In April and May, Ardent Partners hosted The CPO Rising 2K20 Virtual Series – The Resiliency Imperative as a way to bring together our global community of procurement, finance, and supply management professionals and collectively tackle the big issues we were all facing and continue to face as a result of the coronavirus pandemic. More than 2,300 people participated in the 20 virtual sessions including our livestream summit. We also had 27 experts share their ideas and insights. Once the dust settled on the series, Andrew went back to interview many of these leaders so we could learn a little bit more about them and their companies. We’re also working on a plan to replay many of the sessions, so stay tuned.
Andrew recently caught up with Uldis Sipols, the legendary Chief Procurement Officer (and, recent inductee into the CPO Rising Hall of Fame) with a long track record of navigating procurement crises in his decades leading procurement teams at Gillette, P&G, Sonoco, AMP/Tyco, and Danaher.
Andrew Bartolini: Uldis, welcome back! Do you think we could start the interview by telling our readers a little bit about your background and what you are up to these days?
Uldis Sipols: Currently I am CEO of my own procurement/supply advisory, US Associates LLC, working with Private Equity and business turnarounds. As a first generation American, I also serve in a diplomatic role as Honorary Consul, Republic of Latvia in Massachusetts to promote business and cultural exchange between the USA and Latvia. My procurement career spans more than 4 decades with leadership and CPO roles at Ford Motor, AMP/Tyco Electronics, Danaher, Gillette, P&G and Sonoco—frequently in transformational, ground-breaking, or otherwise adverse (yet, opportunistic) circumstances.
AB: How did you end up working in procurement?
US: Somewhat by accident—I was an MBA candidate at the University of Detroit in the mid 1970’s and was interviewing with Ford Motor for what I thought was a Marketing role, when the interviewer asked me if I had ever considered Purchasing as a career. I told him I didn’t know much about that path, and the interviewer described it as “similar to sales and marketing—just the other side of the table.” I replied “Tell me more”—and as they say—the rest is history. That Ford interviewer opened a door to an exciting new career opportunity–eventually hiring me directly into his department as a procurement analyst, and arguably I am still one today after many subsequent experiences! Procurement was an established global discipline at Ford even in those days with a lot of continuous high intensity learning and growth potential, so I could have done far worse than to start out at such a fine company where I spent my first formative 20 years. My first boss at Ford asked me after one year if I had set any career goals for myself yet, and I replied that I would like to at least attain the Director level at Ford or the VP level at a Fortune 500 company. I was fortunate to achieve both goals (and then some), leaving Ford at the Director level to serve further in a series of CPO and VP roles in the diverse “outside world” beyond the Detroit area and the auto industry.
AB: I know that your time at Ford was profound and really set you up for the rest of your career as a Chief Procurement Officer – Tell us about the major influences of your career.
US: There were many influences at Ford early in my career, a few being: Gene Richter, a legendary “Mt. Rushmore” type transformative procurement leader whose better, fewer, longer mantra still rings true today for measuring and sourcing to a consolidated high-performing supply base with robust long-term agreements; Frank Macher, an outstanding general manager with superior interpersonal and organizational skills who gave me my first CPO-type role for Ford’s sprawling Automotive Components Division (the precursor to the Visteon spin-off from Ford); W. Edwards Deming, the global management guru who (as a consultant) personally tutored a group of us in his 14 key management points, statistical process control, and a “total value” business methodology—priceless! After leaving Ford I would highlight George Sherman and Larry Culp at Danaher, Mike Cowhig and Jim Kilts at Gillette, and A.G Lafley at P&G as key influences in my further growth and development as a leader and change agent in challenging circumstances — each testing me and my teams to have a robust business system, learn ongoing, stay focused, continuously improve, and to exceed expectations. It did not always work out — that’s where Plan B (or C, or D, etc.) helped me to stay grounded. Change can be a difficult part of life, yet is often an exciting source of energy and accomplishment as motivated people collaborate to make unexpected things happen in organizations and personal lives as well.
AB: During your session in the CPO Rising 2K20 series, you walked us through the different phases of crisis management and the strategies, considerations, and actions that Chief Procurement Officers should take when faced with a crisis like today’s global coronavirus pandemic. The COVID-19 pandemic has taught us many things regarding short-term preparation and general planning. What should leaders in procurement be paying attention to now, in the short-term, and in the future?
US: I think looking back that few were prepared for what was ahead in 2020. For instance, those companies that had BCP’s (Business Continuity Plans)—maybe only 30%?—even many of those companies fell short of expectations as their plans were not robust enough in the actual implementation stage when it mattered the most— yet still better than nothing. Inventory buffers fell short as some supply chains collapsed, alternate suppliers closed or went out of business, and the economy sputtered—a full fledged “fire fighting” scenario that experienced supply types are all too familiar with. Companies with solid, established strategies, business and quality operating systems, and agile process improvement/prevent recurrence methodologies have a fighting chance.
Meaningful outside supplier relationships are also critical, as well as the ability to distinguish between symptoms and root causes, and acting swiftly with short-term corrective actions, yet simultaneously laying the groundwork for longer-term solutions for root causes as feasible — these are the top performers from which we can learn. Crisis strains and tests processes and relationships — you really see who can lead, who you can depend on, and what it really takes to win. Everyone makes mistake — whether their business is going up or down. Yet, solid management practices do prevail in identifying the best path forward giving our organizations new life and hope for the future. Amazon, WalMart, Danaher, P&G perhaps were in the right place at the right time and I wonder if that was more than a coincidence. Yet, they still have to overcome major issues relying on their strong business cultures to succeed. Others in less fortunate segments like education, entertainment, hotels, and airlines face significant disruption and shake out. Poor management practices, including in procurement/supply, exacerbate a company’s business vulnerability and hamper the ability to adapt quickly to changing supply/demand markets.
AB: As a longstanding Chief Procurement Officer, do you have any predictions for the future of the industry? What is the one thing you’d like to see in 2030?
US: This will be significant decade for procurement—rethinking and redesigning global supply chains will require a lot of introspection and heavy lifting with CPOs at the forefront if they are “worth their salt.” Technology will continue to have a significant impact on advancing and disrupting the profession, thereby leveling the playing field quickly between the Tier 1 and less competent players in terms of tool sets and capabilities. That’s good news to get in and stay in the game. Yet, to really win and produce ongoing competitive advantage which is where I believe highly-skilled CPOs lead with a strong combination of technical and interpersonal skills. They do so as agile integrators and developers between the capabilities of their best outside suppliers and the demanding needs and idiosyncrasies of their internal customers. All the while, optimally managing this challenging, complex dynamic and thus fostering true competitive advantage for their organizations.
Supply bases will also need to be more agile, responsive, innovative, and truly diverse to succeed. Competition for needed external innovation will be intense. Sustainability will continue to take on a life of its own in the next decade globally, and be a real differentiator for corporate success. Social responsibility is also a key opportunity for the externally-facing CPO. The transformation and revamping of our education systems could also use some help from CPOs—their strong cost cutting skills, problem solving acumen, and practical business sense can be a community asset to envisioning and realizing new ways for all people to have equal access to quality education that will result in meaningful, life-changing employment and meaningful interpersonal relationships. And, if CPOs can and will do all this, fully maximizing their skill set—more of them will become COO’s and CEO’s (and GM’s) in this decade if that is their desire – personally demonstrating that anything is possible in this profession! Joining the ranks of Apple, Toyota, Amazon, Merck, and others who are already “in the know”.
AB: During the shutdown, what has been the best or most interesting thing you’ve streamed, read, or viewed?
US: The shutdown certainly curtailed live business and diplomatic activity. I did catch up on some of John Grisham’s later novels (e.g. The Reckoning)—his writing style remains vivid, down to earth, and engaging, although his earlier works are still the strongest in my view. A true American classic. On the diplomatic front, I got some fascinating exposure to external think tank and NGO briefings, often with distinguished speakers and guests and many open to the general public (e.g. World Boston, Los Angeles World Affairs Council, Jackson Institute for Global Affairs-Yale). China, human rights, and supply chain have been hot topics during the pandemic.
AB: Well, supply chain is always a topic for us and I think it is a big positive for the profession. Uldis, thanks for your time today, I hope to talk soon. Be safe!
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CPO Honors 2020 Announcement
Due to the COVID-19 pandemic, Ardent Partners has extended the deadline to submit nominations for CPO Honors 2020 until September 10, 2020.
For more details about CPO Honors 2020, and to submit your nomination(s), visit: www.cpohonors.com.
In case you missed the CPO Honors 2019 Ceremony, here’s the highlights reel – watch it, it’s worth it!!
