881: Owning Transformation: How to Successfully Lead Procurement Through Change W/ Gretchen Vance

0:05Hi there, my name is Philip Ideson. I want to welcome you to the Art of Procurement podcast, the podcast that helps you, a forward-thinking procurement professional, position yourself and your team to proactively take advantage of the revolution that's taking place in procurement today. By interviewing industry trailblazers and sharing insights from our own experiences, my team and I pull back the curtain and shine a light on the strategies, tactics, and tools that procurement teams are using to elevate their impact. Today on the show, I'm delighted to be joined by Gretchen Vance. Gretchen is the Vice President of Procurement at Forest Lawn Memorial Parks and Mortaries, funeral establishments and cemeteries in Southern California that served the local community for over 100 years.

0:51Now, first of all, Gretchen, thank you so much for joining us on the podcast. Thank you for having me. And the first question that I get to ask that I ask all of my guests is, did you find procurement or did procurement find you? I've listened to this question several times and I'm going to answer very similarly as other people do in that procurement definitely found me. I started my professional career later in life after raising our four kids and And found my way to Forest Lawn, but started as a secretary in the sales department. And so didn't last very long there. Moved over to purchasing, was purchasing at the time, and landed here.

1:39I have so always loved data, but love to interact with people. And so when I found procurement, I was like, this is perfect. I can crunch numbers all day and I can also negotiate and have supplier relationships. And so that is how I found procurement or purchasing when it was here and then moved up throughout my career here. Yeah. And I think you've been with Forrest Lawn for a number of years just looking at your background. So you've kind of grown up the ranks throughout the years and through your time there. I have. I started as an admin, but, you know, went back to school, got my supply chain certification, got my CPSM through Institute of Supply Management.

2:29And then actually during COVID said, I'm going to go get a second bachelor's degree in supply chain management. So I did that. So, yeah, I have learned along the way. um but yes i've been here 18 years um love the company it's a great company and um well you're one of the few that has a bachelor's in supply chain management i will say that even though you answered the question you know like many of us in finding procurement and i uh i get the sense that right that the learning is a lifelong journey um by the sounds of it for you in what you have done i understand that you're doing an mba as well at the moment so i am going on you know let's go and do an MBA at the same time.

3:13Yes, I am. I am. I believe that leading is learning. And so I decided to go back. I am attending Claremont Graduate University, Peter Drecker School of Management. And in the process of obtaining my MBA, I'm not in a super hurry doing one class at a time but really enjoying it um and and um finding it so valuable as i move along in my career journey um well certainly all credit you're doing things that you know i wish that i could have done and the moment that i saw that algebra was going to be on the entrance test decided that maybe that wasn't the route for me which you know funny for a procurement person but anything with math scared me so if I couldn't use Excel I was out yeah I mean we did I just I just finished a corporate accounting class and it was hard it was not a joke um but I got an A so well congratulations it helps that I only take one class at a time so yeah um well I want to talk first of all about because you're in a I think a very unique organization in terms of what you do in procurement space.

4:27Can you talk a little bit about Forest Lawn's mission? But also, you know, you said just then you love your job. How does that align with your own kind of professional philosophies? Yes. Forest Lawn is a serviced company, obviously. Our mission is to serve the people that enter our gates. And that really aligns with my philosophy of serving others. And it's the same way we treat our vendors. So it makes my job easier just because communicating that message to suppliers, people want to be a part of that. So, yeah, it is definitely a different type of organization. Like I said, I grew up in here, so I don't I grew up here.

5:16I don't know much different, but it is very fulfilling. it's very mission driven and from the top down at Forest Lawn it is about helping the families that we serve and we're helping people at the hardest time in their life all of us have been there at some point if we haven't we will be and so it's great I really enjoy it and it's easy to communicate that message to our suppliers Now, with the responsibility that you do have and the mission and the purpose, you know, and I'm sure that all of your peers speak in the same way. You know, it sounds like it's a very mission driven organization, a purpose driven organization.

6:01How does that affect how you go and think about the partners, the external partners that you then, you know, your suppliers that you then go and select? You know, it's funny you ask that question. I had a supplier one time that said he had never cried in a negotiation before. It's not hard to communicate that message because, and it's not hard, it's not hard to find suppliers, but you can't, they're easily identifiable because suppliers are just people, right? It's all about relationship. I'm very big on the supplier relationship management piece. and I spend a lot of time in the interview process of our suppliers and it's really important that I communicate the message that they are an extension of us in serving our families and so they want to be a part of that because it's it's bigger it so Drucker says that culture eats strategy for breakfast.

7:05I had to plug in a Drucker quote just because of school. But our culture is truly a culture of service. And it is the same expectation we have for our suppliers. I read a book by Adam Grant once called Give and Take. And Forest Lawn is full of givers. And the suppliers are the same. So, you know, I've become very good friends with a lot of our suppliers because it is an extension and i won't even go into covid and our suppliers but had it not been for them covid would have been extremely challenging so other things that um yeah i'm thinking how do you how do you get the sense for that shared culture when you're meeting with a potential supplier for the first time or where you're considering bringing a supplier on board or even within a supplier, you know, when they have change of personnel, you know, is this, is it something that the same traits are true, you know, with every supplier that you see?

8:05Or I'd love to know kind of how you get that sense that this is a supplier that understands us. And as you say, it's beyond cost. You know, there's far more to this than just the cost elements of the relationship. It is. I do a rigorous background check. Typically prior to even inviting a supplier in. It is important for us to not only just see the financial side, but also the different types of clients that they currently work with. We have very unique suppliers. Not a lot of people deal with dove release companies and clergy people. They're unique. And so it's not hard, but we were very intentional about who we bring in, who we partner with.

8:58And a lot of times we'll bring them in for one meeting and say, that's not going to work. It's not hard to figure that out quickly, especially because I've been doing it for so long. I almost have a sixth sense. It really doesn't take me long. But I will say that when people, when suppliers do come in and they want to work with us, they have to prove themselves. and there'll be times too that i'll do it i've been known to ask legal to do a short-term agreement just to try them out um because you don't get to you don't get a second chance it when you're providing cemetery funeral services for people you don't so um yeah the product side is easy it's the service side that I invest more of my time into.

9:51I'd love to, because it sounds like just from, you mentioned a couple of areas of things that you bought and it sounds like there's an ecosystem kind of around the industry that you're in that it may be unique to the industry that you're in. Would you mind sharing what kinds of categories of spend you typically manage? Oh, sure. We do a lot of indirect spend. IT, HR, contracts, MRO, capital equipment, tractors. I mean, people, it's so funny when I ask, people ask me, oh, you're in procurement at a cemetery mortuary. What could you possibly buy? And I'm like, you have no idea what I'm, so all the stuff that everybody else buys along with, you know, SLAs for mortuaries.

10:39We manage all the SLAs for the mortuaries and resale items for our flower shops. But like I said, it is about those service agreements for me that's the most important because they're hands-on touch with our families. We do have an on-site warehouse and we manage about 435 SKUs. Those are mostly urns because we need to be able to grab those right away. We can't wait.

11:14Some of our stuff is just in time, but the urns are there. And then we're pretty intentional about our cycle counts and making sure that we have. And then you look at, as far as our industry, I've got to have safety stock. Yeah. A lot of items because you never know what's going to happen, right? With COVID, we've learned that. And so I'm very intentional about what we keep on our shelf, making sure that I have what I need to, you know, if I need it. Do you have to do a lot of coordination with other agencies, like public sector agencies as well, just given kind of the role that you play in the community?

11:58Yeah, we did. We do. We we did a lot during covid just because of the nature of what was happening. Typically on a day to day basis, we just we work with coroner's offices as far as, you know, picking up and then municipalities to obtain burial permits, death certificates. We do all of that type of procurement on the half of the families in ordering all that stuff. And so what does success, like how do you define the success of the procurement team? Is it around the service that you're able to provide, you know, to the rest of the organization, which allows them to provide the services that they need to provide to the families?

12:47Absolutely. I am, when I talk to my team, I say there's three very important goals that I have in this department. First thing is to mitigate risk for the organization. And that's the contract, right? And not every procurement person is going to tell you we have to mitigate risk at every turn. Whatever agreement we have in place, whatever relationship we have, it's about mitigating risk for the organization, making sure we have. And I would put the safety stock and being prepared for emergencies in that bucket. Second is to watch every dollar that comes out of the organization. I know we might talk about it later, but we now in procurement are in charge of the whole procure to pay process.

13:34So not only am I doing the purchasing side, we're managing the AP side. And so I'm very careful about what goes out the door. Ten dimes make a dollar, our president says. um so and then the third is to utilize systems and create process improvements both to help in our internal i call our internal customers our employees we have about 1100 employees which is a decent size and um to solve problems and enhance our customers experience um um i i was i was going to tell you that um i was listening to one of your podcasts and you had a guest on the show and he said, don't come and tell me what you want me to buy.

14:20Come and ask me what problem you want to solve. And I literally out loud had an aha. Yes, yes. Because I see us as being a creative group that solves problems. When operations comes and says, we need to do A, B, or C, they'll come to procurement and say, how can you help us do this? How do we achieve this? Yeah. Yeah. out so and then and that puts you in much more of a kind of a business partnering um lane so to speak in terms of how you are perceived by your peers around the business too and there are the role that you can play to support the business in driving it's the goals that it has and the outcomes it's trying to drive for absolutely absolutely um i'd like to touch on the digitization side because that's you know something that's not unique to you and the industry that you're in everybody's kind of going through this journey at the same time of how they bring our technology to support the procurement organization.

15:19I wonder if you could just talk a little bit, first of all, kind of where you are right now in terms of digitization. So it's interesting you ask. When I started, after I became manager, we were all paper, very paper and um all right i worked for our cfo and i i came to him one day and i said we need to digitize uh purchasing and um at that point i i don't think it was much of a priority um but i pretty much laid it out on the line and said it's either that or it's me because i'm i started my career later in life and i want to do this and i'm going to commit to making it successful but that was back in 2018.

16:03So believe it or not, eight years. I, when I was researching that recently, I was like, I cannot believe we went digital eight years ago. So we did implement an e-procurement system eight years ago. It has been a fantastic relationship. I feel like we chose an amazing company that we are still with. And, um, they, they have just supported us. Uh, not, I, I am, I am a master at that system. We recently did an ERP upgrade. So we have a few integrations. We also have a payment system. So everything flows through from the front end. We have a three-way match, goes into our ERP and then gets paid. So I am, we are in the process right now, company-wide doing a massive digitization initiative that includes heavy use of AI.

16:59So I'm working on right now one more integration with my system to support that initiative that they're working on. I think that digitization is so important. It is one of the most important things in procurement because if i didn't have digital tools i would not have survived i know i keep bringing up covet but it's so like front for us um i wouldn't have survived because i was the first one to get the po's to the suppliers yeah and um i needed to because i needed the supplies like guarantee the the inventory then yes yes so um yeah i it has been a great it has been a great process and thrilled to have been able to do it and it to be successful in our organization and to be embraced by our leadership and our employees.

18:00So, yeah. I have a question. I'm going to come back to it in a minute because it's actually not related to technology. It's what you said about taking risk. But I do want to just ask, you know, you talked about the fact that you, as an organization, you are going through a program of digitization and embracing AI. I just love your perspective on AI from a procurement leadership perspective? Something to embrace, something to fear, areas where you may be thinking about its best usage. What's your perspective? Because everyone obviously has a different opinion. Yeah, I am an embracer of AI because it is such a it is it is so helpful and such a time saver for us um we we do it right now we're using ai to pull data from our erp to organize and analyze reports to help us research and analyze rfqs um we're creating ai prompts to to help our with our month end tasks it is a time saver um And I am very specific with my team about using AI as a crutch.

19:12Like, don't ask AI to do something that you don't know how to do yourself. Right? So I actually had a specific example where somebody brought me a report that they had done in AI. And I looked at it in two seconds and said, this is wrong. These numbers are wrong. You should have looked at it first before you let it. because AI is not going to be perfect. It's to, it's to help you. It's to save time. And so, so we're really the manager who works for me. She, she's an AI champion. And so I kind of ride on her coattails as far as she, she will bring a lot of things to me. And I'm like, wow, that's great.

19:57But I have, I've embraced it. I mean, you look at it just in a simple, easy example. You take an agreement that you're renegotiating, right? And you have an agreement that you had already done with this player. And there were lots of changes, you know, red lines back and forth from legal. You take the old agreement that had already been redlined, put the new agreement into AI, let them compare and let AI tell you instead of going line by line on the agreement, you're set what we used to do, right? We used to look at each line, it would take hours. Even after only doing this for a year or two, you know, I think back and think, how did we do it the old way?

20:36Like, how did I even have the attention span to do it the old way, frankly? But also, I think contracting is a great use case. You know, it's something that I use all the time. And, you know, what are key risks I need to be aware of? What's going to, what's the biggest vulnerabilities I need to close and things like that? And it doesn't mean that I'm not going to go and you know take a look through the whole contract in case something's been missed but it helps me really quickly go to okay this is where I go and I definitely get what you say about you know there's a way to use it and a way not to use it and the way not to use it is throw a prompt or two you know it spits out pages and pages of words and then present that as your own when you don't really understand it it's one of those things I was on a call actually before we're doing this recording about how how powerful it is in the right hands and how dangerous it is when it's in the wrong hands right what I mean by that is as a procurement leader or a subject matter expert it's extremely powerful because you can use what an LLM has created and poke holes in it and say but those are the three gold nuggets that I can build on and if you don't necessarily know to look for those things you look at it and you pass it off and you know you don't kind of spot the bits that you need the gold bits versus the not so gold bits and you pass them all and then that's when you get in trouble right and and i will say that ai i mean i've talked about this but ai will never be able to have the relationship that you have with the suppliers right and to be able to sit around in a room and look at somebody eye to eye and say do you want to be an extension of who we are at Forest Lawn.

22:15And I will never be able to do that. So yeah, it's great. And it's important to use it the way that it was intended to be used and for good. Yeah. And data is always a common challenge when you're going through digitization. Yeah. How have you looked at just making sure that you have the data kind of structured in a way that, you know, you can obviously trust the outputs, that are depending on the inputs of that data. Yeah, that's very interesting. I think it goes along with the products that you choose. The e-procurement system that I have has great reporting. And I've done this long enough to know what reports that I need.

23:07Um, and so, um, and also you don't, when, when we went into our new ERP, you're not going to put a mess in a clean house, right? So making sure that when you, when you initiate something or you start something or you implement something that you want your house to be clean from the beginning. I would just got off a meeting with one of my teammates and we're categorizing our suppliers. And she's like, it's really important that you choose these categories because you know how you're going to pull the data and you know how you're going to want to see this. And I think for me, it's about being dedicated and to looking at all of that information on the front end so that when it's time to pull that data, because it's not hard to pull the data, especially now with AI.

23:58What do you want to see? How do you want your category management to look like? How do you want to position your people to look at the data? And there are times when the CFO calls and he needs something right away, you've got to pull it out and have it ready. He's not going to wait. You don't get a week to put together a PowerPoint anymore. That's exactly right. I think we know what I hear as well is that be really intentional upfront because I think it's it's it's an easy trap to fall into to get carried away carried away by what you can achieve with AI and the promise of AI and you kind of go straight there rather than making sure your data is in order on the flip side I wouldn't want anybody to over like I hear data as being an objection that's used probably often as a smoke screen for not wanting to drive change.

24:59So I wouldn't let it get in the way of change. We use the intention about making sure you can get it at the beginning of your journey rather than the end of the journey when you realize that what you've bought and implemented isn't giving you the answers that you want because the data wasn't good enough. Right, right. And, you know, change is going to happen, right? I mean, there's nothing you're going to be able to do about it. So embracing it is the best way to move forward, in my opinion. I do. I think we need to be a people of change. That's how we can be better. Yeah. You mentioned earlier about taking on accounts payable as well.

25:37So you've now got the full, you know, kind of procure to pay process. Did that change? How are you? It's kind of a two-parter. First of all, did that change how you approached digitization? And maybe some things that a leader who doesn't have AP could think about that they might not think about because they don't have it, if you know what I mean. Like what to be aware of to make AP's life easier as a procurement leader that you may not see unless you have end-to-end responsibility for the entire cycle. Um, yeah. So, um, the first thing I would say that I learned is I never understood how significant month end is.

26:18Um, it also gives you a different view on making sure everything's coded correctly, because, you know, in procurement, we're coding things, we're making sure the right accounts are on everything. Um, if that doesn't happen, it, it goes all the way down to the PNL. So understanding the importance of that also in the supplier, and I know I keep going back to the supplier relationship, but to be able to have end to end with the supplier from initiating the relationship to paying the bill is very powerful. and understanding that the supplier, I mean, purchasing people know you payment terms is something that you can negotiate, right?

27:06Well, if you're the person who's paying the bill, it's really easy to understand, okay, if you're negotiating for that, you better be bringing your AP people in and making sure that they're on board with that, right? Because now I am the AP people. And so that has really been very eye opening for me. But it didn't really change my approach to digitization. The reason I was given AP or asked to take on AP was it hadn't been digitized. And our company had seen how I was a massive proponent of digitization. So they're like, can you digitize this? For me, it was just a really fun project. It really was.

27:53It was hard because, again, you're back to your numbers and your accounting. You didn't do as much of that. I mean, you do you're pulling reports and you're looking at, you know, P &Ls for your suppliers, but you're not really in the weeds, per se. When you're in AP, you're in the weeds and it's fun. and it did give me a whole nother project, but we were able to digitize it in nine months. And I mean, they had, there were just piles of invoices and that's how they paid them. And I was like, oh my gosh, this is never going to work. And so, and I'm also blessed in that the e-procurement system that I had is a procure to pay system.

28:35So I was able to just convert all just, I literally called them and added the invoicing portion of their system of which I already knew their system i know the back end of their system like nobody's business and um just brought in all the ap functionality and then brought in a team to help um so it really um there were some late nights because we were in the middle at the same time of an erp change so i mean it was it was fire um but it was fun it was fire but it was fun well it's one of those things I think AP is a black box to procurement and we don't try and learn it if we don't have responsibility over it and I think something really powerful you said earlier about supplier relationships was you know the strength of a relationship when you're supplier is did I get paid on time when you as a supplier don't get paid on time and you go to a procurement person to say I didn't get paid on time I'm very guilty of this you know I would try and push that down to AP and I would think oh payments is not really my responsibility I don't really know I'm going to just shout louder at somebody in AP to make sure they got paid and they would still sit there for a month or for however long you know the supplier's getting angrier and angrier so actually join up that process where you actually have the ability to go and act on their behalf as well um on what for whatever else we may see is probably the most important thing for them from a relationship perspective is that i get the money it's a great negotiation tool too because when the supplier comes in i say i'm ap too so i can help you on that side and it's a one point of contact for them it has been powerful yeah um yeah it's been great and seeing my you know my procurement team and my ap team working so close hand in hand it's not like they have to go, oh, well, I got to get the AP team on board where they're in the office next to you.

30:32You know what I mean? So it's really, it's great. And we have the systems, so there's no conflict of interest because the systems are still making sure we have all the approvals. We have all the audit trails that we need. So it works really, it's a beautiful thing. It has worked really well. And we're relatively new, just about two years into it. So. well as we were taking notes i know it's coming up to wrapping up here but i i took a note about risk taking when you were speaking to me about uh you know when you first went on the digitization journey back in 2018 i think you said and it was essentially uh you know i need to do this it's like digitize or it's me kind of ultimatum and it may have been that harsh it may not have been that harsh the reason why i wanted to bring it up is because there's often a lot of fear for pushing for something that we believe very passionately is required and requires investment, but we can be afraid of it from a risk perspective and a career perspective.

31:33And so I just wondered if you could talk a little bit about kind of your perspective as you made that call to be the risk taker, you know, in asking for that investment, which helps you then drive the change that you wanted to see. Yeah, I am a risk taker. I am deeply committed to the success of our organization and so much that I would I literally would risk my job. So the way the story really goes, if you want to know, is I had I had gone out and done an RFQ on my own to find an e-procurement tool. And my bot, the CFO at the time said, yeah, go ahead and look. I kind of knew he wasn't really into it.

32:22But I remember the day that I called him and I said, hey, can I come up and talk to you about this? And he said, yeah. And I came up and I was shaking a little bit because it was a big risk. But I had two pieces of paper and they were turned upside down on his desk. And I and I I said, under this piece of paper is that is the procurement tool and the quote for that and under this is my resignation i'd like you to pick one and he picked the procurement tool so i mean if i if that's not risk i don't know that's like a game of real rights it was it worked out and i did know too that when he picked that one it was gonna have to work yeah because i was laying it all on the line yeah your career was at at stake for my career was at stake, but it was a, it was a risk I was willing to take because I knew it was what our, where our organization needed to go.

33:22Um, if not, then, you know, it, it wasn't the right place for me either. Well, I think it's a great perspective. I'm not sure if many listeners will have the same risk tolerance, but you know, uh, you never know. So if anybody has gone through the same process, let us know, um, but Gretchen, I want to thank Thank you so much for sharing a little bit more about, you know, how you think about digitizing the profession, the successes that you've had, obviously the role that you have within procurement and just supporting the forest lawn organization and the, the such an important role that you have, you know, as forest lawn in the community that you serve.

34:03So it's been a pleasure to speak to you. I will put a link to your LinkedIn profile. If anyone's interested in reaching out, I'll pop that in the show notes for the podcast. So that'll be at artofprocurement.com slash podcast. And one last time, thanks for joining me. Awesome. Thank you for having me.

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35:03That's artofprocurement.com slash subscribe. Thank you for joining us today and I look forward to seeing you again soon.