Scott Munker

Scott Munker

SVP Global Supply Chain, J.Crew

October 15, 2020

View Transcript.

Scott Munker, J.Crew - 10/15/2020 C-Suite

Amy - Welcome to the C-Suite commentaries. We’re excited to have you join us today. You are considered a tycoon in retail from an industrial perspective. You’ve been in the C-Suite for a good portion of your career. What do you deem some of your biggest challenges and accomplishments?

Scott - Thank you. I’m appreciative of the SCLA. You’ve done fantastic work. I”m glad to be part of this discussion. As you advance through your career, it’s important to find the right talent - not only new talent but grooming talent and creating the next level of executives in the supply chain. Supply chain has evolved. It’s not the same supply chain when I started in the early 80s. Then it was foundational brick and mortar, transportation over the road, etc. A lot has changed with the flow of information, how we use information, using AI into analytics. There have been significant changes.

Amy - The right people and getting them the right tools have been a secret to success?

Scott - Absolutely.

Amy - With people and the investment of people, that’s always top of mind. You’ve assembled a great team and kept it together, remained innovative and agile. Given some of the challenges of 2020, how do you see the workforce emerging, changing in the future?

Scott - Absolutely changing. Back to the teams. There are three principles in building teams. First is trust (develops empowerment). If you don’t trust the individuals and the work they are doing, not connecting, it’s difficult to have a relationship and relinquish tasks and execution. Second is teamwork. The individuals have to work together in a cohesive team. As we move into the next stage of where we are with COVID and the virtual platforms, that’s difficult. Where’s the balance to continue to have teamwork? Last is effective communication. As a team, we are communicating up to the C-Suite or C-Suite down - a very clear line of sight, the agenda, how we are going to execute. We have multiple meetings per week. We have specific meetings that talk about strategies and plans going forward. I meet with the CEO and COO every week, and there are few things I leave out as I communicate with my org so they understand where leadership is going and where they are taking our business. 2020 has been an interesting hurdle. How do you wrap ourselves around a virtual environment when you run operations? It’s going to continue this way for some time but we are trying to get our teams back into the office. We’re doing it slowly and following CDC guidelines. We’re bringing in 25% per week, one day per week, and putting up plastic barriers throughout the offices so we can get the teams back in. We need the continued team support. There are things we can do virtually but there are things you miss. The ability to understand the individuals you’re working with, how you’re connecting and how you groom/build them. It’s tough to build talent virtually. It’s not impossible. Having the ability to work together and connect personally is really important. Some roles may not be as important in the offices, but logistics, transportation and supply chain, we’ll want staff back in the office.

Amy - You talked about four pillars: trust, enabling team members, connecting and communicating. I love the transparency aspect as well.

Scott - Re: strategy going forward, we posted our sales out of Chapter 11. The runway for us is as long as we want to make it. We have a value creation plan that is quite detailed but relatively simple in terms of what we need to do to execute going forward.

Amy - You’re resilient! You’ve been a member of the SCLA for a while. How have you leveraged the SCLA to help build teams, stay connected? You believe in building and investing in your people, giving them a future? Has SCLA played a role in that?

Scott - Absolutely. When you join SCLA you are able to have a certain number of your team members participate. The most recent virtual conference we had 10-15 members participate. They enjoyed the learning. The speakers did a fantastic job. There was great information to intake. You realize you’re not so far behind. You learn things and where your peers are at. You can bring things to the table when you come back. It’s been a great collaborative organization, a think tank. Throw ideas out to see if they stick, what are the next trends?

Amy - We appreciate your leadership. So many changes are going on in retail. Brick and mortar is changing. In 2019 there was a trend for omni-channel companies that were exclusively selling online to start establishing brick and mortar. You have a combination of both. What do you think the next few years hold for retailers?

Scott - We’ve always had a plan of right sizing our store fleet and a percentage of what we thought was brick and mortar vs. our online penetration. As we expanded our store fleet to add ship from store, pick up from store. COVID accelerated the path for us around the most optimal size of the store fleet, what and how we’ll promote out of the stores vs. the digital growth that was almost 100% (some months). It showed that we could ramp up rapidly to deal with a huge online penetration, servicing our customers appropriately in a very fast environment. Changes were happening so rapidly. In terms of the future, we love our stores. The way we use the stores in the future will change. We could use the stores to be more prescriptive to certain customers. Customers can set an appointment, get one on one treatment with a stylist when they come into the stores. Your footprint in your ecomm business has to keep up. Our penetration was heavy on the ecomm side. Going forward we’ll see much more work on our digital platforms and tools that allow our customers to have a simple, seamless way of going online, ordering what they want, having the ability to adjust something on their order, updating where they want the delivery to take place. It’ll be faster and more seamless for the customer. We’ve been on the loyalty side for many years and will continue to advance and work on our loyal customers and adding more incentives in terms of loyalty penetration.

Amy - Do you think the order online pick up in store will have a resurgence? Do you see that as a future trend?

Scott - Absolutely. You’ve got to be able to use NYC, for example, for those who want to get out of their homes. It gives folks an opportunity to get out, go someplace and shop. It’s a great tool and a utility tool that allows for your customers to execute against. We’ll continue to find other ways as well.

Amy - You mentioned information - access to information, having the right tools and data. Looking into the future, what do you think might be a large breakthrough that’s just emerging and could be helpful?

Scott - As you look at the customer base, we have the ability to really stratify our customers. Not all customers are created equal. You have a plethora of customers, all scales - age, gender, ethnicity, etc. That information is really important in how and where we promote, particularly when we get into the geo stuff and demographics relative to our customer base. That we’re aligning our stores to the regions (zip codes) they’re operating in. That data is there, and we’re working hard to start aggregating and using that information to better service our customers.

Amy - I love that. Being in tune, knowing who your customers are and responding to them - giving them the product mix they are looking for. That’s exciting. It’s an exciting future. Thank you. Anything you’d like to end with or pearls of wisdom to share with our viewers?

Scott - I always use this statement. It’s not mine. It’s from an old sea captain, Captain Riesenberg. I’m an ex-merchant mariner and went to a merchant marine academy. It’s stuck with me, “The sea is selective, slow in recognition of effort and aptitude but fast in sinking of the unfit.” You have to always prepare. You’re never going to be able to prepare for everything, but the point of planning and execution against those plans continuously will make sure that if and when things happen (like COVID), that you are in a position to act rapidly. I use that with my teams. Planning and preparing are paramount - and communication. You need to communicate to the teams and orientate them in terms of the ship and where that ship is going.

Amy - You’re a good captain of the ship, and I wish you smoother sailing.

Scott - Thank you very much.

Amy - Thank you.

 

About DBM

The Distribution Business Management Association (DBMA) provides think tank forums between business and academia that seek solutions to the pressing issues facing today’s and tomorrow’s supply chain and logistics executives.

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