Breaking the Silo Mentality

IBM Vice President, Business Growth Initiatives, Linda Cantwell discusses how Big Blue is helping members of its Integrated Supply Chain organization develop the expertise and attitudes they will need to ensure the success of the company's next-generation supply and demand chain.

[From Supply & Demand Chain Executive, April/May 2004] IBM debuted its "e-Business on Demand" strategy with much fanfare in late 2002, highlighting on demand as a way of making supply chains more agile and adaptable to changing market conditions. But behind the scenes, IBM itself has been going through a significant supply chain revolution: The company set up an Integrated Supply Chain (ISC) group in 2002, consolidating dozens of different supply chains into a single organization that now runs most of Big Blue's supply operations. The goal: become more flexible, more responsive to customers' evolving needs, in short, more "on demand."

As in any major corporate re-engineering effort, IBM's move to its new supply chain model has involved more than just realigning boxes on an org chart. The company is finding that the on demand supply chain requires new skills and a new mindset for members of the ISC group. Recently Supply & Demand Chain Executive spoke with Linda Cantwell, vice president, business growth initiatives, Integrated Supply Chain, about the skills that the company is targeting for development as part of its latest transformation.

Cantwell joined IBM in 1982 and has served in a variety of roles in IBM's procurement, software manufacturing and Global Services organizations. In procurement, she specialized in business transformation to ensure that the purchasing function both understood and fully supported IBM's sales and marketing teams, and she created client-dedicated procurement teams and multiple business process changes in order to provide increasing support to the Global Services division. In June 2000 IBM appointed Cantwell to the position of vice president, global customer solutions procurement for IBM Global Services. She came to the position of IBM's vice president of strategic sourcing in January 2003 and was promoted to her current position in March 2004.

We began by asking Cantwell about her work at IBM.

Cantwell: I was responsible for strategic sourcing in the part of procurement that most companies refer to as the indirect side. Of the $39 billion or so that IBM spends with external suppliers every year, the piece that I represented, which we call services and general procurement, is about $20 billion. The driver behind that spend profile is really our services business, IBM Global Services, which is approximately $12 billion of that $20 billion in spend. Services is the large, growing, strategic part of IBM's business, and it's the future as far as the customer solutions that we're selling in the marketplace.

S&DCE: How has IBM's "on demand" vision affected that part of the supply chain where you worked?

Cantwell: The on demand vision and the on demand transformation that is being driven across the company has been key for the ISC. The vision is for the ISC organization to be the world's first "on demand" supply chain so that IBM can sense and respond to the needs of our customers, interface with our suppliers in that same way, and drive the end-to-end efficiencies and quick responsiveness that [IBM CEO] Sam Palmisano talks about.

Bob Moffat, who runs the Integrated Supply Chain, wants to make sure that all 19,000 employees of the ISC organization understand the strategy and the vision, and that they're all marching as one to get us to the end game. He has been very aggressive about making sure that the ISC strategy is communicated to all our employees around the world so that they understand what we mean when we say we intend to become an "on demand supply chain."