As the economy begins to improve, and activity in the nation's warehouses and distribution centers picks up, managers are struggling to juggle multiple projects and meet customers' ever-changing requirements, Material Handling Management's recent reader survey reveals. The material handling manager of the 21st century will need to know how to manage people and technology to advance their careers during the next 5 to 10 years.

Skills Needed to Succeed
The five main knowledge and skill areas MHM survey respondents say they will need to move their careers forward are people management, logistics, project management, information technology and training. Sometimes, it is difficult to know where to start when considering career advancement, whether it is learning a new skill or making the decision to go back to school.

Matthew C. Wojewuczki, vice president operations, Vera Bradley (Fort Wayne, Ind.), a manufacturer of handbags, luggage, accessories and special collections, has a few pointers to help people move higher in the material-handling profession:

  1. Improve awareness and understanding of technology.
  2. Be open to change and willing to try new technology.
  3. Develop a better appreciation for customer service and the importance of supply chain management to a business.

MHM's survey shows more than two-thirds of respondents recognize that establishing a culture of continuous improvement will have a high impact on their future success as materialhandling professionals.

Wojewuczki says tomorrow's managers need to understand how to manage and communicate with diverse teams of people many of whom may work for other partner, supplier, and customer companies. An understanding of continuous improvement practices is very important, with a particular emphasis on lean logistics, he adds.

"People are our most important asset," says David Baiocchi, president, J.M. Equipment Co.'s Material Handling Division (Modesto, Calif.), a material-handling and farm-equipment dealer. "The proper management and motivation of your staff can easily propel your organization beyond its competitors. Conversely, mishandling of your people can damage your image, ruin your customer relationships, and bankrupt your bottom line. As a whole, our workforce is much more educated, communicative, and globally aware than they were just 15 years ago. Their needs have changed, and as employers it's our job to create opportunities that fulfill their desires to individually innovate, corporately contribute, and matriculate within the organization both for their benefit and for ours."

However, he adds, there is still societal disparity in the workforce between tech-savvy employees and those who are not. The knowledge gap makes it difficult to craft and manage opportunities for staff that keep them interested, involved, engaged, and motivated. "Those organizations that are equal to the challenge will be the market leaders in the next 10 years."

Project management and juggling multiple projects rank high in the survey as challenges for material handling managers in the coming years. David N. Koenck, president, Material Handling & Packaging Consultants, LLC, offers an eloquent argument for making project management a core skill. "While we all must master the technology, we as individuals must use all of our acquired skills in people and project management to train, direct, and motivate our employees to provide the best and most productive products and services to our customers. Today's marketplace requires us all to be nimble at reacting to our customers needs. Specific project management will bring the relationship between our customers and us closer." In fact, with widespread corporate downsizing, many larger firms have eliminated in-house project management in favor of hiring a trusted outside firm to meet their goals and needs.

Project management is part-and-parcel of the total customer care genre taking hold in this industry, Baiocchi adds. "The idea is no longer to manage individual transactions, but rather to manage 'customer needs'. Customerrelationship management (CRM) software, team selling, managed billing, and fleet management are all components of this expanded offering. The key to proper project or customer-needs management however is having the right people, with the right training, in the right place at the right time. People are the building blocks of effective project management," he emphasizes.

Focus on Customer
Today's customers know more and expect more. Rapidly changing technology is one factor driving increased customer demands, says Donald E. Kuzma, president, Trommer & Associates Inc. (Akron, Ohio), a facility-planning services company. For example, he says, "FedEx has done a wonderful job training individuals and the rest of the world that next-day is about the only type of delivery that is acceptable. It has serviced its customers well. Now, when we design a warehouse, it's a given if we get an order by cutoff, it needs to be shipped the sameday." Additionally, he says, as companies try to lower their inventories, they want better accuracy, just-in-time delivery, and next-day delivery. "All of these demands are filtering back to distribution centers."

Koenck adds, "We all must concentrate on our customers' needs and anticipate changing needs. We must also look closely at our competition, learn their strategies, and make our strategy the preferred customer choice. Those that are proactive in these areas will be more successful and will move to higher levels."

Technology will have a larger role
The next generation of material handling managers will need to be more adept at understanding the benefits of and implementing information technology. "Material handling technology is improving constantly," says Rick Towner, vice president, sales, Reddline Systems Inc., Plano, Texas. His company designs and sells wireless and voice-activated order management systems.

"Today's high performance MH solutions are an intricate blend of mechanical design, system software, and refined business processes. However, the system is only optimized when managed by immediate views of critical data. Reports tell you what happened yesterday, data views tell you what's happening right now," he says. "Corrective action when system diagnostics identifies a problem, and course corrections when SKU/order flows are different from expected, will always produce more at the end of the day."

The big technology trend now is radio-frequency identification (RFID). MHM'survey respondents are beginning to get onboard, over one third said they plan to invest in RFID technology in the next two years.

Currently, Dan Charmy, director or material handling and packaging, DRI Recruiters Inc. (Cleveland), a recruiting firm for material handling equipment manufacturers, notes that many companies print-and-stick RFID tags on shipments sent to Wal-Mart and the U.S. Department of Defense, but they don't actually use the technology themselves. "Expect this trend to change in the next 5, especially 10 years. RFID technology is being refined at a quick pace."

As technology in general matures, says Vera Bradley's Wojewuczki, software becomes more affordable and it is reaching down into smaller companies. "What used to take hundreds of people to pick, pack and ship can now be done with half the people in half the time." He says the increased use of software may displace some employees and change the jobs of others.

Education advances careers
People in the MH industry have their eyes on higher rungs of the corporate ladder. After holding onto their present job, approximately one third hope to move to a higher level in logistics or supply-chain management, or up the ladder in material-handling management. Getting more education is one way to advance a career.

It can also lead to a higher salary.

When asked about their current salary, one quarter of respondents report annual wages of less than $50,000, one quarter said they earn between $50,000 and $70,000, and the remaining 50% earn more than $70,000 per year. Of course salary levels vary significantly by an individual's years of experience, skills, number of people supervised, and the size and location of the company.

A few colleges and universities such as Georgia Tech and Ohio University offer degrees in material handling. Charmy says Ohio University's program focuses on automatic identification, bar coding, data collection, warehouse and distribution centers. Wright State University has a new one-year Master of Science program in logistics and supply-chain management. "Michigan State and Clemsen University do a good job on the packaging side, and Georgia Tech has good career development and job placement ratio," he reports.

Kuzma says many pure warehouse managers with college degrees do not have material-handling backgrounds. "This is the reason for the high rate of certification in the industry. People with non-business majors or no prior education or experience in MH are getting certification."

A solid majority of the MHM respondents, 63%, are certified in some area of material handling. A bachelor degree is held by 38% of respondents, 14% have graduate degrees, 15% have associate degrees, and the remainder have graduated from high school.

Final Thought
Technology is rapidly changing material handling. Tomorrow's managers will need new knowledge and skills to be able to perform at higher levels. They will need to anticipate and respond quickly to changing customer demands. Training and motivating people to 'execute' will remain a top priority for all companies. More sophisticated software will let managers better maximize their business processes, and work with larger, more diverse groups.

In the end, Wojewuczki believes businesses are still run and managed by people. "As a manager, you need to be able to motivate and manage the organization. Understanding the nuances of change management and organizational behavior are key elements in establishing companies that can sustain growth." MHM

Technology is rapidly changing material handling. Tomorrow's managers will need new knowledge and skills to be able to perform at higher levels. They will need to anticipate and respond quickly to changing customer demands. Training and motivating people to 'execute' will remain a top priority for all companies. More sophisticated software will let managers better maximize their business processes, and work with larger, more diverse groups.

In the end, Wojewuczki believes businesses are still run and managed by people. "As a manager, you need to be able to motivate and manage the organization. Understanding the nuances of change management and organizational behavior are key elements in establishing companies that can sustain growth."

Knowledge and Skills Needed to Succeed in the Next 10 Years
People management 70%
Logistics 67%
Training 61%
Information technology 61%
Project management 61%
Purchasing 57%
Supply chain management 55%
Finance 42%
Engineering 29%
Sales 27%
Marketing 25%
Source: Material Handling Management Reader Survey, December 2005


Top Challenges of Material Handling Professionals
High Impact
Juggling multiple projects 75%
Meeting changing customer requirements 74%
Managing people 71%
Establishing a culture of continuous improvement 66%
Implementation of best practices 65%
Creating a safe working environment 61%
Successful implementation of new technologies 59%
Making better use of existing technologies 56%
Finding sufficient manpower to meet customer demand 53%
Getting senior management understanding of strategic role of material handling 50%
Making the most of scarce resources 45%
Establishing effective security practices 35%
Working with Third-party logistics (3PL) partners 25%
Source: Material Handling Management Reader Survey, December 2005


Climbing the Rungs: Professional Goals for the Next 10 Years
Keep present job 55%
Move to higher-level in logistics management 32%
Get an advanced degree 31%
Move to higher level in supply chain management 30%
Move into general management 27%
Move up the ladder in material handling 21%
Source: Material Handling Management Reader Survey, December 2005


Equipment is Tops on Companies' 'To Buy' Lists

Business is getting better. The U.S. Commerce Department reported that business investment in new plants and equipment grew at a solid 13% annual rate in the third quarter, after a 12.5% secondquarter rate. A recent report from the Freedonia Group, a Cleveland-based industrial research firm, (see Material Handling Equipment and Systems Demand to Reach $20.4 Billion in 2008, page 1) predicts demand for material handling equipment to increase 4.3% per year through 2008.

MHM's survey respondents say they are ready to buy. During the next two years, almost half say they will purchase new conveyors or lift trucks; more than one third will buy warehouse management systems and implement automated material handling systems in distribution centers.

The economic situation is "absolutely" changing, says Dan Charmy, director of material handling and packaging, DRI Recruiters Inc. (Cleveland), a recruiting firm for material handling equipment manufacturers. "Companies say business is improving. Budgets are being approved. Companies are coming up with money for capital equipment. It is the best it's been since Sept. 11."

Even though the economy is coming back, MHM 's survey respondents are cautious. When asked to prioritize their objectives for the next five years, their number one goal is to keep their current job.

"The material handling industry has experience significant downsizes and consolidation especially just prior to and immediately following Sept. 11," says David N. Koenck, president, Material Handling & Packaging Consultants, LLC (Bloomington, Minn.) He says many employees have been laid-off or know people who have lost their jobs. "Industry recovery has been slow and spotty."

David Baiocchi, president, J.M. Equipment Co.'s Material Handling Division (Modesto, Calif.) a material-handling and farm-equipment dealer, offers another reason why the material handling industry has suffered: The Internet.

"Some industries like travel, insurance and financial services have undergone a complete restructuring of their business plans in order not to be eliminated through technology," he says. "This troubles people in all business sectors and makes them question if their job is next on the chopping block.

"Overall however, the threat of decreasing employment in our business is unfounded. The facts show that it's getting harder and harder to find people that want to work in this industry. Service technicians still have to work on machinery in inclement weather and other less than comfortable environments," says Baiocchi.

The bottom line, he says, at least on the distribution level, "is there are plenty of opportunities for employment. The need for this business was here before the dot-com group changed business for good, and will still be here long after the techies have figured out that not everyone can purchase everything online."


Opening the Purse Strings: Two-Year Planned Investments
Invest in hardware (conveyors or lift trucks) 48%
Implement RFID (radio frequency identification) project 38%
Invest in software (warehouse management system) 37%
Implement automated material handling system 34%
Establish relationships with 3PL 23%
Implement automated material handling system in manufacturing plant 16%
Source: Material Handling Management Reader Survey, December 2005