DC Velocity - July 2018

t h ou g ht l e ad er s

It is never easy for a big company to transform a noncore function into a core discipline, especially when the status quo has held for decades. But that’s what FedEx Corp. did in

2013, when it recognized that global strategic sourcing and procurement was central to its overall success and that the function needed to be centralized to most effectively support its business units. It created the position of vice president, sourcing and procurement for FedEx Services, and recruited Susan Spence to run the new operation.

Spence came highly credentialed, arriving at FedEx with 28 years of experience at industrial giant United Technologies, where she was the parent’s director of supply management and held various high-level posts at the company’s massive aerospace division. Today, she oversees about $13 billion worth of annual FedEx spending in its operational and services categories, and manages procurement compliance, systems, and policies at the Memphis, Tenn.-based company.

QDescribe your role within the FedEx ecosystem. AMy team is responsible for global strate- gic sourcing and procurement operations, strategies, policies, and systems for everything FedEx buys, with the exception of aircraft, aircraft engines, avionics, and a few other categories that are handled separately.

QDid your roles at United Technologies pre- pare you for the FedEx environment? Were there significant differences that you had to adjust to?

AMy role at United Technologies definitely prepared me for life at FedEx, especially when it came to managing risk in the supply chain and understanding the value of holistic category management versus the tactical nature of procurement. I have received unwavering support from our senior leadership team all the way up to our chairman, Frederick W. Smith. When I joined in 2013 and laid out our transformation plan, which would take four to five years to come to fruition, the only question my senior leadership team asked was “How can we help you realize this vision?” I think that says a lot about a company and its leadership.

QThere has been debate over the past few years about the role of a shipper’s procurement department in motor carrier negotiations and relationships.

Some have said procurement folks are just concerned with the lowest rates and don’t fully grasp the nuances of a shipper-carrier relationship. As a procurement professional, what is your opinion on that issue?

AFedEx has a unique perspective because not only are we a transportation services company, but we also purchase transportation for the routes our own network doesn’t cover. We work closely with operations stakeholders to understand what the right market price is, and we recognize the value of quality and service. We keep the total cost of ownership in mind, and we have a sophisticated model in place to make the right decisions in negotiations and to effectively manage relationships with our suppliers.

QCompliance is one of your responsibilities. What is your biggest day-to-day challenge in this arena?

AMy team does a very good job at compliance. Still, one of the challenges is that “you don’t know what you don’t know.” There is no easy way to perfectly measure all things related to compliance. We continue to develop measurement systems and tools to address those issues that can pose risk for us. We benchmark our processes with respected peers to ensure we flush out issues before they become major problems.

QWhat is your proudest professional achieve- ment, and why? AOne of my proudest achievements is the move I made five years ago. After 28 years with United Technologies, I left to join FedEx as an officer, an opportunity that rarely arises given the company’s “promote from within” philosophy. FedEx aimed to build a centralized sourcing and procurement team, and it created the position that would lead that organization.

For me, it was a big move—a new company, a new culture, a new region and state—at the same time my youngest child left for college. It meant taking a chance and putting both my professional and personal comfort zones on the line for something I knew could be quite remarkable.