientific methods are very important in bringing an improvement in any field of human affairs?
Joannes Vermorel: Yes, that’s exactly what I mean. And literally, if I take you know some sort of argument, I’m choosing different topics. If we go back 150 years about transports, people would say, oh, it’s about, you know, you need to care for your horses, you need to train them, and you need skills to train horses, and you need to be gentle with the beast, and you need to do this and that and that. And then there are some people who invent the automotives, and they just, you know, eliminate the whole thing. And my point is, I’m not saying that those skills are not important. I believe that they are important in any single field of human affairs. Those sort of skills are always important. And what I’m saying is that if we want to have something an improvement of the order of magnitude of, you know, factor 10, factor 100, factor 1000, it’s not through soft skills that we achieve that. It’s not through soft skills that we manage to basically bring the distance between Europe and the United States to go from a month to a boat to just eight hours for an aircraft. It was through the precise application of scientific knowledge that we have been able to build basically super-fast craft that were also very reliable and very safe.
Kieran Chandler: So, Muddassir, can you tell us more about how Amazon is using scientific knowledge in supply chain optimization?
Muddassir Ahmed: Sure, so Amazon is applying scientific knowledge to basically rethink entirely how they should organize their warehouses. Through better leadership, you can have a better-run warehouse where you have like 20, 25 more productivity because you have a warehouse leader that is very, very good, and that exhibits excellent leadership.
Kieran Chandler: What qualities can a leader have that multiplies the productivity in your warehouse by a thousand times?
Joannes Vermorel: The answer is no, hell no. It’s not about leadership. You need something fundamentally different. The essence of scientific methods is very elusive. How can you have something that is a million times better? If there is an act of belief, even an act of hubris, something that is crazy ambitious, it’s that the scientific method says that you have the ambition to create something incredibly better. The human mind can engineer something where you’re not into making a minimal improvement in the qualities of people. People have been people for 2,000 years. Yes, you can educate, and you can bring them to be a tiny bit better. But if you want to have something that is capitalistic, where you stand on the shoulders of giants and you capitalize on that, and you have generations of minds that add up all their collective knowledge, you need something incredibly powerful. You need something very much like science, and that’s my proposition for supply chain.
Kieran Chandler: Gentlemen, I think we’re going to have to leave it there. Muddassir, if you want to make a last point and also tell us about your hopes for SCMDOJO over the coming months and your hopes regarding education.
Muddassir Ahmed: I’m still trying to understand where Joannes is coming from. I think we could agree on the Amazon example. They have used technology to provide better customer service and information, communication, and visibility. That’s definitely where the scientific mindset and technology would create value for humans. But the Amazon success is more down to the way they design their network and logistics network, which is more of a comparative advantage than anything else. We agree on that part of technology revolutionizing the supply chain. There is no debate on that. But fundamentally disregarding the soft skills, people side, and basic supply chain competency as unimportant and made-up stuff, I certainly disagree with that part. That’s my conclusion.
Kieran Chandler: Brilliant! I think one thing we can all agree on is that healthy debate pushes things forward. Thank you both for your time. If you agree or disagree, let us know in the comments below. Thanks very much for tuning in, and we’ll see you again in the next episode. Thanks for watching.