Why Supply Chain Teams keep burning out

The principles of leadership don't change no matter what times we are living in

Besides the flood of AI articles, we keep hearing a lot about burnout in different areas of supply chains (all sub-functions and from the most junior roles to the top roles, from SMEs to MNCs - the whole yard) and the reasons cited don’t really change much, but they repeat themselves over the last 20 years (reports only stem back to last ~10 years, but the topic was already known in the field much earlier).

The only difference is the frequency of these events, the velocity of how fast people burn out and how often (maybe also to what extent, but I cannot delve into that, that’s for your psychology journals). No wonder, our economic circumstances keep changing at a rate and pace which is humanely hard to keep up with.

I came across another opinion earlier this week which described supply chains as “constant firefighting”, meaning that that’s how supply chains are known, that’s the hallmark of supply chains and how they work - as if this was a given, or as if it became the baseline of how supply chains operate.

I admit that in my whole course of career this is exactly what I was working against and I still do. I firmly believe that supply chains are not and should not become a firefighting station.

If the leadership is doing the job well, it will not become constant firefighting.

Granted, there will always be times, which are hectic, but not every day and not over extended periods of time and people know this in your team.

I have proof of this as a supply chain leader myself (both as interim leader and as global director) and from other peers successfully navigating supply chain leadership.

Before we jump to the proof, let’s look back at the main burnout drivers, why these present themselves in supply chains first and what solutions most companies turn to for resolution and if these work.

The top 5 most cited burnout drivers or factors in supply chain teams and leaders remain the followings:

1. conflicting priorities or total lack of priorities (everything is priority No.1.)

2. unsustainable workloads (expectations to work well beyond paid time every day)

3. chronic crisis management (firefighting)

4. lack of meaningful work (also worded as lack of variety / too specialised roles)

5. lack of career paths and growth opportunities

(resources checked, but not exclusively used: Managing Burnout during a Supply Chain Crises from Gartner May 2023, Predictors of burnout among supply chain management professionals from International Journal of Value Chain Management January 2023)

Adding at the back of this topic that these factors are also in the top list of why people resign from supply chain positions or why they keep changing companies and roles.

I deliberately did not mention drivers which are similar for other functions as well or can be generic for the whole company as those are factors which only the board and the top management can resolve together. A supply chain leader alone cannot solve these (such factors can be, as example: poor or downright toxic company culture as a whole). If your functional area is the only one that’s toxic (highly unlikely due to the rotten apple in a basket effect, but in rare cases it can happen), then it is fully yours to deal with and solve!

These factors usually present themselves first in supply chains and commercial areas. Simply because these two areas are the closest to daily business partners (customer, supplier, authorities etc.) and external collaborations, where the feedback related to the shortcomings of the business are instant or as the minimum, the feedback loop is very short (id Est: you mess up, you find out very fast).

Therefore the pressure to perform right first time every time is the greatest in these areas of the business on a daily basis. I’m not saying the others don’t feel it or days cannot get heated for them. On the contrary, the intensity of the pressure is equal, but how fast it arrives and how often is not).

Which is how it should be. We love working in supply chain exactly for these, as leaders.

But the key point remains that teams must have adequate recovery time between these “hits” to allow them to not burn out.

What are the most basic solutions many companies think of right out of the bat to solve these problems (again, only the top 5 - these are based on my own observations):

• Hoarding automation and adding further tech to the existing tech-stack including AI (“we can automate the problem out” mentality): this is based on a perception that the key reason for the burnout is the remaining manual processes

• Offering work flexibility options or additional benefits (e.g. hybrid work, more annual leave days, recognition programmes): the perception here is that the key reason for the burnout is the lack of benefits

• Further process optimisations (e.g. changing existing technology, adding another high-pressure project on top of the existing many): the perception here is that the key reason for the burnout is lack of efficiency on a daily basis

• Increasing area of responsibility for the individual on paper: this is based on a percepcion that the key reason for the burnout is the lack of personal/professional control and/or authority

• Sending the person on a burnout leave (in most countries, when diagnosed, it is mandatory by now): here the perception is that due to the work overload, if adequate rest is provided, they will bounce back and perform again as before the burnout

Now, I’m not saying these cannot help. Some of them may help in certain specific cases.

But the reality shows that most of these actions are sadly no solutions to the problem and they either increase the issue or they further perpetuate it.

In my experience for these five options companies rely on too often, the below are true:

• Manual work and processes are never the problem, as long as they are in the correct department (I’ve seen it otherwise too, not recommended). Unfortunately, digitalisation doesn’t solve process issues in most cases, as long as the process is not corrected itself. So only add tech to the existing stack if you are willing to invest in correcting or realigning the impacted processes too. Otherwise the people end up with more work and increased sense of insecurity around the systems you added.

• Part of these can work, if the person is truly asked about what they need and the offered solutions match the needs of the person. Flex/hybrid work where possible is a great solution (exceptions: Warehouse and transport employees etc.). On the other hand, more annual leave when they simply cannot take it, or recognition programmes which mean nothing outside of the company itself, or even worse, if they project the sense of “meaningless or false recognition” to keep someone “happy” will result in further deterioration of the individual or them leaving.

• This one is likely the highest on my priority list when I look at these means of what a company applied to tackle burnout. Requiring further process optimisation when you have one or more people in your team close to or already burnt out will give you nothing. Unfortunately. If anything (unless you supplement your own workforce with good enough external consultants, which is very expensive and rarely approved), these programmes lead to further burnouts before they can be completed resulting in loss of team members and loss of money.

• This is the other culprit, where I usually find damage that is irreversible. A person being close to burnout will become actively burnt out if their responsibilities are increased. Simply because increasing responsibilities is not equal to increasing the sense of control over the outcome of their work. This is also unfortunately a false reaction in case of burnouts.

• Now this one can work and it is the right thing to do, especially in active burnout cases. However, not solving the problems and the real reasons for what led to the burnout, will leave the person burnt out again after returning within a relatively short period of time. Even if the person was phased / eased back into the role.

You may want to jump to conclusions now and get to work on these options to correctly execute them.

However, if you are a leader, before you do that, you have to self-reflect and brutally honestly.

If you look at the original set of top 5 factors, actually all of them come from failure of leadership (not necessarily the lack of capabilities of the supply chain leader, but further issues in the leadership team).

If someone has even one, or more people who are close to or are in active burnout in their teams, they have to re-evaluate how they lead before they apply any other means or tools to remedy the situation.

The below is a list that I recommend every supply chain leader to do, even if they don’t have a crisis or burnout in their teams.

The bare minimum to reflect on:

1. Your alignment and effectiveness with the rest of the leadership team. Focus on collaboration, honest feedback to each other and if tough discussions can be carried out without repercussions between the leadership members.

2. Overall clarity of responsibilities within the business between the different functional leaders. Are there gaps or white areas where conflicts regularly arise (who’s job is this kind of questions with no answer)? Are there severe misunderstandings on how incentives and deliverables align over a fiscal year and beyond?

3. Your overall capabilities and knowledge of the function you lead. Here obviously we aren’t looking for perfection (nobody is perfect and nobody knows everything all the time), but knowing your strengths and weaknesses as you would have to recruit your team accordingly to ensure they compliment your strengths and you lead them also in accordance of what they deliver.

4. Your applied management methods and if these are adequate to the team you lead. Are you fully aware of the full capabilities and strengths/weaknesses of every single team members of yours? Do you truly know what they need and want as professionals? Do you think they trust you or not? Can you truly diversify your leadership approach for each person or not yet? Are you fully aware of where they think they waste the most time and when they are the most frustrated (or the opposite: when they are in flow, when they go home/come in with a relaxed face)?

5. Your setup of the functional organisational structure, processes, systems. Are these adequate to what the business needs vs what your team can deliver as professionals? Where are the gaps?

6. Your own status of burnout and if you, as a professional, are heard by your own boss (or bosses if you work in a matrix organisation). Are your responsibilities and authority in line with each other or are they thwarted? If yes, how and by whom and why? Can it be changed? If yes, how and how soon? If not, why not and what are the options you yourself can utilise? Do you see eye-to-eye with your boss and do you have respect for each other? If yes / If not, what to do etc.

Most of these questions leaders answer normally at the start of their leadership and then repeat it regularly (minimum once per year, before you even start evaluating your employees). In case of a critical or hectic situation, as often as required to enable you to lead.

The answers to all the above questions will inform you at the same time about which one of the earlier means/tools you can utilise in the burnout situation and which ones should you leave out.

If you noticed, all these points are standard supply chain management techniques (from stakeholder mapping, to negotiation techniques, organisational structure setup and structural development, PPS alignment, etc.).

Examples for how answering these questions can help you sort out what you truly have to do to solve the problem at hand:

1. Many of the perceived need for additional technology/automation or further process optimisation should be parked first and the gaps between the leadership team members need to be repaired, as those are the root causes of the process issues, not the systems or the processes themselves. Same is true for responsibility and capability gaps. Example: cross-functional operative planning issues, S&OP issues (S&OP = Sales & Operations Planning), Service level issues, cost versus service issues.

2. The dilemma related to increasing or decreasing area of responsibility to solve issues, especially burnout, is much easier to answer if you already answered question number 3, 4 and 5. If you did these mappings and you are up to date regarding your employees, it gives you the answer as to whether you are under/over utilising their competencies over a given period….and if you need more FTEs or less (Full Time Equivalent, full time employed person). If you assumed your role and you haven’t even got to mapping these at any point in time, it is a high predictor that you will face multiple burnouts including yourself as a leader. Make time for it. If it is not understood by your boss/peers, you are likely in the wrong place. This you can do within 6-10 days and add notes to it over the first 6-12 months till you complete the first fiscal year with the company. From there, the frequency of review can decrease down to quarterly then to bi-annually then annually, unless your industry is the one going haywire for external reasons. Then the frequency remains where you find it beneficial for yourself.

3. If you haven’t mapped question 5 above, I’d advise to not start any process optimisation (except if a 100% clear issue comes up and you can afford to do it as you aren’t preoccupied with burnt out employees). Similarly, if someone is new in a leadership position, it is a false expectation to “deliver quick wins early” in the role (many times in the first 90-120 days in the job). Again, unless there is a crystal clear case inherited by the leader already planned, you should not start massive changes until you are clear on the full company setup (which rarely happens before month 9-12). One can inherit problems which need attention, but don’t let these prevent you from focusing on what you have to do as a leader.

4. Depending on how much authority you have in your leadership role, I’d not even touch the HR-related point (flexibility, recognition, annual leave changes) before you are sure what you can/cannot decide on alone (with as little influence or interjection from others as possible). If you are already there and you mapped questions 3-4-5, you should have zero problem knowing where the problems are and which solution can help. As all of these are extra cost for a company, they are rarely approved for supply chains, but you have to push for nevertheless if you think that’s the right solution. Similarly, the tricky point of such solutions is always the equity between teams. If you offer it to one person or a few (the burnt out ones), then the others will feel discriminated against. So I’d always go with an all-team approach and solution with flexibility on the members’ end on which options they choose. I’d advise to have HR on your side on this one as they can also help you (if you are new) to oversee historical benefit changes for individuals, which can help you to determine what makes sense.

5. For the last burnout factor, lack of professional growth and development/career path you can only do a lot if you are allowed to re-organise your teams (mostly large companies allow these, SME companies only reorganise in case of dire need as it is so expensive). You may have guessed already, only after answering questions 3-4-5, otherwise hard to know what they need. If you cannot reorganise, then your only option is to fairly, honestly and respectfully share with the person in need for a change (either burnt out or not) what their options may be. If these aren’t good enough at that point in time, best is to remain in good contact with the person and welcome them back at a later time in their career.

I know doing these are a lot for every leader. I myself admit that I don’t even bat an eyelid when I learn that I can only do this reflection exercise over the weekends in an interim leadership role (it is normal).

However, if we always throw tactical tools at strategic problems, we will end up with the same problem (the leader may change in the meantime, but the problem won’t).

Most of those leaders who are successful in supply chain management actively practice the above self-reflection (with even more questions, tailored to their own situation/circumstances) and even anticipate issues based on these reflections.

If you aren’t or if you only plan on stepping into leadership roles, I can only say: please find either a mentor or external help to support you navigating stormy waters and getting your mappings/structure and people management methods in place in good time, so you don’t end up perpetuating crisis situations.

Nobody comes with a developed set of seasoned leadership tools. We either learn on our own, making our own mistakes and potentially getting badly hurt as leaders as well, or we find those who can help us at the start then pay it forward later.

Now the cherry on top, the proof!

These will also answer some of those key points mentioned at the start of the burnout factors.

Large MNC (Multi National Company) No.1, global presence but specific site issue only:

Sourcing & Procurement team of 3 (1 head, 2 buyers). Overseeing a flow of goods of 45-120 million USD per month.

One buyer is fully new, young. The other is seasoned, but before retirement.

Head burnt out and on long-term sick leave. The new, young one is close to being burnt out due to all 5 factors (some perceived, some real).

Factors which were real: constant overload, no prioritisation, firefighting

Factors which were perceived (still real for the person!!): lack of career progression options, lack of meaningful work

Complication / crisis inducing issue beyond the burnout of the head of department: the largest supplier of the site is threatening to decrease service levels due to this site causing them extra cost and revenue losses, which would result in a 4-6 million USD extra cost for the site in held inventory (at the very least)

There was 1 extra FTE given to help the situation with specialist work on specific processes (fix-term, 9 months).

Going in as external support (not official replacement of the head), max 6 months with 2 days per week on site.

Task at hand:

1. solve the supplier crisis and avert the extra cost

2. support the site supply chain leader while the head of department is recovering (all reports, all ad hoc issues that were with the head before)

3. document missing process paperwork, clarify roles & responsibilities between the buyers and the additional person

4. support the 2 buyers with process knowledge improvement

5. limit the department’s overload and exposure to internal issues to avoid the burnout of the young buyer

6. find solutions to the key issues the department’s overload is coming from

Solutions used:

1. full self-reflection mapping completed and with that the key issues identified and internal solutions were found

2. crisis was averted and full monetary exposure was zeroed out for the coming 9-12 months

3. the reports which should have been with the head of dept were done each month in time (as required only!)

4. missing process documentation was completed (including documenting the list of processes that should be in place)

5. weekly/monthly work structure was set up and internal/external exposure to excess work was strictly limited allowing catch-up on critical tasks as well, general departmental and interdepartmental prioritisations were put in place, responsibilities were clarified where it was critically missing

6. the burnout of the young buyer was temporarily averted as well by providing her with a personal work structure and prioritisation method

None of these included tech stack increase, process optimisations but focusing on delivering on the standard departmental responsibilities. The new head of department arrived while the predecessor sadly had to go as she could not recover well enough from burnout. The new head successfully took over the remaining tasks and did their own mapping with me to get off to a great start. The new head is doing well in the role and is a respected part of the management team.

Large pharma MNC 2, global presence, global programme, this was one of the projects as part of the programme:

Commercial supply chain team in APAC (~10+2 leadership people including the head of supply chain).

Original project aim is to outsource the existing WH and logistics operations to a selected partner. Project target and opportunity calculations were done by counterparts from HQ on site with the local team.

Aim was to decrease the number of FTEs by 10 people altogether at the end of the transition.

Project manager was appointed and sent there for the project (also as a career opportunity).

Selection of external partner was done by the local project team with almost zero transparency to our HQ team as they were sure they can manage alone (they got the trust at that time).

The process transfer and downsizing of the local department started.

Around month 9 into the project, the crisis hit: the external partner is not able to execute the processes as agreed and expected and the company was losing customers/sales (cannot disclose amounts, but it was substantial for the local business, let alone considering long-term implications) while the Project Manager got close to burnout.

Stepped in as extra HQ support (no take over).

Task at hand:

1. check if the external partner is capable of executing the agreed tasks

2. figure out why they cannot deliver

3. get the project back on track while depressurising the Project Manager

4. figure out further options if it turns out that the selected partner is not the right one

Solutions used (note that it was in context of a project):

1. audited and re-checked the capabilities and leadership of the external partner, where we found issues with the local leadership’s attitude - this got quickly corrected with our global counterparts of the supplier’s leadership (2 levels above)

2. after this the relationship with the supplier was gradually repaired step-by-step (agreement on mutual respect and transparency about shortcomings and solutions on both sides)

3. we did the self-reflection mapping with the head of supply chain to ensure we cover all aspects for the project re-evaluation

4. all gaps were found, including process documentation gaps and calculation issues of the original plans (not the calculation itself, but there were missing processes which weren’t taken into consideration), we corrected these and re-evaluated the targets, recalibrated back with 2 FTEs remaining on site for the time being out of the original 10 to support the transition longer

5. customer deliveries were brought back on track by the repaired collaboration and updated new process documentations

6. the leaking project costs were also stopped

7. +1 we solved 2 other issues along the way which became process improvement in the end, but these weren’t planned but a nice extra

The project manager was able to decompress during the time and finish the project till the end. The project timelines weren’t fully recovered, but the business was and so was the relationship with the supplier and the leaking project costs.

None of these involved any of the solutions that companies generally throw at burnout and crisis situations. Again, we went back to basics and focused on delivering on the core promises of supply chain management.

These are only 2 proofs out of the many I either did myself or witnessed from successful supply chain leaders during my career.

Conclusion:

Supply chains are not there to become firefighters and burnout can be prevented by adequate leadership, regardless of how volatile the business environment gets.

The keys are what most successful leaders say: focus on what matters and prioritise accordingly. Reflect and re-evaluate as needed to enable you to lead.

I’d add one more point:

Do not allow the circumstances to regularly or constantly pull you down into execution as a leader. Your job is to lead and it is plenty to do if you want to do it well and the best way to prevent crisis from happening is you leading and not doing. I see this too often happening now. Leaders execute instead of being given the opportunity to lead. Step up and make sure you lead and you are respected enough to be given the opportunity. Otherwise it is just a puppet show.