Q&A with Sri Gopinath, Director of Global Procurement Strategy at Schneider Electric

"A supplier needs to be able to articulate and demonstrate a track record of delivering results on multiple requirements."

M7: What are some of the important qualities you look for in a supplier?
SG: A supplier needs to be able to articulate and demonstrate a track record of delivering results on multiple requirements – although providing parts, products or services at a competitive price is a requirement, but the expectations are higher. Above all, I look for ethical, socially responsible leadership and a culture and passion for delighting customers through quality, customer satisfaction, competitiveness, innovation, sustainability and operational excellence. Commitment to collaboration and long-term relationships are key to working together effectively.


M7: Buyers and suppliers need to collaborate more to advance sustainable procurement. What is your vision?
SG: Sustainable procurement is the right thing to do for our society and planet, and has become a requirement for us to succeed, and exceed our customers’ expectations. I am proud to say that Schneider Electric is one of the world’s leading companies recognized for our sustainability practices. We have evolved from regulatory compliance and risk mitigation to generating competitive advantage to deliver on all sustainability goals, and we need our suppliers to work with us to be successful together. We are also strongly committed to ethical sourcing – to ensure our suppliers and their suppliers in the entire value chain adhere to safe and acceptable working practices and human rights.

In our supplier business reviews, assessments and supplier events, we not only identify areas of improvement, but also recognize and reward suppliers for leading sustainability practices and share best practices. We are committed to working with our suppliers as part of our global commitment to build a sustainable world. You can get more details here if you are interested.

"A fully flexible, low risk and highly tailored local supply chain may be cost prohibitive, while a fully global approach can be cost effective but increase risk and decrease supply flexibility."

M7: How can businesses balance local and overseas procurement arrangements in a global sourcing environment? What actions are you taking to improve cost control in today’s increasingly competitive environment at Schneider Electric?
SG: To address the subject of local versus global sourcing, procurement leaders have to achieve the right balance between local and global sourcing strategies. There is no one right answer – each purchased category or product has its own market dynamics and supply chain footprint that needs to be managed. Some categories like electronic components and fasteners are globalized because their manufacturing is dominantly Asia-based, regardless of the final destination. Other categories like steel, metal stampings, and sheet metal parts are more localized due to the challenges of global logistics and raw materials. The best decision is achieved by collaborating with suppliers to “think global and act local” – where we can align our requirements to their capabilities in order to meet or exceed expectations.

Next, we need to understand the pros and cons and determine the key success factors. Understanding the benefits and risks of global sourcing is critical to decide how much localization is appropriate. A fully flexible, low risk and highly tailored local supply chain may be cost-prohibitive, while a fully global approach can be cost-effective but increase risk and decrease supply flexibility. Clearly, the right answer for most companies is somewhere in between. Leading suppliers figure out how to work globally and operate locally – providing strong operational performance while building stronger global relationships.

Regarding the actions we are taking to manage costs, we utilize both short term and long-term approaches to driving cost management activities. Negotiations with suppliers are conducted based on data and facts – cost savings achievement is necessary but not the only condition to meet our supplier performance requirements. We drive performance by maximizing relationships with our strategic and best suppliers and engage our internal stakeholders in driving cost improvements. Examples of such activities are, value engineering, supplier product and process innovation, streamlining the end-to-end supply chain, supplier quality and capability improvement, etc. The guiding principles of our overall cost management approach are collaboration, interaction and digitization.

M7: What are the challenges for Schneider Electric as you look at global procurement in the areas that you work in?
SG: We have to look at achieving consistent global performance of our total cost of ownership, quality capabilities, operating performance, risk and resiliency. Our internal governance and organizational mechanisms for managing these diverse requirements require strong engagement, information sharing and communication with our suppliers and stakeholders. Sourcing strategies are also validated with the business units and product leaders in order to align the needs of our customers with supplier capabilities.

"Leading suppliers figure out how to work globally and operate locally – providing strong operational performance while building stronger global relationships."

M7: How has the COVID-19 pandemic affected your work - what day to day processes have you had to re-tool to be able to pull them off remotely? What does your remote tech stack look like?
SG: Schneider Electric is a global company, dedicated to providing energy and automation digital solutions for efficiency and sustainability. We operate in environments that are considered essential – such as critical energy infrastructure, data centers, hospitals, airports and so on. Our people are already used to working in flexible environments; therefore, the pandemic was not a big shock when we were required to work from home if our role permitted us to do so. My role is global, which needed frequent travel prior to the crisis. I have maintained my global scope and interactions while working from home considering that I work with all time zones, which can get quite challenging when we are trying to work together or meet at a mutually convenient time.

Our people use industry-leading collaboration tools for voice and data communication that enables them to be effective in their work, regardless of location. We also use server and cloud-based digital applications for managing documents, supplier interactions, business intelligence tools and digital enablement of our key work processes.

M7: Speaking of fun, what’s one fun fact about you?
SG: I have traveled to over 30 countries and climbed the Great Wall of China 4 times in different locations, starting with where the wall begins in Qinhuangdao.