The Purchaser Issue 15

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JORDI SUBIRANAS ON PROCUREMENT EVOLUTION AT KERN PHARMA

SKIP MORSE TALKS MITIGATING SUPPLY CHAIN DISRUPTION DURING COVID

RALPH LAUREN’S CRADLE TO CRADLE CERTIFIED GOLD CASHMERE SWEATER

PROCUREMENT

SUPPLY CHAIN

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TECHNOLOGY

#15

THE CRAFT OF TRANSFORMATION ABV’S JARRETT UNDERDOWN ON LEADING PROCUREMENT EVOLUTION AND CENTRALISATION

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LETTER FROM THE EDITOR

In this issue we speak with Jarrett Underdown about his role as Director of Procurement at Artisanal Brewing Ventures (ABV). Underdown has the food and beverage industry in his blood, having grown up with parents who owned and operated a large restaurant franchise, had stints in procurement and sourcing for several industry-leading companies and, now, taking on a transformative role at ABV. Since joining the business in January 2019, Underdown and the team he has built, have focused on transforming procurement across the organisation including centralisation of disparate procurement functions that have evolved as a result of the company’s growth through merger and acquisitions.

He talks us through the fundamental

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steps of that centralisation, including the adoption of a new ERP system, and discusses the benefits to both those in the business and suppliers and partners.

There’s a host of other interviews and insights from leading figures in procurement and supply chain in this edition.

You’ll find Jordi Subiranas on strategically mitigating risk at Kern Pharma, Shaviya Sharma on procurement and category management in shipping, Skip Morse discussing managing supply chain disruption during COVID-19, education as a force for change at Airtron, supplier relationships and leveraged opportunity at JK Moving Services, and VBG Group’s Per Sandberg on his career in procurement.

We also take a trip to Malta to seek out the best of business and pleasure in the Mediterranean and take a closer look at Ralph Lauren’s work in the circular economy courtesy of its Cradle to Cradle Certified Gold Cashmere Sweater.

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© Stroud and Clarke Ltd 2023. All rights reserved. Whilst every effort is made to ensure that information is correct upon publishing, Stroud and Clarke Ltd is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information in this magazine is provided “as is”, with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information. This magazine may not be reproduced or used in any manner whatsoever without the express written permission of the publisher except for the use of brief quotations in a book review.

Editorial

We hope you enjoy the issue.

Content Director

Marketing Director

Managing Directors

Matt High

Jack Pascall

Creative Director

Project Directors

Charlotte Clarke James Pepper

Steve Shipley

Henry Allton-Jones Will Tottie Alex Neagu

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Contents

08 | INSIGHT

EXEC SUMMARY News, views and insight 14 | INTERVIEW

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ABV On procurement transformation and centralisation in the business 26 | PORTFOLIO

TECH YOU NEED Innovations for work, leisure and the environmentally conscious

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3 6 | I N N O VAT O R

ARVANI

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Meet the future of carbon accounting 38 | INTERVIEW

KERN PHARMA On the importance of strategically mitigating risk 50 | INTERVIEW

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SHAVIYA SHARMA Discusses procurement and category management in shipping 62 | DISRUPTOR

THOUSAND FELL Zero waste. Closed loop.

Cool sneakers

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64 | INTERVIEW

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SKIP MORSE On partnerships and supply chain disruption during COVID-19 80 | ENTREPRENEUR

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The brainchild of Emily Rogers and Claire Rampen 82 | INTERVIEW

AIRTRON On education enacting transformative change 9 4 | I N N O VAT I O N

TIMELESS LUXURY Ralph Lauren’s Cradle to Cradle Certified Gold Cashmere Sweater

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64 94

REATH

100 | INTERVIEW

JK MOVING SERVICES On the importance of supplier relationships and leveraged opportunity

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112 | INTERVIEW

VBG GROUP

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On procurement leadership and success 122 | CIT Y GUIDE

48 HRS: MALTA

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Business and pleasure in the Mediterranean

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Exec Summary

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Synthetic supplies

Crisis dominates today, with supply shortages bringing ongoing disruption.

But, there is another way. We could grow cost-effective and sustainable solutions to these same crises using emerging innovations in synthetic biology, for example. According to the World Economic Forum synthetic biology, which reimagines how we manufacture everything, could be used to do away with shortages permanently, seeing our future selves growing everything from sustainable alternatives to food additives, cosmetics and fragrances, through to textiles, drugs, fuels and building materials. www.weforum.org

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STRENGTHENING SUPPLIER DIVERSITY

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Intel reached $2.2bn in diverse supplier spending in 2022, eight years ahead of original goals it set out in 2020. The amount represents close to 15 times the company’s annual total when it launched its supplier diversity programme in 2015. Jackie Sturm, Intel’s Corporate Vice President Global Supply Chain Operations, said the company reached its goals ahead of schedule as a result of processes and incentives that have encouraged diverse suppliers to work with it, and a rapid increase in manufacturing worldwide that has widened the potential supplier base. www.intel.com

Working with leading companies worldwide has identified seven trends that will shape the future of procurement, says Boston Consulting Group: > Geopolitical tensions and conflict elevating risk > The impact of more frequent natural disasters > Uncertainty from inflation and potential recession > The adoption of climate sustainability goals > Greater organisational commitment to social equity > Next-generation technology bringing efficiencies > A talent shortage of specialist skills www.bcg.com

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T THHE EP PUURRCCHHAASSE ERRMMAAGGAAZ ZI NI NE E | | I SI S SUUE EF FOIUFRT TE E ENN

Exec Summary

T HE F U T URE OF DE L I V E RY Dronamics, a business born out of two brothers’ desire to find a quicker, greener and more affordable way to deliver goods by same day delivery for everyone, everywhere, is the world’s first cargo drone airline. It recently completed the first flight of its flagship aircraft, Black Swan, demonstrating the potential for the logistics industry to enhance efficiency when transporting products and materials. Black Swan was remotely piloted by two commercial airline pilots from a ground control station. It is able to carry 350 kg at a distance of up to 2,500 km, up to 80% faster, 50% cheaper, and with 60% lower emissions than alternative modes of transport. www.dronamics.com

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“Since the day we first imagined what the Black Swan aircraft could look like, we’ve worked towards this flight. Today we’ve made history and are proud to have demonstrated the validity of our drone technology”

–

Konstantin Rangelov, Co-Founder and CTO, Dronamics

T THHE EP PUURRCCHHAASSE ERRMMAAGGAAZ ZI NI NE E | | I SI S SUUE EF FOIUFRT TE E ENN

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Exec Summary

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SUPPLY CHAIN LEADERS Gartner has revealed its Supply Chain Top 25 for 2023, the annual ranking of the world’s superior supply chains that identifies, celebrates and profiles global supply chain excellence. Each year Gartner researches hundreds of supply chains to understand key priorities and investments. This year, it said, three key supply chain trends are accelerating capability and high-performing companies: driving growth amid risk, including building an ‘antifragile’ supply chain; progress from ecosystems and a focus on partnering, data sharing and collective action; and transforming how we work, which centres around driving high performance within the organisation. Schneider Electric topped the ranking, leading a top five consisting of Cisco Systems, Colgate-Palmolive, Johnson & Johnson, and PepsiCo. www.gartner.com

G7 LEADERS DISCUSS SUPPLY CHAIN At the 2023 G7 Summit, held in Japan on 19-21 May, finance leaders of the G7 countries discussed the need to make global supply chains more resilient by reducing over-reliance on China. German Finance Minister Christian Lindner told journalists that countries including his wanted to reduce dependency on China, adding that “here, emerging and low income countries come into play”. Reuters reported that host country Japan has been diversifying its supply chains away from China by building partnerships with low- and middleincome countries through investment and aid. www.reuters.com

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©Reuters

Mediterranean Shipping Company (MSC) takes delivery of the world’s largest container ship, MSC Tessa, which can carry up to 24,116 TEU containers.

Boeing Chief Executive Dave Calhound says sector-wide supply chain issues, which have impacted global jetliner production, could take until the end of 2024 to iron out.

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FedEx has launched a new tool, FedEx Sustainability Insights, that uses scan data from its global logistics network to provide customers with greater access to emissions tracking and reporting. The cloud-based innovation uses near-real-time data to estimate CO2e emissions and users can also view historical emissions data.

Nike CFO and EVP Matthew Friend will take over procurement insight, including oversight of demand and supply management, as part of an executive shuffle at the brand.

Maersk opens The Maersk Innovation Center, a new facility focused on accelerating supply chain innovation and resilience.

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Interview

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THE CRAFT OF TRANSFORMATION ABV’s Jarrett Underdown discusses procurement evolution in food and beverage, and bringing transformation and centralisation to the business

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Interview

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hatever your thoughts on fate or destiny, Jarrett Underdown was seemingly always meant to work in the food and beverage industry. And, while part way through our recent discussion about the intricacies of procurement in this complex sector, his career to date, and his work at Artisanal Brewing Ventures (ABV), he insists it was never planned that way, his experience tells a different story: growing up with parents who owned and operated a large restaurant franchise, stints in procurement and sourcing for industry leaders like HJ Heinz, S&D Coffee & Tea, and Premier Inc, a transformative Director of Procurement role at ABV… who said fate isn’t real?

In close to 15 years, Underdown has worked across key roles in procurement and sourcing with much success. Over the same period, he says, the role and scope of work of those in the procurement function has evolved significantly. “There’s a definite shift in perception, not just in the businesses I’ve worked in, but consistently across most industries,” he says, reflecting on his experience to date. “Since I started out in the profession, it’s become far more relevant in companies’ strategic focus and moved away from merely being a transactional or tactical necessity for the business. A lot of that change, I think, is down to the competitive landscape we work in. Particularly in food and beverage, companies are always looking for the competitive edge and teams that have a supply chain that enables them to be more agile and reactive, or manage risk more effectively can bring that edge.

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The food and beverage industry, even prior to recent disruption, is a complex one for procurement and supply chain

professionals to operate in, says Underdown, listing range and volume of different products to source, external factors that can impact security of supply, and consumer demand as key considerations.

“Take my current role as an example,” he says, expanding on the theme. “You hold a bottle of our beer in your hand, there’s three or four different malts in that bottle and the same number of hops, there’s the glass bottle itself, the materials for the bottle cap and more – that’s 10 or 12 different products our procurement team had to source so you can enjoy that drink.

At the same time, because many of those ingredients are procured agricultural products, our supply chain is susceptible to drought, disease, sociopolitical factors, disruption and more. It means that the technology, processes and quality have to be world-class across the entire business and supply chain.”

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“In terms of the role itself, our contribution across the business is significant,” continues Underdown. “We can improve supply chain lead times to get to market quickly, build key partnerships and relationships with leaders in the industry, lower input costs and improve payment terms, foster innovation opportunities through our supply base, or be the conduit between the R&D teams and sourcing the relevant new technologies. It’s always exciting to be part of that and to be able to see quite clearly the improvements and benefits you’re able to deliver for the organisation.

Of course, many of these strengths – as well as some of our weaknesses – have been amplified more recently through the disruption caused by the COVID-19 pandemic and subsequent uncertainty.”

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Interview

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TRANSFORMATION AT ABV It’s these challenges and more that Underdown has been focused on since joining ABV in January 2019. The company was established in 2014 to bring expertise and resources to the business side of the growing craft beer industry. It has since grown a portfolio of breweries and brands through mergers and partnerships that includes Victory Brewing Company, Southern Tier Brewing Company, Sixpoint Brewery, Bold Rock Hard Cider, and Southern Tier Distilling Company. Collectively, ABV’s beer business represents the sixth-largest craft brewing company in the US, while Bold Rock Hard Cider is the second largest cider brand nationally.

Underdown came on board in a transformational role; its growth through merger and acquisition created an environment in which supply chain and procurement operations were siloed and specific to each company under the ABV umbrella.

As Director of Procurement he leads the centralised procurement team he has created during his time at the business, and is responsible for the leadership, oversight and execution of its procurement strategy and the performance of the collective brand portfolio.

“Procurement happened at each company, specific to its facility, and with very little collaboration,” Underdown explains.

“My initial goal was to centralise ABV procurement and then leverage the

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collective purchasing power of the business to obtain favourable pricing, terms and conditions. Since 2019, we’ve successfully integrated five separate companies under the ABV procurement department, which allows our one procurement team to then service the five separate entities far more efficiently and effectively; that’s been the main goal of the transformation since my time of joining the business. We’re now in an environment in which procurement is far more sophisticated, there’s a greater use of technology to enable that change including automating a lot of our processes so we can quickly digest and act on information, and we have a far more proactive and strategic function that can fulfil the demands of the organisation.”

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“THE TECHNOLOGY, PROCESSES AND QUALITY HAVE TO BE WORLD-CLASS ACROSS THE ENTIRE BUSINESS AND SUPPLY CHAIN” Underdown says that, in order to be “As a result of this approach, we’re able successful in delivering this level of to view everything, from the beginning centralisation, it was critical to adopt one customer order, right through to the manuERP system across the entire ABV organifacturing and distribution of the product,” sation. “Each of the companies really had Underdown continues. “We know when its own approach to procurement,” he adds, specific materials are needed at each facil“but we wanted standardised processes ity, when the product is shipped to the across everything and having that singular customer, we see the invoice being issued visibility of everything under one ERP to the customer, and when they pay that system was critical. Having that over our invoice. Having that system is invaluable, network allows us to have end-to-end visand it means we can take that aggregated ibility of the entire business process, to see demand, go to our supply network and gain demand for each specific site and to then new contracts, leverage our volume and aggregate amongst the entire ABV portfolio. execute on our strategy.”

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Naturally, driving such change across an organisation with the scale of ABV can be challenging. In this instance, Underdown explains, it required close collaboration across all the brands under the ABV umbrella during the transition period.

“It was a very hands-on approach that required extensive time on the ground,” he states. “If I consider some of the implementations we’ve completed, then they’re quite unbelievable. By the time we’ve acquired a company, we have implemented and integrated its ERP system within six to eight months, which is fast.

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GROWTH AND SUPPLIER RELATIONSHIPS Externally, too, close collaboration and strong partnerships are an important part of ABV’s success, and the procurement function’s ability to deliver. Underdown explains that the emphasis has been on building a best-in-class competitive supplier portfolio for the business that includes many leading companies in the respective fields. “There have been scenarios where we may have a relationship with a supplier now, but they also have a relationship with the company we acquired, and so there are variations in pricing. During our integration, we will then put the acquired company on our existing ABV contract. Because of that, not only will that company get improved pricing and terms, but the supplier will then take that additional volume that’s on our ABV portfolio, consider that, aggregate it, and give us better pricing terms across all of our network.

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“The positive is that, as soon as those companies have joined, they see the benefits almost immediately in terms of savings,” he adds. “For example, they effectively get immediate cost savings on most products because they’re similar, or exactly the same, to what we’re buying with our other companies. There’s also huge benefits from a performance standpoint, too. By being on the centralised ERP, they’re more sure of on-time delivery of their inbound materials, favourable terms and conditions on all contracts, less risk, and more certainty.

Being able to deliver results in terms of change management was really built on the trust and reliability of the system and everyone involved.”

“Being able to build relationships with suppliers means they see the opportunity from working with ABV, our growth and how we’ve become the six largest craft brewing company in the country,” he continues. “We want that growth to continue, and to get bigger, better and stronger.

With that comes synergies for our suppliers as well. Rather than working across five companies and having five contracts, everything is consolidated and centralised into one procurement team that supports them. As an example, if we’re long on a

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Interview

“HAVING THE ABILITY TO BECOME ONE COHESIVE NETWORK AND MANAGE ALL OF OUR SUPPLY CHAIN AS MUCH AS POSSIBLE, GIVES US CONTROL AND PREDICTABILITY, AND KEEPS US COMPETITIVE”

certain item with one of our breweries, but another needs it, we can quickly shift meaning the supplier’s not sitting on too much product. All of this just allows us to be nimble, flexible, and have one line of communication. So this transformation has benefited our supply base as well.”

As well as working with external suppliers, Underdown explains that having its own distillery – Southern Tier Distilling – is enabling ABV to enter emerging markets and drive its own vertically integrated supply chain. “The canned cocktails market, drinks with a high-proof

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base like margarita or whiskey and cola in ready-to-drink form is a growing sector, and one we’ve been working for growth in over the past few years. Previously, we would source those high proof base spirits from other suppliers but, having the distillery, allows us to both go into a new segment and be vertically integrated; we are our own supplier when it comes to the base spirit for the drinks. There’s obvious benefits of cost there, but it also means we have a supply chain that’s 100% designed and optimised to fit our needs and allow us to be reactive, flexible, and competitive in this space as we continue to grow.

In just over four years, the work of Underdown and the ABV procurement team has helped create strong foundations on which to build. Those same foundations, he says, played an important role in underpinning the business during pandemic-related disruption, helped mitigate challenges stemming from ongoing inflation, and facilitated greater innovation and speed to market.

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“It’s one of the real benefits that comes from being part of ABV,” he explains. “We have facilities that are able to make all the products – beer, cider, seltzers, hard teas, hard lemonade, and ready-to-drink canned cocktails. And, as capacity at certain facilities reaches its maximum, we can shift it as and when needed. For certain companies, if their hard cider products quickly become very successful and they’re unable to meet the demand, they effectively become out of stock and unable to fulfil orders. In contrast, our network allows us to go ahead and make cider, certain beer brands, or cocktails wherever we have that open capacity and shift production around. Becoming vertically integrated on the spirit side is great, but having the ability to become one cohesive network and manage all of our supply chain as much as possible, gives us control and predictability, and keeps us competitive.”

“Looking ahead, my objective and that of the procurement team, is to be a reliable and results driven organisation,” he states.

“As we’ve built this great foundation and optimised some of our core business, it’s important for us to continue to be agile, to embrace change and new technology, and to not only improve our existing processes, but develop new and improved processes. Doing so will give us a competitive edge and allow us to continue to deliver world-class products with worldclass quality. As long as I stay focused on that as a leader, we’ll be able to achieve whatever our strategic goals are at ABV, continue to grow and be looked at as a leader within our industry.” artbrewdev.wpengine.com

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Portfolio

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Innovative and inspired items for work, leisure and sustainable living

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SWISSRIDER ROAD

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‘Yeah, well my bike has the same technology as NASA’s Mars Rover’.

It’s quite the conversation stopper, right? And it comes courtesy of Swiss high-tech bike design shop Thömus and its next-gen, fully integrated electric Swissrider Road road bike. It features ultra-lightweight [just under 2kg] Maxon drive technology, total battery capacity of up to 80 miles assisted range, integrated lights in handlebars and rear chainstays, built-in phone mount and controls, and an accompanying smartphone app.

It’s light too – the full carbon frame giving an all-in weight of just 11.5kg.

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Portfolio

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Innovative and inspired items for work, leisure and sustainable living

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VONMERCIER AROSA

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Remember hovercrafts? Big, noisy, inefficient, complex to operate and, as a result, left by the wayside.

Forget that, and meet VonMercier’s Arosa, a supercar-styled, highperformance hovercraft packed with technology, luxury styling and all-electric power. Arosa has a 400V battery and three 240hp motors that give a top speed of 50 mph; the electric powertrain reduces noise, pollution and miantenance and can be plugged into any standard EV charger.

It features a lightweight carbon fiber body and hull that borrows construction techniques from the automotive industry, and it can carry up to three passengers. www.vonmercier.co

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Portfolio

Portfolio

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Innovative and inspired items for work, leisure and sustainable living

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DISPLACE TV

displace.tv

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How do you stop losing the remote control? There’s plenty of hacks online. There’s also Displace TV, the world’s first wireless television that does away with remote controls for something far more modern: hand gestures. Displace TV has no wires or ports, just hot-swappable batteries that last a month on a single charge. Its gesture control system lets you browse and play content using just hand gestures from anywhere in the room.

And, because it weighs less than 20 lbs, it needs no wall mounting – instead using proprietary activeloop vacuum technology to simply stick to the wall.

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Portfolio

Portfolio

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Innovative and inspired items for work, leisure and sustainable living

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SUPER CHRONOMAT AUTOMATIC 38

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The problem with diamonds [cost aside] is their environmental impact. Not so for those used in Brietling’s first fully traceable watch, whose owners can watch the entire supply chain journey from material to fully finished product thanks to a blockchain-backed NFT digital passport that details responsible measures taken during its creation. And it’s pretty responsible, too. The Super Chronomat Automatic 38 uses lab-grown diamonds and features a case constructed of artisanal gold that’s sourced from accredited suppliers.

Blockchain also allows Brietling to manage the product lifecycle of the watch more effectively. www.brietling.com

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Portfolio

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Innovative and inspired items for work, leisure and sustainable living

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CE 04 VAGABUND MOTO CONCEPT

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Urban transport of the future has to be simple, environmentally friendly, functional and, most importantly, personalised to the needs of those moving about our cities. In fact, it has to be just like the BMW CE 04 Vagabund Moto Concept, a custom e-scooter from custom bike specialist Vagabund Moto and BMW Motorrad Austria.

It’s a stylish, multifunctional scooter for urban use that draws on the synergies between functionality and aesthetics. It boasts impressive eco-friendly credentials too: all-electric, 31 kW maximum output, a range of 130 km, and a charging time of just 65 minutes from 0% to 80%. www.press.bmwgroup.com

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Innovator

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T HE F U T UR E OF C A R BON ACCOUN T ING

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There’s no two ways about it: procurement is in the driving seat when it comes to sustainability initiatives in the organisation, particularly around managing Scope 3 carbon emissions and accountability across the entire supply chain. For that, you need visibility, transparency, and clarity. And, of course, data.

“WE HELP CREATE A COMPREHENSIVE PICTURE OF CARBON EMISSIONS IN VALUE CHAINS”

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Which is why Avarni, the Australian-based carbon reporting and management startup, is onto such a good thing. Its platform applies AI, natural language processing and data to help clients report and forecast their carbon footprint – automation of much of the process cuts the time spent on this task from months to minutes, says Avarni, meaning organisations have more time to focus on executing their net zero targets.

Avarni automates the process of emissions analysis from spend and activity data, providing an accurate overview of emissions hotspots across an entire supply chain, regardless of the structure or taxonomy of input data. Its calculation methodology and data collations enable procurement and supply chain teams to see emissions from vendors, suppliers and contractors, make onboarding of new suppliers simpler and in line with net zero goals, and allow for managing offsets and compliance. www.avarni.co

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Interview

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JORDI SUBIRANAS DISCUSSES PROCUREMENT EVOLUTION AT KERN PHARMA AND THE IMPORTANCE OF STRATEGICALLY MITIGATING RISK

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Interview

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ordi Subiranas doesn’t like to be bored, instead relishing new challenges, and using his more than two decades’ experience and expertise to solve them and deliver strategic value. Given the challenges that global supply chain disruption, pandemics, conflict, geopolitical instability and more have brought recently, it’s little wonder he’s as passionate about procurement and its role in the enterprise as he’s ever been over his 20-year career. We joined him to discuss the evolution of the function, the importance of people, culture and risk management, and how the strategy he set out at Kern Pharma in 2015 helped mitigate many of these challenges.

Jordi Subiranas is a vastly experienced procurement professional and leader, having worked in key planning, supply chain and procurement roles across several industry sectors including automotive, cosmetics, chemicals and pharmaceuticals. As a result, his breadth of skills and capabilities, and his broad insight into different organisational cultures and processes, give him a unique perspective on the evolution of the function. Recently, he says, procurement has entered a ‘new era’, driven by the need to respond to significant disruption and the requirement to bring business-focused outcomes.

“The world and the consumer behaviours we encounter are in constant evolution,” he explains. “All of the recent and quite remarkable disruption we’ve experienced in recent years has seriously impacted global supply chains, commodities and utilities. Responsiveness, certainty and steadiness are the key ways in which to deal with such crises and, in the turbulent and complex context we’re in, it’s procurement that’s been able to deliver this. As a result, we’ve seen it actively strengthening its strategic role as a highly valued asset to manage and mitigate challenges.

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JORDI SUBIRANAS

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Aon is in the Business of Better Decisions

In such an environment, says Jordi Subiranas, the role of the leader has also changed to encompass a far broader skill set and scope of work.”In my opinion, the key success factors for modern leadership can be summarised in four areas: problem solving, which includes analytics, creativity and innovation; self-management, which requires resilience, adaptability and flexibility; people, where leadership, development and an ability to influence both inside and outside the firm are essential; and lastly, a good understanding of digital technology including data.”

“WE’VE MOVED FROM A SERVICE FUNCTION TO A TRUSTED ADVISOR THAT UNDERSTANDS HOW TO PLAY A MORE EXPANSIVE ROLE AND DELIVER VALUE ACROSS AREAS LIKE STRATEGY, DIGITALISATION AND PEOPLE”

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“The procurement we know from decades ago has changed,” says Jordi Subiranas.

“It’s a more strategic and relevant lever in all organisations, capable of influencing outcomes and bringing creativity through sustainability and purpose. Because of this shift, procurement professionals have evolved far beyond just purchasing in terms of skills; we’ve moved from being a service function to a trusted advisor in mature organisations that understands how we can play a more expansive role and deliver value across areas like strategy, digitalisation and people.”

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Interview

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TRANSFORMATION AT KERN PHARMA

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It’s these skills and more that Jordi Subiranas brings to Kern Pharma, which he joined in July 2015 as Head of Procurement.

The business, founded in 1999 is a pharmaceutical laboratory that’s part of the family-based Group Indukern. Its activities are spread across six core business lines: generic medicinal products, consumer, biosimilars, women’s health, sports nutrition, and manufacturing for third parties. Kern Pharma conducts its work in Spain and two subsidiaries in Portugal and the US, and also carries out

export activities, manufacturing products for international laboratories, and supplying its products through agreements with local distributors.

“Working in the pharma business requires a specific approach compared to some of the other industries I’ve been involved with,” says Jordi Subiranas. “Our core objective is to guarantee the ongoing provision of important medication of the highest quality to the health community.

Because of well-established, but sometimes cumbersome processes and

“OUR CORE OBJECTIVE IS TO GUARANTEE THE ONGOING PROVISION OF IMPORTANT MEDICATION OF THE HIGHEST QUALITY TO THE HEALTH COMMUNITY”

protocols like homologations or validations, it’s absolutely essential to always be proactive, plan in advance and monitor suppliers and supply risk. Ours is such an important duty. On top of all the procurement skills and attributes you must have to be successful, you need a certain sensitivity and empathy for the work you’re doing. We think of our social impact and the role we’re playing in eradicating illness or injuries our customers have.”

He explains: “There was the need for some tough changes in some areas of the organisation. After an initial assessment, which included gathering key data and discussion with stakeholders in the business to align with main objectives for Kern Pharma, I set out the basics of the procurement organisation for the next five years.

This included processes like source-topay, category management, tools, spend analysis, segmentation, people, and an overarching strategy. Essentially, it was about setting the roadmap of how procurement can positively and more actively contribute to the business sustainably in the short, medium and long term.

“The most exciting point about working in procurement is that, despite any challenges you face there are always opportunities to take advantage of,” says Jordi Subiranas. “In terms of the strategy, I decided that the procurement function needed to be redesigned, introducing a different mentality and mindset to align with the pace of the business and be better prepared for any new challenges we may face. Segmentation, rationalisation, risk and category management, optimisation and innovation were the main goals, with the aim of setting the right levels of business continuity so we could properly approach how the market was evolving at the time.”

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Jordi Subiranas joined the business in a transformational role. At the time of coming on board, he says, the procurement function needed to change and evolve in line with the changing market and to ensure that any future risk or disruption could be properly mitigated.

Initial work centred around establishing

what the new procurement function should look like, including development of key objectives and strategy.

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Interview

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MITIGATING RISK Jordi Subiranas points to supplier risk as one of the key challenges when setting out the new strategy, explaining how it was necessary to streamline the company’s vendor portfolio across categories.

“We needed to have a very lean vendor base in order to capture the right value,” he says. “Once I saw we analysed category by category I knew we had to address our supplier pipelines - one of the main goals on top of people, data, and tools was to have the leanest possible vendor base that included the top or state-of-the-art vendors in each individual category. It was a tough exercise that included steps like introducing spend analysis, reducing the procurement spend or the amount of SKU to lower the complexity. It was a complex task, but was necessary to gain competitiveness.”

At the same time as evolving procurement’s processes and approach to its work, Jordi Subiranas has also considered the greater use of digital technology, in particular to help manage risk. Kern Pharma, he concedes, is less mature than some organisations in its adoption of technologies like AI and blockchain, but he and his colleagues are exploring these innovations for application around better defining procurement processes, supply parameters and risk forecasting.

Risk and disruption has been at the forefront of all those working in procurement and supply chain in recent years. In the

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case of Jordi Subiranas and Kern Pharma, much of the initial work in establishing strategy and setting strong foundations around supplier risk proved fortuitous in helping the organisation survive many of the challenges that came with the COVID-19 pandemic and subsequent geopolitical instability.

“No one expected what we’re currently going through,” he states. “It massively impacted supply chains, particularly for us in terms of longer lead times, shortfalls, higher prices and more. One of the biggest lessons is the importance of monitoring supplier risk to help prevent as

much disruption as possible. One of our main focuses continues to be controlling and reducing supply risk and vulnerability across our supply chain.

“Some of the strategy work we completed before COVID definitely helped us when challenges began,” continues Jordi Subiranas. “We were forced to rapidly adapt to the situation with flexibility, determination and a collaborative approach and, thanks to the setup of the procurement function and our supply

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“IT WAS ABOUT SETTING THE ROADMAP OF HOW PROCUREMENT CAN POSITIVELY AND MORE ACTIVELY CONTRIBUTE TO THE BUSINESS SUSTAINABLY IN THE SHORT, MEDIUM AND LONG TERM” base, we were able to continue delivering important medication to pharmacists and hospitals. Risk management was one of the preferred initiatives we implemented in 2016 and since then, as a result of detailed up- and downstream value mapping and the introduction of our toolkit, we’ve gradually reduced the risk exposure on our strategic products by more than 53%. We plan to further enhance our approach to risk management by introducing a data and analytics platform to give a more holistic view.”

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“WE’VE REALLY SHOWN WHAT WE CAN DO: WE DELIVER SUPPORT TO THE MAIN STAKEHOLDERS, WE DELIVER ROBUSTNESS INTO THE SUPPLY CHAIN, AND WE DELIVER VALUE IN TERMS OF INNOVATION” CONTINUED DEVELOPMENT For an enterprise function like procurement or supply chain, risk is ever present.

And while, globally, recovery from the level of disruption seen over recent years continues, Jordi Subiranas is mindful that it must continue to be of focus. There are positive signs, he says. For example, the manner in which he and his colleagues helped steer the business through the challenges faced has helped demonstrate the value of procurement as a strategic part of the business.

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“As I always believed that procurement is a strategic area for any firm, from 2015 I focused to deliver value to the company,” he explains. “We’ve really shown what we can do: we deliver support to the main stakeholders, we deliver robustness into the supply chain, and we deliver value in terms of the innovation we’re able to capture from our strategic vendors. Alongside any vision, strategy, technology and people are crucial.

Our team has been built from scratch and we’re all committed to what we do – adaptability, resilience and empathy are some of

the major traits across our function and, while our task is always complex, it can be really thrilling. I definitely think that the attitude towards our team and our work has drastically changed as a result of how we’ve performed during these critical times.”

Jordi Subiranas is rightly proud of the work he and his team have delivered to date at Kern Pharma. He is also someone not prepared to rest on his laurels. The delivery of core strategy initiatives will continue into the future, but he and the team are also considering how they can bring value to other important areas of the business such as sustainability.

“I want us to deliver on this and continue to implement the work and goals we set out in 2015,” says Jordi Subiranas. “I’m a demanding and challenging leader, but I want the best from what we can do. In terms of areas of focus, I think there are three we need to consider: digitalisation, vulnerability and risk management, and supplier relationship management. It’s a lot of work, but it’s what I enjoy. Procurement is one of the most exciting functions to be a part of, and I’m looking forward to delivering more for the business. It’s a lot of work, it’s challenging, but it’s about bringing real change and value to the company.”

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wellbeing,” he elaborates. “ We can’t ignore the challenges we face, and have to manage the topic with responsibility and determination. At Kern Pharma, sustainability is one of our core strategic pillars and our vision is to positively contribute to a better world. For us, areas of focus include reducing our carbon footprint, using sustainable sources, eco-friendly vendors, recyclability, materials reduction, and promoting equality. We also analyse, monitor and improve the sustainability rating of our supply chain both upstream and downstream; at least 80% of our supplier base is regularly assessed and 85% have received a silver or gold medal for their work.

www.kernpharma.com “I define sustainability as fulfilling our current needs without compromising those of future generations, while also taking care of the environment and our social

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TRANSFORMING PROCUREMENT SHAVIYA SHARMA DISCUSSES PROCUREMENT AND CATEGORY MANAGEMENT IN SHIPPING

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T

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hings happen for a reason.

And, when it comes to work or a particular passion, it’s so often the case that you’ll end up where you’re supposed to be. Take Shaviya Sharma as an example.

A passionate solver of complex problems, adaptable and dedicated to diversity and leading in a multicultural environment, an effective communicator and, for as long as she remembers, someone with an interest in people and a love for engaging with others. It’s little surprise that since her first experiences of procurement 15 years ago when working as a site engineer, she quickly became fascinated by the profession and has never looked back.

Over that relatively short period, Sharma has made her mark on the profession, too, achieving significant success. Prior to her most recent role, as Category Management Head at one of the world’s largest third-party ship management companies, Sharma enjoyed close to seven years at international logistics giant Maersk. She was one of the founding members of the company’s category management team and operations, spearheaded various sustainability initiatives, successfully established a new team of buyers during the initial heavy disruption of the COVID-19 pandemic, and committed herself to developing responsible sourcing processes.

Across these various roles, she says, the profession and the shipping industry have evolved significantly, in particular driven by the growth of focused category management in shipping and logistics companies, an increasing focus on sustainability, and the more recent challenges brought by significant disruption. “Certainly over the last decade we’ve seen huge transformation,” says Sharma. “Procurement itself has changed, shifting from a transactional department to one of the core functions within the organisation. We’re now viewed as a part of the business that’s essential to partner with, and which contributes to many of the key strategic discussions and commitments.

“But beyond, the biggest transformation has been the shift of the entire industry around sustainability and a commitment to deliver on environmental targets,” she continues. “I’ll give you an example. The shipping industry contributes to more than 90% of all global trade – that’s the magnitude of the business. But it is also responsible for close to 3% of the world’s CO2 emissions. There’s a lot of action

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“PROCUREMENT HAS CHANGED, SHIFTING FROM A TRANSACTIONAL DEPARTMENT TO ONE OF THE CORE FUNCTIONS WITHIN THE ORGANISATION” now across the whole industry to address this, whether it’s pushing sustainability through green procurement, supplier codes of conduct, direct category buying when it comes to things like fuel oils, green fuels, ammonia, and more. We’re also seeing some of the leading companies, like Maersk and others, trialling green or sustainable vessels, so it’s a large transformation.”

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SUSTAINABILITY AND EVOLUTION Sharma is a conscientious and empathetic leader who is passionate about the broader impact of her and her company’s work – the level to which she has focused on diversity, equality and inclusion when building teams is testament to that.

Sustainability is another area she is personally invested in, influenced both by the evolving market conditions and some of the pioneering work she first trialled at Maersk and is now continuing in her current organisation.

“I always reference Maersk,” she notes, “because it’s really where my whole journey in procurement in the shipping

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we were doing starting to make a difference, you get a real sense of satisfaction from that.”

Alongside this evolution of procurement and the broader shipping and logistics industry, the recent years have been characterised by disruption, risk and uncertainty, first from the COVID-19 pandemic – the after-effects of which are still rippling cross global supply chains – but also geopolitical instability, conflict, shortages of supply and more. Unlike some industry sectors, which faced lockdowns, slowing operations and even shutdowns, the shipping and logistics industry carried on working around the clock, says Sharma, pointing to the transformational impact of the pandemic.

“Whether land, sea or air, everyone in the industry had to work continuously through very difficult and challenging times,” she adds. “It taught us several important lessons. For example, all companies have changed the way they work with regards to remote working, empowering employees to take decisions into their own hands, and giving greater freedom in the workplace. From a business perspective, there were massive challenges. At the start of the pandemic I was still with Maersk and, with everyone spread remotely from home and all of the problems that brings with communication, I had to take over a team of buyers, still handle procurement activities, build relationships to benefit the business and more.

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industry started and, since, I’ve really had a lot of passion for this subject.

I was responsible for some of the category buying for new ships in China, Korea and Japan at a time when all of us in procurement were putting our hearts and souls into auditing suppliers around the UN’s Global Compact Principles and really setting the foundations for these initiatives. We were taking in a lot of insight from companies that were leading in the area, like IKEA, HSBC, and others, learning from industry peers, and also building our own team dedicated to responsible procurement. Their task was to actively pursue sustainable suppliers, and we could really start to see the results. On a personal level, it was exciting to see what

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Interview

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“Beyond just COVID, I think the instability we’ve experienced over the last two or three years has changed the way that everyone in procurement thinks, regardless of which business you’re working for,” Sharma continues. “Risk aversion is now one of the most important topics, in particular when it comes to things like conflict, which we’ve never considered before in detail. The supply risks from COVID, war in Ukraine, political

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instability, and currency fluctuations have shown that in our industry we can’t rely on one country or region for our supplies of products and raw materials – in line with the sanctions placed on Russia, for example, we looked at alternative sources of lube oil. Similarly, closures and lockdowns in China meant we had to look at alternative locations for drydocking and manufacturing. It’s been a set of important lessons.”

“MY AMBITION WITH HIRING IS ALWAYS THE SAME: SKILLS AND CAPABILITIES CAN BE TAUGHT, SO YOU FOCUS ON FINDING THE RIGHT PERSON FOR THE ORGANISATION”

PROCUREMENT TRANSFORMATION

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“The organisation is going through a wider transformational journey. It has grown In May 2021, during the height of the organically over the last 15 to 20 years, COVID pandemic, Sharma relocated to starting from roughly 10 ships to 650 toHong Kong leaving behind her family, day,” she continues. “It has grown very including her two-year-old, to join one of quickly, meaning there hasn’t been a lot the largest ship management companies. of time spent on procurement to keep “It’s one of the best known ship managepace with that evolution, which is where ment companies in the world and, having I was brought in to add value. The main worked in the owner-based setup during ambition is to move from more traditional my time at Maersk, I wanted to explore procurement practices to greater strucprocurement in the third-party ship manture, improved visibility on spend, and a agement sector,” says Sharma, recalling her early days at the business. “At the time, more strategic approach – it’s everything from scratch.” the company didn’t really have a category management-based function or a strategic Accordingly, Sharma and team have procurement function, which was the worked on refining and streamlining the main reason for me coming on board, company’s supplier base so that it is more considering my previous experience. effective and efficient, and provides greater value. “It’s a win-win for everyone involved,” she elaborates. “It should never be about ‘many’ suppliers, but rather, having the right supplier for the right product or materials. Historically, I think it’s been the case that too many people have added too many suppliers into the system, which we’ve looked to curtail.

Whenever you look at any spend analysis or report, it’s typically the case that about 20% of your suppliers contribute to close to 80% of the business. My ambition here has always been the same: what percentage of suppliers have actually added value to the organisation?

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“We run highly critical machines on board our vessels so many of the key manufacturers of that equipment are suppliers that are critical to the functioning of the business – companies like MAN, Hyundai, Daihatsu, and Yanmar,” Sharma continues. “With that in mind we’ve defined our suppliers in various categories: high value, high value/non critical, high-value/high-critical and so on. Doing so means we’re sure we’re always getting the right supplier for the right job, but it also means that, because of the more limited supplier base, we can partner on various initiatives with some of our more focused suppliers.”

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RESPONSIBLE PROCUREMENT

People, mindset and team play an important part in Sharma’s approach to her work. From the early days of her move into procurement, driven by her love of engaging with different individuals, and her strong understanding of the importance of solid relationships, these have been consistent threads in her work.

“Talent is a challenge,” she says, “because there aren’t a lot of category management-focused people in shipping, even though that aspect of procurement is growing in the industry. Our approach was to hire people with procurement experience and train them specifically on category management work. My ambition with hiring is always the same: skills and capabilities can be taught, so you focus on finding the right person for the organisation.”

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Sustainability is one such initiative.

With the subject close to Sharma’s heart, she has made it a key priority for procurement and the wider business. During 2022, she introduced a responsible procurement programme, including a supplier code of conduct which the majority of the company’s core suppliers have signed up to and many more are expected to follow. In line with industry targets – the International Maritime Organisation currently has a target of at least a 50% reduction in greenhouse gas (GHG) emissions by 2050, compared to 2008 levels – ESG is high on the agenda across shipping.

“We carry out annual reporting of GHG across our vessels to meet these targets,” Sharma explains. “We’re working to ensure our clients are testing new environmentally-friendly fuels like ammonia, hydrogen, and methanol; this work is being carried out in collaboration with the clients that are on the same sustainability journey. Moving forward, it will be the precursor to success for any business, not just those in the shipping industry.

My goal is to move to a place where sustainability is ingrained in our mindset and by all our people, so that everyone is working on a similar front.”

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Interview

“MY GOAL IS TO MOVE TO A PLACE WHERE SUSTAINABILITY IS INGRAINED IN OUR MINDSET AND ALL OUR PEOPLE” As a leader, mentor and coach for her team, Sharma is also passionate about encouraging diversity, both in the business and across the wider industry. She explains: “When I pursued civil engineering at college, I was one of three women in a class of 80 men, so diversity and equality is something I’m passionate about and has always been part of my journey. I’ve always been in male dominated industries and have been encouraged by the people and support that have influenced me along the

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way, so I try to do the same for women in shipping. There are some great female leaders in the industry already and we’re seeing a greater focus from many shipping companies on ensuring diversity on board vessels – when you have that on ships it means you can create a real pipeline through the whole industry for women.

“But you have to remember that diversity isn’t just based on gender,” says Sharma.

“I’m originally from India, which is

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SHAVIYA SHARMA

a really diverse country with more than 20 states and many languages and dialects. We’re in a global industry so, for me, diversity means not restricting ourselves to regions, locations or anything else, but having no barriers to finding competent people with a good attitude and the right mentality, we can teach the rest. That approach brings a huge value to the organisation in the shape of different creative minds, ideas and ways to do the job that we can join seamlessly to meet the goals and objectives we want to achieve. Of course, those goals and objectives continue to evolve as the industry changes and develops, companies and teams work through ongoing disruption and challenges.”

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Nearly 2.5 billion pairs of shoes are sold in the US every year; 97% of those end up in landfill – more than 300 million within a year of purchase. Sneakers, in particular, have other detrimental effects on the environment: they’re created from harmful chemicals, have one of the heaviest carbon footprints of all items of clothing, and take many years to decompose.

The result is a zero-waste, closedloop, circular supply chain built on sustainable materials, lower energy and water consumption, and a reduced carbon footprint. www.thousandfell.com

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Interview

HEALTHCARE IDN SUPPLY CHAIN EXECUTIVE, SKIP MORSE ON SUPPLY CHAIN DISRUPTION DURING COVID AND THE IMPORTANCE OF SUPPLIER PARTNERSHIPS FOR MEETING THE TEST HEAD-ON

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“

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E

veryone wants to be tested,” Skip Morse tells us, part way through a broad-ranging and engaging discussion about life and experiences in procurement and the military, healthcare supply chains, transformation and, naturally, working your way through risk and disruption.

Of course, Morse’s analogy for that test – a professional athlete working from grass roots sport to the biggest game of their lives – pales in comparison to the one he and his colleagues at his current IDN, a not-for-profit health system wholly governed and operated in northeastern, Oklahoma, faced from the end of 2019: how to mitigate supply chain disruption and navigate through COVID-19.

It helped that Morse was ready [albeit he had joined the business only a few months prior to the pandemic taking hold to steer a supply chain transformation that rapidly changed direction], his previous experience in supply chain across several industries and roles giving him valuable insight into the intricacies and unpredictability of working in the profession.

Morse came to supply chain in 2006 when, upon leaving the military after 11 years of service as an infantry and military intelligence officer and deployments in Iraq, Kosovo and Afghanistan, he worked first in logistics for Nestle, before taking on roles as General Manager of Transportation at Iron Mountain and Director of Logistics at Goodwill Central Texas. Combined, these various positions covered a broad spectrum of supply chain skills and knowledge across areas including logistics, warehouse and inventory management, transportation, distribution and more, all of which served Morse well when moving into healthcare in 2013. In just six years working for health systems in Austin and the Tulsa area he progressed through roles including operations manager and analyst to executive director, before joining his current IDN in August 2019, where he holds the role of Director, Supply Chain Management, focused on contracting, strategic sourcing and value analysis.

SKIP MORSE

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pandemic. I think there’s not necessarily the understanding of the work it takes behind the scenes to make sure something is available on the grocery store shelves or, in my case, at the hospital for the doctors and nurses to use.

“The reality is that, even before the pandemic, working in supply chain had become more challenging and more complex,” he continues. “That’s just been amplified over the last couple of years, where we’ve seen difficulties with logistics, availability of products and raw

“THE BOTTOM LINE IS THAT EVERY DECISION YOU MAKE HAS A KNOCK-ON EFFECT BECAUSE IT’S SO IMPORTANT AND CAN SAVE A LIFE”

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Over that near-20-year period, supply chain operations and the role of supply chain within the organisation has evolved significantly, says Morse, pointing to greater complexity, a higher need for risk management and forecasting, and changing perceptions of the work necessary to deliver successfully. “Businesses like Amazon, certainly over the last few years, have made it look easy,” says Morse, expanding on these points. “Everything is a click away, people expect to get things the next day and, when they don’t, there’s frustration – you saw that even during the

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Interview

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materials, and the general breaking down of many of the established supply chains around the world, which are still struggling to recover. The ability to anticipate issues, be responsive and proactive in tackling them, and to effectively plan for the potential failures we’ve seen has also become far more important. That means there’s a premium on talent, and the right skills and capabilities required to be able to do that in the best way possible.”

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SUPPLY CHAIN IN HEALTHCARE The sudden and dramatic impact of the pandemic on supply chains was vast, says Morse, adding that it brought many of these challenges to the fore. “It started to impact everyone’s lives,” he states, “more so than ever before. People suddenly ‘saw’ the challenges we face in supply chains everywhere: grocery stores, online, with their utilities and more.

I think the way that Amazon was able to recover quickly was an important lesson,

“WE REALLY LEVERAGED OUR LOCAL PARTNERSHIPS”

There are few more complex supply chains than healthcare, bringing both highly regulated sourcing of products

due to the nature of their use and the urgency of true life or death decision making, where an inability to procure the necessary goods can impact lives.

“You’re not going to put someone’s life at risk if you don’t get something on the grocery shelf, or your Amazon order doesn’t make it,” affirms Morse. “That’s the challenge we face, even down to something you’d imagine is relatively straightforward. Take a flexible straw – something you see in every restaurant you visit – as an example. In the hospital that same straw goes into a water pitcher at the patient’s bedside but, if it’s not flexible, the patient has to move the pitcher and can spill water. Having that flexibility means they can sit up and drink without the risk of spilling; that straw becomes a life-saving device because if you’re not able to source that, people aren’t drinking and staying hydrated while they’re in hospital.

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particularly how they moved rapidly to find an alternative solution or product, or to work with another supply – it was important to have that redundancy. Of course, there are still challenges. People think COVID has gone and that a lot of the disruption we faced is in the rear view mirror because we’ve collectively solved many of the major supply chain challenges. That’s really not so much the case in healthcare, where the issues have pivoted from the initial problems we faced around PPE, through raw materials and sourcing non-preferred products.”

“That’s the difference in the healthcare supply chain, and we’re talking about relatively mundane products here, before we even consider more complex things like expensive knee replacement implants or specific equipment,” he says.

“The bottom line is that every decision you make has a knock-on effect because it’s so important and can save a life.

If you don’t take that seriously because you’ve worked in other industries where you can delay production or order or miss a delivery window, then people may be harmed because of that.”

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PANDEMIC DISRUPTION

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To make those decisions and operate a complex supply chain like that at Morse’s current IDN is challenging at the best of times. To do so during a global pandemic, even more so. Morse originally came to the business before COVID, during a period of relative business as usual and tasked with transforming the organisation’s supply chain. “It was a transformational role,” he explains, “because the supply chain here was, and to an extent still is, relatively immature in that it hasn’t had the decades of investment in technology, tools, processes and governance structure that you may find in other organisations. There was a lot of opportunity to bring more structure while also focusing on saving money, and so in those early days that was the focus: building the supply chain out. Then COVID hit. It changed the ball game.”

No one could predict the extent of the challenge that many healthcare organisations like Morse’s would face as the pandemic spread worldwide impacting work, production and manufacturing, transport, logistics and those managing the already complex supply chains.

Initial challenges for Morse and team included shortages and price rises of personal protective equipment (PPE) including masks, gloves and other items as demand from both other health services and government organisations soared. To mitigate the challenge required flexibility and agility in the

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team’s ability to consider other suppliers and sources which, says Morse, made vendor relationships, trust and transparency between suppliers and partners, and communication essential. Unable to leverage size like some other larger health services, he found solutions in existing and new relationships with local companies and within the wider community.

“We really leveraged those local partnerships,” he states, discussing the importance of such relationships. “One, Medline, was our main distributor and the relationship we had with them really meant they gave us untiring support and availability of products when there were

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In it for the long haul—and all your other supply chain needs.

“The local support was strong,” continues Morse. “So many wanted to help, and while not all could, we formed some

good partnerships. We’re not like some of the larger health systems that have hundreds of hospitals all over the US, or even globally, and the supplier reach that comes with that size. We’re a small, regional player so we had to think differently and be prepared to react quickly.

It was a very challenging period – during the very early stages of the pandemic, once you started communicating with suppliers you had to be able to purchase the products quickly and with little delay, or you’d lose your place in the line.

We realised we had to be agile and think on our feet, having multiple suppliers who could come through for us, which of course brought its own challenges.

But that was the nature of the beast.”

Healthcare products and practices are governed by strict bodies, regulations and sets of standards including the National Institute for Occupational Safety & Health (NIOSH) and, during the pandemic, Emergency Use Authorisations (EAUs) that were introduced by the US Food and Drug Administration (FDA) to help address concerns about availability of certain PPE products. Understandably, when pivoting quickly between suppliers and products, this placed additional challenges on Morse and the team.

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real challenges – they either found the exact product or did a great job of sourcing alternatives. But there were so many other examples of how local relationships paid off. For example, we worked with a fireworks supplier here in Oklahoma that was able to leverage existing partnerships it had in China to source PPE masks for use in our hospitals; we also worked with a local gentleman who wanted to help and was using his own 3D printer to make face shields that we were able to use.

“You had to be sure that the product you were sourcing was either an acceptable one in the first place, or was on the EAUs, which meant lots of vetting and sampling when we were trying to be very

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Interview

agile at the same time,” he comments.

“Trust and transparency was challenging, purely because of the number of parties in the marketplace at that point, and there were instances of counterfeit products identified by the FDA that we had to make sure were not in our inventories.

That’s why it was so important to have multiple sources of supply, not have all your eggs in one basket, and to keep communicating with suppliers – most were allocating products and delivering piecemeal rather than in one shipment because of the logistic challenges, but we worked through it. Like many others, we ended up with surplus supplies, much of which we’ve since been able to send to other organisations or countries like Ukraine, and contribute to humanitarian aid efforts.”

Slowly, the healthcare sector began to navigate the challenges surrounding PPE, says Morse, with the most significant problems being largely under control and supply chains regaining some of their previous health into 2021.

However, subsequent commodities issues including challenges in raw materials, manufacturing and transportation from Asia to the United States placed continued strain on those working in the industry.

“In many ways the PPE challenges were easier to manage,” says Morse. “It was a more limited scope of products and the issues around raw materials and

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manufacturing were far less predictable – whether it was glass, plastics or chemicals for all our work, you just never knew where a problem would manifest and the suppliers were unable to give clear forecasts. It was big challenge, and required a lot of close work with suppliers, asking for transparent communication, regular updates, and that they are open and honest about the situation – several times we had to pivot to other suppliers from those that are good partners with good products, but weren’t forthcoming with the information we needed to keep the doctors and nurses at the hospital informed on supply disruptions or product substitutes.

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“WE’RE A SMALL, REGIONAL PLAYER SO WE HAD TO THINK DIFFERENTLY AND BE PREPARED TO REACT QUICKLY” “And that’s a really important point,” he adds. “On the other side of the supply chain are the people in the hospital who need the equipment, and we have to be able to give them the information on what they can expect so that they can make the right healthcare decisions. For our team, it simply wasn’t possible to say ‘I don’t know’ – we had to get them what they needed, or

give them as much transparency as possible. That way they can make the call on what patient gets the products we have, where we could use alternative therapies or treatments; it’s what they’re looking for us to provide and, I think, that’s the reason we’re all going to see such a premium on value of supplier partnerships, trust and relationships as we move forward.”

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LESSONS LEARNED AND THE FUTURE

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We are by no means past the disruption and heightened risk levels that the COVID pandemic brought to global supply chains and health care systems.

Nonetheless, Morse points to several key learnings from his and the team’s handling of the crisis that are relevant to all working in the profession, including around building greater resiliency and the importance of working closely with partners. “We need to look closely at suppliers, be more vigilant of where they’re manufacturing products, where they source their raw materials from, what levels of stockpiling they have, where is it stored, and how are they transporting it to us,” he says of the former. “Resiliency is the key watchword.

We can’t influence the answers to a lot of those questions, but we have to have a higher level of understanding of the answers and better preparedness so that we can anticipate and avoid any further significant crises and disruption.

“OVER THE LAST COUPLE OF YEARS WE’VE SEEN DIFFICULTIES WITH LOGISTICS, AVAILABILITY OF PRODUCTS AND RAW MATERIALS, AND THE GENERAL BREAKING DOWN OF MANY OF THE ESTABLISHED SUPPLY CHAINS AROUND THE WORLD”

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products, logistics and procurement, and how they diversify their portfolio across different locations and geographies. All of this has changed since the pandemic and more recent disruptions from weather and conflict and, certainly from our perspective, it’s making us look at everything very differently – it’s a balancing act we have to collectively get right.”

“A lot of this comes from the communication we’re having with partners,” Morse continues. “We are certainly challenging them to be more resilient and to see their roadmaps for that journey because, ultimately, however good a product is, if the supplier can’t get it to me then we have to consider alternatives. At the same time, I know we’re not the only ones who expect to see greater transparency from suppliers in this industry, particularly when it comes to details about their

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Everyone wants to be tested, as Morse himself said. And, in this instance, he and his colleagues faced the test head on, ensuring that the level of healthcare at his current IDN remained consistently high and learning valuable lessons to apply to future improvement and evolution. Assessing the last couple of years, Morse is modest and honest in his summary: “It was the ultimate battle test,” he says. “Were we 100% able to solve every crisis that hit our supply chain? No. We failed sometimes and got burned, too.

“But, ultimately our clinicians, physicians, administrators and people across the organisation knew that 99% of the time we either had what they needed or could provide a suitable alternative that wouldn’t put either the patient or caregiver at risk,” adds Morse. “And that’s something that’s certainly always driven me. Over my whole career, whether in the military or any of my supply chain work, I’ve always focused on doing something that I feel good about, that I believe in, and that I think is making a difference to the community or other people.”

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Entrepreneur

EMILY ROGERS & CLAIRE RAMPEN When Emily Rogers and Claire Rampen came together in 2019 they brought years of experience in technology businesses, and an understanding of how to use data to overcome operational and commercial hurdles to a shared objective: to understand why businesses weren’t reusing packaging, and change it.

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“WE ARE EXPERTS IN REUSE. THE PRACTICAL KNOW-HOW WE’VE GAINED FROM DEPLOYING SEVERAL REUSE SCHEMES MAKES US A POWERFUL PARTNER IN TACKLING CLIMATE CHANGE”

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Through research they found people and organisations aware of the mounting threat of climate change and keen to implement more sustainable practices, but beset by challenges. To mitigate these hurdles they worked with Innovate UK, the UK’s innovation agency, and published their findings as an Open Data Standard known as reuse.id. This became the foundation for Reath, a simple-to-use platform that creates digital passports for physical items and tracks them at every stage of their lifecycle.

Today, the award-winning startup helps businesses launch and scale reusable packaging systems that engage customers, bring greater ESG outcomes and help reduce packaging waste. A machine readable tag is added to each item, Reath scans it and creates a digital twin in its system capable of tracking every step of its journey. reath.id

Emily Rogers, co-founder & CEO, Reath

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THE POWER OF PROCUREMENT EDUCATION 82

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IAN DAVIS EXPLAINS HOW IMPROVING EDUCATION AND EMBRACING A LEARNING-LED APPROACH TO PURCHASING CAN HELP TO ENACT TRANSFORMATIVE CHANGE WORDS JONATHAN DYBLE

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A

cademia is undoubtedly important. However, all too often there is a disconnect between the knowledge that students acquire during their studies and employment opportunities in the real world.

One study previously revealed that 44% of undergraduates are unable to define the industry that they would like to work in once they graduate. Meanwhile, more recent research also shows that over a third of Americans have no plans after graduating from college or high school, while 41% don’t have a job lined up.

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Like many others, Ian Davis found himself undecided on future plans upon graduating from Northern Arizona University with a BSc in Business Administration. “I got hired by a distributor right out of college, and I remember the recruiter asking me what I wanted to do,” he recalls.

“I remember them saying, you’re about to graduate. What do you want to do with your life? What do you want to do when you come and work for us? I didn’t have an answer.

I didn’t know. Thankfully, they said this wasn’t a unique situation, and put me on an externship programme so that I could experience four different aspects of the business – recruiting and HR, finance, credit and as the last stop, either warehousing or purchasing.”

For Davis, it was this last stop that provided the lightbulb moment he needed. “At the end of the twelve-month programme with three-month stints in the aforementioned departments, they asked me what I wanted to do,” he explains. “I said ‘it’s purchasing, 100%, all day, every day.

I could do this for the rest of my life’. It was that perfect combination of putting everything together. Purchasing can be like the engine of an organisation.”

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INSPIRED TO EDUCATE Since then, Davis has gone on to have an illustrious career as an established procurement leader. Having held senior roles at several companies, he today stands as the Director of Procurement for Airtron Heating & Air Conditioning, one of the leading heating, ventilation, and air conditioning (HVAC) providers in the United States.

“NOT MANY UNIVERSITIES HAVE A STRONG PRESENCE IN SUPPLY CHAIN. WE NEED TO UPSKILL YOUNG PROFESSIONALS IN THE RIGHT WAY”

Through his exposure as a hiring manager, as well as his own university experience, it has become clear to Davis that a significant knowledge gap exists in the purchasing and procurement arena.

“Not many universities have a strong presence in supply chain,” he affirms.

“It’s an under-represented skill. Even now, I’ve hired people that unfortunately don’t have a full grasp of how purchasing and supply chain ties into the rest of the organisation. We need to upskill young professionals in the right way.

“We need to teach them that learning how to speak to finance teams in language and terms that finance professionals are accustomed to only helps you do a better job; one that could see your business use the savings procurement has negotiated to reinvest into the business. Similarly both legal and procurement could write the best contracts in the world, if you can’t pay your bills on time, or suppliers can’t invoice you correctly, you’re going to have a nightmare,” Davis continues.

“Supply chain professionals coming out of universities lack this understanding of how the whole jigsaw puzzle fits together. They may see a few trees, and understand specific functions, but they often fail to see the whole forest.

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Operating out of 13 locations across Texas, Ohio, Maryland, North Carolina, Indiana, Kentucky and Tennessee, Airtron’s North American Technician Excellence (NATE®) certified technicians provide a variety of installation, repair and maintenance services for heating and air conditioning systems. The company provides an all-encompassing approach to HVAC solutions, delivering prompt, efficient and high-quality products and services for the residential new construction market as well as the direct

to consumer space. Its services include professional installations and comprehensive Essential HomeCare Plans that provide customers with ‘comfort you can count on’ [its slogan].

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“It’s in this way that good procurement professionals can properly diagnose the root problem and address it before the trickle-down effect reaches the everyday purchaser. Throwing people at the end result of the problem only solves that one specific moment’s problem, but it doesn’t prevent it from occurring again, and possibly occurring worse the next time. It’s this preparation and the thoughtfulness to plan for and foresee these issues in advance that ensures supply chains can avoid catastrophic disruptions to its businesses.”

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“WITH SUPPLY CHAIN AND PROCUREMENT, YOU HAVE THIS UNIQUE AND IMPACTFUL PROFESSION”

aligned, as well as outlining the need to consider external macroeconomic influences. He has also mentored many of his employees to obtain similar procurementfocused certifications to deepen their understanding of their profession as well as to fully enforce their passion for the profession and to continuously improve their own craft.

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However, in further highlighting the knowledge gap, it also inspired a true passion and desire in Davis to move into education himself, to inspire the next generation and provide them with the skills and understanding needed to hit the ground running. “My current aspiration is to get into teaching,” he affirms.

“I really want to get in front of freshmen and try to start flipping majors towards supply chain and procurement.

“It’s truly exciting to think about. I would hope to show them that there’s more than just science, than accounting, than HR,” For Davis, this disconnect resulted in him continues Davis. “With supply chain personally returning to education to and procurement, you have this unique obtain a certified supply chain profesand impactful profession. I’m not going sional certification (CSCP) as well as study to pretend I have all the right answers. a Master of Business Administration But if I inspire just a few people, then the (MBA) at the University of Denver. And, head start they can have will be immense. by his own admission, this transformed They’d have four years of development his understanding of supply chain. While time which they wouldn’t then have to Davis previously had a good understandspend in the real world juggling both ing of financing and accounting from his performing and learning the nuances of undergraduate, the MBA enabled him to supply chain and procurement.” appreciate the big picture, demonstrating how each individual operational function

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Interview

CHALLENGING TRADITIONAL APPROACHES

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For Davis, several key focus areas will provide the next generation of professionals with the skills and knowledge to prepare them both now and into the future.

Specifically, he points to project management and business intelligence as the two future cornerstones of procurement.

“Supply chain can be just as much about driving change as it is the movement of goods within an organisation and market.

And to drive change, you need to have an understanding and grounding in project management,” he explains. “Equally, what can you change? That usually comes from good business intelligence and partnering with IT people to acknowledge pipelines, timelines, and what is realistic.

You can’t do everything all at once, so you must think, brick by brick, how am I

“AT THE END OF THE THREE-MONTH PROGRAMME, THEY ASKED ME WHAT I WANTED TO DO. I SAID IT’S PURCHASING, 100%, ALL DAY, EVERY DAY. I COULD DO THIS FOR THE REST OF MY LIFE” 90

going to move the business in a meaningful way? What are the quick wins, and what should come later? In many ways it is similar to building a home, certain steps must come before another. You can’t put on a roof after laying the foundation if you don’t have any walls.”

IAN DAVIS

“Relationships are a critical part of supply chain, but procurement can’t operate on decision making that relies too heavily on relationships or gut feelings. There are principles that go beyond handshakes or proximate awareness,” he explains.

“I’ve seen it all too often within the homebuilding and HVAC industry, someone dictates what product is acquired based on their preference, creating a dynamic in which the tail wags the dog. That’s an equation that needs to change. And it changes by implementing tools that help the purchaser make fact-based decisions and help them make those decisions more easily and more often. I see that happening through the implementation of business intelligence tools and increasing automation.

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Airtron has proved an exciting project for Davis, the company backing him to enact key changes that are already having significant impact. One of the most significant shifts that he has overseen has been an evolution away from a regional, fragmented approach to purchasing across its various locations towards a more consolidated, logical, national approach.

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“By reducing the hands-on, labour-intensive purchasing and allowing purchasing to transform into procurement a supply chain can evolve to worry less about saving money on one purchase order but by conducting deeper and more consistent RFP’s on products,” adds Davis. “Instead of consulting just one OEM, we can consult several, outlining our annual expenditure and asking them to make us an offer. In this way, you get a free market economy, awarding the contract to the best deal. And while local contractors may be resistant to this change, we will ultimately secure them more business. If we make more money, we can invest more in marketing and expand our business.”

KNOWLEDGE LEADING TRANSFORMATION Returning to considering education, Davis has typically found that many supply chain professionals are resistant to change simply because they don’t understand the potential benefits that can be derived by taking a disruptive approach.

“If I’m able to save $2 million over a year because we negotiated a better price, and we have better performance, and a better reputation, then we should be open to a change in approach,” he affirms.

Partnerships are key to this approach, Airtron’s work with AprilAire standing as a prime example. Together, the two companies are discussing how to create a better experience in the add-on and replacement of HVAC systems, educating service technicians and sales folks to

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improve customer experience as well as being able to pass along that knowledge to their consumers so they too can be better informed. By ensuring education is always made a priority, transformative projects will be met with less resistance.

“It’s about educating people about these potential outcomes,” Davis concludes.

“Yes, there’s a steep learning curve, but it can pay off immensely. We hope that through our strong relationship both

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“RELATIONSHIPS ARE A CRITICAL PART OF SUPPLY CHAIN”

Aprilaire and Airtron Heating & Air Conditioning can educate consumers on how they can improve their home’s indoor air quality (IAQ) to create healthier spaces for their families to live and breathe in.” airtron.com

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Innovation

T I M E L E S S LUXURY

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INTRODUCING CRADLE TO CRADLE CERTIFIED GOLD CASHMERE SWEATER: ICONIC, ENVIRONMENTALLY FRIENDLY, AND BASED ON CIRCULAR PRINCIPLES THE PURCHASER MAGAZINE | ISSUE FIF TEEN

Ralph Lauren and timeless luxury – one and the same since the American fashion designer launched his eponymous fashion brand in 1967. Ralph Lauren products have always been designed to be worn, loved and passed on through generations or, as Lauren himself said: “We have always stood for values and things that last – things that are timeless and enduring, things to cherish as they age and that never fall out of style”.

The fashion label takes its environmental and social responsibilities seriously.

Take, for example, its Live On Promise, part of its Timeless By Design approach.

The promise sets out how new products will be designed according to circular principles, that it will work to extend the life of existing products through initiatives around repairing, rent and recirculating, and that it will invest and participate in industry innovation for circular initiatives.

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Innovation

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“MADE TO BE WORN. MADE TO BE LOVED. MADE TO LIVE ON”

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To deliver on this pledge, Ralph Lauren is dedicated to responsible design and sourcing, the use of sustainable materials and integrated circularity, and environmental bestpractice across its operations; the brand also champions diversity and inclusion, community engagement and philanthropy, and empowerment across its supply chain.

As part of its Live On Promise, Ralph Lauren has pledged that,

by 2025, five of its iconic products will be Cradle to Cradle (C2C) Certified. C2C Certified is a global standard applied across industries, brands and manufacturers for designing and making products that enable a healthy, equitable and sustainable future. It provides a framework to assess materials and products across five categories: material health, product circularity, social fairness, water and soil stewardship, and climate pollution.

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Innovation

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This means all materials used are safe for people and the planet,

adhere to circular principles, and apply renewable energy and emissions reduction initiatives during the manufacturing processes.

In addition to launching Cradle to Cradle Certified Gold Cashmere Sweater, Ralph Lauren has created a cashmere recycling programme in collaboration with textile recycling company Re-Verso. Through the initiative, customers can send 100% cashmere products directly to Re-Verso’s recycling facility in Prato, Italy where the yarns will be repurposed for new products. www.ralphlauren.com

“WE HAVE ALWAYS STOOD FOR VALUES AND THINGS THAT LAST – THINGS THAT ARE TIMELESS AND ENDURING, THINGS TO CHERISH AS THEY AGE AND THAT NEVER FALL OUT OF STYLE”

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The recently introduced Cradle to Cradle Certified Gold Cashmere Sweater is the first of the brand’s products to be C2C Certified.

During its crafting, each stage of production – from the cashmere fibers through to the rich dyes and organic cotton label – is assessed with the C2C Certified Product Standard. All three were certified at Platinum level, the highest obtainable, for material health; in the four other C2C Certified categories Ralph Lauren was awarded Gold, the level directly below Platinum.

RALPH LAUREN

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THE POWER OF PARTNERSHIPS CHRIS OWENS DISCUSSES SUPPLY CHAIN AND PROCUREMENT IN THE RELOCATION SECTOR, AND THE IMPORTANCE OF SUPPLIER RELATIONSHIPS AND LEVERAGED OPPORTUNITIES

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t’s true what they say. Often, particularly in business, the best ideas are the simple ones. Supply chain and procurement have changed immeasurably in recent years – new technologies, innovation, digitalisation, a more strategic outlook and set of objectives, disruption and more making the role complex, multifaceted and more challenging. In such an environment it doesn’t hurt to remember the fundamental skills at the heart of these important business functions: communication, partnerships and strong relationships, collaboration and shared, leveraged opportunities. Together they contribute

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significantly to customer delivery, value and experience.

Chris Owens is an advocate for the power of leveraged opportunity and the importance of the relationships he and his colleagues nurture to maximise value.

He has to be. His work at JK Moving Services, a global leader in the relocation and logistics space, and sister company CapRelo, which offers relocation services for corporate, government and international clients, involves moving people all over the US and internationally, and demands the highest levels of service and customer experience possible.

Owens is an experienced supply chain management professional with over 35 years of successfully managing supplier and client relationships across several sectors including financial services and insurance, hospitality and, most recently, corporate relocation and logistics. And, while the profession has evolved significantly over that period, engagement, communication and relationship management have been consistent threads that underpin his work.

“People will always talk about ‘build it and they will come’, ‘price it and they will buy’, and that’s fine,” he says,

“People don’t look forward to moving or relocating because it’s difficult,” he continues. “It’s stressful, is a complex operation, takes time, and involves many components and third parties that the average person doesn’t necessarily understand or can complete themselves. That’s what we do so they don’t have to worry.

And that’s why I also talk about experience a lot and push it to our suppliers as well. We’re a service business. A lot of talk nowadays is about technology and innovation, but we’re a face-to-face business and so our entire supply chain has to understand what and who they’re ultimately serving. If we don’t do a good job or if the transferee has a terrible experience, then we don’t serve the client organisation and their goal of capturing and retaining talent.”

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picking up on the theme, “but it’s the partnership and leveraged opportunity that really lets you bring value to those you serve. In particular when it comes to supplier engagement, companies and supply chain or procurement teams will often flex and talk about price and volume, be a part of it and we’ll test you in three months. I don’t think that applies any more. For me, particularly here in my current role, it’s more a case of ‘we’re in business together, how can we take what we need as a business and what you do well and with value as a supplier, and combine them to enhance the experience of people we work for?’.

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“IT’S CRITICAL I CAN COMMUNICATE EFFECTIVELY WITH SUPPLIERS TO DISCUSS OPENLY AND HONESTLY ABOUT HOW THEY CAN MEET OR MITIGATE MY CHALLENGE AND HOW THEIR PRODUCT, DELIVERABLE OR CULTURE MEETS OUR GOALS” 104

RELATIONSHIPS AND LEVERAGED OPPORTUNITIES The ability to nurture these kinds of relationships and engage across the entire organisation in order to align objectives and outcomes for all parties is an essential skill of the modern supply chain and procurement leader, says Owens. “I think we’ve moved away from a time where the professions weren’t front facing within the organisation,” he explains. “We touch every aspect of the business and its opera-

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tions, and so we have to be prepared to have a deep level of engagement with all stakeholders. Previously, there’s been a tendency to say ‘throw it over the fence to supply chain, they’ll refine it and come back to me with a finished product’. I just don’t think that’s the case anymore.

“To be successful you have to engage with every stakeholder, identify the needs of the business and the project or programme, have the knowledge to mould the questions we should be asking of the market, and then engage with the suppliers and ask them to respond,” Owens continues. “A good leader has to be the kind of person comfortable with doing that – when you’re talking about services and experience it’s a deep process. Sure, the competency of ‘supply chain’ is still important, but you have to focus on everyone’s deliverables, including the end customer. Understand what the business or the division needs, what the client needs and the benchmarks we’re setting, and then engage with the supplier by bringing them into that discussion so they have the opportunity to communicate how they can meet that need.”

This approach is a by-product of Owens’ various supply chain and procurement experiences, in particular his time working in food and beverage and the hotel sector.

“It’s intuitive and it’s a simple process, really. Sometimes a lot of those things can get lost in the weeds when we’re just talking about product or cost. Yes, it’s supply chain, but it’s about having a marketing or branding head on too, particularly when it’s about the kind of delivery and experiences we want to offer. I remember in previous roles several times engaging across the whole organisation on certain initiatives, and brand VPs always asking the question ‘how will the customer react?’.

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“With that mindset, price almost becomes table stakes,” he continues. “Everything else suddenly becomes more important: what if you don’t hit the mark, move the product, or deliver the service that’s expected? All of that has to be built into the analysis and initial development from a supply chain and procurement perspective and, within that, it’s critical I can communicate effectively with suppliers to discuss openly and honestly about how they can meet or mitigate my challenge and how their product, deliverable or culture meets our goals.”

SUCCESS IN RELOCATION Owens has brought this approach to JK Moving Services and sister company CapRelo, which he joined in 2014, marking his first foray into the relocation space.

JK Moving provides full-service moving options for long-distance and international moves and is a global leader in the relocation and logistics space. It assists customers in both the residential and commercial sectors and, in the latter, has been working with companies and enterprise clients to help them move since 1982. In the commercial sector, JK Moving offers several services including officer moving, commercial storage, technology services such as reconfiguration and decommissioning of mission-critical assets and data centres, specialised or niche services, archiving, and global relocation.

CapRelo offers relocation services for corporate, government and international clients, providing customised and flexible

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“WE’RE A FACE-TO-FACE BUSINESS AND SO OUR ENTIRE SUPPLY CHAIN HAS TO UNDERSTAND WHAT AND WHO THEY’RE ULTIMATELY SERVING”

global mobility solutions centred around the core objective of making the process as easy as possible for everyone involved, from clients and their employees, through to partners and suppliers.

Owens is Director of Supply Chain and Procurement for both organisations and is responsible for the entire procurement supplier development process for both direct purchases, which impact the JK Moving environment, as well as thirdparty relationships with partners that work with clients to transfer employees.

“On the CapRelo side, it’s all about thirdparty relationships,” adds Owens. “In this instance, our suppliers are the ones that provide service delivery for relocating our customers including destination service providers, temporary housing providers, mortgage providers, household goods movers, insurance and more. The scope of that aligns with the particular client’s policy. Typically, their mobility departments will develop policies that could be for C-suite level relocations, to a variety of other positions within the organisation; they’ll have varying services included under that as a benefit to the employee to accept a move for the company from one location to another. We have to understand the deliverables that are specific to the client, but there’s typically a lot of crossover, which is where we’re then able to use our scaled opportunity to bring value. And it really is about value, not price. Everything we do has to be centred around moving the transferee

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“I manage both sides,” he says, exploring his role in more detail. “So, that’s the actual purchasing of items that support the JK Moving deliverables – things like truck and trailer equipment, forklifts, fuel, lift vans, packing materials, safety equipment, uniforms, and all the components that make up a successful household goods moving project. We have a large fleet that this work supports, and we also have teaming agreements with other partners that help to increase our scope both nationally and internationally.

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as seamlessly as possible, and within “EVERYTHING WE DO HAS budget, from A to B and, if I do my job I can use the leveraged opportunity TO BE CENTRED AROUND toright, manage this programme, negotiate relationships more effectively than partMOVING THE TRANSFEREE ners can do on their own, and work directly with them to bring the best value AS SEAMLESSLY AS to the ultimate end user of the service.”

POSSIBLE, AND WITHIN Since joining the business, Owens and his colleagues have evolved the supply BUDGET, FROM A TO B” chain and procurement process with the objective of initially understanding what the supply chain looked like and where improvements could be made, before working on the process. “When I came on board, I had to quickly assess all our categories and understand where

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the challenges and complexities were so that we could move from a place where the supply chain was managed across divisions to one in which we could scale opportunity,” he explains. “The challenge was in understanding the complexities of the various components and considering how best to engage with the suppliers to try to and highlight/expand their value proposition that we can extend to the clients.

CHRIS OWENS

NAVIGATING THE MARKET This ongoing evolution has paid dividends for the business, says Owens, particularly recently when the market more broadly has been affected by challenges in the real estate space including pricing uncertainty, fluctuations in rates, and decrease in inventories impacting affordability. In navigating such challenges, he explains, closer relationships with suppliers play an important role.

“It’s an important moment for them to bring their knowledge and expertise of the market to me and offer suggestions, advice or solutions for tackling the various challenges we face together around availability of inventory, squeezes in the rental sector and so on.

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“It was the first thing I did,” he says, of the engagement with suppliers. “I realised that, not only could we do a better job to try to build these environments or streamline and extract the value from them versus simply giving it away, but also, from the supplier’s standpoint, they

would have an opportunity to expand what they do well, and provide their true value to a greater audience. In our network we had around 14,000 suppliers, which meant there was no leveraged opportunity. I had to work almost category by category to understand where we needed to focus to increase efficiencies, ensure they’re working within our processes, and encourage them to provide best value to us, while also bringing in new technologies to improve efficiency.”

“It makes working collaboratively really important,” adds Owen. “I have regular conversations with our key real estate partners, for example, to try to get more accurate projections of market direction and for their suggestions around how we

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Interview

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can still deliver the best experience for the transferee. It’s probably one of the best opportunities in years to get people to really look at how they work and how they can change to get through challenging times; it definitely calls for greater acceptance of having our suppliers be almost front-facing, engaging and offering solutions that can give our clients the best relocation service.”

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Owens points to close collaboration with partners including Colonial National Mortgages and National Corporate Housing as good examples of this. “Colonial is a key partner,” he states, “and we’ve worked together for many years. It’s an example of

“I HAVE REGULAR CONVERSATIONS WITH OUR KEY REAL ESTATE PARTNERS TO GET MORE ACCURATE PROJECTIONS OF MARKET DIRECTION AND FOR THEIR SUGGESTIONS AROUND HOW WE CAN STILL DELIVER THE BEST EXPERIENCE FOR THE TRANSFEREE”

a supply chain relationship that works hand in hand directly with the transferee to understand their credibility, affordability requirements, type of home loan and more to create a mortgage package that best meets their goals. Because of the volatility in the market recently, we’ve been working really closely together and they’ve been useful in offering expertise and suggestions.

“In similar fashion, National Corporate Housing is also a key partner for us,” Owens continues. “They offer corporate apartment solutions internationally and are a lead partner in the space. Because of the nature of the work – understanding individual client policy benefits and temporary housing terms – they work directly with the customer to outfit them with a particular unit that’s close to where they need to be.”

Owens and the team and JK Moving and CapRelo will continue to nurture close collaboration with suppliers and partners into the future. At the same time, he says, technology will play a more important role, in particular systems to measure supply chain efficiency and to manage performance and processes more effectively.

“We have pretty aggressive growth goals,” he says. “As such it takes investment in people and infrastructure to manage the multiple categories that we already have, and which are new, with the latter also meaning new clients, new regions of the world, and new partners and supply chains to support that development.

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“Looking ahead we’ll continue to test and renew our own existing environments, particularly with all of the challenges we are currently seeing in the market,” he states. “One area to focus on is our measurement and analysis of each of our relationships, and not just in terms of sales against expectation but customer service scores and other key metrics. I’m a firm believer that they’re a real value that we can present to future clients as a demonstration of why they should work with JK Moving and CapRelo. The most important thing is really the supply chain to get the

value. It’s understood, but I don’t think it’s promoted. We deliver through our network of suppliers all the things we talked about and I want to improve exposure of that, making sure we all take advantage of the value of these important relationships and what they deliver as a business development tool for us.” www.jkmoving.com

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PROCUREMENT WITH A LONGTERM LENS

PER SANDBERG REFLECTS ON KEY LEARNINGS ACQUIRED THROUGHOUT HIS 30-YEAR CAREER AND EXPLAINS HOW THEY INFLUENCE HIS ROLE OF STRATEGIC PURCHASING DIRECTOR AT VBG TRUCK EQUIPMENT WORDS TOM WADLOW

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Interview

PER SANDBERG

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R

emaining in the same profession for three decades requires a lot of things – knowledge, passion, perhaps even patience, and persistence when times are challenging. For Per Sandberg, 30 years after graduating with a logistics degree at Chalmers Technical University in Gothenburg, enjoyment is what drives him to keep going in the procurement business.

Working in materials planning and logistics development in the early 1990s at Saab Automobile AB, then owned by General Motors, Sandberg was recruited to take on a purchasing role. The rest, as they say, is history, with a brief switch into healthcare procurement followed by a return to the automotive sector and VBG Group’s Truck Equipment division in 2008. Today, he draws on all his acquired experience and learnings in the role of Strategic Purchasing Director at the organisation.

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“I’m still having a lot of fun,” he says, as we catch up with him full of energy despite it being the end of a busy week.

“And I wasn’t even ‘destined’ to work in procurement – there was no real career plan in place after my education.”

Considering in more detail the key ingredients that make up a successful procurement leader, he replies: “I have learned many things along the way, but building external and internal relationships is probably the most important part of working in procurement. With suppliers, you need to be open and honest, but also hard when necessary. This doesn’t mean adopting a ‘big bully’ attitude where you exert control. As a smaller firm, we realise we need to be humble. Internally, you need to care about the people in your organisation, because without them you yourself are not much at all. Leaders should be there to support, direct and push people – I’ve found that this approach always pays back.”

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Sandberg follows this approach at VBG Truck Equipment. Part of the VBG Group, it offers products and services under several brands that contribute significant value for customers and users in the form of increased reliability, personal safety, and efficiency. Its major product lines include drawbar couplings, underrun protection devices, and automatic tyre chains, with sales pursued across approximately 70 countries spread around the world. Key customer bases include truck body assemblers, truck manufacturers, and users of commercial goods and emergency vehicles.

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“SUSTAINABILITY AND ESG WILL BECOME THE CORE OF OUR OPERATIONS” A major USP is the company’s ability to offer highly bespoke solutions designed at a system-wide level as opposed to off-the-shelf individual components.

Meanwhile, its unwavering commitment to safety and ongoing role in pioneering more sustainable truck travel through developing systems that lower fuel consumption have positioned VBG Truck Equipment as a knowledgeable, valuecreating partner in the automotive ecosystem. In 2022, the Truck & Trailer Equipment division had around 380 employees on its books and contributed 36% of VBG Group sales.

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Interview

“WITH THE SUPPLY BASE, WE HAVE A ‘GROW, FIX, EXIT’ APPROACH” ‘COMMUNICATION, COMMUNICATION, COMMUNICATION’ Sandberg also highlights the importance of working through a long-term lens, with a mix of targets and objectives which are broken down into manageable pieces that are well communicated across the organisation. Shortly after he arrived in 2008, this very much became the priority when VBG Truck Equipment’s plant in Germany was closed due to the financial crisis, with operations being merged with its site in Sweden.

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Sandberg took on the role of plant manager in 2009 and immediately set about implementing some fundamental processes and practices. “Delivery performance to customers was not where it should be, and there was no long-term view or plan in place,” he recalls.

“Structural changes were needed to support a new culture where feedback and communication became king. We implemented KPIs and success factors and built in daily meetings to assess metrics in granular detail.”

Following the transformation of operations at the Swedish plant, in 2011 Sandberg moved into a broader Supply Chain Director role which now also sees strategic purchasing activities splintered out into a separate team from the rest of the procurement setup. In essence, his work has centred around developing a long-term supplier base that is healthy and thriving.

Sandberg has also adopted best practice sourcing processes from around the automotive world, and much like the feedback loops established internally, regular followups and constant dialogue with suppliers is helping to build bridges. “It is also important to celebrate our success together, which is why we created the Supplier of the Year award to recognise those partners who go above and beyond,” he admits. “It adds a little bit of healthy competition and suppliers see it as a prize they want to win, and we have had several local suppliers pick up awards which is great to see.”

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“We now have a commodity structure in place whereby everybody’s responsibilities are clearly set out with targets and longterm visions,” Sandberg explains. “We create strategies around how to get there.

With the supply base, we have a ‘grow, fix, exit’ approach. For the most successful suppliers, we want to grow our relationship and business with them. Others we

may identify areas that need fixing and will work with them to make improvements that benefit both parties. Where things cannot be fixed, we exit the relationship.”

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“YOU NEED TO CARE ABOUT THE PEOPLE IN YOUR ORGANISATION, BECAUSE WITHOUT THEM YOU YOURSELF ARE NOT MUCH AT ALL. LEADERS SHOULD BE THERE TO SUPPORT, DIRECT AND PUSH PEOPLE”

LOOKING AHEAD As the conversation steers towards what the future has in store, Sandberg outlines a combination of short-term and long-term priorities. In the immediate term, volatility caused by the ongoing crisis in Ukraine coupled with rampant inflation has created a dynamic where it is difficult to keep costs under control. Managing creeping expenses is therefore a major concern for Sandberg as VBG Truck Equipment seeks to continue offering value to its customers.

admission will be no small undertaking.

“Sustainability and ESG will become the core of our operations,” he says. “Much like how quality became a non-negotiable aspect of supplier-buyer relations 20 years ago, we are now heading rapidly towards sustainability doing the same thing. Once again this requires careful planning that looks far ahead into the future. It will be challenging, but it is imperative that we embrace it head-on.”

Longer-term, a key focus is embedding sustainability into the company’s value chain, a task that by Sandberg’s own

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www.vbggroup.com

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City Guide

EAT S LE E P WORK P LA Y

tiekol irqad xoghol play

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MA L T A

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W O R D S D A VID

GA LEA

You may be forgiven for thinking of Malta as a traditional sun, sand and sea destination, where people spend their days swimming, wining, dining, and cooling down at the beach, while working on their suntans. But there’s so much more to it that I don’t even know where to even begin. From a business perspective, not only has Malta developed a reputation for being an established financial services centre and one of the largest freeports in the Mediterranean, it has also proved to be a significant technology hub bridging the gap between Europe and North Africa. Tech business professionals won’t be disappointed to savour the experience that Malta has to offer.

Here, as a technology business professional myself, I share some of my favourite places to go to make your experience worthwhile.

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City Guide RADISSON BLU GOLDEN SANDS RESORT

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AIBC

MALTA IGAMING CONFERENCE BUSINESS As a reputable international tourism destination, several large conferences are organised in Malta, attracting thousands of people from around the world.

My favourites are:

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also attracts numerous representatives from VCs and Angel Investors looking for their next potential Unicorn.

AIBC (Artificial Intelligence Blockchain and Cryptocurrency Conference) is an annual event organised specifically around AI and Blockchain and characterised by world-class speakers in their

As a leading online gaming destination, Malta hosts one of the most sought-after conferences in the sector: Malta iGaming Conference. This is home to more than 160 speakers and exhibitors showcasing their best talent and innovations in the industry. Being a highly data-driven

corresponding areas. Networking is also integral, so much so that several peripheral events are organised for attendees to have time to connect, get to know each other, and exchange business. The event

sector, I’ve always been fascinated by how exhibitors demonstrate new and evolving capabilities in AI and Big Data analytics to develop an enhanced user experience for the industry.

HILTON MALTA

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STAY Business travellers are spoilt for choice when it comes to hotel accommodation in Malta, but there’s several I recommend. If you enjoy tranquil and peaceful surroundings with breathtaking sea views whilst tapping away on your laptop, then Radisson Blu Golden Sands Resort is the place for you. If you visit in summer, you can almost jump out of your balcony straight onto the surrounding golden sands for a quick dip in

privacy, while being served with the most delicious food.

Malta’s clear blue seas. Rooms are really spacious, particularly the suites, which feel more like small apartments. The business lounge is also extraordinary.

You can organise meetings in complete

some quiet time. Its business centre is fully equipped and is only a stone’s throw away from a marina that’s home to the most exclusive yachts.

If you subscribe to the proverbial ‘Work Hard, Play Hard’ maxim then I’d recommend a stay at the Hilton Malta.

It’s located at the heart of the entertainment centre in Malta, yet has been studiously built on top of a secluded creek that provides shelter from the surrounding mayhem if you wish for

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City Guide

DAVID GALEA, DIRECTOR, CENTIGO IRELAND David is an innovative digital transformation professional with over 20 years of international advisory experience.

David has worked for cuttingedge technology startups and developed new business models, leading high profile strategic and digital projects in Europe, the UK, and the Middle East. His extensive experience has enabled him to see beyond the complexity of technical frameworks and conceptual models to embrace a pragmatic and more humanistic approach that places people at the heart of everything he does.

Learn more at www.david-galea.com

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THET EPURCHASER C H - E X E C M AMAGAZINE G A Z I N E | I|S SISSUE U E F I FFTI FE TE ENE N

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City Guide TA’ XBIEX WATERPOLO CLUB

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PRECA RESTAURANT

EAT / DRINK No visit to Malta is complete without giving your palette a special treat. How can you say no to a succulent piece of Cerna (Grouper), Spnott (Sea Bass) or Pixxispat (Swordfish) made al Sale (salt), accompanied by roast potatoes and blended with an aroma of inviting herbs?

It’s well worth that extra 10k run you’ll need to sweat out to knock off a couple pounds and get back in shape.

You can rarely go wrong with a fish restaurant in Malta. My favourite one is Preca Restaurant, my first choice for a winter visit to the island. Set in the historical surroundings of Valletta, you can almost imagine a knight tying his horse at the door and shuffling his way through with his heavy armour to a table located

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in the traditional old building to be served by the owners themselves. It’s not just the vast selection of fresh fish available that makes this place special; you get several additions and surprises from the chef that add spice to the experience.

My obvious choice for summer would be a waterside restaurant like Ta’ XBiex Waterpolo Club. What more do you need than a good bottle of wine and fresh fish, served at a table where you can almost touch the water and feel the gentle breeze around your neck? What fascinates me most about this place is the reflection of the imposing Valletta bastions on top of the sea, partly distorted by the tiny ripples of waves that bump gently at the edge of the restaurant’s side.

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LEISURE Malta is big on entertainment of all types and for all tastes. If you’re an avid fan of bars and clubs, then Paceville is the place for you. The area is literally packed with young people having a great time, hopping from one establishment to another until the early hours of the morning.

If you’re staying at the Hilton Malta, Paceville is literally a stone’s throw away.

For years, Malta has been hosting the Isle of MTV during the summer months. This week-long event brings together the most popular singers in the world to perform live in front of thousands of fans. If you wish to attend this event, be sure to book early not to be disappointed.

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GLOBAL EVENTS CALENDER GARTNER SUPPLY CHAIN SYMPOSIUM/XPO 5-7 JUNE 2023 | Barcelona, Spain

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Must-have insights, strategies and frameworks for CSCOs and supply chain leaders to think big, and drive real impact within their organisations.

> VISIT WE BSI TE

PROCURECON IT SOURCING 26-27 JUNE 2023 | Boston, USA The only peer-led, senior-level procurement event solely dedicated to the unique challenges of the IT sourcing community.

> VI SI T WEB SI T E

PROCURECON ASIA 11-13 JULY 2023 | Singapore Asia’s leading summit for CPOs and Heads of Procurement. Your opportunity to learn from and network with Asia’s most progressive procurement leaders in one location.

> VISIT WE BSI TE

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PROCURECON EAST 11-13 SEPTEMBER 2023 | Orlando, USA Whether you’re a CPO or a rising star, a large or small spend company, ProcureCon has content and built-in connections to ensure your long term

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PROCURECON EUROPE 26-28 SEPTEMBER 2023 | Barcelona, Spain Benchmark your procurement strategies with CPOs and Heads of Procurement at the world’s largest companies to define how to best thrive in the current uncertain global landscape.

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sourcing success.

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DPW AMSTERDAM 11-12 OCTOBER 2023 | Amsterdam, NLD Where the world’s biggest brands in procurement showcase cutting-edge innovations that will pave the way for the future of procurement.

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