Podcast: Suuchi Ramesh on Supply Chain Platforms

Highlights from the Conversation

How did you get involved with supply chain?

• Supply chain came up both in work and school. I have an MBA in Software, and I took several classes in supply chain. My first job with Intel was in the supply chain analytics division.
• After graduation I worked in the predictive analytics field and have dealt extensively with both sales and supply chain data.
• I worked for several companies for about ten years before starting Suuchi Inc. I had a front-row seat watching a couple of B2B data and analytics startups enjoy some very fast growth, and this had a big influence on my world view. I’ve always had an itch to do my own thing, so I was very lucky to be able to see the actual processes—not just the ideas—that allow you to scale.
• My view of supply chain has always been through the data lens. When I was starting to think about starting what became Suuchi Inc., my initial thought was that it would have to be a large opportunity with a large market.
• Supply chains are very interesting. It doesn’t matter what the industry is, whether it’s products or services, it needs a supply chain.

What are the challenges that you saw in supply chain that made you want to start your own platform?

• Supply chains are broken in many ways, but the challenges across industries are more similar than dissimilar.
• There are a couple of common themes in the challenges across supply chain:
  • The value of goods and services flowing across supply chains in all the industries is massive. Each supply chain is a multi-trillion-dollar market.
  • The digital landscape is broken. Companies at the smaller end of the continuum were working out of Excel sheets or Google Docs or, at the other end, working with clunky, complex enterprise resource planning (ERP) systems and product lifecycle management (PLM) systems.
  • The disconnected digital landscape was affecting the physical flow of goods. It impacted speed to market, resulted in lower efficiency and higher cost of goods sold.
• Our original goal was to help solve these challenges in a next-gen way, meaning an intuitive front-end interface. I think the B2B systems of the future will all have better user interface (UI) and user experience (UX), following the consumerization trend.
• Our other thought was about democratizing access. In order to solve for the disconnectedness, we had to empower access and democratize participation.
• We wanted to allow easy entry for different supply chain skillsets across the world, including lowering the cost of adoption.
• Right now, supply chains are excruciating in their complexity, and the execution risk of solving for supply chain challenges is massive. But where you have a large execution risk you also have a large opportunity. But that’s also why supply chains have operated the same way for so long, because solving for something that massive and complex isn’t easy. So, it all intuitively adds up. But if you’re able to get past all that with some good guiding principles on pricing, disruption, and design philosophy, you can open yourself up to a very large market.

What were the core problems you saw, and how did they align with the technology you started designing to address those problems?

• A main one was the disconnectedness across the tech stack, or maybe I would say the lack of a platform. If you look at industries outside of supply chain, progress has been more advanced. The single source of truth and the platform play has become almost common in other industries, but not supply chain.
  • There was a real disconnectedness. In some cases you had many different systems, but they weren’t really communicating.
  • And then, of course, some parts of the supply chain were still analog.
• The second one is snooty access. Part of that is lack of empathy in designing the front end for employees like factory workers. The other part of that is purchasing decisions for these systems is still top-down, and usage is top-down as well.
  • There’s a lot of people that interact across a supply chain, and 95% of them are automatically booted out by this.
• The final is ease of access in price point. A lot of the big systems cost in the millions of dollars. There was also opportunity for disruption in terms of price point.

Let’s talk about the Suuchi Inc. Platform, the Suuchi GRID, and how it fits into supply chain.

• While we knew we eventually wanted adoption in many industries, we had to start somewhere so we wouldn’t dilute our focus in terms of building out our product road map.
• We began with our marketplace module for fashion, which is a curated network of factories. Brands and retailers would come to us to connect into that network of factories to create their products.
• In combination with access to this flex capacity, they also have the domino progress tracker for their products, for everything from placing the order to completion. We wanted the user to be able to configure the system for their own workflows, and they can.
• From there we added more modules based on customer feedback, and, as we’d hoped, there were customers who fell in love with the software without necessarily wanting to access the marketplace.
• Now we have seven modules, six of which have nothing to do with the marketplace. The marketplace is still only for fashion and some medical products.
• We want to be very deliberate about how we expand, so we’ve ensured there were commonalities. The next natural step for us was expanding into areas like direct to consumer, but over time we’ve gotten into manufacturing as well.

A lot of companies are stuck on how to start the digital transformation journey. If you were a consultant working at a company like McKinsey, what are the critical things you would recommend to someone in search of a new solution?

• You should be looking at a new provider and optimizing your software suite at the same time.
• I think a lot of companies suffer from software shock. They’ve got a lot of legacy systems and they’ve spent a lot of money managing the beast. The impact from these legacy systems is really low and the cost to manage them is really high. So, the rationalization of these systems should be done in tandem with asking ‘what should I be looking at’ and ‘who should I be looking at’ as a new purchase.
• Objectively, I would recommend that you look at vendors who are building to be platforms and building to be product suites. These are two different things and they’re both important.
• A lot of supply chain systems are built to be products, and they’re fairly siloed in their architecture and their vision of interoperability. They don’t really have software development kits (SDKs) and application programming interfaces (APIs), which really should be table stakes today.
• If you look at the platform as a superset and the products within that, even if you have an API and SDK, and you start off with some set of products like we have, at some point you realize there is some layering and intricacy to answering the different challenges across the different departments of the supply chain. If you also start building a product suite within your vision of a platform, I think you become a lot more valuable to the customer. You can’t execute against these overnight.

Some of the embedded systems like SAP and Oracle ERP are trying to transform into platforms. How do you feel that is going, and how do you see your own inroad with their clients as a platform-centric disruptor?

• The advantage for systems like SAP and Oracle ERP is that they’re already entrenched. We speak with a lot of executives at big companies that use these systems, and even though they have gripes it’s kind of like a marriage (and I say that respectfully) as they have already invested all that money. While I personally don’t agree with the sunk costs argument as a reason for not moving forward, the reality is that a lot of them look at it that way.
• A lot of innovators are realizing that they have a lot of choice in terms of how they build the tech landscape. They probably don’t need something as clunky and complex and expensive as an Oracle or an SAP or Microsoft Dynamics. Those that aren’t already encumbered by existing purchases aren’t making the same choice.
• The systems like SAP really are like a monopoly in many ways, but I really do believe there is a shelf life for that dominance, primarily because they’re not built to be platforms. It’s very difficult to change the internal organ structure when you become such a big company.
• In terms of how upstarts like us should get in there, you have to find the formula for disruption. I don’t think the answer is competing head on with one of those large players. It’s about how you position yourself at that entry point in a way that is complimentary and where you can have a direct conversation with the visionaries and the pioneers at the right side of the chasm (going back to Geoffrey Moore’s concept of the chasm).
  • It’s a combination of making sure the positioning is very well thought through and that you are targeting the right people within those organizations.

I’ve been shocked by how large and how underserved the supply chain space. Have there been any surprises for you on your journey with Suuchi Inc.?

• The hunger and appetite for change is a lot more widespread than I would have anticipated. There’s still a lot of evangelizing that you need to do, but it’s not as much pulling teeth or as tiresome as I would have imagined.
• As a team we anticipated a lot of change management conversations and a lot of convincing and coaxing, but there’s also equal parts internal evolution and the realization that change has to happen inside these organizations.
• One big trend is this flood of fast-growing direct to consumer (DTC) companies that are dominating growth and are bringing in a new way of thinking. So, when you talk about enterprise today, it’s no longer a big, monolithic old-fashioned company that has been around 30 or 40 years. Today “enterprise” also means that eight-year old company that started in a garage and has a supersonic growth rate.
• There’s also a lot fear right now, but fear can sometimes drive positive change.
• And finally, companies are bringing in new leadership, often from tech companies.

What’s the DNA of the new supply chain professional and the new supply chain leader?

• A company that recognizes that supply chain is important will bring in a next gen leader.
• A leader that is going to take their company forward has:
  • A growth mindset.
  • Is empowered to take on risk.
  • Recognizes that data is the new oil.
  • Is interested in changing their organizational culture.
• What is changing is that the CSO is now recognized as an important position, so the calibre of leadership will be higher.

Do you have any advice for other supply chain tech startups?

• It depends on what your priorities are as a founding team. Are you looking to have something be a lifestyle business or are you looking for it to be a home run?
• If it’s the second option, higher ambitions mean higher scale and higher risk. And if you want to look at that, you want to find large markets. Supply chain is massive. It’s also a wide space—there’s not a lot of people in it yet.
• The exception to that last part is downstream, in logistics. There’s a huge sea of startups in logistics. But there are a lot of untouched parts are in upstream—but there’s also more risk.
• I’d say to look at the parts upstream where it’s not as crowded. It’s about finding that one entry point in one industry with one product, and expand from there.

What is the investment crowd seeing in this space, what are they missing, and what is your forecast for supply chain platforms?

• There’s definitely a lot more interest and enthusiasm, based on the inbound inquiries we get. Now I don’t know if that interest is because we’re now in our fifth year or because there’s more interest in supply chain in general. I think it’s a little bit of both.
• I think the onus is on the founding team and the leadership team in terms of educating and evangelizing.
• If you’re an investor it’s all about finding that balance of timing but also investing in those companies that are early but not too early.
  • If you’re first you must bear the burden of the educating and evangelizing, but then you also have those early success stories.
• At the end of the day it’s also about unit economics. You must be able to tell a story buttressed by clear metrics and a sound scalability plan, because there’s always that risk involved.

Do you have any observations about circularity and sustainability, because they’re inevitably tied to supply chains and they’re hot topics for investors right now?

• Those terms get thrown around a lot, so you really have to have something to say.
• We empower brands and retailers to demonstrate their sustainability and prove they’re doing the right thing by connecting all the participants across the supply chain by allowing them to have a digital profile. There’s more transparency about compliance.
  • Some factors about sustainability and compliance are binary: either you are compliant with label laws or you aren’t.
  • There are some variables that aren’t binary, like water usage and carbon footprint, where you can be somewhere on a continuum.
• It’s one of the most expensive exercises to track sustainability when you’re talking about boots on the ground—but by digitally tracking you’re reducing the cost of trust.
• The other way is by just connecting everybody, so you have better speed to market. Speed to market has been shown to be directly proportional to reduced wastage.
• Again, sustainability can mean many things, but once you have that data you can quantify this for the outside world.

What do you see coming in the next three to five years?

• I think there will be a lot more platformization of the supply chain space, and you’ll see a lot of tools and systems coming together with having homogenized access and one version of what’s going on across the supply chain, with complete end-to-end transparency.
• The other revolution will be the consumerization of the front end for B2B software in terms of UI/UX. Supply chain is the worst for interfaces. We expect to have the same beauty and aesthetic fitness in the software we use at work as the apps we use at home.
• Finally, there is the realization that data is the new oil. Data is going to take a front seat, and supply chain jobs will become data jobs. Gartner has a research paper on supply chain analytics players and that’s going to become huge as well.

More about Suuchi Ramesh

A self-described nerd, Suuchi started her career in the US working for Intel in their data and analytics division. After an enjoyable four years, she worked for a couple of VC-backed data and analytics unicorns. Her experience runs the gamut from developing predictive models, managing teams and building sales organizations winning multi-million-dollar contracts. In 2016 she founded a new supply chain platform, Suuchi Inc., with a team of three. Today the company employs over 120 professionals and the Suuchi GRID has become a solution for over 300 customers in over 25 industries.

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