What is an MBA in Supply Chain Management and Logistics?
Logistics means a lot of different things to a lot of different people. It could relate to the commercial transportation of goods, the movement, and accommodation of military equipment and troops, or simply the detailed organization and implementation of any business-related task. While these operations have the potential to be incredibly complex in their nature, Professor Tim Pettit, National University’s Academic Program Director for the MBA in Supply Chain Management and Logistics, doesn’t like to focus too much on the word “logistics.”
According to Pettit, the MBA in Supply Chain Management and Logistics goes way beyond “getting your hands dirty, learning to make purchase orders, shipping products on a truck, and the more menial, day-to-day stuff of logistics.” Supply chain management takes this MBA specialization to a whole new level.
What Is Supply Chain Management?
According to Pettit, the field of supply chain management has developed into a complex, results-focused business strategy.“It did grow or evolve from logistics but at the MBA level, we’re really looking more at how companies work together to get the best product to market at the lowest cost,” says Pettit. “So it’s about collaboration, it’s about working together on product developments — things like new products, R&D, or modifying existing products. It’s about how to meet the customer’s needs better than your competition, faster than your competition, and throughout that whole process, getting the costs down as low as possible.”
In essence, supply chain management examines every single variable that can impact on an organization’s profitability and seeks to optimize those processes.
Supply Chain – From Dirt to Dirt
“When we say supply chain, we are thinking all the way from the raw materials,” says Pettit. “So cutting down trees, drilling for oil, taking iron ore out of the ground, all the way through the various manufacturers, distributors, wholesalers, eventually to the retailers and to the final consumer. It then goes even beyond that, in terms of the returns process, whether it’s returned for credit, returned for remanufacturing, or returned for recycling. One of the phrases we like to use is that the supply chain really is dirt to dirt.”
Dirt to dirt is an interesting way of looking at the way businesses have to handle their operations responsibly in the new global economy, where how a company treats the environment is as important to its reputation as the way it treats its customers, employees, and suppliers.
“Dig things out of the ground and eventually one day it finds its way back into a landfill,” says Pettit. “In a perfect world, it’s used, re-used, and finally, re-used again. That’s the kind of thing that we are talking about.”
The New Way of Doing Things
According to Pettit, supply chain management is a relatively new field in business. It was first adopted by business in the 1990s and didn’t really take off until the mid-2000s.
“It’s a new field, and it’s a growing field,” says Pettit.
So how would a company benefit from the careful implementation of a supply chain management strategy?
“The one example I like to highlight, that people relate to really well, is the story of how Coca-Cola solved a problem for their independent bottlers relating to sourcing aluminum,” says Pettit.
“What Coca-Cola found was all their independent bottlers were competing for aluminum. Coke as a corporation saw that was detrimental to their business. They were competing against each other, rather than helping each other. So Coke stepped in as the partner, not as the parent company, because they were independent bottlers. Coke made a mass purchase with a long-term strategic agreement with the Alcoa aluminum company that all of their independent bottlers could utilize. This lowered costs, reduced the variability in costs, and because there was no competition between their independent bottler partners, helped with long-term forecasting. These are the kind of win-win situations we are always looking for in supply chain management.”
Pettit is keen to highlight that the vast majority of work that takes place in supply chain management is between businesses. This is because business is very much like an iceberg — while the final relationship with the consumer is clearly visible above the water, there is much more going on below the surface.
“Specifically at the MBA-level, it’s all about companies working together,” says Pettit. “So mid-level management, directors, vice presidents, CEOs, and presidents of companies making strategic alignments together. Primarily, this is business-to-business. When you think of all the steps in a supply chain, only the final step involves consumers. Everything else, where the majority of this work takes place, is business-to-business.”
The core challenges that are basic to every business mean that supply chain management isn’t specific to any one kind of business.
“Supply chain management is necessary to every industry,” says Pettit. “Whether you are in auto manufacturing, or in pharmaceuticals, or high-tech, or high fashion — everybody needs to buy materials, everybody has some kind of manufacturing process that requires inventory, everybody needs to ship goods, whether it’s across town or across the globe. So, this is a great specialization, no matter what your niche is and where you are.”
Why Study for an MBA In Supply Chain Management And Logistics?
According to Pettit, the MBA was originally designed for someone who wants to move up the career path and enter mid or senior management positions. They might already be a skilled engineer, scientist, or any other professional but in order to progress, they need to demonstrate that they possess a more complete understanding of the business across all functions within the business.
“The two things in supply chain management that we like to focus on are the cross-functional nature of business and the inter-firm nature of business,” says Pettit. “First we are going to teach students about purchasing, about manufacturing, and about shipping but we are also going to spend time talking about how to make decisions about purchasing, manufacturing, deliveries, and how do your decisions impact areas like marketing, research and development, and everything else in your business.”
The second focus, says Pettit, is about going outside of your company and working with suppliers. “So it’s not, ‘I want to buy a part,’ but ‘How can you work with me as a supplier? How can I work with you on our whole product line? How can you help us expand or enhance our product line?’ We also look at working with partners like distributors. ‘How can we move into new markets? What type of new products do we want to have for each particular market?’ This is a much more strategic approach than someone might get involved with in the day-to-day operation.”
With the dual-focus approach, the MBA student learns both the functional skills of purchasing, inventory, and transportation but also how to connect those things together cross-functionally and inter-firm.
No Typical MBA Student
Because of the broad nature of supply chain management, there really isn’t a typical student attracted to the MBA specialization.
“So far, it’s been very popular with our military students,” says Pettit. “The military is very focused on logistics and supply chain management in terms of shipping parts, or beans, bombs, and bullets around the world at the right time and the right place. So they’ve been very interested.”
Job Opportunities for Veterans
According to Pettit, many military students are attracted to the MBA program towards the end of their military careers. They are getting their MBA to be competitive when they leave active service in a couple of years. They see incredible value in the program as it helps translate the many skills they have developed in the military into the commercial world and so enhances the job opportunities for veterans.
The problem of skills translation isn’t a challenge just in the transition from military to civilian life. Because the field of supply chain management is so new in the world of business, there is very little standardization in the field.
“What one company calls this, another company calls it that — so it is a little difficult to try and communicate this story,” says Pettit.
This means, in the MBA program, it doesn’t matter if your background is military or commercial, everyone starts on the same page and is ultimately part of the process of developing the language of this exciting area of business.
Pettit also sees a lot of interest in the program from entrepreneurs.
“It’s interesting because the diversity of our student body is really extreme,” says Pettit. “We’ve got students from the military — a huge organization, we’ve got students from big companies that have these huge offices where they are buying millions and millions of dollars’ worth of stuff and shipping it around the world, but the other kind of demographic are the entrepreneurs — the individual people who say ‘Hey I want to start a business or I have a small business, it’s just me and a buddy.’”
“They are looking to get an MBA because the entrepreneur has to do everything themselves,” says Pettit. “They have to do their own marketing, they have to do their own finance and budgeting, they have to develop their own strategies — that’s the MBA core.”
The MBA specialization in supply chain management helps entrepreneurs to build strategic plans around how to find and work with their suppliers, decide how much materials they need to buy and when and where to store it, and finally how to ship goods to customers, whether it’s consumers or another business.
“An entrepreneur’s skill set has to be so broad,” says Pettit. “So I often say the MBA with the specialization in supply chain management is a great way to just get enough to make you ‘dangerous’ in each of those fields, rather than taking a specific full-focused master’s degree in finance, for instance. An entrepreneur has to know everything.”
Pettit himself has a solid military background, having served 24 years in the United States Air Force where he was responsible for shipping aircraft parts around the world and managing overseas warehouses.
“I have had time doing this for real on the government side,” says Pettit. “I ended my military career by teaching at the Air Force graduate school (this kind of MBA program in supply chain management) and then the Air Force Academy in Colorado Springs before joining National University to set up the MBA in Supply Chain Management and Logistics.
During his time in the academic world, Pettit also honed his skills doing serious research and consultancy for major corporations, including Walmart, FedEx, and Dow Chemicals.
In one project he worked on, he essentially saved two or three steps for a warehouse worker to complete a specific task. At first glance, this would appear to be a fairly insignificant achievement but when rolled out over thousands of workers, across hundreds of warehouses, it saved the company millions of dollars in man-hours.
“Every dollar saved is potentially a dollar of profit for an organization before taxes,” says Pettit. “This is why these big organizations pay big bucks for smart supply chain management professionals.”
The Career Outlook for MBA Students Specializing in Supply Chain Management and Logistics
According to Pettit, the career outlook for MBA students with a specialization in supply chain management and logistics is incredible.
“When we started this program three years ago, we looked at employment statistics and one of the key things that really stood out to me was for every graduate with a supply chain specialization in California, there were 12 new jobs open,” says Pettit. “Of course, I had to ask our analyst what that means, and they said for comparison, in journalism for every 10 graduates, there is one job. So in supply chain management, the situation is completely opposite.”
This shortage of skilled and qualified professionals is reflected in the earning potential of someone with an MBA in supply chain management and logistics.
“We show some salary data in class before their capstones,” says Pettit. “These supply chain managers are making anywhere between $100,000 and $150,000 per year. In some cases, they are earning more than $250,000.”
It’s a salary figure that surprises some students. “We talk about why in the world would an executive make more than $250,000 a year and then we go over some of the examples of bright ideas that save millions of dollars. That’s a pretty good return on investment. To hire the right person, that smart individual with those disruptive ideas — that’s what is really in demand.”
What Types of Businesses Are Hiring All These Graduates?
“Here in San Diego we have some pretty major corporations,” says Pettit. “But just to give you an idea of who is hiring our graduates: there is a big shipbuilder, which probably has 5,000 employees total, a pretty good-sized company. I recently visited their supply chain department and it is expanding from 50 to 70 people. So while it’s a new field, it’s definitely a growing field.”
The vast majority of these new employees have business degrees — for which there is already a ready supply of graduates — but the top jobs will go to those with a specialization.
“Get a specialization because everyone’s got an MBA,” says Pettit. “You want to be different.”
Disruptive Ideas in Supply Chain Management
Due to the speed at which business operates in the digital age, Pettit admits it can be problematic to teach disruptive business practices.
“When we were developing our program, I asked my adjunct professors ‘What would you teach two years from now?’” says Pettit. “One guy hollered back at me and said ‘If you had asked me two years ago what I would do on the job today, I would have been totally wrong!’”
“Our field is changing so much with e-commerce, omnichannel distribution, blockchain technologies, robotics, autonomous vehicles, 3D printers — those things are revolutionizing the way we manufacture, the way we store inventory, the way we ship products around the world, and the whole concept of globalization. You cannot learn this stuff solely from a book that was maybe published a couple of years ago — but was probably written four or five years ago.
National University gets around this problem by building deep-rooted relationships with industry. Many of the adjunct professors delivering the course are still very much at the forefront of the business community.
“I’m talking about executives at FedEx and Amazon,” says Pettit. “When the students come to class at night, they are going to hear discussions about what is in the textbook, the theory, the basics but they are also going to hear about what was said in the FedEx boardroom today, and what Amazon’s plans for the future are. They are not going to share any proprietary information or trade secrets but what they do talk about gives National University a real competitive advantage.”
A Disruptive Force in Education
National University is no stranger to the world of disruptive technology. The university has been disrupting the world of education, re-shaping the way adult students are able to access education and pioneering online degrees and MBA programs since its inception in 1971.
The University’s unique, rolling 4-week class format, which allows students to focus on one class at a time, along with year-round enrollment and no extended summer and winter holiday periods, mean an accelerated MBA program at National could be opening new career opportunities for you in as little as 14 months.
Alongside the MBA in Supply Chain Management and Logistics, students at National University can also choose to specialize in a diverse range of fields to enhance their chosen career path. These include Accounting Professional Skills, Financial Management, Human Resource Management, Integrated Marketing Communication, International Business, Management Accounting, Marketing, Mobile Marketing, and Social Media, and Organizational Leadership.
For more information or to register your interest in joining National University’s Online MBA program, please visit the program page on our website.