As I mentioned last week, I had too many notes from the ISM Twin Cities conference for one post. Today let’s continue the takeaways with more on AI (because of course), risk management, and making yourself more visible/valuable to the C-suite. I read a post this week from Blair Enns saying he writes his blog posts as a way of processing his own learning, examining it, and getting a little bit smarter all the time. I love that framing. Especially with conference notes, I definitely write them as a way to clean up my notes so Future Janice can refer to them, and getting to share them with you is a bonus. If you missed last week, my notes included building flywheels, implementing AI for supplier management and the current state of the commodity market. This week let’s cover another view on AI in procurement with Simfoni, a deep dive into risk management with Moody’s, and some clear pro tips on making yourself more visible to your company’s C-suite team from Jill Johnson. Like last week, I’ll share my notes, share what these notes mean for procurement practitioners, and then share my more general thoughts on the topic and how it was presented. It’s all about connecting info!
Extracting Value from AI in Procurement with Makenzie Gallagher and Paul Cook from Simfoni
This presentation from Simfoni included a bit of a discussion about make vs. buy for AI tools. Makenzie Gallagher and Paul Cook really knew their stuff and did a nice job with both the conversation and demo. Similar to the 3M presentation, their point with AI use was that AI should do the groundwork while people make the call. The old question was: Are we using AI? The new question is: Do we know where AI belongs in our organization? Humans should continue to manage negotiation, trust, and long-term partnerships. AI can be used to prepare for decisions, but shouldn’t make the decisions.
If you are being asked to build your own tools using AI, instead ask for the token budget and weigh the token budget against the cost of simply purchasing software to do what is needed. Building in house also means maintaining in house, even when tokens get more expensive. The presenters observed that DIY AI stalls because of missed savings (usually 1%), eating up the team’s time, the system breaking down with poor or manual data input, and not having guardrails in place or knowing what guardrails to put in place.
What this means for practitioners: Right now AI token budgets are being thought of completely separate from other budgets. Many companies are still trying to use AI everywhere and everything, instead of thoughtfully using AI to do grunt work while using humans for strategic work. We have to start thinking about token budgets and operations budgets more holistically and that they truly do affect one another.
My thoughts: this conversation made me think of the statement that AI can draft or edit, but it can’t do both. There may come a day we can hand decisions to AI (although do we want to?). That day is not yet, and yet I still see clients trying to do it. AI seems to be especially toxic whenever we have AI talking to AI without a human involved, and we have to keep an eye out for those situations. We are still accountable for what AI does and cannot absolve that responsibility.
How the Most Resilient Supply Chains Approach Risk Management with David Weeks from Moody’s
David Weeks framed his presentation about different types of risks, their connections, and a practical approach on how to reduce risk in supply chains the way Moody’s commonly sees risk. He framed up eight major risk categories:
- Money & Supplies
- Geopolitics
- Cyber
- Regulatory & Compliance
- People & Planet
- Operations
- Reputation
- Weather & Disasters
A common theme was how much risks don’t show up alone, they come in groups of 2-4 at a time. For example, the current issues with shipping in the Red Sea were started by geopolitics, but also impacted operational, money, and regulatory risks. Everything is connected, and as we learned during COVID a backup isn’t a backup if it has a common failure point. You might have two suppliers for a given category, but if both of those suppliers use the same supplier for a critical component, you don’t actually have redundancy (or resiliency). By the time you realize everyone’s backup is a common source, the resources are already gone.
What caused our current situation? A few things:
- We optimized for cost, not a crisis. We definitely all learned this in 2021 and it still echoes
- Team’s don’t talk to one another and we don’t ask, “Who’s not in the meeting?” often enough
- We ignore the warning signs or just don’t know what to do about them. Many of our metrics are lagging instead of leading indicators
- We don’t invest in supplier relationships enough
He also shared a fascinating statistic: supplier bankruptcies are increasing. There were 3,016 supplier bankruptcies in the first half of 2024, 3,595 in the first half of 2025, and 4,589 in the first half of 2026. When looking at the warning signs, performance reports/supplier scorecards only show you the past. David shared a fascinating progression of a typical supplier spiral, from leading to lagging indicators:
- Ownership or control change in the supplier – i.e. sold to private equity
- Financial trajectory drift – earnings reports, etc.
- Quote and acknowledgement delay – taking longer to return quote requests and PO acknowledgements
- Rising expedite requests – shipments are coming late or you’re increasingly having to expedite to meet deadlines
- On-time delivery rate drops – at this point the disruption has already happened and it’s too late
- Defect and return rate goes up
David also cited some key leading/current/lagging indicators, I’ll list the leading indicators here because they’re the most useful:
- Probability of financial default
- Regulatory and compliance risk (sanctions, trade controls, violations)
- Cybersecurity threat (breaches and vulnerabilities)
- Extreme weather exposure (geography, lack of planning for key events)
- Geopolitical (geography for tariffs and regional instability)
- Operational resilience risk (capacity, labor pool, leadership continuity)
- Concentration risk (single supplier, site- or region-dependency)
- Reputational risk (adverse media reports, ethics issues)
How do we start to mitigate these risks? First, put a few things in place now:
- Know who your suppliers really are – where do they fall on the previous risks? Connect your supplier records to the real companies, owners and sites.
- Sort suppliers by what’s at stake – how many risks they’re carrying, whether they have measures to recover or prevent, and how redundant they are to you.
- Map where you’re overexposed – which plants, locations, regions, materials, etc. are most vulnerable? Which suppliers are most critical to your business’ revenue?
- Pre-approve the playbook – decide ahead of time who can pause, rush, move, or escalate an order.
- Measure how fast you react – note how fast a warning sign becomes a fix. Or run tabletop exercises that simulate big issues and push all the way to the breaking point.
What this means for practitioners: Increasing supplier bankruptcies indicates a higher supplier financial risk, so practitioners have to make sure a financial review is part of onboarding any new suppliers. When trying to find the leading indicators for a supplier in trouble, ask the AI tied to your inbox which suppliers (using an @domain.com search to catch everything) have been pushing out their deliveries, taking longer than they did a year ago to quote/acknowledge their POs, etc. We all know as part of procurement our job is to mitigate risk, but consider actually writing down the risk categories for your key suppliers or typing them up somewhere. Maybe it’s even a mapping exercise with a team complete with post-its on a wall!
My thoughts: The 2021 supply chain crisis still looms so large in many companies’ memories (after all, it’s only been five years!) that many companies and industries are still overstocking for the next crisis. This is all well and good… until they’ve run out of cash flow and still have the wrong items on the shelves. I know our job is to be risk-averse and constantly thread the needle between risk vs. cost, but many procurement teams are still a little too far on the risk-avoidance side. I will also note that CIRAS at Iowa State has an excellent supplier mapping program/process if you’re in Iowa. If not, your local university might also have something. I believe CIRAS will do mapping for other midwest states, but their focus is Iowa because they are tied to the public university.
Making Yourself More Valuable to the C-Suite with Jill Johnson from Johnson Consulting Services
Jill Johnson brought a wealth of experience and knowledge working with C-suite clients, and her talk was very applicable beyond supply chain/procurement. She emphasized simple and clear presentations with very few words and grounded her talk in psychographics (framing your communications based on someone else’s why instead of their attributes). I hadn’t heard this word before, but I completely agree that communication goes better the more we can speak to someone else’s “why.”
What is the “why” for many C-suite executives? Mostly they’re worried about the big disruptors to business: technology, government, competition, industry changes, and black swan events (i.e. COVID). When we realize those are the things they worry and think about, we can change how we talk about our value to directly address those disruptors.
Speaking of value, what does value even mean to a C-suite executive?
First, provide insight, not just data. An inventory number is great, but why do they care? Is it high or low? What should they be doing about it that addresses the disruptors they care about?
Second, understand the wider key metrics. That means not just knowing the company values, but understanding the profit and loss statements and balance sheets (at least generally).
Third, tie your priorities to company priorities. If you read and look at the company communications or listen to what your CEO is saying, you can hear what they are thinking about and worried about. If they are constantly talking about quality and delivering the best possible quality to customers, tie your goals to supplier defects. In other words, know your priorities on the iron triangle.
Lastly, Ms. Johnson emphasizes some points on communication. Her advice was:
- Speak their language – use your company lingo, and don’t use procurement-specific acronyms
- Be concise – executives don’t have time to listen to a long presentation or explanation
- Be confident – coming across as confident is compelling to a listener, executives are people just like you
- Be big & clear – don’t use too many words on your PowerPoints, emphasize minimal words and large graphics
- Have an elevator pitch for talking to C-suite: “I’ve been thinking about XYZ, I think we can implement ABC if we MNO”
What this means for practitioners: You don’t have to want to join the C-suite someday to benefit from being more valuable and visible to that leadership team. Simply elevating procurement’s stature in a company means you will be engaged sooner, appreciated for your value more, and able to meet your goals and deadlines better. As always with conferences, the iron triangle showed up in this talk. Know and align with where your company is on the triad of cost, quality, and delivery/lead time. When you get a goal that seems counter to that priority, figure out why and consider pushing back to better align procurement with your C-suite.
My thoughts: While I hear Ms. Johnson’s note about communicating in someone else’s language, I think this is a piece of why women have a hard time communicating in “C-suite language” because that language is predominantly male in Western cultures. I asked a question about this and Ms. Johnson countered that it isn’t male language, it’s the language of business. She and I will have to agree to disagree on this one as I still consistently see the inability to speak in a masculine way as a major barrier to women landing executive roles. Like it or not, the “language of business” was built over decades by male executives. I completely agree with her assessment about understanding a profit & loss statement and balance sheet, and the wider key metrics. Procurement tends to live in a bubble and speak our own language and we have to poke our heads out more often to understand our businesses.
I don’t like her format for the C-suite elevator pitch. I think it’s good to have an answer to “what do you do?” that’s more than your title (such as “I reduce supplier costs so we can increase net revenue as part of the procurement team”), but if I’m in an elevator with a C-suite exec, I’m asking them what keeps them up at night. I want to know their perspective on my company’s biggest risks and then I can take that back to my desk and do something about it. Ultimately that’s the way to bring a company value.
If you’d like to talk about the value of AI in procurement, risk management, or making yourself more valuable to the C-suite, let’s chat. If you’d like to get these articles weekly straight to your inbox and never miss one, sign up for my newsletter.
My book, Transform Procurement: The Value of E-auctions is available in ebook, paperback and even hardcover format: https://www.amazon.com/dp/B0F79T6F25
My chapter in the powerful anthology Femme Led: Hard-Learned Lessons from Women in Leadership is now available in ebook and paperback format: https://a.co/d/0bOzma8F
