Are we getting back to normal? According to the Global Supply Chain Pressure Index, the level of disruptions in supply chains is moderating. While the current trend suggests lowered levels of volatility, most supply chain managers believe that some shortages and serious disruptions will continue throughout 2023. Are you prepared for what’s to come?

Dan Reeve has been Esker’s Vice President of Sales North America for 10 years, maintaining responsibility for recruitment, training, and direct sales, and supporting a team of excellent sales managers. Morgan Swink is the Eunice and James L. West Chaired Professor of Supply Chain Management, and the Executive Director of the Center for Supply Chain Innovation at Texas Christian University. He is the former Co-Editor in Chief for the Journal of Operations Management, and he continues to serve in consulting and associate editor roles for several top journals.

In this livestream-based episode, Dan and Morgan share key findings from Esker and TCU’s Working Capital Report with hosts Scott Luton and Greg White:

• The tactics organizations are currently using or planning to use to improve working capital

• Outcomes that companies are expecting and experiencing after improving their working capital processes

• Macro-level challenges businesses are most concerned about having to overcome in the future

Intro/Outro (00:00:04):

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, wherever you are. Scott Luton and Gregory S. White here back with you on Supply Chain Now. Welcome to today’s livestream. Greg, all I said was your name.

Greg White (00:00:44):

So, I — I’ve never heard anyone say it like that before, but thank you. Yes.

Scott Luton (00:00:48):

Well, hey, it is great —

Greg White (00:00:49):

I’m easily entertained, Scott. What can I say?

Scott Luton (00:00:51):

Well, that’s the exact audience I need with all my horrible dad jokes. But hey, big show here today. Great to have you back. I know you’re back in Hilton Head, which is wonderful. I can see the ambiance right in your home studio there on the island, huh?

Greg White (00:01:06):

Yes. Ambiance. Yes. There it is. Right there.

Scott Luton (00:01:09):

And soon —

Greg White (00:01:10):

The pillows, I’m sure people who know miss the pillows, so.

Scott Luton (00:01:13):

And soon we’ll get back to publishing the index. But we’ve got a whole new index that we’re going to have.

Greg White (00:01:19):

I did the index today, Scott.

Scott Luton (00:01:22):

OK.

Greg White (00:01:22):

Actually, I came across one of our favorite chief supply chain officers last night, Rick McDonald, and I showed him the index. And there was one ship, just one —

Scott Luton (00:01:34):

Man

Greg White (00:01:34):

— waiting to get into the port at Savannah. So, great job, gang.

Scott Luton (00:01:38):

Good news. Good news for sure.

Greg White (00:01:39):

Yes. Well, they had — you know, they had that lift down and elevator, whatever the heck they call it.

Scott Luton (00:01:44):

Yes.

Greg White (00:01:44):

And they got it fixed. So — and I think they’ve expanded a little bit as well.

Scott Luton (00:01:49):

I agree. So, the — hey, the full report tonight at 11:00.

Greg White (00:01:52):

You’re welcome.

Scott Luton (00:01:54):

Hey, our audience has spoken. And our repeat guests today, Greg, are back by popular demand.

Greg White (00:02:01):

Yes.

Scott Luton (00:02:01):

Now, as always, you got to give the people what they want. And today we’re diving into key findings from a really intriguing joint research report produced by our friends at Texas Christian University and Esker.

Scott Luton (00:02:14):

So, Greg, as you know, Dan Reeve from Esker, and Dr. Morgan Swank with TCU will be joining us here momentarily to discuss key takeaways on this research that focused on managing working capital. You got to have the rocket fool — a rocket fuel, right? If you’re going to blow up and keep growing. Right, Greg?

Greg White (00:02:32):

You’ve got to have that rocket fuel, and you got to have it invested in the right places, yes. So, yes. I love having these discussions because I think among all the other risks in supply chain, this is one that is often overlooked. It’s how to appropriately deploy capital, right?

Scott Luton (00:02:48):

Yes, absolutely. So, stay tuned, folks. You’re going to be — this is going to be some very actionable insights from Dan and Morgan momentarily. Hey, really quick. I want to say hello to a few folks. We have Guy in Asheville, North Carolina with us here today. Guy, I hope this finds you well. Dave, good morning. From Dallas-Fort Worth, Texas. Old DFW. Dave, great to see you again.

Greg White (00:03:07):

The metroplex.

Scott Luton (00:03:08):

That’s right, the metroplex. Always miss that. But Dave, really appreciate all of your advocacy and facilitation behind the scenes. Allen from beautiful Canada. Allen, I hope this finds you well.

Greg White (00:03:18):

Yes.

Scott Luton (00:03:18):

And you and Greg and me, all three of us are looking forward to Morgan’s and Dan’s insights. So, great to have you here, Allen.

Scott Luton (00:03:25):

So, Greg, we’ve got a lot to get into. I know we didn’t hear anybody. Folks, we want to hear from you. So, as we unpack all this research and share these insights, tell us what all this means to you in the comments. We’ll share that throughout the hour. Greg, we ready to get to work?

Greg White (00:03:40):

Let’s do it.

Scott Luton (00:03:41):

All right. With no further ado, I want to welcome in two outstanding guests here today. Repeat guests. Our favorite kind. As I mentioned, Dr. Morgan Swank, the Eunice and James L. West chaired professor of supply chain management at the Neeley School of Business at Texas Christian University. Go Horn Frogs. He’s with us. And Dan Reeve, vice President Sales with Esker.

Scott Luton (00:04:07):

Hey. Hey, Dan. How you doing?

Dan Reeve (00:04:09):

I’m good. How are you?

Scott Luton (00:04:10):

Great. Good to see you as always. And Morgan, backed by property demand. How are you doing?

Morgan Swink (00:04:15):

Doing great. Good to see you guys.

Greg White (00:04:17):

Yes, good to have you.

Scott Luton (00:04:18):

You as well, Greg. We had a lot of fun with Morgan and Dan about a year ago, didn’t we?

Greg White (00:04:22):

Yes. Well, every time, but yes. Yes. Although, I have to tell you, Morgan, in the green room, just saying 10,000 professors scared me, right? All I saw was a pile of 10,000 Fs in front me.

Scott Luton (00:04:39):

So, to connect dots for our listeners, we have the best pre-show conversations, by the way. Morgan had visited a really big event where 10,000 professors were gathered to talk about global business and global supply chain. So, we’ll have to get some more details here momentarily.

Scott Luton (00:04:54):

But before we got a lot to get to here today, Dan and Morgan. I want to start with this little fun warm-up question, because on this day, August 16th, back in 1995, where were you in 1995? Microsoft introduced the world to Internet Explorer. So, it wasn’t the first internet browser, but it was one of the most popular for a certain stretch. In fact, I was surprised to find out that in 2003, Internet Explorer was the most widely used web browser with some estimates saying it had a 95% usage market share.

Scott Luton (00:05:29):

So, the question that we’re going to start, and I want to start with Dan here today. In those earliest of internet days, I mentioned Prodigy in the green room. In those earliest of internet days, what was one of the first things you remember using the internet to do, Dan?

Dan Reeve (00:05:46):

Plagiarized for my dissertation, I think. Perfect.

Greg White (00:05:51):

Just like the kids today.

Dan Reeve (00:05:51):

Whoops. No, I think what it was is I was researching — I studied economic development, which is kind of a combination of geography and economics. And I was trying to choose what I, you know, focus on India or Thailand. And I managed to find a topic, and using the internet, I managed to find some books and some prior research done on the cultural, sociological and impact of certain things that were happening in Thailand.

Scott Luton (00:06:24):

Man.

Dan Reeve (00:06:24):

And I think I stumbled across the internet and discovered there’s a load of books I could read and, you know, and all find. And a lot of the answers were already in those books. So, I was — I — it was my second year of university. I was starting to panic about my dissertation that was required in the third year. And I think the internet came to the rescue.

Scott Luton (00:06:43):

Oh, wore a cape. And you’re like, hey, this is going to be around for a while. I appreciate you sharing that, Dan. Morgan, based on how we started with Dan, I’m curious to know what was the first one of the first things you remember about using the internet?

Morgan Swink (00:06:54):

Well, it’s —

Dan Reeve (00:06:55):

Morgan — Morgan’s about to call my university to destroy my degree.

Greg White (00:06:59):

Yes.

Morgan Swink (00:07:00):

Actually, my answer’s very similar. I finished my dissertation in 1992. So, I didn’t have the advantage there. But just a few years later, it was actually pretty quick, you know, probably around 2000. All the libraries at the universities I worked at started digitizing stuff really quick. So, it just made my life so much better. I remember so many hours deep in the basement of libraries, you know, looking at microfiche and make — I had to borrow money to get copy, make copies of all these papers and stuff. It was just so — it was amazingly, better, you know, for my quality of work life, that innovation that came along.

Scott Luton (00:07:42):

Oh, Morgan, you just took me back through my childhood. I remember those black and white copies, 25 cents a piece, and the Funk & Wagnalls’ 20-year-old encyclopedia is using that for papers and stuff. Greg, I can’t wait to hear your answer.

Greg White (00:07:56):

My very first e-mail address, gswhite@cskauto.com, that’s when I knew it was going to stick, because up to that point, I think that was ’93 or ’94, up to that point, only the executives got e-mail addresses.

Scott Luton (00:08:10):

Really?

Greg White (00:08:10):

And if you wanted to e-mail, like with a vendor, I had to go to my boss, who was a merchant — a merchandiser at that time, and use his e-mail. And when I got my own e-mail address, I thought, this is going to stick.

Scott Luton (00:08:26):

Man. That is — I remember the same. Very similar experience there, Greg. It’s like that moment from the jerk, you become somebody when you’re in the phone book or you get your first e-mail address. I don’t know. Great flick with Steve Martin.

Greg White (00:08:37):

I’m still getting spam at that e-mail address. The company doesn’t even exist anymore.

Scott Luton (00:08:42):

All right. So now that we have walked through, probably a universal moment — well, a big moment for a lot of our audience, not all of our audience, but a lot of our audience. What I want to do, we got a big topic to get to here today, and I appreciate Morgan and Dan, you all joining us, and especially all the research that was conducted.

Scott Luton (00:08:58):

Before we get there, you were both with us. You know, Dan’s been with us a multitude of times, but you were both with us together about a year ago. And Morgan, I want to start with you. What has become one of the most critical elements impacting global supply chain, kind of, sense?

Morgan Swink (00:09:13):

Well, clearly, you know, we’re still dealing with some of the residuals of Covid. So, we got inflation going on, although it seems to be getting a little bit better and still some labor challenges in some sectors. But the big thing that’s really capturing my attention these days is what I would call deglobalization. All the reshoring, nearshoring, onshoring, siloing, all these things that are happening because of Covid. I think the heightened sensitivity to risk, it’s always been there. But after going through that, two or three year process, I think supply chain managers have become a lot more sensitive to it and thinking a lot more about managing risk and resilience and all that.

Morgan Swink (00:10:02):

And then you’ve got rising labor costs in the former low-cost countries. And then, of course, all the political stuff that’s going on with trade barriers and national security concerns and U.S. subsidizing, manufacturing of chips and batteries and all that kind of stuff. And then you’ve got the E.U. with their carbon tax on imported goods.

Morgan Swink (00:10:25):

So, there’s lots of forces out there that are kind of all aligning in the same way. They’re driving a lot of activity. I just heard today that the U.S. came out with a new ban last week on investment, American investments in Chinese chip or advanced computer developers. And coincidentally imports from China are down 25%, which is pretty shocking number just in the last few months.

Morgan Swink (00:10:54):

So, this has huge implications for a lot of different, you know, global network design and configuration issues. And you see a lot of movement in Mexico, of course, and Canada and some of the other Asian opportunities, Vietnam and India. But it has huge implications for working capital as well. You know, it’s going to change inventory, strategy. A lot of transit inventory is going to be freed up now if we’re sourcing from lower, closer locations. But it’s huge. I think it’s really huge. And it’s a big a part of a huge deglobalization trend, you know, everywhere.

Scott Luton (00:11:29):

Yes. OK. Folks, you all just got a snip — a snippet of how great this conversation is going to be. Greg, I think I just got a certification after the last three minutes of hearing from Morgan. Dan, we — Greg, weigh in a second. But Dan, what say you, since you all were both with us about a year ago?

Dan Reeve (00:11:46):

Yes. Well, one — it’s funny what Morgan describes there. I’m reading a book right now all about the end of globalization as we know it. And it talks about many of the topics that that Morgan alludes to or mentions, so that seems right on point.

Dan Reeve (00:12:03):

And I think for us, what we see, or what are the finance leaders, the I.T. executives, what they share is there’s still a lot of focus on having cash available, just in case. Borrowing costs have gone through the roof. I’ve had financial directors, V.P.’s tell me that their cost of borrowing can vary anyway — anywhere from 12% to 20%, depending on the day. And the costs of — those costs have continued to go up. And for many, you know, you go back to Covid, the first thing companies did is they ran out and extended their revolver.

Dan Reeve (00:12:39):

Now since then, I think what we’re seeing is that the access to cash, the ability to get cash, there’s a bit of a — it feels like there’s a bit of a credit crunch developing, especially for the small businesses. I’ve seen some commentators talk about that.

Dan Reeve (00:12:55):

So, what we’re seeing is folks saying, look, what can we can control? How do we, sort of, ensure that the wheels spinning really quickly and we remove any obstacles for collecting cash and/or we take advantage of opportunities to generate working capital from our supply chain and how we engage with our suppliers? And I’ll talk about that later.

Scott Luton (00:13:16):

Yes. And a good point, Dan. I like your — that last point you ended on. Folks, you’re going to have a lot of actual insights based on the data and what we’re seeing practitioners and business leaders do. So, stay tuned for that.

Scott Luton (00:13:27):

Greg, after we’ve heard there from Morgan and Dan, I’d love to get your thoughts of where we’ve been since the last year.

Greg White (00:13:36):

Yes. Well, on this critical element impacting supply chain, we haven’t been anywhere. It’s labor. It was bad last year. It’s bad this year, if not worse. Some people will never come back to working in supply chain. And now companies are struggling with trying to figure out how to get that work done. Right? The dark, dirty, dangerous, and dull jobs. I don’t think we’ll see people coming back to a lot of those jobs.

Greg White (00:14:06):

And, you know, with automation and artificial intelligence and other technologies like that, it is really not deployable fast enough to catch up. But — I mean, they’ll get there, right? They will get there.

Scott Luton (00:14:21):

Yes.

Greg White (00:14:21):

But they’re still struggling with which jobs can and should and must, frankly, must frankly, still be done by a human being.

Scott Luton (00:14:29):

All right. So, great starting salvo there. Let’s get into the research. A little background on the research. So, Morgan, folks can actually download this. We’ve got a link. Folks can download this on their own. And, you know, mark up their own copies, spill coffee on it. You know, dog gear and all that good stuff. Take notes.

Scott Luton (00:14:50):

But one of the cool parts that was included. I want to start with this. This global supply chain pressure index. Let me share this graphic here. I think a lot of folks are going to get a kick out of these trend lines here. So, man, how good we had it back in 1998. Now, look at this. So, I think we’re feeling a little bit of pressure over the last couple years. So, Morgan, speak to this and also speak to the exhaustive research that the team behind this report put in

Morgan Swink (00:15:19):

Yes. So, I’m glad you showed this. It really does illustrate, kind of, what we’ve been through. And I actually looked at it just the other day, and it’s actually come down a little — even below that, kind of, middle line in recent weeks. So, you can see — this — you can go to the website and see what goes into it. There’s some, I think it’s the New York Economic Bureau or something that’s put this together.

Scott Luton (00:15:44):

Right. Right.

Morgan Swink (00:15:44):

And they pull a bunch of different indexes together to create this composite. But yes, we had extreme disruption. We’ve actually, kind of, back to normal or even below kind of normal disruption levels according to those indexes. But people are still recoiling from it. I — it’s like I was saying earlier, I think the sensitivity has just gotten so raised because we’ve gone through that situation that it’s still driving a lot of decisions and a lot of behavior of the supply chain executives out there.

Scott Luton (00:16:12):

Yes.

Morgan Swink (00:16:13):

So, that’s one part of we’ve been tracking, kind of, these global indexes that might have implications for working capital. But the gist of the survey of the research was a survey that we did last year. We got about 150 supply chain executives to fill out a short survey that asked about, you know, what business challenges they were most worried about? And what types of working capital process improvement plans they had in place? And what benefits they were seeing from implementing some of those changes?

Scott Luton (00:16:43):

Yes.

Morgan Swink (00:16:44):

So, there’s kind of a macro perspective. We’ve also been looking at — I have access to all the financials for publicly held companies. You know, in the U.S., we’ve been tracking cash and inventory and AP and AR over time just to see what the general trends are there. So, we’re — we’ve kind of got the micro piece in terms of the survey and then the macro data from the economy at large.

Scott Luton (00:17:06):

Yes.

Morgan Swink (00:17:07):

We’ve got another little piece to it that I’ll talk about in a minute, if we have time as well.

Scott Luton (00:17:11):

OK. Excellent. So, you know, Greg, we talk about this a lot, right? And in fact, this conversation here today kind of follows a trod and true approach. We take — we — you know, Morgan’s bringing all these data points and these indices into a really actionable report. And then mirroring that with Dan’s perspective as a, you know, practitioner out in the markets, helping businesses navigate through these landscapes and succeed. Greg, your quick thoughts before we move on?

Greg White (00:17:36):

Well, I mean, clearly there’s — you know, there was a great uptick in pressure when Covid hit, right? Because we basically shut down the world’s economy for a short period of time and had to restart it from scratch, essentially. But I think that, you know, that’s had — that is — I think we would call that in statistics gathering, Morgan, I think we would call that an outlier. But that doesn’t mean that the ripple effects of that haven’t continued to reverberate through business. And they have for years, right? We are three years, hence, the start of Covid.

Greg White (00:18:15):

So, it’s been a substantial impact. And I — I’m not sure that we will see stability. We obviously are starting to see pressure come down, and I think the latest report is actually pretty encouraging. But we’ve — we won’t see stability because of a lot of the initiatives and some of these challenges that we just talked about. Things like reshoring, right? And companies going back to the office, or not going back to the office, or having a great argument about going back to the office, right?

Greg White (00:18:47):

The structure of organizations, the labor situation, all of those things impact that pressure. And then you add all of the impacts that can have on working capital, and working capital on addressing those factors. Wow. I just made my myself real clumped [phonetic]. You guys need to discuss. The industrial revolution was neither industrial nor a revolution.

Scott Luton (00:19:17):

OK. Oh, I love that throwback. The SNL, the glory days of SNL. All right. So, thank you, Morgan for setting the table. You know, so folks know a little bit more about the research. And again, folks, you all can download it on your end, and we’ll make sure we drop the link in the chat as well.

Scott Luton (00:19:33):

But — all right. So, Morgan, I want to go here as we start to get pulls some of the key takeaways from you and Dan both. I want to start with what tactics are organizations currently using or planning to use, Morgan, to improve working capital?

Morgan Swink (00:19:47):

Yes. So, as we mentioned, cash has come up already and the cost of capital. Dan talked about that. So, we saw this huge buffering strategy, I guess, both cash and inventory, through the pandemic, and it kind of lagged beyond the pandemic. Some of those numbers are coming down now. I think for the reasons that have been mentioned. People are starting to feel like things are a little more stable. And then as Dan pointed out, the cost of capital has gone up with inflation and interest rates and all that. So, it’s becoming much more experienced — expensive to chase that buffering strategy to hold all that excess cash and inventory just in case. So, things are coming down.

Morgan Swink (00:20:37):

In terms of the survey, the things we asked about in terms of tactics, the manager’s, number one thing they said was, well, they’re doing a lot of training of folks who are working in these processes, procure to pay, and order management, inventory management processes to try to eliminate waste. But also, errors, mainly trying to cut out errors. So, a lot of process analysis, a lot of process improvement efforts there. Even dedicating more personnel to some of these processes to try to improve them.

Morgan Swink (00:21:08):

And there’s pretty bit of — I think Covid put a little bit of a hiatus on this, but there’s before and after, it’s picking up again now. Investments in basic — what I would call foundational systems, order management systems, inventory management systems, procure to pay systems that automate a lot of the transactions and offer the opportunity to get rid of a lot of the manual data entry, manual translations that have to happen because that’s where errors happen a lot.

Morgan Swink (00:21:37):

So, that’s kind of been the past and current. There is a rising trend. Some of the — we asked the folks from the survey. Well, what are you doing now, and what are you planning on doing in the future? And the largest responses in terms of future was — and you could probably guess this, it’s even more investment in automation. But automating not just the transaction part but the data capture part. Data capture, data processing, data cleaning. And then that, in turn, gives you the ability to build in these analytics tools.

Morgan Swink (00:22:08):

So, a lot more investment in analytics, some A.I. applications, dashboards. All kinds of ways to identify and address exceptions in whether it’s in AP or AR or inventory outliers, you know. Exceptions, anomalies, track performance, and improve and drill down on things a little bit more through that greater insight. So, that’s where the real investment’s happening now, I think.

Scott Luton (00:22:36):

Excellent, Morgan. And then I’ll come bring you in here to respond and share what else you see. But I like your touch on data capture and data cleaning, because we got to — and, Greg, we’ve talked about this before, not data lakes, data swamps is where a lot of our data is residing. We got to get it up out of those swamps, clean it up so that we can use it and use it effectively and more easily.

Scott Luton (00:22:55):

But, Dan, before we bring Greg back in. Dan, speak to some of the tactics that organizations are currently using or looking to use.

Dan Reeve (00:23:02):

I will. I’m just going to mention a book that for the supply chain leaders, I think, we’ll find quite use — interesting. Peter Zeihan wrote a book called, “The End of the World Is Just the Beginning: Mapping the Collapse of Globalization.” So, he’s a social scientist. And what’s really interesting is he says, look, the big picture is, the U.S. is sort of becoming more inward thinking. The world has been able to flourish since the Bretton Woods Agreement and the U.S. had a huge Navy that protected the world and that enabled free trade.

Dan Reeve (00:23:33):

And he’s like, that’s going to decline a little bit and you’re going to see globalization go down. And a big part he talks about is actually labor. He talks about the fact that for many West — or for most Western economies, the labor pool and the available, you know, the birth rates have been going down.

Dan Reeve (00:23:51):

OK. So, I better get off my soapbox and, you know, and come back to what I really do in the world. That, I think, what it — what they’re getting at is that that means the labor available to do the work, and especially labor available to do the type of work that Greg described which is more mundane, boring, doesn’t really make a difference. People aren’t going to want to do that. And the amount of folks available to do that work is going down. And new folks coming into the workforce both aren’t available and will not do that work.

Dan Reeve (00:24:19):

So, what we’re seeing folks say is, I do want to take advantage of technology. I do want to clean up data so I can have better insights to go and say, right. I could improve my relationship with these customers. I could reduce my risk. because I have better ability to see which customers are struggling or which — what trends mean that certain customers may well need to be, may need — reduce their credit or give them more credit. But folks want that sort of information proactively so they can protect their business.

Dan Reeve (00:24:51):

And also, I think when it comes to dealing with suppliers, folks want to, one, minimize any risk on their business. OK. Now, they’re a bad actor. There’s a lot of fraud increasing, and typically fraud does increase during periods of uncertainty and economic depression. So, companies are looking to make sure not only are they improving working capital, because it’s so expensive and hard to get, but they don’t want to lose any through, you know, getting suckered into paying the fraudsters. And heck, I had to — a one of those e-mails from my chairman just this week, Dan, can you quickly rush this payment through?

Scott Luton (00:25:24):

Right?

Dan Reeve (00:25:26):

He’s never no, you know. So, I think companies are under pressure because hard to get the staff. Folks want to do the type of work that really makes a difference for the customer and the supplier. And they’ve also got to make sure that whatever they do, when you bring on new suppliers — Morgan, you think you talked about this in the past, you know, during the pandemic, companies often had to — could no longer sole source. They had to have multiple options.

Dan Reeve (00:25:52):

But OK. Well, now you need to have cash available so you can pay that supplier on time, or you, OK, well maybe that supplier will work with you, but you’re not going to the front of the queue. You might be at the back. I think those pressures haven’t necessarily fallen off. And if anything, the pressure increased because of inflation and the cost of accessing that money. And many of those I talked about revolvers, they were variable.

Dan Reeve (00:26:18):

So, in a very short period of time, in a year or six months, they went — you know, they jumped from six, seven, eight percent to suddenly the cost of borrowing and funding a project could have gone to 12 or 20, which is huge. So, what we see is companies generally said, OK, I’ve got to look at technology to free my people up. I’ve got to keep the people I have. I’ve got to invest in those folks or we’re at risk.

Scott Luton (00:26:39):

So, I want to pick one thing out that Dan touched on, Greg, before I get your commentary. Because talking about costs going up, I saw research published by IBM a week or two ago, the average cyber data breach here in 2023, the average cost to a business is almost $5 million. How many small and mid-market companies can have a $5 million incident like that? Goodness gracious.

Scott Luton (00:27:04):

But Greg, weigh in on what Morgan and Dan were talking about in terms of some of the current tactics or future tactics.

Greg White (00:27:12):

Well, I mean, it’s — it is — we are — definitely, we asked Matt, who’s — didn’t join us. We asked him to predict the economy because he is really a font of knowledge. And the reason for that was because I think is when we’re seeing it, we’ve seen it all week in the stock market. Companies changing their projections downward. Target and Home Depot, just in the last two days, move their projections downward. Customer sentiment is trending — isn’t trending but it has tilted sort of downward. People are going to finally have to pay off their student loans, right? And credit card debt hit yet another over $1 trillion record in the last week.

Greg White (00:27:54):

So, there’s all these indicators that there is risk and instability on the four. Actually, we’ve been in a period of risk and instability for, for a good long while now, right? And we’ve seen the proliferation of a lot of the dangers the mal-actors, whatever you want to call them, in the space. And I think that is one of the biggest issues.

Greg White (00:28:20):

We’ve been — we’ve — people have attempted to hit us, right? And more recently than in the past. So, it’s — I mean, it’s at every level of business. So, these kinds of things that allow you to manage your capital much, much more efficiently and without the intervention of human. I — as you were talking about that, Dan, I was thinking the one thing A.I. or technology doesn’t have that we have is this sense of urgency based on somebody pressuring them.

Greg White (00:28:49):

In fact, you know, the thought is going through my head that a technology could see that, hey, they’re asking to be paid, you know, in 30% of the time of our average because they’ve analyzed all the data that Dan’s been talking about and gone. This should have a red flag on it right here, right? And maybe pull back instead of push Dan to pay faster.

Scott Luton (00:29:10):

Right. Hey, speaking of, Greg mentioned we’re getting hit a lot. All the bad actors out there. Morgan, watch out. I saw a research the other day and we all know supply chain’s getting hit. But in particular, in the U.S., the healthcare industry and higher learning industries are two of the biggest targets. So, Morgan, look over your shoulder. Every so often, they’re coming out to get you.

Scott Luton (00:29:32):

All right. So, let’s switch gears here. Morgan, I want to talk about what outcomes companies are expecting and experiencing after improving, you know, being able to — once they are successfully and able to move the needle and improve working capital processes, what outcomes are they expecting, Morgan?

Morgan Swink (00:29:50):

So, this is one of the questions we asked in the survey. And number one was cost, as you might expect. They were identifying ways to improve costs through greater efficiencies but mainly labor just to cut labor or to save labor or redeploy labor in different ways through some of this automation. I mentioned error reduction or accuracy, less manual input. So, those kinds of benefits.

Morgan Swink (00:30:17):

Interestingly though, the third most cited improvement or benefit was staff retention and job satisfaction. So, while at the same time that they’re getting rid of some manual processes, I think they’re able to upgrade. Companies are saying that they’re able to upgrade some of the other activities or tasks, and kind of move them from what was purely a clerical, you know, data entry, you know, payment processing kind of activity to more of an analytical activity.

Morgan Swink (00:30:47):

And that increased job satisfaction because people, and then this is speculation on my part, but I — and maybe Dan can speak to this. But I think the folks who are working in these processes now feel like, you know, there’s a lot more mind work going into it. And they’re actually contributing to the bottom line in clear ways by identifying these fraudulent cases or other opportunities to save money or to make money as opposed to just, you know, crunching through data or filling out forms or whatever their jobs were. So, that’s an important one

Morgan Swink (00:31:20):

And then the fourth one was the — also, I think Dan, kind of, alluded to this. The customer supplier experience, that was the fourth most side. At about 50% of the respondents said, yes, we see, an ability to satisfy our customers quicker or more — in a more tailored way, and to deal with and treat our suppliers like partners in ways, you know, based on being able to point up the amount of business that we’re doing. The current payment terms. Those kinds of terms oriented, negotiations can be supported with a lot of the data that comes out of these more automated analytics-based systems.

Morgan Swink (00:31:57):

One more thing I’ll add in, and this is the study I mentioned a minute ago. So, we’re actually doing a new study now that looks at adopters of AR and AP automation tools. So, we’re able to find out companies who have invested in these kinds of tools over the last decade actually, but we’re really focusing on the last five years. And we’re seeing and we’re looking at their financials, and we’re able to show a statistically significant increase in liquidity for some of these companies.

Morgan Swink (00:32:29):

So, on the average, companies that are adopting these types of tools are seeing about a 12 to 15% increase in liquidity. That’s — we’re drilling into that a little bit more now to find out was that because they’re able to hold less cash or less inventory, or are they, you know, getting their AR — their receivables paid fast. What is the impact on that? We haven’t quite drilled down that far. But there’s pretty good evidence here that there’s a payback on these investments.

Scott Luton (00:32:56):

Morgan, that’s a truckload of good news and we look forward to you to continue to drill in some of those areas and we’ll have you back and talk to more of the specifics.

Scott Luton (00:33:04):

I want to change up here. So, Greg, as he was talking about your team members, and retention, and really making their jobs a lot better. That got your attention. So, before we get Dan to weigh in, Greg, speak to that for a second.

Greg White (00:33:17):

Yes, I mean, you know, I just imagined the jobs that are getting and will continue to be automated are the jobs that most people feel very unsatisfied doing anyway. I was just thinking there is plenty of data around that, Morgan. I know that’s not your area to study, but it — there’s plenty of data around that. So, your intuition there is dead on.

Greg White (00:33:40):

You know, people want the — that, I guess, would be considered a dull job of the four Ds, right? It is — if you’re just supposed to enter invoice data — honestly, in 1993 or whatever, when I got my first e-mail address, we stopped entering data from our suppliers. Think about that. I mean, some companies have not been entering data for — is that 30 —

Scott Luton (00:34:06):

30 years?

Greg White (00:34:07):

30 years.

Scott Luton (00:34:08):

Let me use my calculate. Let me use my Excel Spreadsheet.

Greg White (00:34:10):

Yes, that’s more than two decades. I’m never supposed to confess more than two decades. It’s too late for that, isn’t it? But you know, there are opportunities to do that and there are ways to do it. And it’s getting ever easier with the advent of all of these enterprise communication devices, APIs, blah, blah, blah. You know, insert acronym here.

Greg White (00:34:35):

But I think that does allow people to elevate themselves to those higher jobs, just like other automation. I mean, the jobs that people don’t want to do in a warehouse. Those people will be doing a more analytical or, you know, creative thinking, or critical thinking type role because it takes a tremendous amount of data for a machine to do those roles. Whereas humans, however we do it, you know, we’re pretty good at it, or at least we can talk it out with amongst ourselves to solve some of these problems. So, those are much more satisfying jobs to do for almost everyone, right?

Scott Luton (00:35:10):

Well said. Yes.

Greg White (00:35:11):

And I think that that is the benefit of — to the teammates, but also to the company, because the things that we’re not good at are the things we’ve been doing for a lot of years. Turning a wrench or a screw to a particular torque setting, right, which machines can do much better. We don’t get injured if machines do it. We can go do something else if machines do it, right? Same with accounting and payables and receivables and things like that.

Scott Luton (00:35:39):

Well said. There’s certainly a better way. And speaking of, Dan, I’ll get you to come in here. And, you know, we’re asking Morgan about the outcomes, companies and business leaders are expecting. Speak to that, Dan.

Dan Reeve (00:35:50):

I will. I just got to add on someone Greg said. I think if you look at got what Gartner has been saying, you know, like — the likes of Gartner, the likes of Ardent Partners, which is the think tank and the procure to pay space. Gartner’s been saying for years, the way you really take care of customers is how quickly you — can you position your customer service teams to quickly deal with problems and use their EQ and their human skills? And then Ardent Partners have said — for the last couple of years, they were saying, the procure to pay procurement and AP departments need to become more customer centric. They need to grow in their ability to identify problems, launch little initiatives, user technology. And to serve, see themselves as customer service departments that reduce friction and improve the working relationship with the procurement folks.

Dan Reeve (00:36:47):

When you free people up to do all that sort of work — and we see this regularly, is that, yes, then staff are more likely to both stay and also grow within the organization. And you don’t lose all that experience and that, you know, a piece of your culture when somebody leaves the door. I think leaders are paying particular focus on that. And I think when it comes to ROI increasingly, I encourage and I see leaders saying, OK. Yes. Are we going to reduce the position? What is the outcome from this?

Dan Reeve (00:37:19):

And part of the outcome statement may be, how does this sort of lead to career development and people being retained within the organization? I’ll give you an example. I should now answer your first question which was outcomes. You know, I was talking to a V.P. of finance and treasury in Florida, Southern Florida recently.

Dan Reeve (00:37:39):

And I said, you know, here’s a gentleman, they’re forward thinking. They’ve automated their payables process. They’re automating their cash application, their collections process. They’re thinking about automating order management next. So, they’ve got — they see it all joined up. And they’re you know, dealing with some challenges in financing. And, you know, you can’t just go out to one bank. They’ve had to go out to three, four, or five different banks.

Dan Reeve (00:38:03):

And one of the areas that’s been — two areas of interest are, you know, supply chain financing and also getting extra rebates by paying vendors early. And I said, you know, what’s your experience here? How do you feel about this? And it was really interesting, the leader there said, well, Dan, 12 years ago I did this. Oh, yes. Well, what came of that? Then he said, well, 12 years ago I achieved with my team at different company. We moved payments to be made electronically. So, we got away from check, which has the fraud risk. We began to pay the suppliers faster, which they appreciated. And, you know, that in turn reduces their cost of borrowing.

Dan Reeve (00:38:345:

And using virtual card, for example, he said, you know, we were getting a $750,000, $800,000 rebate every year. So, no need to return A.P. into a profit center. Return finance into a profit center, you know. So, that’s the sort of thing that allows you to pay for a department, and probably fund some — fund further initiatives and transformations that people want to be a part of and stay at that organization.

Scott Luton (00:39:10):

Right. Or go to Vegas —

Dan Reeve (00:39:11):

That’s 12 years ago, you know. So, the reality is, these opportunities have been there. And 12 years ago, we didn’t have the borrowing costs that we have now. So, there’s — you know, there’s so much more opportunity given that extra pressure, I think.

Greg White (00:39:24):

Yes.

Scott Luton (00:39:25):

Greg, your quick comment. That dog will hunt that Dan is describing, because that’s — it actually — that’s not — he’s not making that story up. This is what’s happening today or, in this case, 12 years ago. So, the impact’s even greater. Greg, your quick thoughts.

Greg White (00:39:40):

Yes, more of that. I mean, it’s true. It has been around. And look, especially over the last 12 years. We’ve been really sloppy and lazy because money was free. So, now that — as Dan identified, that pressure is much, much greater, it will lead to greater efficiency in organizations in — at every angle. But especially here, because the technology has matured so dramatically in the last 12 years that it’s not only effective, as effective as at least as it was 12 years ago and probably more so, but it’s much, much easier to implement these days as well. So, more companies will do it. They’ll capture more of that opportunity and benefit. I mean, it’s —

Scott Luton (00:40:24):

Undoubtedly

Greg White (00:40:26):

— time. Time.

Scott Luton (00:40:26):

Greg, I love that. And that’s such a great call out about how we’ve been spoiled with access to cash. And I know you’ve written about that before and helped a lot of folks open up some minds.

Scott Luton (00:40:35):

Hey, really quick. I want to take a couple quick comments. One of our faves is here. Siham [phonetic], she says, the ’90s wants its manual input back. I’m with you. I’m with you. Let’s see here. Mosab [phonetic], I think we’re kind of speaking to some examples. And of course, we’ll see if we can work more of in terms of how A.I. continues to impact supply chain. And then Harry says — Harry, great to see you. Managing risk is a process. Have you taken the time to understand your inherent risk, strength of your controls, and residual risk? Most companies have not. Great point.

Greg White (00:41:05):

Well, that’s a man who makes his living. Reduce — reducing risk for companies when he’s not fishing and bragging endlessly about it.

Scott Luton (00:41:15):

So — all right. Moving right along, Morgan, Dan and Greg. Where are we going next? Let’s see here. So, we’re going to go back to the future a bit. And by the way, I can’t say back to the future without thinking about Michael J. Fox, there’s a great documentary out on the streaming services about his career. So, check that out.

Scott Luton (00:41:33):

But for this conversation — and Morgan, I’m bringing it back to you. What future macro level challenges are businesses most concerned about having to overcome? Your thoughts, Morgan?

Morgan Swink (00:41:45):

Well, back to macro — well, let me just say one thing real quick though. I don’t know if I mentioned this before you — before we close off that last part. The — I don’t know if I mentioned this other project. We just published a paper earlier this year that looked at AP and the effect of AP policy, accounts payable policy on supplier relationships, basically. And that’s really where I come at this whole thing from. I’m not a finance guy. I’m a supply chain guy, you know.

Morgan Swink (00:42:12):

But how managing, working capital can affect your relationships. And we found conclusively that companies that treat their suppliers better in terms of paying faster, reap benefits in terms of co-development processes, innovation, just all kinds of collaborative benefits from that. So, I just want to reiterate that point. There’s a great opportunity that I don’t think a lot of folks are necessarily aware of or attuned to.

Morgan Swink (00:42:42):

So, back to the big picture, well, you know, deglobalization has kind of been the other trend that we’ve talked about here. And by the way, I love that Zeihan book too. It’s very provocative. I’m not sure I believe all of it, but it’s very provocative book.

Scott Luton (00:42:55):

Does it — Morgan, really quick, does it have the Dr. Morgan Swank official seal of approval, that book?

Morgan Swink (00:43:02):

I haven’t been paid anything to do that. So, I guess I won’t hold that —

Greg White (00:43:05):

He just said he doesn’t believe all of it too. So, now I really have to read it. Can we have a Morgan Swank edited version? I don’t believe this. I would love to see that, seriously.

Morgan Swink (00:43:16):

It’s a long book and it’s — he makes a lot of —

Dan Reeve (00:43:18):

It’s a long book.

Morgan Swink (00:43:19):

— a lot of bold claims. But most of it, it’s actually pretty believable. And the good news is, from his perspective, the U.S. is actually in pretty, relatively speaking, pretty good shape because we’re energy independent and we’re — and we have — our labor’s not as bad as others. And we’re food independent as well.

Morgan Swink (00:43:35):

Anyway — but this whole deglobalization trend, I think, is something that supply chain managers have to continue to grapple with. It’s an opportunity as well as a challenge. But who can predict what the political climate’s going to be like five years from now? You know, the coming election is going to — could possibly change directions, you know, one way or the other on that. So that’s difficult to predict. But I think it’s something — as Greg, I think, you said, we can’t make changes to these structures overnight. This is three to five to 10 years.

Morgan Swink (00:44:09):

It’d take a long time to build these global supply chains. And to unwind them or reconfigure them is not something we can do quickly. It’s not like you can just say, well, I’m going to start buying in Mexico instead of China. What about all the suppliers of the supplier you’re buying from, you know? They have to change, as well.

Morgan Swink (00:44:26):

So, there’s a lot of activity there that I think most smart supply chain executives are thinking about. And more generally, how can we build these networks that are resilient, not just to the immediate short-term disruptions that we can envision now that we’ve gone through Covid, but to the longer-term shifts and business cycles. Can we build supply chains that may not be as, “Cost efficient” in the short run as they have been, but have this longer-term resilience property that, you know, everybody’s seeing as necessary today.

Scott Luton (00:45:02):

A lot of good stuff. We need another hour just based on Morgan’s last response there. Dan, going back to the question. I’ll get your take here. What future macro level challenges are business leaders most concerned about having to overcome?

Dan Reeve (00:45:16):

Two, I’ll go with. One is — maybe three. Obviously, labor we’ve talked about, I think the — just in case. And in the past if you had your finance and procurement operation was like a Formula One car flying around the racetrack, that was fine. But now we’ve got a racetrack that’s full of potholes. And also, you’ve got to go off the racetrack because there could be disruptions and you’ve got to drive through the field. So, now, I think what folks need is cash, just in case. And they need flexibility within the business processes to adjust.

Dan Reeve (00:45:50):

Finally, I’ll mention, you know, we are talking about deglobalization, which could well mean you have, you know, you’re buying from suppliers in Latin America. Perhaps we’re going to, you know, you’ll see production move to Latin America and nearshore, as an example. And we know that population decline or changing population pyramid is — has been one of the drivers, not the only driver.

Dan Reeve (00:46:17):

You know, the need to eliminate fraud. And compliance has led to more good pre-approvals around if you’re going to pay somebody or receive payment. Increasingly, government entities or systems exist, both especially Latin America and Mexico with the SATs and other countries. You see it now. France, Spain, where increasingly if you are going to do business, you have to, sort of, make sure that you are compliant so that — and you register those payments and those transactions.

Dan Reeve (00:46:52):

So, I believe that what we’re seeing is that as companies begin to create shared services, business units and operations in these other countries, there’s going to be additional systems that you’ll have to adhere to. You know, you have to send the invoice in a particular format. You have to upload it in a particular format. You have to provide reporting on a weekly or monthly basis. France. France is, you know, has a huge initiative with their new platform.

Dan Reeve (00:47:22):

So, this is going to both make it more complicated for businesses. Increase the pressure to make sure they’re compliant. And you’re going to need smart people on your team to help you navigate through that.

Scott Luton (00:47:33):

That’s right. All right. So, Dan shared a lot there, Greg. I’m going to come to you now. I’m going to get you to comment here. But you know, Dan mentioned that compliance is cool again, right? He also is going back to his first point there. He was talking about racing around the racetrack in your nice Ferrari at the speed of a thousand gazelle’s. We’ve gotten a lot of traction out of that. But Greg —

Greg White (00:47:54):

Yes, it is.

Dan Reeve (00:47:54):

He’s a quick learner, Scott. I love it. You know, he picks up on these terms. It’s good.

Scott Luton (00:47:58):

I’ll try. I’ll try. Hey — but Greg, weigh in between what Morgan and Dan both shared there in terms of what business leaders are really worried about having to overcome as we — as — you know, we look ahead. Your quick thoughts, Greg.

Greg White (00:48:11):

Well, I love the analogy of Formula One. So, imagine a Formula one car with Mickey Thompson 33s on it, right? With a little bit of a lift kit to get it through the field when it has to go off field with paddles on. Able to be deployed from the tires when the — when — yes, when it — when the track gets flooded in certain sections.

Greg White (00:48:32):

And also, Dan, the track is also constantly shifting, right?

Dan Reeve (00:48:36):

Right.

Greg White (00:48:36):

You can’t go this way this time. You have to go that way this time. And so, there is a lot of — there are a lot — it’s a great analogy. Man, that would make a great speed racer cartoon. But look — sorry, back to the topic. There are so many changes coming, and they are irrefutable and undeniable. Compliance is one of them, right?

Greg White (00:48:57):

There are — there’s ESG regulations. There’s, you know, there — that include, not just environmental, but now human rights. In the States, we mostly focus on or ignore, mostly ignore, environmental impacts. In Europe, it’s now mandatory that you prove you are not using slave labor in your supply chain, as well as the stuff was rationally sourced.

Greg White (00:49:23):

As I’ve talked to supply chain leaders, they’re also concerned about the provenance. My favorite word, the provenance of their goods. Because as we’ve talked about, as the economy begins to do whatever it’s going to do, and it’s already a problem in a lot of cases anyway, there will be fakes, right? So, you have to make sure that the provenance remains solid. And of course, all of the other risks in supply chain that impact cost, and speed, and reliability as well.

Greg White (00:49:52):

So, yes. I mean, there are a ton of challenges that are impacting us that, you know, you want to eliminate the complexity of the things you can control and leave as few outliers as possible for those things that you cannot control, right?

Scott Luton (00:50:15):

Shakespearean, Greg. Very, very well said. And there will —

Greg White (00:50:19):

Did Shakespeare say, uh, a lot?

Scott Luton (00:50:20):

I don’t know. Maybe. But there will be fakes and there will be many, many more fakes. That’s a great point there. And also, Greg and Dan both spoke a lot about speed. Baked speed into their answers. Folks, when you download this report, you know, managing working capital, returning to a strategic end to end approach. One of the key call-to-actions and recommendations is go for speed. As report points out, “Velocity makes processes more resilient. drives down overhead, and can improve relationships with partners.” Dan touched on that in an earlier answer.

Scott Luton (00:50:51):

So, folks, make sure you download the report and check out the other calls to action. Calls to action. Call to actions, who knows?

Greg White (00:50:58):

Calls.

Scott Luton (00:50:59):

All right. So, let’s —

Greg White (00:51:00):

Good job.

Scott Luton (00:51:01):

Let — thank you very much. I’ll try. Well, the English language is my bad actor. It’s always torments me. OK. So, Dan, we’re going to get a moment of clarity here. I want to make sure folks understand, in a nutshell, what Esker does. And, you know, you’ve been with us a lot, but for the — for our new listening audience, what does Esker do in a nutshell, Dan?

Dan Reeve (00:51:22):

I think when finance leaders, supply chain leaders, I.T. leaders engage with Esker, you know, increasingly the same. I want to make sure that we’re taking advantage of technology, ChatGPT, Cognitive A.I. We don’t want to miss the bus. But what we’re really trying to do is ensure that we reduce friction between our — how we engage with our customers, our partners, and our suppliers.

Dan Reeve (00:51:41):

And that means freeing up customer service staff to be rock stars. Focusing payables procurement to be rock stars. To make it easy to bring on suppliers. Do your due diligence to make it easy to collect payment from customers. Identify any problems or short pays or unfair deductions. So, it’s all — it’s, sort of, technology to reduce friction and improve working capital effectively.

Scott Luton (00:52:06):

Well said. I’ll tell you all the referencing to the pressure. All the pressure is out there. We should have had Greg, David Bowie, and the Queen video queued up to play in the background throughout the show here today. But, Dan, in a — how can folks connect with you? What’s the easiest way to sit down and grab a cup of coffee or something perhaps a little bit stronger with Dan Reeve?

Dan Reeve (00:52:30):

Probably easiest way is e-mail me, daniel.reeve@esker.com, or find me on along LinkedIn —

Scott Luton (00:52:36):

Outstanding

Dan Reeve (00:52:36):

Daniel.reeve@esker, you can find me through the Esker website.

Scott Luton (00:52:39):

Not only is that easy, but I love how a lot of what you described or what Esker does is making life easier for your teams and your business. The folks that are under tremendous, tremendous pressure. Good stuff there.

Scott Luton (00:52:52):

All right. So, Morgan, really have enjoyed your — once again, your, perspectives here today. How can folks connect with you and all the cool things you are doing at TCU?

Morgan Swink (00:53:03):

Thanks. Yes, it’s been a real pleasure to be with you guys again today. So, again, e-mail m.swink@tcu.edu is pretty easy, I think. And then I’m on also on LinkedIn. And I want to encourage you also if — I head up a center here at TCU called the Center for Supply Chain Innovation. It’s all about collaborating with industry partners and supporting, recruiting of our students, that kind of stuff. So, if you’re interested in that at all, check us out. Just go to neeley.tcu.edu, that’s, Neeley School of Business, and then look for centers and you’ll see the Center for Supply Chain Innovation. You can learn more about us. And I’d love to talk to you if you’re interested in —

Scott Luton (00:53:45):

Thank you, Morgan. Really appreciate that. And I really appreciate what all that you do for our current, and really what we call the now generation. Folks that are entering industry are already making that impact. So, I really appreciate what — but really, all three of you all do in that regard.

Scott Luton (00:53:58):

Hey, really quick. We’re going to get Greg’s key takeaway in just a moment. But I want to make sure, folks, you all have the opportunity. This is a free resource that will give you even more insights into what Morgan and Dan and Greg have all touched on here today. Again, as that’s this research report, managing working capital returning to a strategic end to end approach. Speaking of making it easy, we’ve made it really easy because we’ve put the link in the chat. You’re one click away from downloading. And hey, let us know when you — those that do that, let us know what you think. Give us your take on that research.

Scott Luton (00:54:30):

Greg, we’re going to get your key takeaway in just a minute. But I want to thank — we’ve had — I mean, Greg, this is what we’re after, to pull Morgan in and all the research and data and that immense network. And then Dan and, of course, Esker team out there making it happen. Getting those practitioner insights. Greg, this is what we’re after. This is valuable. Must see T.V. or whatever you want to call it. Greg, you’re quick comment.

Greg White (00:54:53):

You see T.V. Yes, must see YouTube. We got to change that term since T.V.’s about to go away, don’t we?

Scott Luton (00:55:00):

You saw that report as well. This is the first time in history right now that — to put it simply, streaming — more folks are watching streaming than traditional T.V. How about that? Interesting time.

Dan Reeve (00:55:11):

Does that explain my wife — why my wife removed the T.V. from the front room? She never said anything. I just noticed it’s gone. Where did it go?

Scott Luton (00:55:20):

Is anything else missing, Dan? Is anything else missing?

Dan Reeve (00:55:24):

Don’t get me started.

Greg White (00:55:25):

That’s the key.

Dan Reeve (00:55:26):

Hey, hey. I — I’m just happy I get the opportunity to live there. You know, I just make sure I’m —

Scott Luton (00:55:31):

Hey —

Dan Reeve (00:55:32):

Hopefully my wife doesn’t see this, you know.

Greg White (00:55:35):

I wonder what did she put in that spot?

Dan Reeve (00:55:38):

Nothing. My wife’s very minimalist. You know, it’s — you know how it is, when I walk through the kitchen, I’ve got to make sure I, you know, I’ve got to remember, it’s not my kitchen. It’s my wife’s kitchen. She does a great job and, you know, and I just mess things up. So, I have to accept this, you know.

Scott Luton (00:55:54):

Well, Dan, I appreciate that. And for your sake, because we got your back, we’re going to thank you both and then we’re going to get Greg to talk about you all as if you are not with us here today. Hey, big thanks, to Dr. Morgan Swink, again, with Texas Christian University, the Eunice — Eunice and James L. West chaired professor of supply chain management at the Neeley School of Business at TCU, which Morgan mentioned. Morgan, thanks so much for joining us.

Morgan Swink (00:56:19):

Thank you. Been a pleasure.

Greg White (00:56:21):

Thanks, Morgan.

Scott Luton (00:56:21):

And we will see you again soon. And of course, your dynamic duo there, your colleague, Dan Reeve. I almost put you a doc — as a doctor, Dan. I almost added a doctor there. Dan Reeve, vice president of sales with Esker, one of our faves. Dan, look forward to having you back soon.

Dan Reeve (00:56:35):

Yes. Guys — gents, Morgan, great to do it. And thanks very much. I enjoyed it. Thank you.

Greg White (00:56:41):

Yes. Thanks, Dan.

Scott Luton (00:56:41):

You bet.

Dan Reeve (00:56:42):

Cheers.

Scott Luton (00:56:42):

We’ll see you all cheer both soon, Morgan and Dan.

Morgan Swink (00:56:45):

Bye-bye.

Scott Luton (00:56:50):

All right. Greg, I think we stopped Dan from going any further because we like Dan without broken legs.

Greg White (00:56:58):

Right, from his wife. Yes.

Scott Luton (00:57:00):

Right. That’s right. All right. So, Greg, we covered a ton of ground here today. And I mean, this is really — these are the kind of conversations that I live with, and my mind just ruminates on some of the factoids and research points that both Dan and Morgan shared. So, Greg, your favorite part that folks have to take away, perhaps, from this conversation here today?

Scott Luton (00:57:23):

Oh, Greg, hang on, hang on. Doug, thank you for the comment. He says, appreciate you all hosting an informative conversation today. Doug, hey, kindred spirits. I definitely — I tell you, Morgan and Dan, they need to take it on the road and have a Taylor Swift roadshow. Don’t they, Greg?

Greg White (00:57:39):

No. because this is enough.

Scott Luton (00:57:41):

All right. So, Greg, you’re —

Greg White (00:57:42):

Yes. You know, because then we get to do it with them.

Scott Luton (00:57:45):

That’s right.

Greg White (00:57:47):

So —

Scott Luton (00:57:47):

So, your favorite part here today?

Greg White (00:57:49):

No, of course they can take it on the road. We’ve just copyrighted everything here. So, well, I got to tell you, the enterprise nature of what we discussed the — there was one particular element that stuck — that struck me. Obviously, everything Morgan shares with us always is so incredibly valuable, and I think gives us a tremendous perspective of where companies stand and where they can go, and even how they can approach that future.

Greg White (00:58:17):

So, whether the future is stability or instability, it never hurts to have great relationships with your suppliers. And the best time, as we learned when Covid kicked off, to build great relationships with your suppliers, with your trading partners of any kind, really, is before a crisis hits. I couldn’t help but think of the discussion that we heard somebody said in one of our comments’ show — commentary shows after Covid started, when Dan was talking about that is be, you know, being kind to your suppliers and being fair with your suppliers actually accrues to the benefit of your own company. Not just from a relationship standpoint, but also from a bottom-line standpoint.

Greg White (00:58:59):

And I thought, you know, whether we’re — whether the economy or whatever is going into instability or gets more stable, now is the time to create strong relationships with your suppliers. Because as a friend of ours said, Scott, when — what is it? When crisis hits, it’s too late to make friends.

Scott Luton (00:59:20):

That’s right.

Greg White (00:59:20):

Right? And —

Scott Luton (00:59:21):

Well said.

Greg White (00:59:22):

— if you have not been fair or particularly good to your trading partners, the time that you need them is not the time to start doing. Asking for favors while at saying, yes, we’ll treat you better next time, right?

Scott Luton (00:59:37):

That’s right.

Greg White (00:59:38):

So, I think there’s a lot of that. But regardless of whether it’s that sort of thing that you’re tackling, understanding the enterprise benefits to your trading partners because — Morgan, also talked about this, that it is affirmatively impactful to your trading partners when you manage — I mean, and of course in this case, we’re talking about working capital which is a great term working capital. Because what are we all working for? Not for glory. Money. So —

Scott Luton (01:00:09):

No, not for glory.

Greg White (01:00:11):

— you know, making someone’s job easier or making your interactions with them easier, that’s a great benefit. But none of it matters if you don’t exchange funds, right? These are not charities, people. They are businesses. So, making it easier to exchange funds and making your ability to be a better trading partner is the one thing that you should take away from this discussion around better working capital management.

Scott Luton (01:00:37):

Well said, Greg. I would just add quick — two quick points. You know, Dan, we’ve talked about. He and Esker team have been with us on a variety of shows. He has been evangelizing, making things easier, and taking care of your suppliers for years. This is not — this is what he and the team are all about. So. you all connect with Dan and the Esker team. Download this report.

Scott Luton (01:00:59):

And then secondly, more broadly, going to your point, Greg, in the words of a– an iconic traveling band of industry analysts, Van Halen, when is the time to invest in supplier relations? Right now. Right now. There’s no better time.

Greg White (01:01:14):

Oh, great song.

Scott Luton (01:01:16):

It is. OK. So, on behalf of everybody, I know we couldn’t get everybody’s comments and questions in, I really appreciate all the audience joining us. Big thanks, of course, to everyone behind the scenes. Hey, big thanks to Matt, Catherine, Amanda, the whole team helping with production and facilitation. Big thanks to our guests, Dan and Morgan. Greg, always a pleasure to knock these out with you.

Greg White (01:01:37):

My pleasure.

Scott Luton (01:01:37):

And whatever you do, folks, whatever you do, there’s lots of actionable insights on what was shared over the last hour. But now the onus passes from us to you to take action. Do something about it. Deeds not words. Take something we shared here today, put it in action, help take that pressure off your teams and your suppliers, your customers, you name it. But whatever you do, Scott Luton challenging you, do good, give forward, be the change that’s needed. And we’ll see you next time right back here at Supply Chain Now. Thanks everybody.

Intro/Outro (01:02:05):

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