Intro/Outro (00:00:03):

Welcome to Supply Chain Now, the voice of global supply chain. Supply Chain Now focuses on the best in the business for our worldwide audience, the people, the technologies, the best practices, and today’s critical issues, the challenges and opportunities. Stay tuned to hear from those making global business happen right here on Supply Chain Now.

Scott Luton (00:00:32):

Hey. Hey. Good morning, good afternoon, good evening. Scott Luton and Greg White here with you on Supply Chain Now. Welcome to today’s livestream. Greg, how are you doing?

Greg White (00:00:40):

I’m much warmer now. Did you notice?

Scott Luton (00:00:43):

Man, that’s a quick change.

Greg White (00:00:44):

It was quick change, wasn’t it? From the green room to the — no. I’m doing quite well. Scott, how are you?

Scott Luton (00:00:51):

I’m doing great. And you weren’t even channeling a little bit of Enrique Alvarez, who made the infamous late entry there on the last —

Greg White (00:00:58):

I could do it if you want me to.

Scott Luton (00:01:00):

Oh, good old Enrique. Well, hey, folks, today we got a great show. We’re going to be talking about, Greg, the power of sourcing and its ability to respond successfully and powerfully in dynamic markets – like this one – to truly bring value by the truckload to the table. Greg, it should be a great show, right?

Greg White (00:01:18):

Yeah. Sourcing, I mean, if it hadn’t been a topic before, suddenly a topic of quite good, quite large concern these days, isn’t it?

Scott Luton (00:01:30):

That’s right.

Greg White (00:01:32):

Not just how you’re getting it, but where you’re getting it.

Scott Luton (00:01:33):

That’s right.

Greg White (00:01:34):

And whether you’re getting it.

Scott Luton (00:01:36):

Well, you know, one of the comments you’ve made a couple times, especially dating back to the middle of the pandemic, supply chain, the craft, as you put it, got a seat at the table a few years back or so. And they got to do something about it, as you like to say. And we’re seeing very similarly sourcing and procurement and those functional areas of leadership have finally have a seat at the table now as well, right?

Greg White (00:01:59):

Well, I mean, often, when we talk about sourcing and procurement, sometimes that’s sourcing and procurement of the direct materials that go into building the stuff that’s on those shelves behind you, the bottles and lids for sodas, and covers for books, and the packaging, and sometimes even the componentry or raw materials of what makes what we buy every day.

Scott Luton (00:02:24):

That’s right. And where all that stuff comes from, and how can you really leverage strategically the power of sourcing, which is what we’re going to talk about a lot here today. So, a lot of good stuff. So, folks, welcome in. We want to hear from you throughout the hour, the cheap seats as we call it or the sky boxes. We’re in football season now, Greg. We’re going to be sharing those comments throughout the hour. So, Greg, are you ready? Are you buckled in and ready to go? All right, man. We’re making highfalutin —

Greg White (00:02:57):

Sound effects and everything.

Scott Luton (00:02:58):

… sound effects these days on Supply Chain Now. Okay. With no further ado, we want to welcome in our guest here today, Ahmad Jiwani, Director of Product and Segment Marketing with Coupa. Hey. Hey. Ahmad, how are you doing?

Ahmad Jiwani (00:03:12):

Hey. Good. How are you guys doing?

Scott Luton (00:03:14):

We are doing wonderful. We’ve really enjoyed our pre-show discussions. We talked a lot of baseball on the frontend. We talked about food. We talked about that beautiful city over your right shoulder, which is, Ahmad?

Ahmad Jiwani (00:03:28):

Toronto, and how to pronounce it correctly as a true Canadian.

Greg White (00:03:32):

Just talking about Toronto made me cold, so I had to put this on, Ahmad.

Scott Luton (00:03:38):

And so, take it one step further, as you heard Ahmad just talked about pronouncing Toronto correctly. Greg, we have a similar challenge in Atlanta, right? Your comment on that.

Greg White (00:03:49):

You just did it. You nailed it. It’s not Atlanta. Just like it’s not Toronto. It’s Toronto and Atlanta.

Scott Luton (00:03:58):

All Ns. All Ns.

Greg White (00:04:00):

All Ns. Maybe a slight D in there, you know.

Scott Luton (00:04:03):

Well, hey, beyond geography, we’re going to start with a fun warm-up question in just a second, Ahmad, but I want to share a few folks that are here with us. Andre, via LinkedIn, let us know where you’re tuned in from. Nlthin, I believe – Nlthin, I believe from Paris. What a gorgeous and wonderful world city there. He’s tuned in from LinkedIn as well. Alfonso from the Mojave Desert in California via LinkedIn. Great to see you, Alfonso. So, folks, we want to hear from you throughout the episode. You know, comment on the whole conversation, and we’ll be sharing that with Ahmad and Greg. Okay.

Scott Luton (00:04:40):

So, Ahmad, before we get into talking all things sourcing a lot more, we discovered in the preshow conversations that you’re a bit like us or maybe a lot like us. You’re a big foodie.

Ahmad Jiwani (00:04:53):

Huge foodie.

Scott Luton (00:04:53):

Huge. So, Greg and Ahmad, today is National Gazpacho Day. One of me and Amanda’s favorite dishes. A delicious chilled soup, a good bit fancier than its cousin, maybe distant cousin, tomato soup. So, with that as a backdrop, especially as things, as Greg mentioned, it’s getting a little bit chillier, Ahmad, what is one of your favorite soups and who makes it?

Ahmad Jiwani (00:05:18):

Yeah, it’s a good question. I would have to say, I’m usually gearing towards more of the heavier soups. So, like your lobster bisque or a clam chowder or something like that, you know, in the winter time where you can just have a nice bowl and it fills you up, just really is a hearty meal. I don’t know if I have a place in mind that’s my favorite. But I know you being a Seinfeld as well, we talked about the lobster bisque and George’s pursuit of that on the T.V. show, and how he was cut off from that. But, yeah.

Scott Luton (00:05:55):

He sure was. What a classic episode. All right. So, Greg, we were just talking Seinfeld last week. We had a very popular exchange with a guest. But, Greg, what about you, favorite soup?

Greg White (00:06:07):

Clam chowder, unquestionably. And with celery. You know, there’s a big row about whether real clam chowder has celery or not. So, my favorite place to get it has celery, but they also add a little bit of bacon. That’s C&S right here in Atlanta. But, of course, Boston is a great place to get clam chowder.

Scott Luton (00:06:33):

Oh, man. We need to ask Kelly Barner where her best go-to spot. So, Ahmad, one of our hosts and friends here, Kelly Barner, is from the Boston area, and we’re going to have to get her input there, so we’ll see.

Ahmad Jiwani (00:06:47):

Yes, we should.

Scott Luton (00:06:47):

So, Greg and Ahmad, now that both of y’all have made me starving with your great suggestions, let’s get into the business of the day. And, first, I want to recognize, hey, Barry, great to see you here. Tuned in from the UK. “It’s already dark here,” Barry says. So, maybe Barry is in the middle of dinner. So, Barry, we’re all foodies. Share with us what your meal is tonight. We’ll see.

Greg White (00:07:08):

Has Europe fallen back yet? I don’t know if they have yet. I think they fall back a few weeks after we do.

Scott Luton (00:07:14):

Interesting.

Greg White (00:07:15):

Probably 6:00 there.

Scott Luton (00:07:16):

Okay. Well, you know what? We’re going to find out. We’re going to find out.

Greg White (00:07:20):

I’m going to do [inaudible].

Scott Luton (00:07:21):

So, Ahmad and Greg, let’s talk about sourcing and a lot more here today. But I want to start, let’s level set a little bit here, recent disruptions, market volatility, economic uncertainty, inflation, you name it, so much going on. Ahmad, let’s start with you with this level setting. What else is top of mind? And especially how some of those observations translate to sourcing teams and sourcing leadership.

Ahmad Jiwani (00:07:47):

Yeah. Yeah. Great question. And thanks, Scott and Greg, for having me on today. So, I think as you were saying just on the topic of inflation, Scott, we’ve seen just record levels of inflation. We hit, I believe, it was over 9 percent a couple months ago or back in the summertime. And, of course, that’s since kind of come down somewhat. And I think typically when people hear inflation, they tend to think about this Consumer Price Index, CPI. But there’s also something called a Producer Price Index, PPI, which really looks at inflation from the perspective of business at a wholesale level. So, looking at prices that are received by a producer for their output. So, similar to CPI, I think PPI shot up quite a bit, in the sense calmed down. But it was interesting how just overall higher input and material costs were affecting companies with physical supply chains, and how, of course, that was then being translated at the consumer level.

Ahmad Jiwani (00:08:47):

And then, one other thing that’s an interesting measurement, too, was something called the Consumer Confidence Index. So, with all this inflation going on and rising interest rates and really that index looking at future developments of household consumption and their sentiment around just kind of general economics, that’s dropped significantly. I think it’s at its lowest rate in about a decade. So, all that to say that demand for goods and services is slowing, and we’re seeing that play out, of course.

Scott Luton (00:09:17):

Well said. Greg, being our chief economist here at Supply Chain Now, what would you add to what Ahmad just shared?

Greg White (00:09:26):

Yeah. Let me just start with my usual disclaimer, not an economist, but as accurate as they ever are. So, I think inflation has to be the number one thing that we’ve seen, and it’s at a far higher rate than any government is reporting. And in a lot of cases, it’s very, very targeted inflation. Eggs, Scott, we talk about all the time, and various and certainly other things that are 30 percent and more, so it’s not insubstantial. And it is largely driven by either the cost of the materials, or of the finished products, or of the transport of those products. Though, fortunately, that seems to have calmed down pretty dramatically in last months. But, I mean, there’s a lot of sustained, definitely not transitory, inflation out there. And it will sustain. I mean, I will go with the economists on this, they’re all saying or many are saying that it will sustain through 2023 and possibly 2024.

Ahmad Jiwani (00:10:34):

So, Greg, you bring up an interesting point around the transportation side of things. Because when we see these fluctuations in supply and demand, we’re seeing just generally consumption slow down, order slow down. We’ve seen how that plays out in the transportation market. So, even if you look at something like Ocean Freight, if we look at a container index just for the cost of a 40 foot container, around the same time last year was hovering around the $10,000 mark. And now it’s dropped to about $2,200, so like an 80 percent drop, which is very significant. And similarly on the air freight side, if you look at just any typical route, even just Hong Kong to the United States, in terms of the cost per kilo of shipping goods, it’s been cut about half since the same time last year.

Ahmad Jiwani (00:11:23):

So, this is extremely important for folks on the sourcing side, especially if you manage transportation as a category. Because this is really the time to be more opportunistic, keep your finger right on the pulse of the market, and really kind of shift that mindset from maybe going to market for transportation once a year or to maybe on a quarterly basis, potentially even a monthly basis, doing more mini vents and stuff like that. So, very interesting.

Scott Luton (00:11:53):

Agreed. I’m going to have a follow up question for you on kind of what you just shared there in just a second. I want to circle back. Kirsten, great to see you, from Seattle, one of our favorite cities. Hope you’re doing well. Ana – Ana or Ana, I bet it’s Ana – to confirm what we’re talking about earlier, it’s 5:00 p.m. Greenwich Mean Time there. And Andre agrees with what you were saying earlier about how challenging 2023 is going to be. Greg, I think you probably find a lot of agreement across one of the smartest audiences in all of global business, this audience here at Supply Chain Now.

Scott Luton (00:12:27):

So, Ahmad, I want to get back to your point a second ago about kind of the opportunities that exist. And one of our favorite phrases around here was uttered by – I want to say Chris Bell, but I’m getting the name wrong, Greg, how you can find opportunities without being opportunistic. I always loved how well put that was.

Greg White (00:12:47):

Kevin Bell. Thanks to [inaudible].

Scott Luton (00:12:48):

Yes. Kevin Bell. Thank you. So, Ahmad, broader supply chain, it’s always asked to find more resiliency, tackle more problems, including proactively, risk mitigation, risk management, you name it, make stuff happen. But how more and more do you see sourcing being asked to lead during these challenging times?

Ahmad Jiwani (00:13:10):

No, I think that’s a very relevant question for our discussion. You know, I think it’s safe to say that procurement and sourcing leaders, they’re facing one of the toughest market environments potentially in their careers. And even if you look back before the pandemic, we were seeing, just in general, cost fairly stabilized. Procurement organizations we’re able to operate successfully. But now with the inflationary surge and scarcity of critical supplies in some respects, it’s made that traditional operating model increasingly more costly a little, and it’s kind of forcing them to switch gears a little bit.

Ahmad Jiwani (00:13:56):

So, sourcing leaders are really being asked to lead to create additional sources of value and really taking advantage of these market ships, these opportunities to work more effectively with their supply base. It could be incumbent suppliers, new suppliers. And, you know, value is a very interesting word, especially as it relates to what we talk about, procurement and sourcing. Because, truly, value is in the eye of the beholder. I know that in many viewpoints, procurement and sourcing, they’re asked to primarily step up and lead from a cost reduction perspective, opportunities where we can save costs in times of inflation.

Ahmad Jiwani (00:14:40):

But how do you balance that with longer term business continuity and resilience? Because you don’t want to just make all of these extreme cuts across the board. I think you really want to take more of a surgical approach to if we are going to try to get to market more often in an effort to reduce our total cost, how do we balance that out with, again, things like sustainability and even the suppliers ability to continue serving us as a company and making sure that potentially you even have more of a diverse supplier mix, you’re looking at different regionalization strategies, and so on. So, there really does need to be a balance from that perspective.

Scott Luton (00:15:22):

Well said. Man, a lot of good stuff there. Greg, your thoughts on what Ahmad just shared?

Greg White (00:15:27):

Well, we can’t be singularly focused on cost anymore, because the presumption of focusing on cost is the five most dangerous words in supply chain and procurement. All other things being equal. And they never are equal. And if the pandemic didn’t show us that, I don’t know what would. So, you have to consider the resiliency. We just spoke about you have to consider the spirit of partnership with the companies that you’re working with, provide you have to consider quality, the pace of play, all of those things.

Greg White (00:16:00):

And, now, particularly in the States and EU and UK, you have to consider the good citizenship of your sources. Because, now, U.S. companies per the SEC, are being held accountable for the performance of their supply chain. Their downline – it’s quite an old Amway phrase – they are being held responsible for the emissions performance through the Scope 3 emissions standards, and they have to report that to their shareholders. It’s just like their profit and loss statement now. So, choosing your suppliers very carefully based on multiple facets is more important than it’s ever been, because now it’s exposed to the entirety of the world.

Scott Luton (00:16:52):

That’s right. We were just talking yesterday about sourcing about all those thousands of containers of solar panels sitting in ports detained by U.S. Customs because of where they’re being made, getting to the bottom of that, Greg, we were just talking about yesterday. Ahmad, I want to keep going down this path, but really quick, I want to welcome in Glorimar, one of our favorites from California. Great to see you. Joshua is in one of the most beautiful cities, Asheville, North Carolina. Great to see you, Joshua. And Ishant from Mauritius. Ishant, great to have you here. And y’all comment, tell us what you think about the role of sourcing in today’s environment and getting through these challenging times.

Scott Luton (00:17:30):

Ahmad, both of y’all have mentioned the word resilient numerous times with meaning, not because it’s cliche, but true. That’s what, let’s say, every supply chain is after, resiliency. So, when it comes to strategic sourcing, how does that factor into organizations trying to become more agile and resilient?

Ahmad Jiwani (00:17:51):

Yeah. So, I think we touched on a little bit earlier around how sourcing teams and really just keeping a pulse on what’s going on in the market can allow them to be opportunistic, in some cases, and take advantage, again, if cost reduction opportunities are of importance, or perhaps it’s even just securing critical supplier capacity in some areas. The changes and the fluctuations that are going on right now allow them to do so. So, getting to market faster in response to these changes, you know, transportation rates, raw material availability, et cetera, really, from that perspective, sourcing can be agile and really focused on speed of execution, assuming that they have a solid process or they’re using digital tools, et cetera. But, in addition, the criteria that they use to make effective decisions, again, in terms of looking at their supplier mix, differentiating with supplier led innovation, or maximizing spend on contracts with the right suppliers, those are what’s going to lead to business continuity and resilience at the end of the day.

Scott Luton (00:19:01):

Greg, I’m going to pull you in, in just a second. Ahmad brought up digital, the D word, digitalization. I can never say this, like democratization. It just doesn’t roll off my tongue like I want it to. So, have sourcing and procurement organizations done enough when it comes to digitalization, Ahmad? And if not – which is probably the likely answer, I’m assuming – what’s holding them back? Your thoughts there?

Ahmad Jiwani (00:19:30):

Yeah. So, what we continue to see, Scott, and I think where we’re at now, is, folks and organizations are realizing more and more the importance of investing in digital capabilities and knowledge in order to build out their sourcing practices and their functions. But we do still tend to see some companies, even larger companies, that are still highly manual or they’re fried with spreadsheets and inefficiencies. And for those organizations that really still haven’t invested in the right capabilities and expertise, to me, it’s just a matter of time, the function is becoming increasingly complex. These teams are being asked to do more with less. And that applies, by the way, whether we’re talking about indirect or direct goods and services, both sides of the fence. But especially as we get into more advanced sourcing requirements, when you have physical supply chains and you have to optimize decision making, especially if we have sourcing events that are very complex in scope, taking into account thousands of items, or you’re working with hundreds of suppliers, you’re trying to apply multiple business constraints or criteria against those decisions, things can get fairly complex.

Scott Luton (00:20:49):

In a hurry. In a hurry. And things are already complex. They get even more complex. Greg, I know this is one of your favorite topics, a lot of those things that Ahmad just shared, your thoughts.

Greg White (00:21:01):

Yeah. My first thought is – I want to be clear about this – spreadsheets are not digitalization.

Scott Luton (00:21:11):

That’s so true.

Greg White (00:21:11):

Spreadsheets might as well be manual. Spreadsheets are electronic notepads or whatever you want to call it. So, I think you have to recognize that what Ahmad is talking about is real digitalization, real agility – to your point – and resiliency. And that you have to recognize that you are working in an incredibly complex environment, that he just talked about. And understand that you are constantly doing this balancing act. Risk balancing is what supply chain is all about. It’s essentially balancing a number of things, cost, obviously. But as in the past, cost was pretty much the only thing we cared about because of those five deadly words. But you have to recognize that cost and reliability, and now ethics and speed, of course, are those things that you have to consider in supply chain. And just those four things have a number of subcategories, like quality and various sundry other things that we talked about in terms of supply chain, that create the complexity that Ahmad was talking about. And that then becomes an impossible to solve combinatorial analytic exercise for the human mind. It takes technology to do that.

Scott Luton (00:22:37):

Yeah. Well said. You know, speaking of spreadsheets – and, Ahmad, I want to get your response here – I worked with a great individual in the Air Force, Greg was his first name. And Greg had a spreadsheet for everything, regression analysis, any kind of breakdown of numbers. If I needed to make a sandwich, he had a spreadsheet for that. But to your point, Greg, that’s more like electronic note taking. That’s a great way to put it.

Greg White (00:23:02):

It can do calculations that you can’t do in your head. But part of the problem with spreadsheet is, I mean, this is why so many solutions wind up replacing spreadsheets. One, the data is disparate from the truth data, whatever you want to call it, the core of the data store. It still takes a lot of manual data gathering and input to do it. Typically, what you’ll see is this, so many times when I have seen people replace a spreadsheet, it takes 30 days to compile the data, to grind up in a spreadsheet, and hopefully somebody didn’t put the stuff in the wrong cell or accidentally erase the formula by putting data in a field rather than letting the system calculate it. Thirty days later, you’ve got data that is now completely obsolete because the problem you were trying to solve was 30 days ago. So, you now know a month later what you should have done a month ago. And if you’re seeing that, then you need real technology to do that because that technology can grind up all that data, keep that data clean, keep that data communicating back and forth between your core systems, and, of course, eliminate 30 days of processing.

Ahmad Jiwani (00:24:25):

Absolutely. And, Greg, just to elaborate on that quickly, and I think we’ll probably touch on this later, Scott, is, you know, especially when we think about getting other stakeholders in the business, across the business involved in sourcing decisions, if you’re relying on spreadsheets, again, to try to crunch those numbers and have you come out or really present folks with an optimal scenario, I mean, I would already say that organizations are faced with challenges in terms of getting stakeholder adoption, having their inputs in terms of sourcing decisions. And that spreadsheet process is just exacerbating the issue.

Ahmad Jiwani (00:25:05):

And we even sometimes see this as well with some of our prospective clients, for those organizations that are very immature, if you will, where they may even still be using spreadsheets to actually conduct their events, so they’re sending spreadsheets out to a handful of suppliers, and they’re asking their suppliers to respond, they’re really finding it difficult to drive the right behavior in terms of a supplier adhering to format, like you were saying, Greg, and not deleting things or moving things around. And once you try to collect all that data, how do you make sense of it? And so, we definitely need to move away from that in general.

Scott Luton (00:25:46):

Agreed. Agreed. And let’s move forward for the sake of time. I want to get a couple quick comments in here from our audience. Yamini says, “Procurement was seen as a cost saving function a bit lately with focus on cost management and the function has become increasingly important for business -” and I would argue much more important for business “- in such scenarios how the trend today in terms of investing in procurement processes be it digitization or getting a BSM tool.” Thank you for sharing that. El-Moizz is talking about Gartner, “More than 50 percent of companies, according to Gartner, have not yet actively started to build a roadmap for supply chain digital transformation. Huge opportunity in the market.” And finally, Scott – great to have you with us today once again – going back to the soup question, his favorite soup is his own clam chowder. All right, Scott.

Greg White (00:26:33):

Shameless self-promotion.

Ahmad Jiwani (00:26:34):

I got to try making that myself too.

Greg White (00:26:38):

I am willing to give you a taste test, Scott.

Ahmad Jiwani (00:26:44):

Okay.

Greg White (00:26:45):

I think Ahmad and I, we can taste test your clam chowder and determine whether it is, in fact, the greatest.

Scott Luton (00:26:52):

All right. Well, Scott, we’re challenging you to either share your clam chowder or your recipe. Throw down the gauntlet. And then, finally, Glorimar says, “Air power in the Air Force is full of spreadsheets and PowerPoint slides.” Glorimar, you know, I got out in ’02, and so it’s been a little while, but no truer statement has been spoken. Okay.

Scott Luton (00:27:15):

Bringing it back, Ahmad, let’s get back to the discussion. I want to talk in particular, you know, we’re seeing a lot of comments around optimization, you and Greg both mentioned optimization, optimization. Critical enabler for sourcing teams, especially when dealing with this complexity you’re talking about, and these highly complex events. In many cases, events that we haven’t seen in a generation or so. I don’t want to be too dramatic. Tell us more about that and if you see any tangible examples of what you’re seeing, use cases that you can share about it.

Ahmad Jiwani (00:27:49):

Sure. So, I mean, if we just keep going with the example of direct materials, when you go to market with a sourcing event for those items, you’re going to be thinking about attributes like what’s your total cost, including unit costs, shipping costs, service levels, order delivery times, any indication of delivery risk if we’re getting into some sort of risk assessment on the supplier, and even things like sustainability ratings and supplier diversity. And that’s really just a subset, but that’s just kind giving you a picture.

Ahmad Jiwani (00:28:22):

But then, if you think about some of the additional criteria that a sourcing team or a buyer may have to employ. For example, rewarding the best performing suppliers or potentially awarding business to a minimum of five suppliers or so, or even something a little more complex like only award up to a maximum of 80 percent of a supplier’s capacity so that they’re never struggling to reach 100 percent throughput. All of these things can become constraints on a bid or a set of bids.

Ahmad Jiwani (00:28:55):

But then, we think about supplier led innovation, giving the suppliers the ability to come to the table with creative offers. You might come up against things like bundled offers, or tiered pricing, early payment discounts, or even things like alternative materials or specs that can usually still satisfy the end needs or the end product for the potential customer with just a slightly different mix. So, with all of this taken into account, you can imagine the number of permutations and combinations that a sourcing team could come up against. And, again, trying to evaluate these things with such complexity, it goes far beyond the realm of spreadsheets. And it’s going to take far longer and it’s going to yield suboptimal results.

Ahmad Jiwani (00:29:39):

So, that’s why solutions, especially from an optimization perspective, they allow you to work with all of these data points using optimization techniques, where you can even create scenarios to understand what’s the impact of moving forward with a specific sourcing decision.

Ahmad Jiwani (00:29:57):

And, you know, we have clients as well just in terms of who are using more sophisticated commentator optimization techniques to evaluate bids and down select suppliers. And, really, just by embracing some of those tools and those processes, many are experiencing great value uncovering double-digit percentage savings, of course. And, also, having that translates to other benefits in terms of overall supply chain resiliency, risk mitigation, et cetera.

Ahmad Jiwani (00:30:30):

And I won’t go too far into the weeds here because I know we want to make sure that we’re staying tight on time. But, again, we work with, for example, manufacturers on sourcing, transportation capacity, and making sure that they’re able to take into account, really, what is important for their business in terms of constraints, having that factor into their decision making, and, again, both direct and indirect tenders across the board. Really, companies that embrace those types of solutions and strategic sourcing in general, they save time and money, they have the opportunity to create more value, not just for their customers, but even in comparison to their competitors as well.

Scott Luton (00:31:13):

Okay. Greg, we covered a lot of ground there and offered up some tangible examples. Some of your thoughts here, Greg.

Greg White (00:31:21):

Yeah. I mean, I think it all really starts with sourcing, whether you’re sourcing indirect materials or whatever, security for your plant or whatever it is, I mean, it all starts with that because that is the foundation of everything that you build upon. And you have to recognize that there is, again, more than cost there. And I think just like supply chain has now come to the forefront since the great toilet paper shortage of 2020, that procurement has likewise, because everybody now – I shouldn’t say everybody. You guys in procurement probably still enjoy a little bit more anonymity, but many, many people recognize that at least in some aspects, procurement and supply chain are inexorably tied. You can’t build plastics without the raw materials to create plastics, things like that. You can’t bottle Coke without bottles.

Greg White (00:32:27):

And because of that, the brand identity, the brand esteem, the brand equity of every single company is at stake based on their sourcing decisions. It’s not just a cost line issue anymore. It never was, by the way. I think it’s just become more and more recognized that that’s the case. And because that awareness exists now outside of the enterprise among we, consumers, and other constituencies outside the four walls of the company, you have to recognize that every decision you make regarding sourcing is a decision to alleviate or create risk for your brand identity.

Scott Luton (00:33:11):

Yeah. Well said. And, Ahmad, do you get the impression that Greg is using all my background images, like the Coke bottle there, in many of his answers?

Ahmad Jiwani (00:33:24):

[Inaudible] his approach.

Scott Luton (00:33:27):

Really quick, a lot of good comments in the chat. We’re not going to get to all of them, but I want to give a quick shoutout to Wallace. Wallace, great to have you here today via LinkedIn. Appreciated your social share the other day of one of our messages. So, I hope this finds you well. Okay.

Scott Luton (00:33:43):

So, Ahmad, let’s talk sustainability, ESG has all come up. Supplier diversity, you mentioned, really important. So many different priorities in today’s world of sourcing. So many of the constants, like Greg alluded to a second ago. But also so many new priorities that’s really shaping industry. So, how are you seeing, Ahmad, sustainability factor into key sourcing decision criteria, again, given the focus as of more recent that’s been on the proverbial old fashioned cost reduction and savings opportunity? It’s still important, but sustainability has really grown in priority, right?

Ahmad Jiwani (00:34:21):

Absolutely. And as Greg was saying, sustainability and ESG pressures, they’re coming from pretty much every angle. You know, even customers that want to buy from companies that have a set of high standards from an ESG perspective, but employees that are wanting to work for companies who are doing good, and then, of course, we have more government mandated legislation that’s continuing to surface. Coupa recently did a survey. We went out and surveyed about 800 business leaders. And about 90 percent of them said that cutting emissions was extremely important to them, followed by eliminating things like modern slavery, and improving supplier diversity. So, across the board, in general, this is a huge focus area.

Ahmad Jiwani (00:35:07):

And when thinking about how this translates into sourcing events, you know, as I kind of mentioned earlier, risk, it is really about balancing the overall objectives and targets of an organization from a sustainability standpoint, and then marrying that with other critical areas, again, such as cost reduction opportunities. And I think sustainability objectives throughout the tendering process, they can be incorporated in a few different ways. We can think about it in terms of determining specifications as part of an RFP, for example, where incorporating environmental and social environment highlights the supplier’s importance of sustainability to both that company and then that future contractual relationship with that supplier.

Ahmad Jiwani (00:35:52):

And then, of course, you know, at the selection stage, when you have specific selection criteria together with related scoring and waitings, being able to sufficiently collect information, ensure that you have a thorough and consistent assessment of the sustainability commitments outlined in the suppliers bids and proposals. And we, of course, work with clients that have key sustainability questions that they incorporate as part of their tenders. You know, things like CO2 emissions and other sustainability factors to make more informed award decisions. And then, of course, to track those sustainability commitments over time.

Scott Luton (00:36:31):

I’m hearing the word holistic in a lot of your answer, Ahmad, you just shared. And I know Glorimar is bringing that point of view. We’ll try to share that comment in a second. Greg, what’d you hear there? What comes with sustainability, some of the impact on sourcing it’s having?

Greg White (00:36:44):

Well, one of the things that we have to recognize is that it’s not a zero sum game. Again, I’ll refer to supply chain or you even addressed this with sourcing, it’s not necessarily that better vendors equal higher cost. That resiliency that you provide, that a vendor might provide doesn’t necessarily have to come at a higher cost. Likewise, ESG performance or compliance doesn’t have to come at a higher cost or at the risk of quality or reliability or speed. It’s a combinatorial optimization, as Ahamd talked about earlier. They can all have some place in the ecosystem.

Greg White (00:37:33):

And I think it’s important to recognize that because ESG has become so important, whether you like it or not, it has become so important that it is something that you have to consider. I mean, just imagine that you don’t consider it and something dramatic happens, like you are found, and I just saw an article from a buddy who is hyper aware of this, that a lot of products in the automotive industry come from Xinjiang Province, where we know virtually all of the labor is slave labor. So, imagine that your GM found to be using slave labor for whatever parts it is you get from Xinjiang Province and the damage that can do to your reputation. I mean, not unlike cybersecurity, I mean, we still talk about Target and their cybersecurity failing that happened almost a decade ago from just one small little mishap.

Scott Luton (00:38:35):

Right. Well said. And to carry out that example a little further you were just sharing there, Greg, Tim Nelson with Hope for Justice, who leads that nonprofit doing great work battling modern slavery and human trafficking, and I’m going to paraphrase, it’s not if you find it, it’s when you find it, what are you doing about it? That’s the big question for leadership.

Greg White (00:39:00):

Are you looking hard enough to find it, also. Because I think a lot of companies, and I can’t blame them, they benefit from cognitive dissonance. If we don’t look too hard, we won’t find it. But, now, they really have no choice. I mean, the SEC, the EU, and the UK have compelled them to find those issues in their supply chains and to do something about it.

Scott Luton (00:39:24):

Welcome development for sure. Ahmad, I’d love to get your take on Greg’s comments or comments there. And then, we’re going to talk about other stakeholders. But your quick comment before I go in that direction.

Ahmad Jiwani (00:39:38):

Oh, yeah. I wholeheartedly agree with what Greg was saying. I mean, that’s where we also kind of get into the topic of just third-party risk management in general, and truly understanding, not just our suppliers, but our supplier’s suppliers as well. What does that overall kind of nth tier network look like? And are they adhering to, you know, just in general the overall targets from a sustainability, from a risk perspective of the organization? And I think those supplier potential risks and those risks assessments are essential as part of your sourcing strategy and your sourcing events overall.

Scott Luton (00:40:15):

So true. So true. You got to look at the supplier’s suppliers. You can’t just stop at the next tier up. I’ll share a couple quick comments, and I’m going to get back to other stakeholders here. I want to go to TSquared, who holds down the fort for us on YouTube, says, “Procurement and supply chain are conjoined twins. To separate would be precarious to any business operation.” And he says, “(Captain Obvious Statement)”. Love that.

Greg White (00:40:42):

Still needs to be said, obvious statement.

Scott Luton (00:40:45):

Yeah, it does. So true. Glorimar says, “I really believe that the lack of holistic view of procurement supply chain and the newer sustainability made many companies less competitive and was also a constraint during the toilet paper era.” Well said there, Glorimar. I agree. Okay. So, we’re just talking about kind of sustainability’s impact, but other stakeholders. You know, speaking of holistically, when it comes to other stakeholders, how are their inputs being factored into decision criteria and sourcing award evaluations, Ahmad?

Ahmad Jiwani (00:41:21):

Yeah. And I think companies have a little more to do in this regard. We definitely see room for improvement in terms of, again, stakeholder adoption and getting stakeholders involved in the process. You know, we think of best practices really for relevant business stakeholders to be included in the sourcing process from the beginning when you’re thinking through kind of overall business drivers for the event and your sourcing strategy, including how you’re going to ultimately make a final award decision. Because if that’s not something that you collaborate on or align on from the get-go, it’s going to make the downstream process extremely tricky and time consuming.

Ahmad Jiwani (00:41:57):

And not only to kind of help align on drivers for an event, but also how does that kind of inform the overall design and approach of a sourcing event in terms of critical information capture that’s necessary to make important decisions. And of course, you know, when it comes time to collect information from suppliers, even work with stakeholders to give suppliers feedback on areas that they can improve on, and then also ultimately coming down to a scoring process, and making that process repeatable so that stakeholders actually want to and see the value in participating in events going forward is extremely important. And, really, something that’s really possible when you digitalize a process properly.

Scott Luton (00:42:42):

Greg, sounds like to me, more goodness from the whole digitalization movement is some of what Ahmad shared there, your thoughts.

Greg White (00:42:52):

Yeah. That, and again, this compelled transparency. You said multitier, nth tier – nth tier is what we love to call stuff in technology. That means more than two or three tiers. And there are companies that have seven, eight tiers, maybe more, of suppliers. Some they never meet because they’re a supplier of a supplier, of a supplier, of a supplier, of a supplier. And now, again, they are responsible for those people that they would otherwise never meet. So, it’s an important part of creating your ecosystem. And this rating notion is going to be very, very important from a number of aspects. So, I think that digitalization, one of those two words really [inaudible] into that nth tier and provide some visibility and transparency and insight to where all these people stand, which I think some people might find a little bit scary once they figure it out.

Scott Luton (00:44:01):

You know, whenever I hear the nth tier phrase, it always takes me back to sixth grade algebra class. Mrs. Hokinson, one of the smartest and best teachers I ever had.

Greg White (00:44:11):

And you remember your teachers name?

Scott Luton (00:44:12):

Oh, man. She helped me solve that one train is leaving Chicago and one train is leaving Toronto, and two hours, all that stuff.

Greg White (00:44:20):

She should be given a Nobel Prize for that.

Scott Luton (00:44:22):

That’s true. All right. I digress. Ahmad, let’s talk about, I think one of the favorite questions I want to ask you here today, because really you and Greg have been speaking to this as well as some of our commenters on so many different ways. So, let’s talk about the level of collaboration. What’s it like currently between sourcing and the supply chain function overall? Is there room for improvement? And if so, how can technology facilitate that? So, it’s kind of a three part question, kind of talk to the collaboration as is, what opportunities exist, and how can technology address it?

Ahmad Jiwani (00:45:01):

Yeah. Great question. So, I think there certainly is opportunity. And what’s great is the last couple of comments that you raised here from the audience, Scott, were talking through how really recognizing the importance of procurement and sourcing and supply chain coming together to be more resilient moving forward. And, of course, in some cases, this was a shortcoming in the pandemic, if you will. There wasn’t as much of a tight collaboration between those functions. But when you think about if you don’t align sourcing across other business functions, even just the broader supply chain function, in general, your organization, they’re going to lose opportunities, they’re going to lose out on value, and they’re going to lose out on money at the end of the day.

Ahmad Jiwani (00:45:46):

And even if you take something like ESG and sustainability, like we’ve been talking about today, those responsibilities and decisions related to those areas, they don’t lie within the four walls of supply chain or procurement alone. These departments must collaborate on that overall strategy. And I would also say that, in general, just source to pay cycles and even just broader supply chain design and planning areas, they’re becoming more increasingly intertwined because they got to be able to adapt the change while staying connected.

Ahmad Jiwani (00:46:21):

So, for example, you may have a supply chain that’s built out from a design and planning perspective, but you may notice in that model that there is a significant opportunity for us to either secure transportation to bring a new product to market or help kind of inventory flows to another market. How do you then connect that to something like sourcing, where you’re now communicating with that team to say, “Okay. We now have to go to market with these transportation routes and lanes and go secure that critical capacity so that we’re almost doing this exercise of continuous optimization having that strong collaboration and time between those teams.” So, you know, the short answer is there’s certainly opportunity to do more there. And, of course, technology can facilitate that collaboration, those decisions, and even just, in general, speed to execution between those functions.

Scott Luton (00:47:21):

Well said, tons of opportunities there. Greg, when you think of the current state of collaboration between these functional areas or these different areas of the business and opportunities and how technology can address it, what are some thoughts that come to your mind?

Greg White (00:47:36):

I think it depends on the segment of supply chain that you’re talking about. But I think we’re predominantly today talking about manufacturing, which is decades and decades behind the level of collaboration that retailers and distributors have between sourcing and supply chain. And that’s where I started my career and I found it to be unbelievably beneficial. You know, you start having these discussions about suppliers that are [inaudible] faceless many and you say, “Hey, I like the per unit deal we got here.” But somebody in sourcing says, “Yeah. But they want you to buy a full truckload, not be able to buy a pallet at a time for that price.” And this vendor allows us to invest less in held inventory by buying at the same cost or even slightly higher, but in a much, much smaller time, supply, and quantity, which allows us to reduce cost overall instead of looking at – we’re going to use that word again – holistic, instead of looking at that singular cost analytic – can you hear that?

Scott Luton (00:48:47):

You’re getting a little trimming in the backyard.

Greg White (00:48:49):

Yeah. Good timing, guys. They’re a day late. Instead of looking at that singular cost analytic, it allows us to look at the complete picture. And this collaboration accrues to the benefit of the entire organization at a much, much higher level than the few pennies that we might pay per unit or per shipment or whatever.

Scott Luton (00:49:15):

Agreed. And, of course, consumers win, right? Consumers win. All right. I’m going to share just a couple of quick comments here, and then we’re going to make sure all three people that don’t know what Coupa does, Ahmad. Kimesha – going back to modern slavery agrees with me – “It’s when you find that what leadership does about it, supplier’s supplier transparency -” that’s a great phrase “- risk balancing, risk management, all critical.” Kimesha says, “We saw mishaps in this area with several big FMCG companies over the past few years.” Great to have you here today with us, Kimesha. I agree with you.

Scott Luton (00:49:54):

Okay. So, Ahmad, Coupa has been on the move quite a bit in recent years. So, again, for the three people out there that may not know what Coupa does, in a nutshell, what does Coupa do?

Ahmad Jiwani (00:50:08):

Yeah. So, Coupa is a leading provider of business spend management solutions within areas like supply chain and procurement and finance, where we help organizations maximize the value of every dollar that they spend. And, really my team specifically, we work with our prospective customers and existing climate clients to understand how to leverage and apply our technology to solve various supply chain challenges. So, with all of the, you know, disruptions that have occurred and disruptions that will continue to be on the horizon, we’ve certainly helped many organizations out in this regard and many who are benefiting with the help of our technology.

Scott Luton (00:50:47):

That is right. And, Greg, Ahmad is one of our new faves. But Madhav Durbha is one of our longstanding faves. We had some great conversations with him. So, Ahmad, please give a high five to all the members of the Coupa team, especially as we march through the end of the year. It’s hard to believe it’s December 6th sitting here today.

Ahmad Jiwani (00:51:07):

Oh, gosh. I can’t believe it.

Scott Luton (00:51:10):

It’s unbelievable.

Ahmad Jiwani (00:51:11):

Still [inaudible].

Scott Luton (00:51:12):

So, speaking of end of year, you brought some gifts for our global family here at Supply Chain Now. We’re going to talk about two white papers, one that’s already out, and I think we’ve got a graphic for here. This white paper, Threading the Supply Chain Needle, How to Break Down Silos to Build Resilience and Sustainability. And, hey, that goes straight to that last question about fomenting effective, successful, and new levels of collaboration between the different functional areas. But speak to this, Ahmad, and then we’re going to talk about one of the newer white papers coming out.

Ahmad Jiwani (00:51:42):

No, I think as you summarized that nicely, Scott, I mean this e-book here is really focusing on how do you really look and drive kind of collaboration between sourcing and supply chain in other areas of the business, because driving resilience is a team sport at the end of the day. And, really, this is a nice kind of summary of our point of view on that topic, but also sprinkles in some great customer examples and, really, some thoughtful steps that organizations can take, again, to help really thread that needle, if you will, and kind of break down silos between those areas.

Scott Luton (00:52:18):

And I love this phrase, building resilience and sustainability is certainly a team sport. Love it. So, folks, it’s free to download. I think our team has dropped the link here. You can get that white book there. Also, you can learn more about Coupa at coupa.com. But, wait, Greg, there’s more. So, Ahmad, we’ve got a new white paper coming out really soon. Tell us quickly about that.

Ahmad Jiwani (00:52:44):

Yeah, yeah. So, that will be available this week and we’d be happy to send that as a follow up to the attendees here today with us, Scott. But, really, that’s focusing on how do you really take advantage of optimized sourcing in these dynamic markets that we’re in. So, really, kind of a great summary touching on many points of our conversation today, again, with some kind of thoughtful approaches and recommendations that companies can start to incorporate as part of their sourcing strategy. And, again, really understand, especially in areas like optimization, how that can help them in terms of efficiency, collaboration, better decision making. So, really, really a great asset that’ll be coming soon and we’ll distribute that out.

Scott Luton (00:53:23):

Wonderful. And check this out, Yamini – great to have you here, by the way – says, “As a Coupa customer, absolutely delighted to see the impact Coupa is creating and the way the tool is evolving. Ahmad, that’s going to make your day, huh?

Ahmad Jiwani (00:53:41):

It totally makes my day. Thank you for the comment, Yamini. And really, really great to work with happy customers and seeing some of that validation today in our discussion.

Scott Luton (00:53:53):

I bet. Okay. So, Greg, while we still have Ahmad, we’re about to make sure folks know how to connect with him. Whether it’s the white papers, the resources, happy customers, Greg, on the end of our conversation, what’s one thing that stood out?

Greg White (00:54:12):

I think that in procurement and insourcing that it’s about more than cost. And I think we talk a lot about that, but we really have to recognize and reinforce that with the actions and the expectations of management. And a lot of that comes from the grassroots. We have to continue in our day-to-day jobs to push that message up, because I think we all recognize that management wants to do the right thing. But when it comes down to it, it’s easy to lose sight of that grand and noble vision when you’re down in the weeds talking about cost. And I think we have to do kind of what I described, before we have to identify, here is the alternate cost of not doing X. Or here’s the potential cost of not being sustainable or doing business with slave traders or whatever. And that is upon each of us in the operation to quantify that and to present that back to management. Look, they deal with numbers all day long. They have to present those numbers to the internal and to the external constituencies of the company. And we have to arm them with information that allows them to make those justifications.

Scott Luton (00:55:30):

Well said. I can’t agree more. Ahmad, how can folks connect with you? Obviously, folks learn more about Coupa at coupa.com. But how can they connect and compare notes with you about all the cool things going on across, not just global supply chain, but specifically sourcing and procurement?

Ahmad Jiwani (00:55:48):

Yeah. No, I would encourage folks to please connect with me on LinkedIn. I believe I shared my LinkedIn with you, Scott, and we can hopefully post that as well. But happy to get connected with folks, you know, even have one-on-one conversations with any of you that are more interested in Coupa and would be happy to just kind of take the discussion further.

Scott Luton (00:56:08):

Wonderful. And talk food, right?

Ahmad Jiwani (00:56:10):

And talk food, for sure. That’s a critical piece.

Scott Luton (00:56:14):

All right. Well, hey, big thanks, Ahmad. I really enjoyed our chat here today. Big thanks to Ahmad Jiwani, Director of Product and Segment Marketing with Coupa. Thanks so much, Ahmad.

Ahmad Jiwani (00:56:23):

Thank you for having me.

Scott Luton (00:56:26):

You bet. Man, swoosh has owned the money here today.

Greg White (00:56:31):

Indeed. They have to do a little bit of procurement collaboration right here. Do you mind if I yell out the window real quick? I’m just kidding.

Scott Luton (00:56:42):

Oh, please do. That’d make my day. By the way, connect with Ahmad. You’re going to enjoy chatting with him, seeing the content they share. Trust me, the same Ahmad you see here in front of the camera is the same one behind the camera. So, great guy. And by the way, yes, the swoosh waits for no one. That is so true. And, Jose, hey, I appreciate that, “Amazing discussion,” man, you don’t hear that every day. But, hey, between Ahmad and Greg and all the great comments, gosh, Yamini and all the others, I thought it was a very intriguing and informational discussion as well. Appreciate your feedback.

Scott Luton (00:57:20):

Okay. Greg, I’ve kind of already asked you for your final thought. As we’re about to sign off here, I just wanted to kind of echo and double down. It’s not 1982, folks, sourcing and procurement, the organizations that are only using all of that immense talent just to drive down costs is so shortsighted, so old fashioned. Get with the times and unleash the power of sourcing and procurement. And with that, Greg, before I’ll sign off, I’m going to give you the last word here today.

Greg White (00:57:51):

Yeah. I think one of the things that we have to recognize is that, each of the tiers of supply chain, I generally call those sourcing, manufacturing, distribution and retail, they can learn from one another. And a lot of these lessons have been learned and applied in retail before. And I think we have sort of inverted the curve in terms of where we ought to be learning from. Because manufacturers have all the money and they get all the consulting dollars, people project that they are far more advanced. But the fact is, I mean, after decades and decades of study, they are far behind the times of retailers, largely because retailers have very tight margins. They are and have been for centuries, literally centuries, customer facing. So, they are used to facing that constituency that manufacturers are just coming to face now. And because they have had all of the risk of carrying inventory foisted upon them by the manufacturers since, literally, the beginning of time. Literally, right? I think about the markets of the old days.

Scott Luton (00:59:00):

The brontosaurus always were driving procurement sourcing decisions.

Greg White (00:59:05):

I always think about that scene in a Aladdin where they’re kind of sailing through the market, Agrabah. But because of that, they have had to become very, very efficient. And there is a lot that manufacturers can learn from the efficiencies between sourcing and supply chain and other aspects of the business that retailers have. And I wish more manufacturers and brands would reach out and confess their need for knowledge, and pick it up and learn it because it would excel things dramatically in terms of broader procurement and supply chain advancement.

Scott Luton (00:59:43):

So true. So true. And we’re going to leave it there here today. What a full session. Thanks for everybody’s feedback. Thanks for everybody’s participation. There’s a lot of gold there in the comments. And, of course, big thanks to Ahmad for being here with us today and all the Coupa team. I love what they’re doing and the good change they’re driving across industry. Greg, always a pleasure to knock out these conversations with you.

Greg White (01:00:04):

Likewise. Appreciate it.

Scott Luton (01:00:06):

You bet. Hopefully, folks enjoy this conversation as much as we have. And with that said, Scott Luton and our entire Supply Chain Now team challenging you to do good, to give forward, and to be the change that’s needed. And with that said, we’ll see you next time right back here at Supply Chain Now. Thanks everybody.

Intro/Outro (01:00:24):

Thanks for being a part of our Supply Chain Now community. Check out all of our programming at supplychainnow.com, and make sure you subscribe to Supply Chain Now anywhere you listen to podcasts. And follow us on Facebook, LinkedIn, Twitter, and Instagram. See you next time on Supply Chain Now.