September 27, 2022 • 33 mins
Sustainable supply chains are good for the planet and good for business. In this episode of Smart Talks with IBM, Malcolm Gladwell takes on this topic with Tim Harford, host of Cautionary Tales, and guest Sheri Hinish, IBM’s Global Sustainability Services Leader and Offering Leader for Sustainable Supply Chain, known as the “supply-chain queen.” They discuss the supply-chain crisis and why transparent, responsible supply chains are imperative for our future.
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Speaker 1 (00:05):
Hello, Hello, Welcome to Smart Talks with IBM, a podcast
from Pushkin Industries, I Heart Radio and IBM. I'm Malcolm Gabbo.
This season, we're talking to new creators, the developers, data scientists,
CTOs and other visionaries who are creatively applying technology in
business to drive change. Channeling their knowledge and expertise, they're
(00:27):
developing more creative and effective solutions no matter the industry.
Our guest today is Sherry Highnesh at IBM. She's the
global leader for Sustainability Services and offering leader for sustainable
supply chain and Circularity, but to her friends, she's better
known as the supply chain Queen. Sherry's job is to
(00:51):
help businesses design and build supply chains that are environmentally
sustainable and socially equitable. She's helped Guide's strategy for Fortune
five hundred companies and has won numerous top awards in
her industry. Sherry has worked with companies like Salesforce and
UPS to shape thought leadership around supply chain, and she's
(01:11):
also a major advocate for greater inclusion and diversity in
her field. On today's show, why sustainability and supply chains
is good for the planet and for profits how technology
can ethically reshape the way consumers source their goods, and
what the supply chain crisis has revealed about the interdependence
(01:33):
of our societies. Sherry spoke with Tim Harford, host of
the Pushkin podcast Cautionary Tales, and longtime columnists at The
Financial Times, where he writes The Undercover Economist. In addition
to publishing several books and economics, he's also a BBC
broadcaster with his show More or Less. Okay, let's get
(01:55):
to the interview. Sherry, thanks so much for joining me.
And I've been looking at your job titles. I've I've
got the official job title IBM's Global Sustainability Services Leader
and Offering Leader for Sustainable supply Chain. And I've got
the unofficial job title, which is Supply Chain Queen, which
(02:17):
I have to say I like a lot better. So
what do you actually do well? The title that I'm
most proud of his mother. Let me just start there.
And you know, I am very fortunate to wake up
every morning and do what I love, which is answering
a fundamental question. What responsibility do you have to others?
(02:38):
And what impact are you making in the world that
we share? So in my current role I lead sustainability
Services and Alliances globally for IBM Consulting. Let's just make
the connection for me between sustainability, which I think I
understand it's like, you know, doing the right thing, looking
after the planet, looking after people, and supply chains, which
(03:02):
I also think I understand. That's a thing that goes
wrong when I don't get my kettlebells, when that ship
gets stuck in the sewers canal, and everyone's complaining about
them at the moment. But how are the two connected.
So sustainability and supply chains are interconnected in that you
(03:23):
have a lot of companies making commitments right now around decarbonization.
Maybe you've heard of net zero journeys or science based
target commitments, and when you double click that supply chains
are actually the conduit to realizing a lot of the
Scope three emission reduction initiatives that companies are after right now.
(03:44):
So I just just explain Scope three for me. So
Scope three emissions are emissions that happen outside of your
immediate control. So think about upstream in sourcing and procurement.
Think about when a consumer actually this is your product. So,
for example, a lot of consumer goods the impacts associated,
(04:07):
especially the carbon impacts and the water impacts, often live
after they leave the retail establishment or your front doorstep.
A lot if I buy a car and I fill
it with gas then and I drive it around, then
you know, even if the car is made incredibly responsibly
and the gasoline was refined in the most efficient possible way,
(04:31):
you know, I'm still benning gas right absolutely. And I
think that this is the real human emergency that's tucked
under a lot of the climate change conversation is how
are you transforming the lives of people, helping them make
better decisions. A lot of that happens in a supply chain.
I think supply chains have gotten a lot of attention,
(04:52):
maybe for the wrong reasons lately, because you you don't
have your favorite snack or your favorite thing at your
fingertips on the shel and certainly with the pandemic, how
we buy and procure goods has changed quite a bit.
But supply chains that's where it really gets real. That's
where we see things around responsible sourcing and a lot
(05:14):
of the social inequities that can be addressed using a
supply chain, fair living wage, making sure that you have
a diverse workforce. So the cognitive diversity something that I
evangelize at IBM. How are we really shifting the type
of people who are in the room building solutions to
fundamentally rethink the world? Right now, this is going to
(05:39):
sound like an ignoble question because you've just expressed these
noble sentiments. But sustainable supply chains good for business, of
course they are. So there's always this business case for change,
and I think there's a pragmatical lens so of having
come from industry and supply chain for over fifteen years,
(06:01):
there's always the lean optimization and what that means is
things like operational efficiency, looking at materials differently, is there
more value left? Is there more value on the table?
So looking at lean and green projects and initiatives, a
lot of those things have been historically tucked under supply chain.
(06:21):
But when you say sustainable supply chain, to me, it
feels very different. It's different because a lot of the
optimization and efficiency gains, specifically in environmental stewardship, have been consequential,
they have not been intentional. Yeah, the fact that people
are thinking about supply chains now I think for the
(06:42):
wrong reasons, as you mentioned, because stuff's gone wrong. I'm
sure that's frustrating as a supply chain professional and the
need to supply chain queen. But I mean, is that
is that an opportunity because because suddenly people notice that
this is important, People notice that the society relies on
(07:04):
supply chains, the economy relies on supply chains. Do you
think that over the next few years the supply chain
sector will look back at this moment and say, actually,
that did is some good. Absolutely. I mean there's the
reality that we will never return to where we were before,
and that supply chains really power the world. They connect communities,
(07:29):
they connect you know, this super global, hyperlocal frame of mind,
and that it shows the relationship that businesses can't succeed
in societies that are failing. I think there's a sense
of renewed resiliency as well when you have business operations
or business as usual, but you you actually can't stop
(07:52):
looking toward the future. And that for me, at least
when I will look back on this in ten years,
I know that supply chains are right at the forefront
of creating the type of adaptability to rethink a new world,
to use sustainability and purpose is really an anchor to
connect every person across the global network that each of
(08:14):
us participates in. To the pre COVID consumer supply chains
were truly out of sight and out of mind. It
wasn't until baby formulas started disappearing from the shelves and
we had to sign up for a six month waiting
list just to buy a car that we realized how
much we had taken for Granted, Sherry mentioned earlier, much
of the environmental and efficiency gains and supply chain have
(08:37):
been consequential, not intentional. But now that disrupted supply chains
are more visible than ever, were forced to ask ourselves,
how can we improve them? How does technology govern the
modern supply chain? What can businesses and consumers do to
make supply chains more sustainable and operationally efficient than before?
(09:00):
Let's listen. I'd also like to talk about computers, because
I feel computers I've got to be involved. But this
is an IBM conversation. You work for IBM. What if computers?
What has data? What has digitization got to do with
supply chains? It's it's so important because digital and supply chain,
(09:22):
especially from where I said, it makes sustainability visible, actionable,
and operational. So we can just take some of the
supply chain obstacles that have emerged in the past two years.
Throughout the pandemic, you know, a lot of executives have
had to scramble to frankly, rebalance their supply chain operations.
(09:44):
So you think about demand volatility, rebalancing workforces, reallocating production
lines to other products, especially as a PPU was manufactured,
all of the policies and procedures needed to communicate openly
with customers, and then also seeking alternative modes of transportation, logistics,
(10:07):
and other services. Data and digital is really at the
heart of this. If you don't have the right technology,
you're not able to make smarter, more informed decisions. And
a lot of this data, frankly, especially in supply chain organizations,
it exists outside your four walls. And the pandemic is
(10:27):
a perfect example of the sort of collaboration with technology
that's essential to not only save lives, but to make
better business and operational decisions. So I'm trying to picture this,
so I just imagine I'm a kettle bell. I don't
know if this is a good example not, but imagine
I'm a kettle belly. I mean, partly because I got
(10:47):
a couple down here and partly because kettle bell seemed
to be the quintessential thing that everyone was trying to
get hold of in the spring of twenty twenty and
no one could. So okay, so does kettle bell. I'm
a kettle bell. I've just been made in a foundry
just out one hundred miles out of Shenzen, and I'm
(11:10):
going to have to be driven on a truck into
the port of Shenjen, stuck on a boat across the Pacific,
arrive at port of Los Angeles, and then be put
on a truck. And I'm going to go to let's say,
Las Vegas, because there's somebody in Las Vegas who wants
this kettle bell. And you know, there's a problem because
(11:34):
supply chains are all messed up, and we're trying to
make this whole thing more sustainable, and we're trying to
use digital technology to just just talk me through how
this process could work better, how it could be more efficient,
how it could protect the planet more, how it could
reduce volatility, what's going on that might make this kind
of thing work better. So the first question you ask
(11:56):
is why are you producing something across the ocean that's
landing in Las Vegas, And I think that part of
the beauty of exponential technology right now in modernization is
that we have more information to inform decisions and make
better decisions than what that means is in your kettle
(12:19):
bell instance, you think about the footprint of that kettle bell.
It's a very long supply chain and there's a lot
that can happen. So shorter supply chains are typically happier,
they have less risk, they have a lower carbon footprint.
They also have more autonomy and agility, meaning there's a
shorter distance and there's less disruption that's probable in that
(12:43):
shorter supply chain. So you know, you look at how
are you sourcing. What's that sourcing decision? Is it lowest price, probably,
but what's the total price? What's the total price of that?
And that includes a lot of the regulatory pressures around
lowered carbon emissions and carbon taxation, cross border adjustment tax
(13:05):
so on and so forth. Also look at the supply network,
like are you creating a shortage of materials or goods
or inventory and other parts of your network as a
result of fulfilling that kettle bell order from China to
Las Vegas? Is there a better alternative is there a
(13:26):
decision that's smarter, that's you a local or domestic decision
where you can maybe with an incremental cost, have a
shorter distance to market to delivery, a lower footprint, and
you have more control over what happens. And a lot
of those drivers of disruption like demands, supply logistics, workforce, sustainability,
(13:50):
you eliminate that risk by design all the way upstream
in that very first decision point, where do wesource? Where
is it going? And what's the total cost of ownership
for that cattle bill? And if we want these decisions
to be made more responsibly, who ultimately is making them?
(14:12):
And what are the what are the challenges that we face?
What are the obstacles to a more sustainable strategy? Is
it cost? Is it ignorance? What's getting in the way.
It's such a big question, and it's a great question
because I now, I know this is a little provocative,
(14:32):
but I think that consumers have more power than they
than they know. They are the demand signal in a
supply chain. It all starts with what you buy and
why you buy it, and what I often find gets
in the way. And you'll have a lot of folks
who give you big, fancy, long answers, pontificating. It ultimately
(14:58):
comes down to choice. It comes down too and again
this is a bit of a first world answer, but
you have the ability to choose with your pocket what
type of world and what type of brand you support.
The thing that I find most telling, tim is if
you knew and if there was a way that a
company could convey that level of transparency, not everything, not
(15:22):
every single data point, but just enough to give you
context around your purchase, would you make a different decision?
And that is what sustainability and supply chain is, in
my opinion, that level of right level of transparency to
help people make better, more informed, responsible decisions. And that's
(15:44):
also where the divide lies. There's so much data. I
think there's no lack of data. Frankly, a lot of
it is living in disparate silos. And part of the
work that I support, how can you be a great
connector across all the different touchpoints to not only connect
(16:07):
this data, aggregate it just for that first step of visibility,
but then the sharing that's needed of great use cases.
The QR code enabled product label, so giving the consumer
the ability to scan a code and see an app
relevant sustainability metrics that would enable, in theory, a better
(16:31):
different decision where you could show not necessarily what a
carbon footprint is or metric tons of carbon. Most consumers
don't understand that, but in this example, hey, if you
buy this product, you're saving forty trees from being cut down.
You're contributing toward this brand, responsibly sourcing a product, and
(16:54):
also evangelizing the information in a way where you can
be part of that journey. There are tons of examples
where customers want to be a part of something much
bigger than themselves. Employees as well. So I think, you know,
we've talked a lot about consumers being the demand signal,
(17:14):
and that's really where it starts. But then I think
that this is the power and the momentum, the paradigm
shift that we're seeing where sustainability and supply chain absolutely matter.
I love this idea that as a consumer, I can
just pull out my phone and scan the QR code
and I can get I can get as much of
(17:35):
as little the data as I want. I can get,
I can get the quick summary, or if I'm a
real nerd about something, and some people are very passionate,
they really want the details. I've got a friend. Every
time we go to a restaurant, he's always asking about
the supply of the fish. He's super interested in sustainable fishing.
It's just what's just what he does. You know, We've
all got our interests. So I love this idea that
(17:57):
that these codes could just empower us. It's it's clear
that that's a possibility. Now the risk of digging a
little deeper into more technical details. You mentioned this problem
with data silos. Talk me through exactly how that problem
manifests itself and what solutions are being explored. So historically,
(18:20):
I think when you talk about competitive advantage, people have
been able to operate in a black box, especially with
supply chain data. A lot of the data around sourcing, logistics, providers, manufacturers,
all of these things were leveraged together for competitive advantage,
(18:41):
so they didn't want to share this data this strategy
across their ecosystem. From what we've seen throughout the pandemic,
you are probably more profitable, more agile, and successful in
understanding where you absolutely have to share this data. This
is equally true for sustainability data. So I think the
(19:05):
paradigm shift is now in order to decarbonize our world,
create the type of meaningful change, biodiversity restoration, ocean health,
making sure that our forests are healthy. All of this
requires cooperation now at scale. So when you talk about technology,
(19:29):
I mentioned before that especially with digital and modernization and
supply chain, it makes it visible so everyone can see
a source of the truth. So specifically at IBM, we
talk a lot about something called an intelligent workflow, and
this is where you can use technology like blockchain, like AI,
(19:53):
like twinning, like quantum to bring all of these stakeholders
up dream and sourcing and procurement all the way downstream
to the consumer. Even so, take that QR code that
you scanned at the shelf, consumer can look at their
phone and see the journey of that product. They can
credibly see where it was sourced. There's even the functionality
(20:17):
to thank their farmer. So maybe you're scanning a bag
of coffee beans where you can thank your farmer, enact,
identify the source community. When have we ever been able
in a source to pay intelligent workflow connect the first
kilometer of a supply chain with the last smile all
(20:40):
the way to the retail shelf. So I think that
these are the types of possibilities and opportunities that are
enabled with technology, creativity, cognitive diversity, and fundamentally rethinking the
way that we've done things right now, nine percent of
(21:02):
materials in the world actually are circular, which means ninety
one percent of the goods that we use, that we
consume end up in a landfill or are wasted in
some way, shape or form, and that is absolutely unsustainable.
We are on a path when we look at our
(21:24):
landfills and we look at just the management of waste
and oceans and waterways, we cannot continue to take make
and waste or throw away goods that we produce as
a species. We're becoming more and more aware of the
societal ripple effects that result from our consumption. Much of
(21:48):
Sherry's job is to think about how we will live
and consume in the future and how we can affect
change today. There's a human element to her work. Tim
asked Sherry how she collaborates with the any humans who
are embedded in our supply chains to get them on
board but changing the status quo and what part creativity
plays in her work. The whole season of the Smart
(22:11):
Talks podcast, it's focused on creativity and business. Are you
a creative person? Of course? You know what's interesting about
my career path? I actually I started as as an entertainer,
as a singer. A lot of people don't know that,
so I was a musician songwriter for many years. But yeah,
(22:36):
I there's something about creativity. It's like the human soul
on fire. And when we think about you know, everything
that we're living through right now, we need people who
can be creative and think from different perspectives to redesign
(22:58):
this world and to redesign business and really steer us
into a new future. Now now, now, now, you might
not agree with me, but supply chain and music are
absolutely connected, and they're very similar. And I'll show you why.
In supply chain, you always start with customer centricity or
(23:21):
voice of the customer. How are you meeting their needs,
their wants? How are you fulfilling the demand. It's no
different than being on stage and singing or writing a song.
Think about listening tempo, cadence and pulse, emoding, tone, all
(23:42):
of those things that orchestration. It's just like music. It's
just like supply chain. I love it. So, I mean,
you've conveyed this idea of the creativity and of the
listening and of the tempo. Can you give me a
specific example of a time that you've helped a client
who's come to you and said, look, I've got to
(24:04):
make the supply chain more sustainable. Or maybe the client
didn't realize that they had to make the supply chain
more sustainable and you convinced them of it. But just
just talk me through a particular client project or client relationship. So, yeah,
looking at a transparent supply chain in this example, this
organization is a bit immature in the space, so looking
(24:29):
at how you encourage healthy snacking. And they wanted to
use data differently. A lot of the data that they
had was very much disconnected from the way work gets done.
But then they also wanted to bring the customer along
(24:49):
with them, which was a scary proposition because I think
one thing that came out of that engagement is they
weren't as mature as some of their competitors. And they said,
if we voluntarily disclose some of the risks that we
know we want to address, but we have to start
somewhere taking that first honest step, will it harm our brand?
(25:16):
And it was a really interesting way of looking at
it because as a consumer who actually buys their products,
I thought, Wow, they're starting from a place of wanting
to be honest and wanting to lean in, and we
have to acknowledge that a lot of brands are on
this journey and we are going to see things that
(25:39):
we cannot unsee. Yea, and very much so. The other
thing was not knowing how to get started. And in
order to give people that level of transparency in this
customer example, they needed the nitty gritty, and the nitty
gritty was very dirty, and it was a lot of
(26:03):
assumptions cobbled together, and I actually had to convince them
that it was a great starting point and almost take
them from feeling very vulnerable to feeling very confident. And
again I saw services in technology and it was a
great learning moment, frankly, because technology doesn't necessarily solve that.
(26:26):
It's very much, you know, connecting that human experience and
that is where specifically, in this example, the client had
a vision for a transparent supply chain, but didn't know
how to piece together a lot of great ideas where
they could actually fund their transformation over a five year period.
(26:49):
It was a billion dollar business case. A lot of
really cool ideas tucked under it, but it was what's
the sequence of steps and why how do we prioritize
resource versus funding transforming work? So a lot of the
work was automated, you know, thinking about the future of
work and automation. How do you repurpose this analysts time
(27:11):
for example, to more value add time. So all of
that to say it was a It was a great
learning experience for me and also for the brand that
I serve, and that we both got to learn together
and do something that really changed everything for them. It
sounds so that this work really masses you. It does.
(27:34):
It does. It's why I get up every morning. I
had this moment where it clicked, and it was about
seven years ago. I have three kids, So my oldest
just turned thirteen, and my oldest shape my daughter aris eight,
and my youngest is seven, and it was when he
was born that I just sat back and thought, you know,
(27:59):
with the climate and urgency, it was right around twenty fourteen,
twenty fifteen, what am I doing, like, what am I
doing to change this? And you start to think about,
you know, when they're eighteen and god knows what the
world would look like then what did you do. What
(28:19):
was your response? And being in supply chain and at
the time starting to dabble in sustainability, I saw those
interconnections and I saw a way marrying supply chain, sustainability
and technology to really make a difference and transforms people's
people's lives and it's good for business and good for
(28:40):
the planet. And I think it was all of that
coming together and clicking for me where I just said,
this is what I'm going to do, and it's just
been an incredible feeling and nothing can replicate this. My
kids are proud of me. I love my team. I
would choose them even if I wasn't here, I would
find them in the univers I always tell them so
(29:01):
that that's really what it's about for me, is making
a bet a better world for others, for my kids,
for their kids, and that's what matters most. Just tell me,
look twenty years into the future, and we know the
climate isn't going to get any better. We know we've
(29:24):
got a real problem there and it's for the foreseeable
future that will get worse even if we're able to
put some real solutions in place, but supply chains themselves
in twenty years time, what would you hope sustainable supply
chains might look like. I definitely want community resilience and
(29:48):
hyperlocalism to be a driving force for supply chain transformation,
meaning that so a big brand like do you have
community permission to open your doors there? How do you
preserve that community? How do you ensure that basic needs
are being met? That is so critical and important. I
(30:10):
mentioned before that businesses can't succeed in societies that are failing,
and I think that that tie between profit with purpose
and societal impact it's coming to the forefront now. When
I think about a supply chain in twenty years, you
think about community resilience. You think about you know, how
am I enabling others who have been marginalized or traditionally
(30:34):
left behind to have access to healthcare, to have access
to education and upskilling. I think all of these things,
that's what I would want most And in terms of
like how work actually gets done and how we transform
our thinking, it's that we have shorter supply chains and
that we think about the impacts holistically. The total cost
(30:59):
of ownership for a brand, for a phone, for a mouse,
for a can of sparkling water, what's the total costs
of this really, which isn't necessarily price, you know, there
are other things that go into that. And I think
that if we really understood the impact that we have
(31:20):
on the world, how we contribute to climate variation and
climate change, I want to believe, in hope, that we
would make different decisions. Sherry Hines, it's been such pleasure
talking to you. Thank you so much. Thank you, Tim,
It's been a pleasure. When we think of supply chains,
we typically picture cargo ships or faraway factory belts, maybe
(31:44):
a map of the world with a string of connected
dots running from Shenzen to Las Vegas. But what Sherry
does so well is highlight the impact these often invisible
systems have in our daily lives. We all want supply
chains that are ethic, environmentally responsible, and integrated with local communities.
It's good for business, good for the planet, and good
(32:07):
for the consumer. The pandemic gave us a chance to
begin the paradigm shift in supply chain thinking that Cherry
talked about. Now there's an opportunity to put these ideas
into action in our day to day choices, in our
businesses and in our communities. The next time we're at
a grocery store and can't find our favorite snack. Let's
(32:29):
take a moment to remember that. On the next episode
of Smart Talks with IBM, how AI powered technology can
help us combat the human biases that result in discriminatory
hiring practices. We talk with Angela Hood, founder and CEO
of This Way Global. Smart Talks with IBM is produced
(32:51):
by Matt Romano, David jaw, Royston Deserve, and Edith Rousselo
with Jacob Goldstein were edited by Sophie Crane. Our engineers
are Jason Gambrel, Sarah Brugere, and Ben Tolliday. Theme song
by Gramoscope. Special thanks to Carli Migliore, Andy Kelly, Kathy
Callaghan and the eight Bar and IBM teams, as well
(33:15):
as the Pushkin marketing team. Smart Talks with IBM is
a production of Pushkin Industries and iHeartMedia. To find more
Pushkin podcasts, listen on the iHeartRadio app, Apple Podcasts, or
wherever you listen to podcasts. I'm Malcolm Glabwell. This is
a paid advertisement from IBM.
Hello, Hello, Welcome to Smart Talks with IBM, a podcast
from Pushkin Industries, I Heart Radio and IBM. I'm Malcolm Gabbo.
This season, we're talking to new creators, the developers, data scientists,
CTOs and other visionaries who are creatively applying technology in
business to drive change. Channeling their knowledge and expertise, they're
(00:27):
developing more creative and effective solutions no matter the industry.
Our guest today is Sherry Highnesh at IBM. She's the
global leader for Sustainability Services and offering leader for sustainable
supply chain and Circularity, but to her friends, she's better
known as the supply chain Queen. Sherry's job is to
(00:51):
help businesses design and build supply chains that are environmentally
sustainable and socially equitable. She's helped Guide's strategy for Fortune
five hundred companies and has won numerous top awards in
her industry. Sherry has worked with companies like Salesforce and
UPS to shape thought leadership around supply chain, and she's
(01:11):
also a major advocate for greater inclusion and diversity in
her field. On today's show, why sustainability and supply chains
is good for the planet and for profits how technology
can ethically reshape the way consumers source their goods, and
what the supply chain crisis has revealed about the interdependence
(01:33):
of our societies. Sherry spoke with Tim Harford, host of
the Pushkin podcast Cautionary Tales, and longtime columnists at The
Financial Times, where he writes The Undercover Economist. In addition
to publishing several books and economics, he's also a BBC
broadcaster with his show More or Less. Okay, let's get
(01:55):
to the interview. Sherry, thanks so much for joining me.
And I've been looking at your job titles. I've I've
got the official job title IBM's Global Sustainability Services Leader
and Offering Leader for Sustainable supply Chain. And I've got
the unofficial job title, which is Supply Chain Queen, which
(02:17):
I have to say I like a lot better. So
what do you actually do well? The title that I'm
most proud of his mother. Let me just start there.
And you know, I am very fortunate to wake up
every morning and do what I love, which is answering
a fundamental question. What responsibility do you have to others?
(02:38):
And what impact are you making in the world that
we share? So in my current role I lead sustainability
Services and Alliances globally for IBM Consulting. Let's just make
the connection for me between sustainability, which I think I
understand it's like, you know, doing the right thing, looking
after the planet, looking after people, and supply chains, which
(03:02):
I also think I understand. That's a thing that goes
wrong when I don't get my kettlebells, when that ship
gets stuck in the sewers canal, and everyone's complaining about
them at the moment. But how are the two connected.
So sustainability and supply chains are interconnected in that you
(03:23):
have a lot of companies making commitments right now around decarbonization.
Maybe you've heard of net zero journeys or science based
target commitments, and when you double click that supply chains
are actually the conduit to realizing a lot of the
Scope three emission reduction initiatives that companies are after right now.
(03:44):
So I just just explain Scope three for me. So
Scope three emissions are emissions that happen outside of your
immediate control. So think about upstream in sourcing and procurement.
Think about when a consumer actually this is your product. So,
for example, a lot of consumer goods the impacts associated,
(04:07):
especially the carbon impacts and the water impacts, often live
after they leave the retail establishment or your front doorstep.
A lot if I buy a car and I fill
it with gas then and I drive it around, then
you know, even if the car is made incredibly responsibly
and the gasoline was refined in the most efficient possible way,
(04:31):
you know, I'm still benning gas right absolutely. And I
think that this is the real human emergency that's tucked
under a lot of the climate change conversation is how
are you transforming the lives of people, helping them make
better decisions. A lot of that happens in a supply chain.
I think supply chains have gotten a lot of attention,
(04:52):
maybe for the wrong reasons lately, because you you don't
have your favorite snack or your favorite thing at your
fingertips on the shel and certainly with the pandemic, how
we buy and procure goods has changed quite a bit.
But supply chains that's where it really gets real. That's
where we see things around responsible sourcing and a lot
(05:14):
of the social inequities that can be addressed using a
supply chain, fair living wage, making sure that you have
a diverse workforce. So the cognitive diversity something that I
evangelize at IBM. How are we really shifting the type
of people who are in the room building solutions to
fundamentally rethink the world? Right now, this is going to
(05:39):
sound like an ignoble question because you've just expressed these
noble sentiments. But sustainable supply chains good for business, of
course they are. So there's always this business case for change,
and I think there's a pragmatical lens so of having
come from industry and supply chain for over fifteen years,
(06:01):
there's always the lean optimization and what that means is
things like operational efficiency, looking at materials differently, is there
more value left? Is there more value on the table?
So looking at lean and green projects and initiatives, a
lot of those things have been historically tucked under supply chain.
(06:21):
But when you say sustainable supply chain, to me, it
feels very different. It's different because a lot of the
optimization and efficiency gains, specifically in environmental stewardship, have been consequential,
they have not been intentional. Yeah, the fact that people
are thinking about supply chains now I think for the
(06:42):
wrong reasons, as you mentioned, because stuff's gone wrong. I'm
sure that's frustrating as a supply chain professional and the
need to supply chain queen. But I mean, is that
is that an opportunity because because suddenly people notice that
this is important, People notice that the society relies on
(07:04):
supply chains, the economy relies on supply chains. Do you
think that over the next few years the supply chain
sector will look back at this moment and say, actually,
that did is some good. Absolutely. I mean there's the
reality that we will never return to where we were before,
and that supply chains really power the world. They connect communities,
(07:29):
they connect you know, this super global, hyperlocal frame of mind,
and that it shows the relationship that businesses can't succeed
in societies that are failing. I think there's a sense
of renewed resiliency as well when you have business operations
or business as usual, but you you actually can't stop
(07:52):
looking toward the future. And that for me, at least
when I will look back on this in ten years,
I know that supply chains are right at the forefront
of creating the type of adaptability to rethink a new world,
to use sustainability and purpose is really an anchor to
connect every person across the global network that each of
(08:14):
us participates in. To the pre COVID consumer supply chains
were truly out of sight and out of mind. It
wasn't until baby formulas started disappearing from the shelves and
we had to sign up for a six month waiting
list just to buy a car that we realized how
much we had taken for Granted, Sherry mentioned earlier, much
of the environmental and efficiency gains and supply chain have
(08:37):
been consequential, not intentional. But now that disrupted supply chains
are more visible than ever, were forced to ask ourselves,
how can we improve them? How does technology govern the
modern supply chain? What can businesses and consumers do to
make supply chains more sustainable and operationally efficient than before?
(09:00):
Let's listen. I'd also like to talk about computers, because
I feel computers I've got to be involved. But this
is an IBM conversation. You work for IBM. What if computers?
What has data? What has digitization got to do with
supply chains? It's it's so important because digital and supply chain,
(09:22):
especially from where I said, it makes sustainability visible, actionable,
and operational. So we can just take some of the
supply chain obstacles that have emerged in the past two years.
Throughout the pandemic, you know, a lot of executives have
had to scramble to frankly, rebalance their supply chain operations.
(09:44):
So you think about demand volatility, rebalancing workforces, reallocating production
lines to other products, especially as a PPU was manufactured,
all of the policies and procedures needed to communicate openly
with customers, and then also seeking alternative modes of transportation, logistics,
(10:07):
and other services. Data and digital is really at the
heart of this. If you don't have the right technology,
you're not able to make smarter, more informed decisions. And
a lot of this data, frankly, especially in supply chain organizations,
it exists outside your four walls. And the pandemic is
(10:27):
a perfect example of the sort of collaboration with technology
that's essential to not only save lives, but to make
better business and operational decisions. So I'm trying to picture this,
so I just imagine I'm a kettle bell. I don't
know if this is a good example not, but imagine
I'm a kettle belly. I mean, partly because I got
(10:47):
a couple down here and partly because kettle bell seemed
to be the quintessential thing that everyone was trying to
get hold of in the spring of twenty twenty and
no one could. So okay, so does kettle bell. I'm
a kettle bell. I've just been made in a foundry
just out one hundred miles out of Shenzen, and I'm
(11:10):
going to have to be driven on a truck into
the port of Shenjen, stuck on a boat across the Pacific,
arrive at port of Los Angeles, and then be put
on a truck. And I'm going to go to let's say,
Las Vegas, because there's somebody in Las Vegas who wants
this kettle bell. And you know, there's a problem because
(11:34):
supply chains are all messed up, and we're trying to
make this whole thing more sustainable, and we're trying to
use digital technology to just just talk me through how
this process could work better, how it could be more efficient,
how it could protect the planet more, how it could
reduce volatility, what's going on that might make this kind
of thing work better. So the first question you ask
(11:56):
is why are you producing something across the ocean that's
landing in Las Vegas, And I think that part of
the beauty of exponential technology right now in modernization is
that we have more information to inform decisions and make
better decisions than what that means is in your kettle
(12:19):
bell instance, you think about the footprint of that kettle bell.
It's a very long supply chain and there's a lot
that can happen. So shorter supply chains are typically happier,
they have less risk, they have a lower carbon footprint.
They also have more autonomy and agility, meaning there's a
shorter distance and there's less disruption that's probable in that
(12:43):
shorter supply chain. So you know, you look at how
are you sourcing. What's that sourcing decision? Is it lowest price, probably,
but what's the total price? What's the total price of that?
And that includes a lot of the regulatory pressures around
lowered carbon emissions and carbon taxation, cross border adjustment tax
(13:05):
so on and so forth. Also look at the supply network,
like are you creating a shortage of materials or goods
or inventory and other parts of your network as a
result of fulfilling that kettle bell order from China to
Las Vegas? Is there a better alternative is there a
(13:26):
decision that's smarter, that's you a local or domestic decision
where you can maybe with an incremental cost, have a
shorter distance to market to delivery, a lower footprint, and
you have more control over what happens. And a lot
of those drivers of disruption like demands, supply logistics, workforce, sustainability,
(13:50):
you eliminate that risk by design all the way upstream
in that very first decision point, where do wesource? Where
is it going? And what's the total cost of ownership
for that cattle bill? And if we want these decisions
to be made more responsibly, who ultimately is making them?
(14:12):
And what are the what are the challenges that we face?
What are the obstacles to a more sustainable strategy? Is
it cost? Is it ignorance? What's getting in the way.
It's such a big question, and it's a great question
because I now, I know this is a little provocative,
(14:32):
but I think that consumers have more power than they
than they know. They are the demand signal in a
supply chain. It all starts with what you buy and
why you buy it, and what I often find gets
in the way. And you'll have a lot of folks
who give you big, fancy, long answers, pontificating. It ultimately
(14:58):
comes down to choice. It comes down too and again
this is a bit of a first world answer, but
you have the ability to choose with your pocket what
type of world and what type of brand you support.
The thing that I find most telling, tim is if
you knew and if there was a way that a
company could convey that level of transparency, not everything, not
(15:22):
every single data point, but just enough to give you
context around your purchase, would you make a different decision?
And that is what sustainability and supply chain is, in
my opinion, that level of right level of transparency to
help people make better, more informed, responsible decisions. And that's
(15:44):
also where the divide lies. There's so much data. I
think there's no lack of data. Frankly, a lot of
it is living in disparate silos. And part of the
work that I support, how can you be a great
connector across all the different touchpoints to not only connect
(16:07):
this data, aggregate it just for that first step of visibility,
but then the sharing that's needed of great use cases.
The QR code enabled product label, so giving the consumer
the ability to scan a code and see an app
relevant sustainability metrics that would enable, in theory, a better
(16:31):
different decision where you could show not necessarily what a
carbon footprint is or metric tons of carbon. Most consumers
don't understand that, but in this example, hey, if you
buy this product, you're saving forty trees from being cut down.
You're contributing toward this brand, responsibly sourcing a product, and
(16:54):
also evangelizing the information in a way where you can
be part of that journey. There are tons of examples
where customers want to be a part of something much
bigger than themselves. Employees as well. So I think, you know,
we've talked a lot about consumers being the demand signal,
(17:14):
and that's really where it starts. But then I think
that this is the power and the momentum, the paradigm
shift that we're seeing where sustainability and supply chain absolutely matter.
I love this idea that as a consumer, I can
just pull out my phone and scan the QR code
and I can get I can get as much of
(17:35):
as little the data as I want. I can get,
I can get the quick summary, or if I'm a
real nerd about something, and some people are very passionate,
they really want the details. I've got a friend. Every
time we go to a restaurant, he's always asking about
the supply of the fish. He's super interested in sustainable fishing.
It's just what's just what he does. You know, We've
all got our interests. So I love this idea that
(17:57):
that these codes could just empower us. It's it's clear
that that's a possibility. Now the risk of digging a
little deeper into more technical details. You mentioned this problem
with data silos. Talk me through exactly how that problem
manifests itself and what solutions are being explored. So historically,
(18:20):
I think when you talk about competitive advantage, people have
been able to operate in a black box, especially with
supply chain data. A lot of the data around sourcing, logistics, providers, manufacturers,
all of these things were leveraged together for competitive advantage,
(18:41):
so they didn't want to share this data this strategy
across their ecosystem. From what we've seen throughout the pandemic,
you are probably more profitable, more agile, and successful in
understanding where you absolutely have to share this data. This
is equally true for sustainability data. So I think the
(19:05):
paradigm shift is now in order to decarbonize our world,
create the type of meaningful change, biodiversity restoration, ocean health,
making sure that our forests are healthy. All of this
requires cooperation now at scale. So when you talk about technology,
(19:29):
I mentioned before that especially with digital and modernization and
supply chain, it makes it visible so everyone can see
a source of the truth. So specifically at IBM, we
talk a lot about something called an intelligent workflow, and
this is where you can use technology like blockchain, like AI,
(19:53):
like twinning, like quantum to bring all of these stakeholders
up dream and sourcing and procurement all the way downstream
to the consumer. Even so, take that QR code that
you scanned at the shelf, consumer can look at their
phone and see the journey of that product. They can
credibly see where it was sourced. There's even the functionality
(20:17):
to thank their farmer. So maybe you're scanning a bag
of coffee beans where you can thank your farmer, enact,
identify the source community. When have we ever been able
in a source to pay intelligent workflow connect the first
kilometer of a supply chain with the last smile all
(20:40):
the way to the retail shelf. So I think that
these are the types of possibilities and opportunities that are
enabled with technology, creativity, cognitive diversity, and fundamentally rethinking the
way that we've done things right now, nine percent of
(21:02):
materials in the world actually are circular, which means ninety
one percent of the goods that we use, that we
consume end up in a landfill or are wasted in
some way, shape or form, and that is absolutely unsustainable.
We are on a path when we look at our
(21:24):
landfills and we look at just the management of waste
and oceans and waterways, we cannot continue to take make
and waste or throw away goods that we produce as
a species. We're becoming more and more aware of the
societal ripple effects that result from our consumption. Much of
(21:48):
Sherry's job is to think about how we will live
and consume in the future and how we can affect
change today. There's a human element to her work. Tim
asked Sherry how she collaborates with the any humans who
are embedded in our supply chains to get them on
board but changing the status quo and what part creativity
plays in her work. The whole season of the Smart
(22:11):
Talks podcast, it's focused on creativity and business. Are you
a creative person? Of course? You know what's interesting about
my career path? I actually I started as as an entertainer,
as a singer. A lot of people don't know that,
so I was a musician songwriter for many years. But yeah,
(22:36):
I there's something about creativity. It's like the human soul
on fire. And when we think about you know, everything
that we're living through right now, we need people who
can be creative and think from different perspectives to redesign
(22:58):
this world and to redesign business and really steer us
into a new future. Now now, now, now, you might
not agree with me, but supply chain and music are
absolutely connected, and they're very similar. And I'll show you why.
In supply chain, you always start with customer centricity or
(23:21):
voice of the customer. How are you meeting their needs,
their wants? How are you fulfilling the demand. It's no
different than being on stage and singing or writing a song.
Think about listening tempo, cadence and pulse, emoding, tone, all
(23:42):
of those things that orchestration. It's just like music. It's
just like supply chain. I love it. So, I mean,
you've conveyed this idea of the creativity and of the
listening and of the tempo. Can you give me a
specific example of a time that you've helped a client
who's come to you and said, look, I've got to
(24:04):
make the supply chain more sustainable. Or maybe the client
didn't realize that they had to make the supply chain
more sustainable and you convinced them of it. But just
just talk me through a particular client project or client relationship. So, yeah,
looking at a transparent supply chain in this example, this
organization is a bit immature in the space, so looking
(24:29):
at how you encourage healthy snacking. And they wanted to
use data differently. A lot of the data that they
had was very much disconnected from the way work gets done.
But then they also wanted to bring the customer along
(24:49):
with them, which was a scary proposition because I think
one thing that came out of that engagement is they
weren't as mature as some of their competitors. And they said,
if we voluntarily disclose some of the risks that we
know we want to address, but we have to start
somewhere taking that first honest step, will it harm our brand?
(25:16):
And it was a really interesting way of looking at
it because as a consumer who actually buys their products,
I thought, Wow, they're starting from a place of wanting
to be honest and wanting to lean in, and we
have to acknowledge that a lot of brands are on
this journey and we are going to see things that
(25:39):
we cannot unsee. Yea, and very much so. The other
thing was not knowing how to get started. And in
order to give people that level of transparency in this
customer example, they needed the nitty gritty, and the nitty
gritty was very dirty, and it was a lot of
(26:03):
assumptions cobbled together, and I actually had to convince them
that it was a great starting point and almost take
them from feeling very vulnerable to feeling very confident. And
again I saw services in technology and it was a
great learning moment, frankly, because technology doesn't necessarily solve that.
(26:26):
It's very much, you know, connecting that human experience and
that is where specifically, in this example, the client had
a vision for a transparent supply chain, but didn't know
how to piece together a lot of great ideas where
they could actually fund their transformation over a five year period.
(26:49):
It was a billion dollar business case. A lot of
really cool ideas tucked under it, but it was what's
the sequence of steps and why how do we prioritize
resource versus funding transforming work? So a lot of the
work was automated, you know, thinking about the future of
work and automation. How do you repurpose this analysts time
(27:11):
for example, to more value add time. So all of
that to say it was a It was a great
learning experience for me and also for the brand that
I serve, and that we both got to learn together
and do something that really changed everything for them. It
sounds so that this work really masses you. It does.
(27:34):
It does. It's why I get up every morning. I
had this moment where it clicked, and it was about
seven years ago. I have three kids, So my oldest
just turned thirteen, and my oldest shape my daughter aris eight,
and my youngest is seven, and it was when he
was born that I just sat back and thought, you know,
(27:59):
with the climate and urgency, it was right around twenty fourteen,
twenty fifteen, what am I doing, like, what am I
doing to change this? And you start to think about,
you know, when they're eighteen and god knows what the
world would look like then what did you do. What
(28:19):
was your response? And being in supply chain and at
the time starting to dabble in sustainability, I saw those
interconnections and I saw a way marrying supply chain, sustainability
and technology to really make a difference and transforms people's
people's lives and it's good for business and good for
(28:40):
the planet. And I think it was all of that
coming together and clicking for me where I just said,
this is what I'm going to do, and it's just
been an incredible feeling and nothing can replicate this. My
kids are proud of me. I love my team. I
would choose them even if I wasn't here, I would
find them in the univers I always tell them so
(29:01):
that that's really what it's about for me, is making
a bet a better world for others, for my kids,
for their kids, and that's what matters most. Just tell me,
look twenty years into the future, and we know the
climate isn't going to get any better. We know we've
(29:24):
got a real problem there and it's for the foreseeable
future that will get worse even if we're able to
put some real solutions in place, but supply chains themselves
in twenty years time, what would you hope sustainable supply
chains might look like. I definitely want community resilience and
(29:48):
hyperlocalism to be a driving force for supply chain transformation,
meaning that so a big brand like do you have
community permission to open your doors there? How do you
preserve that community? How do you ensure that basic needs
are being met? That is so critical and important. I
(30:10):
mentioned before that businesses can't succeed in societies that are failing,
and I think that that tie between profit with purpose
and societal impact it's coming to the forefront now. When
I think about a supply chain in twenty years, you
think about community resilience. You think about you know, how
am I enabling others who have been marginalized or traditionally
(30:34):
left behind to have access to healthcare, to have access
to education and upskilling. I think all of these things,
that's what I would want most And in terms of
like how work actually gets done and how we transform
our thinking, it's that we have shorter supply chains and
that we think about the impacts holistically. The total cost
(30:59):
of ownership for a brand, for a phone, for a mouse,
for a can of sparkling water, what's the total costs
of this really, which isn't necessarily price, you know, there
are other things that go into that. And I think
that if we really understood the impact that we have
(31:20):
on the world, how we contribute to climate variation and
climate change, I want to believe, in hope, that we
would make different decisions. Sherry Hines, it's been such pleasure
talking to you. Thank you so much. Thank you, Tim,
It's been a pleasure. When we think of supply chains,
we typically picture cargo ships or faraway factory belts, maybe
(31:44):
a map of the world with a string of connected
dots running from Shenzen to Las Vegas. But what Sherry
does so well is highlight the impact these often invisible
systems have in our daily lives. We all want supply
chains that are ethic, environmentally responsible, and integrated with local communities.
It's good for business, good for the planet, and good
(32:07):
for the consumer. The pandemic gave us a chance to
begin the paradigm shift in supply chain thinking that Cherry
talked about. Now there's an opportunity to put these ideas
into action in our day to day choices, in our
businesses and in our communities. The next time we're at
a grocery store and can't find our favorite snack. Let's
(32:29):
take a moment to remember that. On the next episode
of Smart Talks with IBM, how AI powered technology can
help us combat the human biases that result in discriminatory
hiring practices. We talk with Angela Hood, founder and CEO
of This Way Global. Smart Talks with IBM is produced
(32:51):
by Matt Romano, David jaw, Royston Deserve, and Edith Rousselo
with Jacob Goldstein were edited by Sophie Crane. Our engineers
are Jason Gambrel, Sarah Brugere, and Ben Tolliday. Theme song
by Gramoscope. Special thanks to Carli Migliore, Andy Kelly, Kathy
Callaghan and the eight Bar and IBM teams, as well
(33:15):
as the Pushkin marketing team. Smart Talks with IBM is
a production of Pushkin Industries and iHeartMedia. To find more
Pushkin podcasts, listen on the iHeartRadio app, Apple Podcasts, or
wherever you listen to podcasts. I'm Malcolm Glabwell. This is
a paid advertisement from IBM.
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