George W. Clopton has spent nearly 30 years in industry leveraging his leadership and interpersonal skills to blend competing interests and gain the support of diverse groups, currently as vice president of distribution for Gap Inc. in San Francisco. Clopton's versatility and wealth of knowledge in supply chain design and process measurement have been amassed through a lifetime of experience and training he received at companies such as Nike Inc., Georgia Pacific, USCO Distribution, Johnson & Johnson, Heublein and Frito Lay.He continues to learn and share his knowledge through active participation in professional organizations such as the Council of Logistics Management, the Warehousing Education and Research Council, the Richmond Events Logistics Forum and the Institute of Industrial Engineers.
Clopton has received industry recognition for his design and implementation of profit and productivity improvement programs as well as for people development and employee participation in large capital projects. He is noted for his hands-on experience in the design and start-up of distribution centers while implementing process improvements; for proven project management skills demonstrated through numerous start-ups, re-engineerings and process redesigns; and for achieving results.
He spoke recently with DC VELOCITY Editorial Director Mitch Mac Donald about his accomplishments and the things he believes make this an exciting time to be a logistics professional.
Q: You have a very influential role at a very well known company. How did you end up in this profession?
A: I received an industrial engineering degree from Northeastern University. That gave me a start in manufacturing. Somewhere along the line I realized that logistics and distribution is a common element for most manufacturing. In trying to find more opportunities I've always felt it important to broaden my scope. Logistics seemed like a natural place to do that. For instance, companies like Johnson & Johnson and IBM make very different things, but they're similar in their logistics disciplines. I wanted to be in a field where a common set of skills would allow you to move easily across the various industries. I realized that if I worked in the logistics sphere, it would be easier to be accepted into new companies as my career advanced. So I transferred. I actually worked about 15 years in manufacturing, but I had a lot of distribution projects. Then as I converted over, I found an opportunity with Uniroyal that had a division called USCO (now Kuehne + Nagel) Distribution, where I actually had an opportunity to hone my skills in logistics and distribution.
Q: So this interest in logistics was really born out of work experience in other sectors within manufacturing?
Q: Tell us a little bit about that. You came into Uniroyal in a logistics position. Did USCO Distribution exist then as a subsidiary?
A: USCO was created in 1967. It was actually one of the early public warehousing companies. It was an outgrowth of Uniroyal's in-house logistics operation. Uniroyal realized it had extra space and decided to go out and lease that space—and later, the services of its human and other resources—to turn it into a business.
Q: You have to give them credit for being so far ahead of the curve that they could look at something like excess warehouse space and turn it into a profit center.
A: Absolutely.No question about it. It wasn't all that common back then. There have, of course, been several companies that have done that in the past 20 to 25 years.
Q: What was your first position there?
A: Manager of industrial engineering. I actually ended up as regional operations manager.
Q: Was there a specific logistics role you had there or were you still on the industrial engineering side?
A: Actually it was operations. I was promoted to regional operations manager and at the same time started up a lot of operations for USCO clients. I set up IBM operations, General Electric operations, Glaxo Pharmaceuticals contract operations and so forth.
Q: Setting up their distribution network and operation for them?
A: Absolutely. Another great experience was setting up USCO's distribution network in Mexico. It was a lot of fun and a tremendous learning experience. I was able to utilize my engineering background as well as my logistics background.
Q: It sounds like you were a 3PL executive before we knew what third-party logistics was.
A: It became that. We started out as public warehousing, and we evolved into contract services. Then all of a sudden this term "3PL" became very popular.
Q: Where did you go from USCO?
A: Georgia Pacific, where I designed and constructed distribution centers throughout the country. It was a reengineering project to set up operations in roughly a dozen cities.
Q: How long were you there?
A: A I stayed with GP for a short while.We wound down on that project, and the re-engineering project didn't go exactly where they wanted it to go. Coming out of that opportunity, I was very fortunate to end up with Nike Inc.
I went to work at Nike's corporate headquarters in Portland, Ore., as a general manager and was responsible for the company's Wilsonville (Ore.) Distribution Center handling West Coast distribution. Wilsonville was one of the company's three major distribution centers. It had about 800,000 square feet of space under one roof and a team of about 800 employees.
Q: Was this the first job in which you had to deal with both "on the ground" logistics issues and with all those other administrative issues that come with being a manager?
A: Oh yes, that certainly was part of it. The key driver with the Nike business, though, was really learning to deal with brands, the awareness that brand management was extremely important. You had footwear, apparel and equipment. Within Nike, each of those divisions had very specific and distinct expectations for logistics services.
Q: It sounds like Nike had its logistics operation integrated into the larger strategy. You folks were aware of what the company was trying to achieve overall?
A: We had to be. It was a very effective approach to logistics. What was also particularly exciting at Nike at the time was they were just embarking on two initiatives. One was establishing a broader supply chain strategy, including implementation of a sophisticated ERP [enterprise resource planning] platform. The second was implementing a shared-service model, where they were trying to integrate and get better asset utilization with all of the brands. For instance, previously we had an equipment facility, an apparel facility and a footwear facility. Then we decided that it might make sense to integrate these into several different facilities that were multi-purpose, multifunctional.
Q: Sounds like you built in flexibility to allow you to shift resources from one operation or brand to another to accommodate the peaks and valleys of business cycles?
A: Exactly. It was a challenge at times.Nike, of course, sells to retailers, but within the corporation,we had product owners in each brand. So each brand had its ownership and then its relationship with the retailer that we were selling to. Our responsibility was to interact with that brand and then provide the services to his retailer.
Q: How long were you with Nike?
A: I was with Nike for six years.
Q: Next came your current position with Gap Inc. Tell us a little bit about what you do when you come to work every day.
A: Here, I have responsibility for several facilities, but I'm also part of the global logistics supply chain leadership team. At Nike, my role was a little more specific. Here, we're not just a part of the supply chain—our involvement actually extends to a true integrated supply chain approach, from the procurement of raw materials all the way through to the store itself.
Q: I've always pointed to the retail sector as a hotbed of innovation in the logistics field. There have been so many instances over the past 30 years or so where retailers have been at the cutting edge both in terms of operations and the use of enabling technologies.
A: I would agree, and I think the Gap has been very much a part of that trend. We spend a lot of time gathering information, educating the members of our team, myself included, and looking for ways to extend our efficiencies. Right now, we're doing a lot with the concept of collaboration. We're looking at our supply chain from end to end. We're steadily integrating new metrics and new processes into our operations.
Q: As you come to work each day, what personal skill, or set of skills, is most important to you in your job?
A: I'd say it's the benefit of having been an engineer because it requires a logical thought process. Many people think engineers are basically boring, but we do, at least, try to put things into perspective. My personal skill is my ability to relate to people plus my passion to engage our people into our processes.
Q: What's the biggest challenge you face right now?
A: I'm working hard with my team to figure out how we can all work together most effectively and establish systems and processes to help us do that.We're focused on getting the most out of our people.
Q: In the past several years, we've seen a transformation of the traditional warehouse from a sort of storage bunker to a distribution center where inventory is never idle. Do you think distribution centers have taken on an enhanced role within the supply chain?
A: We have always felt that was the case. We look upon ourselves here as the people responsible for maintaining the flow through a pipeline. If there's no flow—that is, if things stop moving—we're not necessarily doing our job.
There's a genuine competitive advantage to be had if you can remain focused on the fact that your supply chain is important to your overall profitability and shareholder value. Logistics, properly executed, can be a key driver in a company's success.
Q: What are the biggest changes you've seen in logistics in the past 15 or 20 years?
A: The biggest changes are linked to the amount of technology that's being developed and made available in logistics and distribution. Then there's the awareness that we are part of a supply chain … that is equally huge in terms of driving change. Probably as an outgrowth of those two points, we are starting to see a much more critical need to train our people around the technologies and processes that are being implemented.
But there's another piece that's particularly important in terms of where we are in the evolution of the logistics profession. We are finally starting to understand board talk, meaning the boardroom expectations and communication—the whole concept of shareholder value and free cash flow and how the activities of logistics, like managing inventory and utilizing assets efficiently, relate to the boardroom goals. I think that's particularly important because although we've had the [boardroom] audience for several years now, they kept checking out on us. I think we're learning that we can't just go in there and talk about inventory turns. Instead, we need to go in there and connect the dots between inventory turns and shareholder value.Without that connection, they didn't quite understand where we were coming from and how we could provide a competitive advantage.
Q: Do you think the next big thing coming in logistics will be technology-related or is there something else out there on the horizon?
A: Technology, such as advancements in areas like RFID, will always be important, but opportunities through technology will be coupled with increased attention from CEOs and senior executives as they come to recognize the importance of the supply chain to the company's overall success.
Q: What do you consider to be your biggest accomplishment in your logistics career?
A: I think my biggest accomplishment has been working with a number of different teams and learning from all the people I've worked with throughout my career. It has been huge. I have worked with some of the best people in every category of logistics and distribution and supply chain. My success has been being able to assimilate a lot of that knowledge and information and apply that to whatever new challenge I am facing.