Rupert Gaster caught up with Patrick Dunne, Director of Group Property, Procurement and Cost Transformation at Sainsbury's Plc, to hear more about his career and what he sees as the key focus areas for procurement are right now.
How did you get into procurement?
For me it started at a very young age within the family business, when I was about 15 I saw how my father was buying building materials and started to help out and then ultimately went on to get a degree in procurement, one of the first-ever of its kind in the late 80s.
I got a very early itch for procurement and got excited about the commerciality of it and went on from there and there’s been no looking back since then. At the time I remember looking for universities that do procurement and there was only a very limited number of universities and even that was a post-graduate course. It was a long time ago!
What are you most passionate about when it comes to procurement?
In the beginning, it was the commerciality of it, the value-added side and then later it was more around change management and the role procurement could bring to large organisations in helping to shape their future.
I was at Nissan for 10 years where procurement was very much part of the company’s revival. For companies where I worked such as MFI and Boots, sourcing and procurement were very much about changing their fortunes, now for me, it is all about teams and business. Creating great teams that make a difference and seeing individuals within those teams who will go on to achieve great things.
I always try and build teams that will succeed me, building teams that will become future procurement leaders. A little bit around looking at public sector procurement and how to help out there, helping the likes of CIPS and really thinking about how you can build up talent particularly building the procurement profession beyond what it is today.
What do you think the key focus areas are for procurement right now?
Regardless of the industry or sector, you can’t avoid the pandemic.
I always explain the initial phase of the pandemic in that there were two types of organisations, those that have had to ramp down dramatically as their marketplace has shrunk or disappeared in some cases, whether it be fashion or travel, and those that have had to ramp up dramatically.
The grocery sector, which I’m in, is like that and procurement and supply chain security and getting supply has been a big focus both for goods for and goods not for resale, the likes of PPE is an example.
That will have long-term implications, the flexibility and agility of people’s supply chains are up in the air at the moment procurement has a strong role in that. The area that really interests me at the moment is the role of procurement in the environment, yes we have all talked about sustainability for years, but the carbon agenda and particularly in my own business Sainsbury’s, I helped lead on the Net Zero campaign getting us to net zero carbon by 2040. Procurement has a big role to play in that in terms of working with partnerships to bring better technologies forward to improve our carbon footprint.
I think that procurement can take a leading role here. I think sustainability is the next frontier in which procurement leaders can really excel.
Do you shape roles particularly around this type of initiative?
No, I look after the property portfolio for Sainsbury’s, so I have dedicated teams in property.
I think all of my teams and roles should be focused on that. We look at how we source and give greater weighting to the environmental side of things, the innovation that comes and even the behaviour of those companies and how they behave environmentally.
Now is the time for action and the time to make strong commercial decisions on the back of people’s actions in your vendor base.
We expect everybody to have it front of mind and we want to see that they are actually doing it for themselves without just having Sainsbury’s brand attached to it.
What are the greatest achievements of your procurement career?
I have never been one who has gone out to personally achieve things, but over recent years I have received a number of accolades.
I of course celebrate them personally but I don’t dwell on them, I was Procurement Leader of the year 2019 for CIPS.
My team was Team of the Year both for CIPS and the Procurement Leader’s Award in 2020.
From a professional perspective, the lasting achievement is that people remember who you are, that you left some form of mark and while my roles have been many, procurement has been at the heart of it.
Really putting procurement at the forefront of the commercial activities of those businesses, whether it be Walgreens in America, Boots in the UK or even Nissan, procurement was always put into the forefront.
It may not have been so when I joined, but by the time I left it was and I think that is probably more for me to be celebrated than any other accolade that went with it.
If I had one piece of advice it would be as you get the job, think about the legacy you want to leave behind rather than what you want to achieve.
What inspires you?
I am a very positive person who is always looking for the next challenge. I enjoy looking for things to help improve and make better. It has to be exciting, dynamic and I get a little bored when it becomes mundane or 9 to 5, it is the challenge that inspires me.
What advice would you give someone embarking on a procurement career?
I would strongly encourage anyone to think about procurement as it has access to all areas, you will learn more about a business working in procurement than you will by working in any functional role.
Also, it can only open doors to you. You can go on to shape other careers beyond that if you so wish. One of my passions, with CIPS particularly, is how do we get high schools and university teaching people about procurement. You are always at the heart of the change agenda as well which makes it an exciting dynamic career.
What role has the procurement function played in enabling the company to face the pandemic?
The pandemic landed on everyone pretty quickly and we were in a business that had to grow dramatically and had to manage a lot more capacity come into our channel.
Entertainment closed down and people had to work from home. People called it panic buying, but actually, there was just a lot more needed for people’s weekly shop, you were no longer eating out or having your lunch at work. That in itself brought a lot of supply chain management but, more importantly, there was a health and safety element that meant overnight we had to completely reinvent the way customers travelled through our supermarkets. For example, in March 2020, we decided we needed to have screens in the stores, over the weekend we prototyped it and we were rolling out 20,000 screens the following week. That normally would have taken 2-3 months.
That was just one of more than 100`s of projects that had to happen. Pre-pandemic we were doing about 300,000 grocery online deliveries, or click and collect, and today we are doing more than 800,000.
It was all hands to the pump and we were making quick decisions all with the safety of our staff and customers as the main focus while making sure we fed the nation.
People had to feel confident that they were safe while they got access to their food. There were no shortages in the grocery sector and its supply chain took all of that added capacity and quickly in an agile way reacted to it and delivered to customers, which is a testament to the day-to-day management in our industry. Big up to the vendor base who reacted amazingly well to deliver that.
What sort of initiatives has Sainsbury’s taken to secure supply?
Many different industries have had different issues. We source from more than 60/70 countries worldwide. The first thing I will say is that bananas and pineapples will only ever come from a handful of countries, you have no option so you need to be able to source from there, French wine will only come from France.
The fact is that our supply chain stood up exceptionally well. We do dual source, we have a very robust domestic supply chain around our agricultural side, we don’t just source products, we really partner with farmers, fish farms and we work on the development of the future supply chains of those companies.
You are not just switching on and off supply, you are actually building a real partnership model that in the good times is brilliant, but also in the difficult times, and recently it stood the test of time.
We have had Brexit which has been a separate issue and we have had to take several short-term measures there to secure supply.
We all believed that there would be some element of disruption and I am pleased to say that there has been limited disruption. On the scale of what people were projecting a year so ago it has been pretty good.
We haven’t had to do an awful lot more, we are talking more frequently with our vendors and working together, payment terms is one thing, supporting each other from a cashflow perspective as not everybody sources just with Sainsbury’s they have other customers and we need to help out where it makes sense to do so for them and us.
The shape of the P&L of supermarkets would have changed with increased transport and logistics costs, have your team got involved in that?
Yes, we buy all of the logistics for all of the food and products and shipping cost. I wouldn’t say there has been too much change in terms of inbound logistics.
I think there have been Covid costs and it is in the public domain, it is hundreds of millions of pounds to make sure our stores are safe and secure for customers and colleagues and we haven’t taken any government funding in that way of any nature.
That has had an immediate impact on our profitability. I think there is a short-term issue around deep-sea shipping in terms of the dynamics of containers and we are seeing some short-term spikes in the rates we get, but we are very good at locking out certain contracts and we have some very good partnership models so there are no immediate impacts but we are projecting that the global market will stabilise over the next few months as the containers get back into the right parts of the world.
Aside from that, we are in a good place. We are always focused on transformation inside Sainsbury’s and I personally lead on behalf of the business the cost transformation side of the group. We are not seeing any dramatic changes to our ambitions that going forward.
What do you do in your spare time?
Well, there are only two people who know what I do in my work, my mother and my wife! Even my wife sometimes questions if she knows what I do
I don’t think my mother actually knows in 30 years what I do! She keeps me grounded in reality. I just enjoy life, I love my weekends, I’m a football referee, I’ve been a football coach for 15 years as I had three sons growing up.
I enjoy skiing and love to travel. I have travelled the world for my job, but I also have a buzz for travel wherever I can get it. I love exploring, I have lived in Chicago and Hong Kong and I travel around and meet new people.
I’m looking forward to retirement someday, I want to travel the world, but that is a negotiation I haven’t won with my wife yet!
I will wear her down over time and she might let me retire one day! I have tried wakeboarding and canoeing and all the watersports, but my sons might say I am a bit of an embarrassment, but I love anything that gets me outside.
If you could give your younger self one piece of advice what would it be?
Take a look in the rearview mirror a little more often and reflect where you have come from. I am always looking ahead and going forward, someone once said to me, “Have you seen the devastation you have left behind” – it was at Nissan a great manager of mine, and I was expecting a brilliant performance review as I was delivering lots of great results and he calmly said to me, “Have you ever looked in your rearview mirror to see what you have left behind” and it was quite profound.
So I would say look in your rearview mirror, see where you have come from, what you have achieved but also make sure you have left a good base behind you – and don’t take yourself too seriously.
It isn’t always about results, it is very much about the team and the people around you, they are the ones that will really make you successful.
Results will come and go, they will forget results, but they won’t forget you.