with Grainger. His guidance helped
Grainger shape and execute many
supply chain initiatives that have
been foundational to the distributor’s growth, including product
availability improvements and product line expansion. Earlier in his
career, he was an operations manager for Rain Bird Sprinkler
Manufacturing Co. and a test engineer with the U.S. Air Force.
Macpherson holds a bachelor’s
degree from Stanford University and
an M.B.A. from Northwestern
University’s Kellogg Graduate School
of Management. He spoke recently
with DC VELOCITY Group Editorial
Director Mitch Mac Donald about
his career path and his team’s commitment to supply chain excellence.
QTell us about Grainger and its mission.
AGrainger is an industrial distri- bution business that has been
around since the 1920s, and we have
a Canadian operation that’s even older than that. Grainger
today is focused on making sure we provide customers with
a very broad range of products to help them keep their
facilities and operations up and running. Our reputation is
based on providing terrific, very high-level service to our
customers.
QWhat do you see as your mission as senior vice pres- ident of global supply chain operations?
AWe are a very large U.S. business that last year gener- ated roughly $7 billion in sales. We’ve been around for
a long time and we have international businesses, our
Canadian business being by far the biggest of these. I am
responsible for the global supply chain, which really supports all of those. My role is making sure that we have, to
simplify things a bit, the right products in the right place at
the right time for all of our businesses throughout the
world. I spend a lot of time thinking about product management, inventory management, transportation, operations, global sourcing, and our relationships with suppliers.
The best way to describe the nature of our operations is
that we have literally thousands of suppliers that we work
with and that are very important to our efforts to make sure
we provide great service to our customers. They provide us
with hundreds of thousands of products, which we distribute to our customers through multiple channels. In the
United States, in Canada, in most of our businesses, customers can walk into a local branch to get their product or
they can use one of our catalogs or our website.
In the United States, for example, we have about 3,000
suppliers. We have 10 distribution centers, which are fairly
large buildings. We carry over 400 brands of products in
our DCs. We have over 300,000 transactions a day, so we
have a lot of transactions in those buildings. Our objective
every time we have a transaction is to get the order perfect.
Our business is really based on our team members’ understanding that objective.
QGiven your extensive product line and the varied sales channels, you probably use a pretty broad mix of
shipping modes, everything from parcel express to truckload, right?
AYes, we do. One thing that’s interesting about our business is that we do many transactions, but they’re
typically $250 to $300 at a time, so customers are not ordering huge amounts in most cases. We are generally really
working on their immediate needs, and those are typically
small orders. For that reason, small parcels account for the
biggest share of our shipping transactions, but we do use
pretty much every mode of transportation.
QYou’ve seen substantial growth with global initia- tives. Could you touch a little bit on Grainger’s global strategy?
AWe have expanded pretty rapidly. International is about 20 percent of our total mix. We have a very clear
strategy to leverage our supply chain scale to expand in the
Latin America region and in Asia. We have strong business
in Mexico. We have strong business in Japan. We have fledgling businesses in China and India. From a supply chain
perspective, I’d say we aim to follow the same principles we
follow in our U.S. business, which is making sure you provide absolutely flawless service to customers, making sure
your key members are wired to ensure absolutely flawless
execution.
I think some things are different, though. For example,
depending on the competitive side of the market you’re in,
the product range requirements may vary dramatically.
Oftentimes, the product range in smaller countries is much
narrower than in, say, Canada or the United States, so we
have to think differently. Still, we want to make sure we have
a better product offering, in many cases a broader product
offering, than any of our competitors. What that equates to
