Diageo had to switch from kegs to cans for Guinness due to the pandemic © Brian Ach/Getty Images for Diageo Beer Company USA
Diageo had to switch from kegs to cans for Guinness due to the pandemic © Brian Ach/Getty Images for Diageo Beer Company USA

How Diageo's procurement boss justifies supply chain investment

Will Green is news editor of Supply Management
15 September 2021

The procurement boss at drinks firm Diageo has described how he convinces stakeholders of the importance of investment in the supply chain.

Ewan Andrew, president, global supply and procurement and chief sustainability officer at Diageo, said such investments had been critical in the company’s response to the pandemic and the Suez Canal blockage, which disrupted supply across the globe.

Speaking at the Gartner Supply Chain Symposium, Andrew said: “With the investments we put in, they were able to tell us within one hour of that being reported, what containers were on that ship, what containers were on their way to that route and how we could redirect and work with our shipping lanes to take decisions quickly and stay ahead of what the impact would be on different scenarios.

“This isn’t just about how our business operates today, it’s about being able to deal with a volatile and challenged world into the future, and these systems really do give you a competitive advantage.”

Andrew said supply chain technology, and the data it provided, improved customer interactions with the company – whose brands include Guinness, Johnnie Walker and Tanqueray – and helped with sustainability initiatives.

“It can help you on the cost front in terms of having that transparency in the value chain,” he added.

Andrew said the pandemic “put significant pressure on the supply chain”, for example in having to switch from kegs to cans for Guinness as lockdowns shut down the hospitality sector and people stayed at home.

“We developed a lot of close collaboration, a lot of building up business cases to make decisions for supply chain investments,” he said.

“We had to get into quite early, if we don’t make decisions quickly enough we’ll miss the consumer opportunities and we’ll miss the market share-winning opportunity.”

Andrew said they adopted agile methods such as sprint teams to make decisions more quickly.

“We were able to get smaller sprint teams together, to take away the difficulty a global organisation can have, and empower people into sprint teams that were able to take a goal and make decisions on behalf of the whole business. That might be on reserving capacity and booking slots for suppliers long into the future.”

He advised procurement professionals seeking investment: “Write that paper in a way that shows what’s the competitive advantage for your supply chain. It’s not just about cost delivery, it’s about value creation in a whole lifecycle and taking a medium and longer-term view than maybe traditionally supply chain projects would have done.”

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