Why is there a succession planning problem in transport and logistics?

Gov Kandola, our Transport & Logistics Lead, offers some context behind – and solutions to – the issues his sectors face in recruiting the next generation of talent.

For many leaders in the transport and logistics space, one topic in particular has been a frequent topic of conversation – not to mention a source of worry. I don’t mean supply chain pressures or even, necessarily, the difficulty of hiring the right people, though the latter point is especially relevant to what I’m talking about: succession planning. I wanted to examine why this is so important, and what organisations can do to ensure they have a strategy in place. First, however, let’s look at the current state of play in my sectors, and delve into what succession planning really entails.

For transport and logistics, succession planning is a problem long in the making

This might be the first time I’m dedicating an entire blog post to the topic, but it’s fair to say that succession planning has been on my radar for some time now. It would be hard to ignore it, when the U.S. Bureau of Labor Statistics reports that the average age of workers in transportation and warehousing is 43.1, with 45% over the age of 45. What happens when experienced staff leave or retire?

Succession planning has come up in a couple of articles I’ve posted before, but I feel like I’ve been speaking about the subject with lots of companies in my network lately. More than a few seem to share my view that a dearth of talent at VP-level and below is a significant issue for transport and logistics organisations. For the latter particularly, a demand for logistics candidates amid the pandemic-era boom in e-commerce led to many organisations growing quickly and bringing in more staff. Of course, however, we all know what came next. Supply chain pressures, labour strikes, and geopolitical tensions – all playing out amid and fuelled by the cost of living crisis – contributed to many businesses in the space scaling back their efforts. Newcomers to these already complex industries were left with a maelstrom of new challenges to deal with, which led to many seeking work in other fields after 18-24 months and created a candidate deficit.

Concurrently, we saw numerous senior leaders leaving transport and logistics for advisory roles or taking early retirement, which further compounded recruitment difficulties. While more than a few businesses have been able to make like-for-like hires at executive level, this is simply not possible for roles a couple of rungs down the ladder.

What to do?

The need for succession planning – and an apparent lack of suitable talent to address it – is a serious problem for the industries I work in. It’s hampering growth, and unless something changes, the situation will continue. Strong candidates at C-1 and below are typically too busy navigating the challenges of the market to engage with recruiters or browse LinkedIn for new opportunities, and there are not enough others coming through in the meantime for organisations to be able to make meaningful talent strategies that will see them into the future.

Fortunately, I’ve seen and heard enough over the past few years to be able to offer companies struggling with this issue some advice. Venari Partners has helped numerous transport and logistics organisations with market mapping and talent insights – and I hope we might be able to do the same for your business if you are in need of assistance.

Short- and long-term views

An early step in considering succession planning is to target both existing gaps in knowledge and leadership, as well as those that will open after senior leaders depart. Which are the crucial areas to address immediately? And what might become urgent a little further down the line? Talent mapping will be essential to remedy both concerns. For me, the need for commercial mapping solutions is of particular interest. Put simply: if you’re not selling, you’re not growing.

A recent mapping project we worked on serves as a useful case study. The client, an American transportation company, sought a sales-focused commercial succession plan for directors across its air freight, intermodal, and temperature-controlled divisions. Concentrating on talent in the U.S., Venari Partners was able to advise on suitable candidates for the company, leaving the organisation well placed to revamp sales teams for the above-mentioned verticals.

Laying the groundwork in-house

Of course, however, targeting VPs and directors is not always straightforward, so businesses need to ensure they build for the future with current staff too. One solution could be for transport and logistics companies to focus on upskilling. Not only can your organisation save time with such an approach – it could help you maximise the potential of your existing talent and help to create the next generation of leaders.

In a similar vein, organisations might want to consider investing in training and apprenticeships to broaden their candidate pool. Is there more your organisation could do to increase exposure and interest levels among, for instance, university graduates? Or provide opportunities for talented candidates who may not have the means to pursue further education?

What can leaders do?

The onus for coherent succession planning is not just on organisations, however. Senior leaders in the field can help to lay the groundwork well in advance of their departure by arranging timely knowledge transfers and planning the transition fully. Transport and logistics are sectors that are notoriously sensitive to disruption. Adverse weather, labour disputes, and geopolitics are just a few factors that can complicate smooth operations, so it’s imperative that leaders pass on their knowledge to ensure their companies are well prepared to handle any sudden crises that may arise after they leave. Are your vehicles working effectively? Could enhanced tech and/or AI help to predict issues before they arise? These are just a few questions that will help make the handover as smooth as possible.

A final note I’d like to emphasise feeds back into my earlier point about upskilling. You don’t need me to explain the importance of mentoring on early- and mid-career talent; this is arguably the most valuable and effective step in the succession planning process. Is your organisation providing avenues for talented individuals to learn from senior figures? If not, it may well be time to consider offering formal in-house structures to offer this.

Conclusion

Succession planning is a complex process, and no two companies will have the same needs or problems to address. I don’t claim to have all the solutions but hope that some of the points highlighted in this article might prove useful if your organisation is facing such issues. Of course, I am always more than happy to hear from transport and logistics companies looking for future leaders in the space – just reach out to find out more.