Sup­ply chain chal­lenges impact com­pa­nies of every size, in all loca­tions and indus­tries. Few at SAP are bet­ter posi­tioned to see the big pic­ture of what it will take to estab­lish agile, resilient, sus­tain­able sup­ply chains world­wide than Dar­cy Mac­Claren, Chief Rev­enue Offi­cer of SAP Dig­i­tal Sup­ply Chain. 

Recent­ly appoint­ed to the posi­tion, Mac­Claren now takes on the chal­lenge of build­ing a glob­al net­work and deter­min­ing a go-to-mar­ket strat­e­gy for SAP Dig­i­tal Sup­ply Chain that will be suc­cess­ful world­wide. Her pre­vi­ous role as Senior VP & Head of Dig­i­tal Sup­ply Chain & Indus­try 4.0 for SAP North Amer­i­ca gave Mac­Claren in-depth knowl­edge of all the prod­ucts, solu­tions, and peo­ple at play in sup­ply chains — insights that are already prov­ing crit­i­cal to her effi­ca­cy in tack­ling a wide range of sup­ply chain top­ics, from glob­al­iza­tion to the advent of busi­ness networks. 

“My role is to help our cus­tomers trans­form and cre­ate more resilient sup­ply chains, using RISE with SAP and SAP S/4HANA Cloud, and to help them achieve clean core by using SAP Busi­ness Tech­nol­o­gy Plat­form (SAP BTP),” explains MacClaren. 

Below, ASUG asks Mac­Claren about the cur­rent state of SAP Dig­i­tal Sup­ply Chain, the chal­lenges sup­ply chain pro­fes­sion­als cur­rent­ly face, and the role of arti­fi­cial intel­li­gence (such as SAP’s new­ly announced gen­er­a­tive AI copi­lot Joule) in bol­ster­ing sup­ply chain operations. 

This inter­view has been edit­ed and con­densed.

ASUG: What chal­lenges do sup­ply chain pro­fes­sion­als cur­rent­ly face in estab­lish­ing sup­ply chains that are sus­tain­able, intel­li­gent, resilient, and cloud-ready? 

Mac­Claren: Basi­cal­ly, they all need to change the tires of the car while they’re dri­ving. These are can-do types of peo­ple who get things done and work hard, but most sup­ply chain orga­ni­za­tions are under­staffed, either because of cut­backs in the com­pa­ny or because they can’t find the right peo­ple. This is often the case in logis­tics; from dri­vers to ware­house work­ers and peo­ple in plants, orga­ni­za­tions can’t find peo­ple to do those jobs. So, they’re already over­bur­dened. Still, they’ve got to meet their cus­tomers’ demands in the most sus­tain­able, effi­cient way pos­si­ble, while also tak­ing on the com­plex­i­ty of risk. 

All of this makes it hard to say, ​“By the way, what you’re doing now is not going to work going for­ward,” right? Ide­al­ly, sup­ply chain pro­fes­sion­als con­sid­er­ing trans­for­ma­tion would like to say, ​“Well, I’m going to wait for a pause in the busi­ness, until it’s a good time.” That’s the prob­lem: there isn’t going to be a good time. We have to fig­ure out how to do this now. Our job is to make it eas­i­er for them to trans­form, to get out of the day-to-day and look ahead, know­ing that — in the medi­um- to long-term — you’ve got to start mak­ing sure you have sys­tems and tech­nol­o­gy in place to embrace what will be the new world.

The sec­ond issue is change man­age­ment, because people’s jobs will be dif­fer­ent. They will still have jobs, but their jobs will be dif­fer­ent. Trans­for­ma­tion will take away more man­u­al work and analy­sis, and so we’ll be look­ing for more high­ly skilled work­ers to over­see that. Com­pa­nies need to work toward change man­age­ment, by hav­ing a point of view and a vision for where they believe they need to go. That’s dif­fer­ent from before. It’s more about risk resilient agili­ty and sus­tain­abil­i­ty, as opposed to cost and efficiency. 

It’s also about when and where you start. The when is now, right? The where depends on the com­pa­ny. What is most bro­ken in your sit­u­a­tion? There isn’t one place to start — that depends on the com­pa­ny. What’s crit­i­cal is to have high val­ue, quick wins to get syn­er­gy going. A com­mon place to start, though, is inte­grat­ed busi­ness plan­ning, as well as sales and oper­a­tions plan­ning, because that sets the strat­e­gy for the rest of the orga­ni­za­tion. Some com­pa­nies have that down, but for oth­ers it’s a great start­ing point. The key is that you have to start now. 

I’d also men­tion the con­cept of data. You will nev­er have 100% good data. You don’t wake up one day and say, ​“Okay, we’re done; our data is good.” That’s nev­er going to hap­pen. It’s an ongo­ing process. Anoth­er way of clean­ing up your data is to do inte­grat­ed busi­ness plan­ning. As data is com­ing in, cleanse it. We have tools to help you ver­i­fy data, because most com­pa­nies do need to improve their data. You can do that in con­junc­tion with run­ning a sup­ply chain project.

ASUG: What sorts of strate­gic changes do you see cus­tomers mak­ing, so that their sup­ply chains can sus­tain or opti­mize cur­rent oper­a­tions while increas­ing profitability?

Mac­Claren: Cus­tomers are look­ing strate­gi­cal­ly across their orga­ni­za­tions to see how they should be set up. They’re look­ing care­ful­ly at what’s most impor­tant for them to be able to access in the event of dis­rup­tions — geopo­lit­i­cal, envi­ron­men­tal — that could shut down their busi­ness, so that they can build sup­ply chains that give them more flex­i­bil­i­ty. If cer­tain regions, raw mate­ri­als, or logis­tics shut down, can they still oper­ate? Eval­u­at­ing oper­a­tions trig­gered folks to look at their onshoring-off­shoring mix of man­u­fac­tur­ing, at whether they need to refor­mu­late prod­ucts to allow more vari­abil­i­ty. Look­ing across the whole orga­ni­za­tion, cus­tomers need to build in flex­i­bil­i­ty for longer-term plan­ning, as well as the con­nec­tiv­i­ty they need to be able to react to disruption. 

We’re also see­ing more net­works form­ing. Fierce com­peti­tors, such as Ger­man auto­mo­tive man­u­fac­tur­ers, real­ized they were all miss­ing the same inte­grat­ed cir­cuits, that they need­ed to start a con­sor­tium to fig­ure out that out. And so, Catena‑X Auto­mo­tive Net­work was born. We’re see­ing more coop­er­a­tion and more net­works form­ing to make sure indus­tries are con­nect­ed in a very secure, col­lab­o­ra­tive man­ner when it makes sense for them to do so. 

Everyone’s talk­ing about gen­er­a­tive AI. The whole idea of intel­li­gent tech­nolo­gies — what they mean to my busi­ness, how can I incor­po­rate them respon­si­bly at scale — is anoth­er area where, par­tic­u­lar­ly in the sup­ply chain, pro­fes­sion­als are embrac­ing the change that is com­ing. The com­pa­nies that do that best will have an advan­tage. We already have AI embed­ded in SAP solu­tions — in SAP Extend­ed Ware­house Man­age­ment (EWM), which fea­tures AI-enabled slot­ting rec­om­men­da­tion; in SAP Trans­porta­tion Man­age­ment, with doc­u­ment pro­cess­ing; in SAP Con­cur solu­tions, with trav­el, expense, and invoice. This is math­e­mat­i­cal AI that exists in our day-to-day lives.

What’s new is what you can do with gen­er­a­tive AI. With SAP, when you have a full yard and you don’t know which truck to unload, AI can read the man­i­fest, under­stand it, and then tell you which truck to unload first. With all the data SAP has, we’re in an incred­i­ble posi­tion to unleash gen­er­a­tive AI in a respon­si­ble way. We’ve had AI teams work­ing on our gov­er­nance for over 10 years and we’re con­tin­u­ing to find new ways for our cus­tomers to lever­age AI for busi­ness in rel­e­vant, reli­able, and respon­si­ble ways. 

We just announced Joule, an advanced, gen­er­a­tive AI assis­tant that will trans­form the way busi­ness­es run. It will be embed­ded through­out SAP’s cloud enter­prise port­fo­lio to deliv­er proac­tive and con­tex­tu­al­ized insights from across SAP solu­tions for HR, finance, sup­ply chain, pro­cure­ment, and cus­tomer expe­ri­ence as well as SAP BTP, and third-par­ty sources. With Joule, the user can sim­ply ask a ques­tion or frame a prob­lem in plain lan­guage, and receive quick, con­tex­tu­al­ized results that adhere to the robust safe­guards regard­ing data pro­tec­tion that SAP has cham­pi­oned for decades.

The fact that SAP is embed­ding AI in all of our solu­tions gives com­pa­nies an easy way to roll this out, where AI is part of your sup­ply chain and part of your intel­li­gent enterprise. 

ASUG: What have you observed, from a glob­al per­spec­tive, of how com­pa­nies are specif­i­cal­ly respond­ing to the dis­rup­tion cre­at­ed by the pan­dem­ic and focus­ing on the con­nec­tiv­i­ty of their sup­ply chains? 

Mac­Claren: What this glob­al lens has shown me is the need for stan­dards, which make every­thing eas­i­er for peo­ple to con­nect. SAP embraces stan­dard­iza­tion. Because of our size and scale, we are often a leader in stan­dards. What COVID-19 taught us — if we did not already know — is how glob­al­ly con­nect­ed we all are. Major dis­rup­tion in Chi­na affects the world, and that’s the same if the dis­rup­tion is in Brazil. We all need to be con­nect­ed, and stan­dards make that eas­i­er. What SAP is try­ing to do, with our con­cept of net­works, is make it easy for every­one to secure­ly con­nect to every­thing in their ecosys­tems — to sup­pli­ers, con­tract man­u­fac­tur­ers, logis­tics providers, equip­ment, con­tin­gent work­ers — so peo­ple can do their jobs and collaborate. 

What’s inter­est­ing is how dif­fer­ent regions vary their approach­es. Trans­port is dif­fer­ent in North Amer­i­ca, where trucks trav­el coast-to-coast, from in Europe, where dri­vers go home every night. You have to respect what­ev­er the region­al sit­u­a­tions are. Of course, all kinds of rules focus on sov­er­eign clouds, and com­pa­nies want to keep cer­tain data in their own coun­tries, with secu­ri­ty and process­es that make sense for them. This con­cept of being able to oper­ate as one, while respect­ing the indi­vid­ual region or coun­try’s desire for data pro­tec­tion, has to be dealt with. That adds to the over­all complexity. 

We always design our appli­ca­tions with secu­ri­ty in mind, and our cus­tomers can trust that SAP appli­ca­tions are secure. We also have the flex­i­bil­i­ty to get our appli­ca­tions cer­ti­fied in these dif­fer­ent envi­ron­ments and coun­tries, and ensure that they are in com­pli­ance with each country’s cloud secu­ri­ty require­ments —such as those from the U.S. Depart­ment of Defense, which has some of the strictest require­ments in the world. There is a group that works on our sov­er­eign cloud capa­bil­i­ties, whose role is to go coun­try to coun­try to get cer­ti­fied, to make sure that our cloud appli­ca­tions can run in those regions.

ASUG: How is SAP’s trans­for­ma­tion into a cloud com­pa­ny, and its efforts to move its cus­tomers from SAP ERP Cen­tral Com­po­nent (ECC) to SAP S/4HANA Cloud edi­tions, impact­ing the SAP Dig­i­tal Sup­ply Chain space?

Mac­Claren: SAP is in full trans­for­ma­tion to be a cloud com­pa­ny. In order to inno­vate as a cloud com­pa­ny, we have to get our cus­tomers over to the cloud via RISE with SAP. A key ele­ment of this trans­for­ma­tion is hav­ing clean code so they can take full advan­tage of con­tin­u­ous inno­va­tion on SAP BTP. That same prin­ci­ple extends to sup­ply chains, which work with SAP S/4HANA and RISE with SAP.

When cus­tomers imple­ment SAP S/4HANA through a green­field approach, they’re select­ing what’s best-in-class for their indus­try, with clean code. Those green­field imple­men­ta­tions go up very fast. We’ve seen cus­tomers select SAP Inte­grat­ed Busi­ness Plan­ning for Sup­ply Chain along with their green­field clean code SAP S/4HANA imple­men­ta­tion; per­haps they add inno­va­tion in SAP BTP, but they get up and run­ning very quick­ly. It’s eas­i­er said than done for glob­al cus­tomers with com­plex sup­ply chains, but even very large life sci­ence and chem­i­cal com­pa­nies have been able to trans­form in that way. We work with cus­tomers and with part­ners to make sure they’re on board with the clean code con­cept. Com­pa­nies that make a busi­ness prac­tice out of cus­tomiz­ing code put cus­tomers at such a disadvantage.

ASUG: What’s your advice to sup­ply chain cus­tomers who are cur­rent­ly weigh­ing their options for dig­i­tal trans­for­ma­tion or build­ing busi­ness cases? 

Mac­Claren: With sup­ply chain trans­for­ma­tion, those ben­e­fits actu­al­ly can be the trig­ger for an entire busi­ness to move over to SAP S/4HANA. Trans­for­ma­tion is about look­ing more holis­ti­cal­ly across the orga­ni­za­tion to come up with the right answers. It’s part of change man­age­ment and gain­ing the abil­i­ty to work as one. Trans­for­ma­tion is about get­ting out of silos — either with­in your own orga­ni­za­tion or in your ecosys­tem, which is where con­nec­tiv­i­ty mat­ters. I always tell peo­ple, what­ev­er their roles are, to try to think of trans­for­ma­tion in a big­ger con­text, to imag­ine how they might cre­ate that dig­i­tal thread across their entire orga­ni­za­tion, to be con­nect­ed so that they can have agili­ty and resiliency.

ASUG: What excites you about SAP part­ner ini­tia­tives that are sup­ply chain-ori­ent­ed and intend­ed to help break down those silos?

Mac­Claren: In addi­tion to the auto­mo­tive net­work, what we’re doing with SAP Busi­ness Net­work for Logis­tics is excit­ing to me. We’re con­nect­ing with ship­pers, car­ri­ers, and all of the net­works, so you have this sin­gle point of con­nec­tion. As a com­pa­ny, you don’t have to sign up to all these dif­fer­ent con­nec­tors. You can use SAP as the con­duit to con­nect them for you. From a devel­op­ment stand­point, research and devel­op­ment pro­fes­sion­als will be able to col­lab­o­rate in a safe environment.

Also, if you look at the SAP Asset Intel­li­gence Net­work, you can con­nect all your equip­ment and machines to see how they’re oper­at­ing. This can tell you if a machine’s per­for­mance qual­i­ty drops or is slow­ing down. The learn­ings from that are shared in the net­work in a secure way, so some­one else can learn from it. And you can see how we’re col­lect­ing all this infor­ma­tion we’re learn­ing from. It’s shared, as appro­pri­ate, to folks who should have that infor­ma­tion, and it makes every­body bet­ter. It’s all about col­lab­o­rat­ing, mak­ing sure your intel­lec­tu­al prop­er­ty is secure, shar­ing what you want to share, and get­ting what you want from others.

ASUG: What added per­spec­tive has this glob­al role giv­en you on the sta­tus of North Amer­i­can SAP cus­tomers with regard to sup­ply chain resilience and transformation?

Mac­Claren: North Amer­i­ca is behind in adopt­ing Indus­try 4.0 and automat­ing fac­to­ries. Europe and Asia are much fur­ther ahead than North Amer­i­ca. In fact, if you talk to North Amer­i­can com­pa­nies, they’ll even say they’re automat­ing but start­ing with their plants in Europe or Asia. We’ve made a lot of head­way in the last year or so, but what we can learn from our Euro­pean and Asian coun­ter­parts is how they are much more auto­mat­ed from an Indus­try 4.0 perspective. 

On the oth­er hand, North Amer­i­ca is ahead in sales and oper­a­tion plan­ning, and I think they’re more mature in this area. This can be depen­dent on indus­tries. In the life sci­ences area, both Euro­pean and North Amer­i­can com­pa­nies are advanced, and it’s phe­nom­e­nal. What they accom­plished in bring­ing out the COVID-19 vac­cine so quick­ly is a great exam­ple of what you can do when you col­lab­o­rate, remove dis­trac­tions, and get peo­ple focused on a mis­sion. You can do great things. I’m com­mit­ted, across all our regions, to help­ing our cus­tomers trans­form and build more agile, resilient sup­ply chains in ways that best posi­tion them for success.

For more from Dar­cy Mac­Claren, read our recap of her recent Empow­er­ing Women in Sup­ply Chain event and her recent per­spec­tive on AI in sup­ply chain.