In this episode we’ll be talking about:
- How Procurement can get a seat at the table
- Some of the major shifts Logitech has done in Procurement
- Examples of how to improve your work in Supplier Diversity
- How to increase diverse and inclusive spend
- How to work internally with diversity in your teams
- Best takeaways from his career
Host of The Way We Source: Sam Jenks
And here's the episode:
We have the pleasure of hosting a real promoter for equality and inclusion, a lover of all things digital and currently head of Global Indirect Procurement and Supplier Diversity and Equality at Logitech, David Latten. David, welcome to the show.
Thank you, Sam. Real pleasure to be here! Thanks for the invite!
We're happy to have you on now, David.
I would love to start with a question that we ask a lot of those that we have onto the show. What exactly does sourcing your procurement mean to you?
In really simple terms, particularly at a consumer goods focus company like Logitech; what companies do is we essentially buy things, make things, and then ultimately sell things.
If you look at it through that simple lens, sourcing and procurement is that central to the business. And I think, so what? But if it's done really well, sourcing and procurement can really create value for a business, drive innovation for business, resilience, agility, all that sort of good stuff.
And I think in my earlier career, one executive that I used to work under said that everyone in a business should either be there to sell more or to spend less. And I think you could actually argue that really good procurement can nearly do both actually. Really good sourcing and innovation can drive sales and obviously it can save money too. So I think that's a really cool place that procurement can, can be in a business.
I love that notion and you know, procurement really is in a position of power and we're gonna talk a lot more about that today.
You mentioned before that you'd previously had a career prior to procurement. It was finance and marketing. Correct?
It was finance and I think my professional qualifications and training were in finance, but what I wanted to do was to move to somewhere that I could impact more what a business will do, rather than necessarily record what it has done.
And it was really exciting when I first moved into procurement, I was sort of a kid in the proverbial sweet shop where even things like negotiations and RFPs where very new to me at the time and really exciting. But I think what's kept me around procurement is really what happens in that really invaluable touch point with the external partners.
And of course it's that vital pivot point between internal challenges and priorities and external solutions, I think that's a unique site line that procurement has across the entire business. And that's kept me around. I think that can have such a huge asset and impact for, for the business when it's done well. So that's what's really kept me in procurement for the long term.
Cool to hear. I know that you have some interesting and strong views about the value that procurement can deliver to the business. And I'd love to talk about the value proposition of procurement. How do you see that procurement's value proposition is currently evolving?
Well, I think it's definitely evolved from when I first joined procurement and I hope it's still continuing to evolve because I think it's absolutely essential that it does. And I think where we find ourselves now versus traditional procurement is very much as business partners to the wider business. Constantly asking ourselves, ”how do we empower the business to achieve their goals”?
In kind of procurement 1.0 that would be very cost focused whereas today it could be more about sort of driving stakeholder opinions, customer opinions, overall business agility, ESG and DEI. And those topics are really important now and I think procurement is really woken up to the impact it can have in that space.
All of that is very different from the traditional view of procurement. My view is predominantly that the business, if it viewed procurement as anything, it viewed procurement as a tool for the business to sort of literally hammer out a deal or a negotiation on a cost basis. And we've really gone through a transition over those years and it kind of makes you think about old adage about “what got us here will, will not get us there”.
And what do I mean by that? Well, the new proposition of procurement, that business partner overall holistic view is really quite dramatically different from the traditional, functional excellence view of procurement. And it does present a talent challenge. I know a lot of people have spoken about this, but I've experienced it too, that It's been a struggle with some really good traditional operators in procurement in terms of just skills based procurement excellence. It's been quite difficult sometimes to get them to pivot to that new way of looking at things in that broader role of procurement.
And we've had most success with talent that is kind of always curious about: how can I help Sam achieve what he needs to achieve at the business, has a great partnership attitude and really determined to think; Okay, what can we do next to influence the business? Everything else can be taught really. I think functional excellence, vital, but can always be taught. What you need is that business partnering attitude and really curiosity about how can we improve things.
That ultimately where procurement are going nowadays.
I love that. And what was the adage again? What brought us here…?
What got us here will not get us there. It's actually from a book. Can't remember the type of a book. But I think it really does stand for procurement because we have gone through this huge evolution over the number of years I've been in procurement and we still need those functional skills. That's a tool for the business, but we all want to be a lot more than just a tool to the business in procurement.
Let's pose this question, David. What will get us there in your opinion?
Good question. So I think in the time I've been in procurement, I was struck when I first took the switch from finance that one of my first observations was I found a lot of discussions around how does procurement get a seat at the table?
How do we get on the CEO's radar? This slightly neurotic idea about we're doing all this really great stuff. How do we make the business notice what we're doing? I don't hear that anymore. And I mainly think that's because of that evolution in what procurement does and how C-level view procurement today.
Put another way and to answer your question directly, if we really think about what is important to the business today and really think about how procurement can make a big impact to those topics. That will be a different answer to different companies, and at different times and sort of economic cycles at the moment.
I'm sure some companies are really driving about how do we manage current inflation challenges. The upcoming recession that this seems to be coming. Or it could equally be driving forward equality values such as we've done at Logitech in recent years.
But if you really ask yourself that question, what is important to the business? What is our strategy at this business? What are our values? If you really ask yourself that question and how procurement can really push forward those important topics, you're essentially building your own new strategic impact. I promise you'll find the CEO sits at that table. I can say that because that's effectively what we've done at Logitech in recent years with driving forward our equality agenda via our external spend.
That's gonna be a different answer to many different companies. But if you really ask that foundational question and then think, how can procurement deliver that will get you the CEO’s attention.
So as you're putting it, don't worry about getting a seat at the table. Build your own. Build it and they will come?
Yeah. Don't ask: How do I get a seat at the table? I suppose you're asking yourself what table does my company need? And I'm gonna go and build it. And if you do a good job that. Leadership will sit in it.
You spoke and touched upon some of the shifts that you guys have done at Logitech.
What are some of the major shifts that you've seen happening within the business in procurement?
The biggest shift we've had in recently was in 2020. And I think this is true for a lot of organizations. 2020, a year that will live long in the memory for a number of reasons. And I think at Logitech, the reason it was a big year for us is equality is codified as a core value at Logitech.
That comes directly from Bracken Darrell, our CEO, who's hugely passionate about the topic of equality. We thought we were a great ally for equality, but we had this enlightenment in 2020 that we could certainly be doing a lot more. We could be a better ally.
The huge disruption from Covid of course, really enlightened us about that we can do a lot more. The George Floyd incidents and other topics really made us think: We need to speak out a lot more. We need to do a lot more. Yes, we're being an ally, but if it's our core value, there are other things we can be doing.
And in my world of procurement, I think the immediate impact of that was that we really refreshed a formalized supplier diversity program resourced out of the US. We have some really ambitious goals there. Some really ambitious global goals. Which, as a lot of your listeners will know, is pretty tough.
We're starting to move the needle in the US but our impact ultimately is to have a really profound impact globally. But not only that. I think when we did that in 2020, it also came with this kind of challenge from Bracken and all these sort of question that we asked ourselves. Which went along the lines of something like: if equality is our core value, that core value should ideally be shared by, reflected by and driven forward by all of our suppliers. Not just diverse suppliers.
Supplier diversity is a fantastic initiative. I'm very passionate about that, and we have really ambitious goals, but we are not gonna get all of our spend to be diverse. In fact, at the very least, we're gonna end up with sort of 85% plus of our spend being non-diverse. A lot of those organizations are really large organizations. How can we make them move on equality and also, there are some industries that are so dominated by large players that supplier diversity in its strictest sense would really struggle to impact the media industry with the massive tech players there. Or it would really struggle to impact the corporate travel industry, that there is no diverse owned airline to my knowledge, and yet we all fly around the world. How do we impact these huge companies? That was a question we asked ourselves about. If we are true to our word, equality is our core value. We need to be impacting all of our suppliers towards equality.
So many great insights. You guys are a business that's taken a massive journey and you're leading with equality as a core value.
Do you have any specific examples that you could share with those who are looking to improve supplier diversity, equality and inclusion?
Yes! And I'll start with the simple maths that I mentioned just a moment ago there. That at the moment we're seeing nice growth in our diverse spend. And we're ultimately looking to go into 10-15% our spend being diverse. That's our ultimate aspirational goals.
But if we do that, there's still 85% of our spend is with non-diverse companies. So that's a huge potential impact. There's a huge untapped potential for impact there that we really want to look at. And then I think if you look at Logitech as a company and that we're a consumer electronics company going back to that question I asked myself about, it's really important for companies to ask themselves: do we care about these topics and where can we have most impact?
And I think at Logitech, when you look at it globally, we're a consumer electronics company. A lot of the really technical roles in our company are historically male dominated. Gender equality is tough in the technology industry. We really want to drive gender equality. When you look at some of our major verticals, gaming is a huge area for us.
And again, that's an industry that's had big gender equality issues. Gender is a big issue in technology. It's also a big issue that we can have a real impact towards. So I think combining those two, We're looking to leverage all of that 85% plus of our spend to try and leverage gender equality.
I'll throw a statistic at you. Only 1% of corporate spend globally today goes to women owned businesses. So you could argue that the other 99% of corporate spend is a huge opportunity, an untapped opportunity for a gender lens to that procurement. And that's essentially what we're doing.
We're looking to use that 90% plus of our spend to leverage gender equality. A lot of that spend is with large companies. These large companies employ millions of people across the globe, trillions of dollars of revenue. We need these companies to progress on gender equality. Put bluntly, society will not achieve gender equality without these companies becoming gender equal.
So that's our target audience. And to do that we've co-founded this summer the Coalition for Gender Fair Procurement. We co-founded that with an organization called Gender Fair. Gender Fair, a great organization. They created an assessment. That essentially is assessed with metrics to answer the question: is this company living up to the UN women empowerment principles?
It asks questions around women's representation at leadership, policies, procedures, advertising, a whole bunch of different areas. And it essentially asked the question, Are you living up to the UN women empowerment principles? They started doing that with really large business to consumer companies, and the reason they did that is that they're looking to influence where does ”Sam” spend his money? Where does ”David” spend his money? Where do all of us spend our money? Ideally go to companies that are living up to the UN women empowerment principles. That's a really powerful idea. We loved that idea and thought, wouldn't it be amazing to bring that into corporate procurement? So that, that was the big vision.
We started. We took the assessment ourselves and we're gonna do that each year and we're gonna keep on looking to improve. That's the start. But so far it's essentially, internal DEI.
And where does procurement come in? My procurement team comes in and our external spend comes in. We are looking to extend our impact. We're going out to our high impact suppliers. These are suppliers we spend a lot with. They're suppliers that have high headcounts and high revenues suppliers, frankly, that if they move on gender equality can have a huge impact. And it also happens that they're suppliers that are very difficult to swap out for a diverse option.
So it kinda balances nicely with our typical supplier diversity efforts. We're doing that with those suppliers and we're asking them to take this assessment each year and to continue to improve on gender equality. But I called it coalition and the reason I called it a coalition is that the ultimate goal goes beyond that. The ultimate goal is to change the whole procurement.
You'll be of course aware as a lot of the listeners will be that there's things that typically happen when large organizations work with each other. There's a raft of requirements around compliance, state, security, privacy etc. What doesn't happen, in industry default, is a simple question: Hey, I'm from company xyz. Before I work with you, Sam, I want to know, is your company living up to the UN women apparent principles? Are you gender fair? That doesn't get asked. It's a simple question and it doesn't get asked.
There isn't an aspirational industry standard. I think we can learn a lot from the environmental cause here that everyone is beginning to know on the tip of their talent, right? Hey, when are you gonna be net zero? When are you gonna be carbon neutral? When are you gonna be this? And that drives a real race to the top. If you think about equality, when are you gonna be gender equal is a really fundamental question. But there isn't an aspirational industry standard for it.
The coalition is looking to make it entirely standard that we ask each other that question and that when I say to a potential supplier of ours: Hey guys, when are you gonna be gender equal? I want 'em to know the answer to that. I don't think they do at the moment, but we want 'em to know the answer.
That is the ultimate goal to leverage all of that corporate procurement. To move the sector towards gender equality. That's the ultimate goal of the coalition.
And it's a fantastic vision and a fantastic journey that you guys are on. One that I think that a lot of our listeners can be able to take inspiration from. We being a business, who know compliance and are helping customers to be able to work with more inclusive spend. We also understand the struggles behind ensuring gender quality in a business.
And you put it very frankly there in understanding that sometimes procurement needs to use their power by addressing the the element of the supplier base that is never going to be a diverse supplier base. And ensuring that they themselves are trying to scale that particular impact themselves. When that is the case, because I'm sure that's the case for a lot of the listeners and their organizations that are out there, if they're practitioners themselves, that's a pretty great challenge.
How do you overcome a challenge like that? How do you entice, and empower inclusive spend among? Both in your own organization, but also in other organizations that are in your supplier base that themselves are not diverse suppliers?
Yeah, that's a great question, Sam. And I think when we first started really looking into these topics to create our refresh program back in 2020. In many ways we were actually unwinding some of the training we'd given to our business already.
And what I mean by that, I think if I was talking to a lot of internal spenders at Logitech five years ago, I would've been talking to them about things like: Do you know what you need to do? The way to procure things is you consolidate everything with one supplier. You see who can do it with you globally. You look at the Gartner review, the Forrest Review and all the other groups that will give you the who are the best players at this.
You do all that, but you know what you'll have done? You'll have removed the slightest chance of any diverse supplier really working with you. You might have managed according to risk. And you may well have managed according to cost but what you won't have done is really given diverse suppliers a chance. And frankly that's still something we're battling with today. And I think I have to look at myself and think yeah, I spent a few years telling the business that's what they need to do. And now I find myself saying: Yeah, that's true, but you need to add something different to it now. So I think that's a big challenge.
I think another big challenge is: It's a pretty par for the course activity to add a lot of these topics to RFPs: your request for proposals and include it in waiting.
That makes a ton of sense, but it's also very difficult to get the point across that this isn't just window dressing. This kind of 5 or 10% on top isn't just window dressing. This is really important to us. And that's an internal point as much as it is an external point. So I think it's, a lot of it is looking at how you make internal decisions yourself.
Another thing we're still wrangling with today, because by no means we’re the finished article, I think it's really important to have leadership not only support these activities and we have huge support from Bracken Darrell, our CEO, and others on the leadership team.
That's fantastic. But I think where that needs to have a practical impact is around topics like: We are okay If you take an acceptable level of risk to go with a new supplier, which may be diverse owned, it may be more inclusive, it may be gender fair, whatever it might be. It might be a sort of company that really supports our values. But it's a new supplier. We get that and there's a risk for the new supplier. It's strategic error for our business. I think there's a certain aspect that we need to be really clear with. We are okay with managing risks in that regard. There is an acceptable level of risk in that. And that again, jars a little bit with what I was mentioning earlier about the traditional procurement.
And I think last but not least, we have really strong ambitious goals. Like I say they're corporate level goals and that's fantastic. But where they really need to be empowered is: you achieve corporate wide goals by separate groups and business groups and functions within that organization also having goals that then build up toward that corporate wide one. And the primary importance of that is it gets away from this idea of “Supplier diversity target. That's David and his team's target”. And yes, it is. That is true on the face of it, but for that to ever be achieved, it's a business target and that needs all of the business to be driving towards it too.
So I think a lot of the challenges to achieve inclusive sourcing, whether it be non-diverse companies that are doing great things towards these topics or whether it be diverse own businesses themselves. I think one of the myths that hopefully is busted at this stage is that there isn't a diverse owned or a really great inclusive business out there in the vast majority of sectors. That is a myth, because that they are there. I think the reason we sometimes don't get them is a lot of it has to do with internal challenges.
Like I said, traditional procurement methodologies are managing risk. Really encouraging your teams that if it's in line with our values, there is an acceptable level of risk. Really looking at maybe you split up some of those global contracts. A lot of those are internal barriers. We are working through that. I'm sure most other companies are working through that. That they're the biggest blockers to really blowing this wide open. A lot of these problems are the problems of the large companies, not the diverse owned or the social impact companies that are out there because there are great companies out there that can work with us.
It's the notion of the "be the change you wanna see in this world". And the fact is, procurement is traditionally exactly working in a context where cost is in focus. And unfortunately, procurement is traditionally white men in blue suits, right?
This, we know it's becoming more white men in blue jeans. I would say based upon some of the more recent events that I've attended; procurement's definitely getting younger. But it's apparent that it's still not incredibly gender fair. It's not incredibly diverse within the function. And the fact is it's easy to work with people that look like you, we're two white men talking about diversity and inclusion and equality on a podcast.
I'm curious, how do teams look within and work with these elements? Do you have a concrete tip that our listeners/readers can maybe take away with them? And go back to their teams and look into their supplier base and say; this is something that we can work with.
I think starting with the function itself I would agree with you. I think that recent conferences I've been to that would be my sense as well, but both on the genes progression but also that it's still we still have that challenge around gender and probably ethnic diversity too.
I think a couple of things, I think what's true for the wider business is also true for procurement. That the next generation, the Gen Zs and the millennials really are driving change. I think they really do with a passion, want to support companies that share their values. That's as true if they're buying from those companies as it is working from them.
So I think we talked about talent earlier on and next generation talent in procurement is a challenge to get that great talent. It's gonna be even more of a challenge if they don't view you as being reflective of their own values. So I think there's a huge talent win required there.
On that talent point, I think we can probably get away from the traditional mindset, can't we? That if you ask most people what is procurement, there'll be any number of answers, some of which I probably wouldn't be too happy with. But if there's any theme, it might be about negotiating a deal. Banging your fists on the table, getting the best price etc. And there is a space for that in some areas, of course, but it's not where the vast majority of procurement is going. When it goes back to those topics we spoke about looking at the business as a whole, really seeing where can we go next?
How can I partner with marketing, IT, manufacturing, whatever it might be. How can I partner with them to really make sure we have an impact? I think that role will appeal to a lot more people than would've realized that's what procurement is. And it may not have been what procurement was, but it's certainly what procurement is becoming.
So I think the next generation is key, both in that in terms of that talent pool but also making sure that we take their lead with where procurement is going. And we need to do that because that's how they'll get the best talent too.
And that's a brave notion I think as well to allow the next generation to take over and start to understand that they themselves, we were talking about this the other day internally, the millennials that everybody's laughed at, they're 26 to 41 years. They are our new line managers. So it's a shift happening for sure.
You've said a lot of things that I'm sure you've learned along your great career that you've had now for the last nine years in the procurement space.
Or am I giving you too few years there?
No, I think it's something like that. I did move from finance. The honest answer is, I can't remember.
I'll take that as a good thing.
I'm curious, what's one thing that you know today that you wish you knew at the beginning of your career?
The immediate answer that comes to me, Sam, on that and it's not just specific to procurement. I think it's relevant to whatever function you are in. And it really comes from the perspective of companies are looking to hire really good people, whether that be straight out of college at interns or whether it be at C-level.
We're looking to hire really good people. With really good ideas, curiosity about what can we do next, what can we do better? And I think if I could say anything to myself, and I was that kind of 21, 22 year old coming to the workforce. Be that like it's intimidating when you do join the business world there is a right way of doing this of course, but always ask yourself the question, why do we do this? What's the benefit of us doing this? What is the company gaining from me doing this process or that process? Could it be done another way? Does it even need to be done at all? I think all too often when you join the workforce at more junior levels, particularly, you are cut. It's very much you do what is already established or you do it the way that it's always been done and that's sometimes reinforced with management at more entry levels too.
But there's a massive paradox there, because what good leaders want, of course, is they wanna hear the best ideas from people at all levels of the business. They may not have as close a view as what's happening in certain areas. They need people in these areas to really be asking those questions. Within the remit of doing it the right way and going to your manager. And I don't want to be encouraging people to start being a pain in the neck for their leadership.
But I think with all that said, ask yourself the question: why do we do this? What is the benefit for the company? And if we need to do this, is there a quicker, smarter, easier way to do this? Ask all those sort of questions, and you'll get yourself thinking with that curiosity about what can the business do better.
And I think if you do that then you'll be doing your job very well. And I think it's certainly when you get into more senior roles that kind of ideology becomes more and more important. I think that it gets less about the doing, doesn't it? And it gets way more about why are we doing what we're doing today? What can we do tomorrow? And how can we do things better tomorrow? But you can start that straight outta college. I think that's the key thing that make sure you keep that curiosity.
Curiosity. It's so important. It's actually one of our core values at Kodiak Hub: to remain curious. And it’s a great tip for both people at entry level positions, but as you said also to any procurement leaders, be curious of what that next generation has to say. And be ready to hear their thoughts, even if they're very different of your teams or of how procurement once was done.
I'd love to get into the last section as we unfortunately have to round off here, David.
It's our session of the podcast we call our Kodiak moment. I wanna capture a special time with you here in a little bit of a quick fire round of questions so that our listeners can get to know a little bit more about David, the man, not just the procurement expert.
One book that you would suggest anyone that's out there reading currently or something that you've read previously?
There's a book I read a while ago, I'm gonna make a hash of the title, but it was something along the lines of ”What I didn't learn at Harvard Business School”. I think that's what it was called. And it was written by a really smart guy. Can't remember his background, but he certainly didn't go to Harvard Business School.
Or maybe he did. But his point was a lot of what he learned and a lot of what made him really successful was just really practical tips. So I think it was a very easy book to take some practical guidance from, I think it's called ”What I didn't Learn at Harvard Business School”. But maybe we can share the real title afterwards if that isn't it.
Yeah, absolutely. We can make sure to do so in the podcast meeting notes.
If you were to have dinner with one person, that person needs to be alive, who would it be?
Good question. I was fully prepped for one that was no longer with us. Who would I have dinner with?
You could take the dead and then the alive. How about?
Okay, let me ask the dead one and I'll think on the alive one. I think the dead one, I'm gonna give a fairly predictable answer here for an English guy with a Second World War interest, but I'll go with Winston Churchill for the person that's dead.
I think not only would it be fascinating to listen to him I also know that he liked a good meal and a good drink. So it probably be a fun occasion.
What was it he drank? He drank a liter of port or sherry before 12 o'clock noon or something?
Something incredible like that.
And that's given me a bit of time to think about the next question. I'm a big fan of cricket. Again, an English peculiarity. I'm a big fan of cricket and for those of you that are familiar with it, England had a long history in my early years of losing to Australia in the ashes that the famous series between England and Australia back in the early two thousands. England finally beat Australia in a really famous series where Michael Vaughn was the captain of England. So I think hearing his thoughts as the captain of that team would be very interesting.
An utterly niche response. I love it.
It was, haha. Some people will love it though.
Yeah, for certain. Last question. All expenses paid. It's ready to go tomorrow morning. You're waking up, you're going on a vacation. Where are you heading?
I'm gonna give a short haul answer to this, which may surprise some. I'm recently back from Venice and I absolutely fell in love with the place, it's such a unique place. Beautiful city. It's tarnished with a certain amount of pain that I actually did the marathon in Venice, and I found it a really hard marathon. It was quite hot. But I left the place thinking I'd love to come back here really soon. So if I could go anywhere tomorrow, I think I'd just go back to Venice. Enjoy the canals the gondolas and the food and the wine. So I'd go straight back to Venice.
And if I had the opportunity, I would book my ticket as well to join you along that journey. It sounds absolutely lovely.
David, we appreciate you that I'm not planning, I was thinking more about the food and wine.
We thank you so much for taking the time to be able to be on this episode of the Way We Source. If people wanna get in touch with you or wanna have a conversation, where could they be able to?
They can catch me on LinkedIn. I'm on LinkedIn quite a bit. They can find me on there.
And also if they want to find out more about our coalition that we launched this summer it's a pretty simple URL that I guess we can give the link to as well: https://genderfairprocurement.com/index.html
They can find out more about the initiative we're doing there or Logitech itself. There's a supplier diversity page on our corporate page, so you can find out what we're doing there as well.
But if happy to talk with anyone that, that listens and you can find me on LinkedIn is the short answer.