Agustin Lopez-Diaz [00:00:00]:

I have the privilege in my job to use our products to drive higher efficiency and automation of what we do. And just to give you some examples and probably build a little bit on that story, we center our transformation into key vectors. Trust, sustainability and efficiency. That's who we are. That's our mission.

Narrator [00:00:24]:

Welcome to Supply Chain Now the number one voice of supply chain. Join us as we share critical news, key insights and real supply chain leadership from across the globe, one conversation at a time.

Scott W. Luton [00:00:28]:

Hey everybody, Good morning, good afternoon, good evening wherever you may be. Scott Luton and your good buddy Tevon Taylor with you here on Supply Chain Now. Welcome to today's show. Hey Tevon, how you doing today?

Tevon Taylor [00:00:48]:

I'm doing great. Just hanging out in Washington D.C. getting ready to go home.

Scott W. Luton [00:00:52]:

Okay, wonderful. Do you solve, solve everything up there.

Tevon Taylor [00:00:55]:

In D.C. the guys at Data Center World are way smarter than me, so I didn't solve anything, but I saw a lot of cool stuff.

Scott W. Luton [00:01:03]:

Outstanding. I can't wait to get it downloaded. Well, speaking of cool stuff, we've got an outstanding show here today. We're going to be talking with a brilliant supply chain leader that's doing big things in industry. In particular, we're going to be diving into how a really successful company is fueling supply chain transformation on a grand scale, especially across North America. And not only will we find out some of the critical imperatives related to that transformation, but we'll discuss what's fueling it all. Plus we'll touch on modernizing the manufacturing industry, delivering on the sustainability imperative and a whole bunch more. Tevon, it should be one heck of a show, huh?

Tevon Taylor [00:01:40]:

I think so. Let's do it.

Scott W. Luton [00:01:42]:

Let's get into it. So folks, stick around for a great conversation. Is going to offer up tons of actionable insights by the truckload. So I want to welcome in a terrific guest here today. Agustin Lopez-Diaz is a multi multicultural leader who was raised in Mexico, but he's since worked and lived in six countries while leading teams across several continents. Get this. Representing over 100 nationalities, Agustin brings more than 20 years of progressive experience in P and L and functional management in C level positions to the table. And he's passionate about creating value for customers, teams and our planet.

Scott W. Luton [00:02:19]:

In his current role, Agustin is spearheading the end to end transformation and creating an impact supply chain for both our planet and customers out there. Especially through people and performance. Please join me in welcoming Agustin Lopez-Diaz, Senior Vice President of Global Supply chain in North America for Schneider Electric. Agustin, how you doing?

Agustin Lopez-Diaz [00:02:41]:

I'm doing excellent, thank you so much, Scott and Tevon, for having me here. I'm really looking forward to our very, very fun discussion today.

Scott W. Luton [00:02:50]:

Oh, we got a lot to get into and I'm glad you could carve out some time. Tevon and I, Tev, we've been looking forward to this one, huh?

Tevon Taylor [00:02:56]:

I've been very excited. Yeah.

Scott W. Luton [00:02:59]:

Well, let's do this. Folks out there that are watching or listening to us know I like starting with a little fun warm up question to gain some insights on the personality and the passions of our guests. And what we've learned, Agustin, is you've got some serious musical talent. And when you're not moving mountains in global supply chain, you can be found singing and playing your guitar. Tell us more about that.

Agustin Lopez-Diaz [00:03:24]:

Well, yeah, I mean, it's, it's a passion of mine and since I was a little kid being raised in Mexico. So I, I love, you know, Mexican culture and Mexican music, so. So I still do a little bit of singing on the side. I don't have a lot of time these days, but whenever I manage to carve out a little bit of time, I do that in my time.

Scott W. Luton [00:03:46]:

And you shared with us a particular artist in the pre show that you're a big fan of and, and it's impacted, say, your. Your musical journey. Who is that?

Agustin Lopez-Diaz [00:03:55]:

Yeah, his name is Alejandro Fernandez. I'm sure everybody that is hearing from Mexico will relate very well with it.

Scott W. Luton [00:04:02]:

Well, I'm gonna add Alejandro to my playlist and I'm gonna learn more. I'm gonna leave the singing and music to the experts. But Tevon, you know, we should, we should talk about your musical career too, right?

Tevon Taylor [00:04:17]:

I don't have one. I'm telling you right now, if you heard me sing, this would be the last time you'd invite me to the show. And I, I think, I think Agustin would probably want to disconnect as well.

Scott W. Luton [00:04:29]:

But Breakdance and Tevon is your guy. What more on that later episode. All right, we got a great show to up here today. And again, Tevon and Agustin, great to have y'all. Let's do this, Agustin. Let's, let's. Let's bring in some context a bit and learn more about your professional journey. And where I want to start there is.

Scott W. Luton [00:04:50]:

Prior to your current role, which we're going to touch on in a second, what was a leadership position that you held that really shaped your worldview?

Agustin Lopez-Diaz [00:04:58]:

Yeah, that's always a very difficult question. Right. So there's many. But I will say before coming to this job, I was the chief sustainability Officer of Schneider Electric, actually. So I came from the sustainability world and as we will discuss during the show, to us and to me personally, sustainability goes beyond carbon footprint. It really is our legacy to newer generations, our impact to the communities and you know, how do we really touch the people that are working with us. So we'll have opportunity to, to share with you some insights on how we do it as a company. But out of all my professional career, that is the role that, that Stuart has impact me professionally more than anything.

Scott W. Luton [00:05:51]:

Yep. Let me, let me quick follow up to that before I get Tevon's comments. Do you share? I love the rise of a variety of new sea level roles that brings extra focus and dedicated leadership. But my hunch is that you, you believe that it's everyone's responsibility within an organization to make those sustainability gains. Would you, would you agree with that?

Agustin Lopez-Diaz [00:06:14]:

Absolutely. Right. So everybody plays a role no matter where you are. We have a volunteer program in Schneider where we really reach out to every individual, especially in the region. And you know, we collaborate with unions, with employees at all levels of the organization to really share that bit. But I'll give more insights as we go in the conversation.

Scott W. Luton [00:06:39]:

Love that. And Tevon, it really is, whether it's sustainability or cybersecurity or so many other issues of our time, it's a team sport, huh?

Tevon Taylor [00:06:49]:

It is. I mean the boardroom's important. But to be clear, those decisions and those fact finding missions, that's the frontline. Employees know best because they're the ones interacting and touching the product. So a lot of the inputs and a lot of the insights that get to the boardroom, they come from the people. So if you, if you engage your people and empower them, they'll, they'll bring it to the team. Right?

Scott W. Luton [00:07:11]:

That is music to my ears. No pun intended. Good stuff there, Tevon. All right, so I'm sure, Agustin, that lots of our audience out there, because we got the smartest audience in all of global supply chain, know a good bit about Schneider Electric. We also, as I was sharing pre show on our monthly show that I do with Mike Griswold, we talk a lot about what the Gartner top 25 organizations are doing. And of course you'll find Schneider Electric atop that list at least for 2024. We'll see the new one soon. But if you, for the three people out there that may be new to Schneider Electric, would you share a little bit of information about the company and what you do as SVP of global supply chain for North America Yeah, absolutely, Scott.

Agustin Lopez-Diaz [00:07:53]:

So, I mean, we are a relatively large organization, right. So last year we reported a global revenue of about $40 billion. We really segment in two key pillars. Industrial automation, where our main focus is really driving, you know, manufacturing agility, automation and efficiency. And then we really centered quite a lot of our portfolio, especially on what we call energy management, which is all the infrastructure, residential distribution centers, data centers, and so on and so forth. So everything that's energy management and infrastructure is really our core focus. And our mission is very simple. We aspire to be a trusted partner to our customers, especially in two domains.

Agustin Lopez-Diaz [00:08:47]:

Driving sustainability, which is the core of our mission and of course, efficiency that comes and its addition to that.

Scott W. Luton [00:08:56]:

And in your role, Agustin, I love the level setting on what Schneider Electric does, especially its mission. Cause trust, that's how we move mountains in the industry. Right. So tell us more about what you do in your role.

Agustin Lopez-Diaz [00:09:10]:

Yeah, so I'm in charge of the supply chain end to end in, in North America, which represents close to 40% of the footprint of the, of the organization roughly today.

Scott W. Luton [00:09:24]:

Okay, that's a big plate. I bet it's full. Agustin. Tevon, what'd you hear there? Whether it's about, you know, kind of a summary of Schneider Electric's business model and its mission or what Agustin does in his role.

Tevon Taylor [00:09:41]:

Well, his role is vast. When you think about what he's doing, you have manufacturing, energy management and sustainability all wrapped together. To me, it's one of the most exciting companies out there just for the fact of what you're doing. You know, again, I'm in Washington D.C. i saw a lot of the cool things that the data center world show that Schneider's got on their plate and quite frankly, energy management, I mean, when it comes to energy, people, you know, in the old days you thought about the lights and the AC and things like that, but AI and data centers are consuming a great amount of energy. So we have to make that sustainable and we have to make sense of it. So I'm excited to hear more about what he's doing and you know, where we're going in the AI and data.

Scott W. Luton [00:10:24]:

Center world, me and you both, and, and we can't approach the energy infrastructure like it's 1987. Right. Especially to some of the your observations there. Tevon and I look forward to diving in more with Agustin here. So let's do this. Let's talk about the big pushes out there towards growing the manufacturing sector here, not just in the U.S. but really across North America, but certainly in the U.S. a lot of companies are also at the same time looking how they can modernize their operations.

Scott W. Luton [00:10:56]:

Kind of what I was just saying, not doing business like it's 1987, but like it's really 2030 we'll call it. So to that end, Agustin, with the transformation that you're leading, tell us more about the technology solutions that Schneider has implemented or is implementing, especially across your factories and some of those benefits you're getting.

Agustin Lopez-Diaz [00:11:16]:

Yeah, well, look, I mean this is a supply chain audience, right? So I'm really excited about this question, right, because that's really what drives all of us day in and day out. So I'll try to give you as much color as I can possibly give and you know, we can just build from that. But you know, we're incredibly lucky in, in, in Schneider because a lot of our portfolio is self consumed. So you know, we, we center in industrial automation, we center on efficiency, we center on sustainability. So that's really what we do. So I have the privilege in my job to use our products to drive higher efficiency and automation of what we do. And just to give you some examples and probably build a little bit on that story, we center our transformation into key vectors and kind of following the same concept, right? So trust sustainability and efficiency. That's who we are, that's our mission.

Agustin Lopez-Diaz [00:12:23]:

And then we build, we try to do our best to build a holistic approach to this. And we have two enablers to that. The first one is automation, automation and control. And we have, again, lucky enough, we have a great portfolio of different type of automation from PLCs to motors, sensors, what we call Lexium, which is one offer that uses blocking automation, motors and arms. So we have robot arms that are really helping us with the automation of the lines. So we really look at how we can automate as much as we can possibly do our facilities. And we love the technologies that are simple and scalable. So that's really what we do.

Agustin Lopez-Diaz [00:13:15]:

So that's one perimeter of what we do. We invest, you know, a very significant amount of effort in really looking at all our processes and how can we make them more automated, more efficient through automation and control. Then the second aspect to add, which is also very unique to Schneider as a company, is we not only have the hardware, but we also have, you know, a very large software suite that we use for IoT edge control and efficiency. We have platforms like Aviva that really looks at the entire analytics and advanced intelligence. We have lds, which is a self made software where we control production on an hourly basis. It drives that to a control tower where we look at production levels, production plan, order intakes and things like that, which are really core for our operation. And last, but very, very importantly, and again, you know, this is the privilege to be in supply chain in Schneider Electric is we have a sustainability consulting group that goes to my facilities, analyzes the facility and gives us information on how do we optimize our carbon footprint in our overall waste management. And we have one software that we call a Resource Advisor and it gives us real time information about energy efficiency and control.

Agustin Lopez-Diaz [00:14:56]:

So you know, Aviva EcoStruxure and resource advisor back connected to the automation is really giving us, I think, a great edge on what we execute. But of course we also partner with some external companies that gives us this holistic view of the supply chain as we go outside. One of the big lessons learned, Scott, in the past years, especially after Covid, is really the engaging of all the echelons of the supply upstream and downstream is absolutely critical. So what we do is we really partner with an external company that helps us make that connection all the way back to our suppliers. So we want to be really a partner of trust, of course for our customers, but not only for our customers. We see this partnership and trust to be built up with our supply chain and suppliers, which we see as our critical partners. So that's a little bit of how we do it.

Scott W. Luton [00:15:58]:

Agustin, Fascinating. I wish we had about three hours just to dive into that response. But Tevon, a couple things. First off, I wonder if those robot arms Agustin was talking about would improve my golf game. I would look into that. But getting inside me too. Automation software, especially on the software side IoT you heard a lot about analytics, the control towers. And then thirdly, at a very high level of what he was talking about is I love how they're constantly looking at and analyzing their sustainability footprint to find ways they can optimize and, and garner more gains in, in real time.

Scott W. Luton [00:16:44]:

It almost seems like. Tevon, what'd you hear there though, in terms of this technology solutions that they're deploying now and ongoing?

Tevon Taylor [00:16:53]:

Well, what I'm hearing is the foundation of all of it is trust, sustainability and efficiency. And once you define that base, then you build from it. And all those things, you know, controls, automation software, driving efficiencies. It's smart manufacturing, right? It's not static, it's very dynamic. It's always evolving. There's a reason Schneider Electric is where they are in the supply chain realm. It's because they're always evolving and they do with that base. And I, I've never heard that with the trust, sustainability, efficiency, but you think about everything you do in a company and they should point back to those three pillars.

Tevon Taylor [00:17:31]:

So that's, that's a great way to drive an awesome supply chain.

Scott W. Luton [00:17:36]:

So well said. And I haven't heard someone use the word realm since my Game of Throne watch in days. So that's a, that's a good one, Tevon. You know, get inside. Hey, and, and really as he was describing the scope, as Agustin was describing the scope, realm is a good word for it because it's a big one. One last thing I want to touch on because I think this is really important and you know, one of the silver linings of the pandemic was of course, so the supply chain industry and supply chain profession certainly, you know, rose to the top in a lot of folks mind, folks that had never been in supply chain. And I think also in parallel with that, what he was touching on was the holistic view of a supply chain organization and the ecosystem and all the different players involved. Tevon, that is critical that we really, when we say supply chain, what that means and for organization wide us to have alignment around that, right?

Tevon Taylor [00:18:36]:

Absolutely. If you're not aligned, it only takes one break in the supply chain to, to whip the other components. Right. There's a reason you always heard about bullwhip, where the bullwhip happens, where you have one spot in the supply chain that's not where it needs to be. So that alignment is critical.

Scott W. Luton [00:18:52]:

And on the other side, where we're, we're garnering continuous improvement ideas or innovation or product ideas, service level ideas from really across the ecosystem, you never know where the next billion dollar idea is going to come from. Okay, Agustin, what you shared, your response, what begs the question in my mind, especially given your overall organizational footprint, including the massive one that you lead, how have you been able to deploy this degree of transformation at scale?

Agustin Lopez-Diaz [00:19:24]:

Yeah, well, I mean, first of all, you know, we gotta start by being humble, right. So we do have a large footprint. We have well over 50 sites in North America alone and we have, you know, thousands of collaborators that we have the pleasure to work with every day. And so there's always, you know, corners where we haven't touched just yet. But I will say we have been lucky of, you know, the luxury of starting the journey a little bit ahead of the wave. So we've been working on it quite a bit. But I will say in general what we did is kind of the old fashioned Strong production systems management. Right.

Agustin Lopez-Diaz [00:20:14]:

So we didn't walk away from it. Whereas I think some companies probably kind of switch gears. We built on our legacy of what we call the Schneider production system. It's a system that's been going on for probably close to 30 years now. And that's really kind of incredibly well integrated to who we are as a supply chain. Right. Both for us and our factories as well as for our suppliers. And so what we did was really evolving that and just making these, you know, manufacturing one on one, if you will, as Stern was alluding to, and just make it smarter and more digital and more efficient.

Agustin Lopez-Diaz [00:21:03]:

So I think that's proven to be really helpful for us as we do the deployment. We don't do it as an adjacent initiative. We just build it up in our production system mechanism. I think I'll say that's probably number one. Number two, you know, skill sets is critical. So we have, we invest in Schneider quite a lot on people Schneider. By all measures, it's a people centered company, culturally wise and you know, how we operate every day. So we spent quite a lot of our time and resources seeing, creating these capabilities in house.

Agustin Lopez-Diaz [00:21:47]:

We have several programs where, you know, we incentivize this increased knowledge and you know, really securing that level of capability. We call it electrifiers. Right. So it's a program where, you know, we build that competency in the factories across the board. And then, you know, we, we do a lot of recognition right around activities. We have not been rigid and prescriptive. We have a portfolio of tools. We train the teams and we let them run with it.

Agustin Lopez-Diaz [00:22:27]:

And so we have several programs that will incentivize innovation, new proposals and we have some healthy competition which we love right in supply chain. So everybody's really looking forward to be the next one, being recognized as a lighthouse. And we partner also externally with some organizations like Gardner or the World Economic Forum that will help us create that sense of objectivity benchmark externally to make sure that we are always staying ahead. Those are the key pillars of, of this transformation.

Scott W. Luton [00:23:09]:

Agustin, I really appreciate you sharing and Tevon, this might be oversimplifying, I think, but I think it's still accurate. I heard three big themes in Agustin's response there in terms of how they're able to deploy this level of technological transformation, business transformation at scale, People, people, people, people, systems and culture. They're reinvesting in their people. I love that equipping them with new skill sets which leads new opportunities they made from a system standpoint. Of course, they doubled down, maybe triple down on the Schneider production system, which has been around for more than 30 years. And then thirdly, he may not have mentioned culture, but he made an important distinction. Rather than setting up a whole new transformation plan outside the business or parallel to the business, they really use their current culture, their current systems and their people to drive transformation in a manner that's, this is how we do business. Right.

Scott W. Luton [00:24:09]:

And I think that's, that's how you drive some of the most effective, powerful change, even if it's at a grand scale. But Tevon, that was my take. What'd you hear there from Agustin?

Tevon Taylor [00:24:20]:

It's amazing, you know, how long that, you know, people have been around to not figure out the secret sauce is the people. Right. Systems and culture, where do those come from? They come from the people. And trusting the people, that's the core value that I heard. Trust is number one, empowering the people. And I like the word he used. Collaborators. I've never heard that.

Tevon Taylor [00:24:43]:

Collaborators. Those are the people collaborating together to build the company. Electrifiers, that was another keyword used. But if you empower your people, trust your people, listen to your people, next thing you know you're going to build the systems and the culture that are going to drive your company. And IT and culture is a big deal. People always, companies talk about culture, but you can see where the culture is by what you just mentioned. You're measuring yourself with Gardner and some others. Well, the scoreboard tells you if you have a culture and you're encountering your people.

Tevon Taylor [00:25:14]:

So the companies that are just saying it, there's a lot of, there are a lot of companies that talk about culture and people. But you got to look at the scoreboard and looks like Schneider's got a, they got a big W on the scoreboard. You're winning. Whether it's a soccer game or football game, we'll figure out later.

Scott W. Luton [00:25:30]:

And that's right. There is a lot of lip service leadership out there. And then there's folks that really stand out because you see it in their deeds, not words. And that's what in rubbing elbows with folks out in the industry, including folks from Snyder Electric, that really seems like it is. It's action oriented leadership and change and transformation. Agustin, one other. If I can, if you can elaborate just a bit more, you also talked about the importance of not being too rigid. Right.

Scott W. Luton [00:25:59]:

And being flexible as, as you're driving change. Can you, can you maybe share for folks out there that might be surprised by that, why that's so important.

Agustin Lopez-Diaz [00:26:09]:

Yeah, I mean, again, that will probably be a super long answer. I'll try to be as concise as possible. You know, it's very critical that, you know, in innovation there's room for, you know, flexibility and creativity, right? So we learned very early in this process that, you know, if you are too rigid, you stop improvements and innovation. And so, so we really have come up with a somewhat of a secret sauce of what we don't compromise. We call it principles. So we have some principles that we never compromise and those are super clear for everybody. So we have, in our production system, we have what we call fundamentals. I'll give you one very simple example, right? So one of our trademarks as a brand is because we are in a circuit protection environment, quality is critical to us, right.

Agustin Lopez-Diaz [00:27:12]:

It's is beyond the priorities. It's a, it's an absolute principle for us is really beyond a priority. So we, we spend a very large amount of money in automating and preventing issues to go out to the market, right? So what we in supply chain, we know as pokey yokes. So we have poke yokes automated everywhere in the, in our facilities. So that is a no compromise. So people will know that is a fundamental, you cannot go away with it. Right? But then we have all the rest that is more preferences. So we said, okay, everything that's preference, we have a preference system, but we allow people to come up with better ways to address those.

Agustin Lopez-Diaz [00:28:03]:

So a standard work, for instance, there's multiple ways to do a standard work. We have some guiding principles on how to do it, but we allow creativity. And you know, one of the great outcomes of that was, you know, one of our collaborators in a factory in the US came up with an algorithm that helps us create the AIs with a vision system which is proven to be incredibly useful for us. And so we're super excited. So that I think is the definition of what's a principle that cannot be compromised and all the rest open to innovation.

Scott W. Luton [00:28:45]:

Appreciate you sharing. Agustin and Tevon folks picked up on terms there poke oak, which big old mistake proofing, right. Eliminating the root causes that can create mistakes that, you know, rather than managed by firefighting, let's just prevent the fires. That's a thought, huh? Standard work, but not too much standard work, which what I'm hearing from Agustin is allowing for that operational flexibility, that creative flexibility that, that helps you unlock innovations and opportunities and a whole bunch more, especially the best kind of ideas or the ideas that come from the front line who are truly the experts in any organization. What'd you hear there, Tevon?

Tevon Taylor [00:29:28]:

Yeah, very similar, you know, the best operations I've ever, you know, toured or been part of. You, you have your standards, you protect your quality, you protect what you know you're doing well, but you always have that. You know, you go to the warehouse and you see the idea boards where you want your people to go, hey, have we thought about this? Or why are we doing it this way? You can challenge the status quo and sometimes it's like, hey, it's, we're doing it this way and this is why, because you're protecting what you're doing. But then there's got to be a, hey, let's, let's run that up the chain and see if we can adjust this. Because it's improving the product, improving the service or the experience, right?

Scott W. Luton [00:30:04]:

Yeah, that's right. Even standard work evolves oftentimes. Okay, let's talk growth, Agustin. Lots of growth. The Schneider Electric team continues to grow across the US and across North America. And you have been expanding your operations and your supply chain infrastructure, especially here in the US first question related to all the growth. Would you share a few insights on the role that North America plays as part of the overall company portfolio of business? I think you said earlier, did you say 40% earlier? But you tell us more about that.

Agustin Lopez-Diaz [00:30:41]:

Yeah. So just to be Incredibly precise, it's 36.8% of the company in an incredibly important region. Right. I mean, obviously the biggest region in the group in terms of both size, absolute size, and also relative growth. So in, in Q4 alone, we grew about 22% last year, which for a company of our size is, you know, we're very thankful and honored to be part of this growth profile. And I think as a company, you know, we sort of anticipated the waves of growth that were going to come our way. And as Stefan was saying. Right.

Agustin Lopez-Diaz [00:31:28]:

I mean, we're in the data centers, which is, you know, even with some slowing in, in the market is still growing very, very hot. We are in the energy infrastructure, as also was said by Tevon. I mean, we cannot approach energy infrastructure as we did it 20 years ago or 15 years ago or heck, 10 years ago or even two years ago. Right. I mean, the energy needs of AI are just going to be outrageous. Right. So, so we, you know, we benefit quite significantly on, on that wave and you know, our second part of the portfolio, which is driving efficiency and I think those are critical elements. So, yeah, we're super well positioned.

Agustin Lopez-Diaz [00:32:17]:

We see continued growth and of course, as a company we are very committed to the US we find that our footprint, our brand equity, our collaborators in the region, we have been able to set up a very efficient, a very customer oriented supply chain. So we will continue to double down on that.

Scott W. Luton [00:32:46]:

Outstanding. Quick follow up before I get Tevon's commentary. You kind of spoke to this a little bit. A little bit in terms of the. Some of the market forces that are prompting the expansion. We're all familiar with the data center explosion and how that's empowering this golden age of supply chain tech amongst many other things. You talked about the energy infrastructure and of course we got tons of opportunity there. We're going to have to drive improvement on to not leave anyone behind.

Scott W. Luton [00:33:13]:

Any other market forces that you want to call out that are helping that are fueling this expansion and investment?

Agustin Lopez-Diaz [00:33:20]:

You know, I, I think every, everything that's growth in terms of systems in automation as well. Automation, discrete and non discrete. I think it's also quite significant. Those are the segments that we're seeing the, the vast majority of the growth. We have some other segments that have more moderate but the biggest one are of those two of those three.

Scott W. Luton [00:33:42]:

Good stuff. Tevon, anything there surprise you in terms of the. The market forces fueling growth and of course the big role that North America plays amongst the Schneider Electric portfolio of global business.

Tevon Taylor [00:33:57]:

No, it's actually not shocking. I mean their tagline is life is on. Right. With the little on button. So electrification and you know, Schneider Electric, it's in the name. Right. So you know, it doesn't shock me at all. I kind of shocked at how big the region is, but it makes sense.

Tevon Taylor [00:34:14]:

This is, this is the original home base for Schneider Electric, right?

Agustin Lopez-Diaz [00:34:18]:

Yeah.

Scott W. Luton [00:34:19]:

And the precision there. 36.8. I love that Agustin. We hey, we're in supply chain. Data is important. Accuracy is important. Okay. So Agustin, we would need several hours to give a full response here.

Scott W. Luton [00:34:35]:

But give us some specific areas, some examples of some of this expansion if you would.

Agustin Lopez-Diaz [00:34:40]:

Yeah, well, I mean again, so when we look at the portfolio, by the way, you know one of the things that, that we're doing is regionalizing. Right. So I think you know, regardless on, on you know, which papers you read, globalization has changed quite a bit in the past months. Right. So I think we are going more into a regionalized approach. This is not new to Schneider, to be honest with you. I think we anticipated that a couple years ago without any effect from tariff impacts. We understood that we wanted to create a, we call it supply tailor supply chain and we talked about this trust with the customers, right.

Agustin Lopez-Diaz [00:35:24]:

So we decided to do a lot of efforts to regionalize our footprint quite a lot last year. So we are. Our growth in the US and in North America as a supply chain comes from two main vectors. Obviously the organic growth that we're having, which is substantial, but also a super clear and intentional program to regionalize both our factories and our supply chain at large. So, so those are the two main drivers and you know, we're expanding. We're either automating and making our factories more efficient through, you know, some of our products and additionally some support from some partners. So one is, you know, really upgrading our factories. We do a fair share of our investment in upgrading our current facilities and we always do it in a sustainable manner.

Agustin Lopez-Diaz [00:36:24]:

Right. So we spend a significant part of our capex is also related to sustainability efforts which also drive efficiency. So it's good business sense overall. But that's one piece. So upgrading our footprint and optimizing it. The second one is expanding our current footprint. So expanding our buildings. So buying adjacent buildings or expanding our buildings like in Columbia, Missouri where we just announced a quite significant expansion of our, of our current facility there to really center much more in the US Market and be closer to our customers.

Agustin Lopez-Diaz [00:37:05]:

And we have new facilities all together. Right. We recently announced Middle Tennessee. It's a critical area for of us y'all. So we are in, we are in very committed to, to the, to the state of Tennessee. I am home based in Nashville. Our supply chain headquarters are here in Nashville. And with the support of, of the local government and, and and agencies, we are expanding quite a lot our, our factory, especially in Middle Tennessee.

Agustin Lopez-Diaz [00:37:40]:

We just announced our newest facility in Mount Julier for instance and also in El Paso, which is one of our critical sites in terms of footprint. We also announced a new building expansion where we are creating one of our largest campuses. I think it might be actually the largest campus that we have in Schneider Electric. It sits in El Paso today with about six buildings by the end of the year.

Scott W. Luton [00:38:08]:

Okay, Tevon, and I've got a list here Overall, on the side of all Agustin touched on Mount Juliet, Tennessee. He touched on El Paso. You got Andover, Massachusetts, Columbia, Missouri. I think he touched on that one. And wait, on the bottom of this list I'm looking at as a reference guide here, the beautiful city of welcome, North Carolina.

Agustin Lopez-Diaz [00:38:30]:

That's right.

Scott W. Luton [00:38:30]:

I love the name of that city. We need more towns and cities named welcome places across the world. But Tevon, let's see here. Upgrade manufacturing facilities, obviously Technology and otherwise. He's also touched on earlier investing in their people, skill sets and you name it. But he also mentioned expanding sites, current sites, building new sites. He touched on the regionalization we're seeing kind of at a broader macro level. What else did you hear there, Tevon?

Tevon Taylor [00:38:59]:

Well, I'm just happy that their largest campus is in Texas because everything is bigger in Texas. Let's just be clear. Tennessee is our little brother. So we're okay with this. In all seriousness, the regionalization, it's smart move. You got ahead of the curve. We heard global, global, global for decades almost. And regionalization is smart for two reasons.

Tevon Taylor [00:39:23]:

One is it supports the local governments, the local everything. You can try to source as much as you can in that region and you still have to source some materials outside of the region. But you also sustainability. The smartest thing you can do is, you know, move product within the region and not all around the world because we need to quit doing flyer miles, you know, boat miles, truck miles for product that you can do locally, so or regionally. But yeah, I think it wraps into what you talked about earlier. Efficiency, sustainability, those two things and regionalization. And that was before tariffs. Now tariffs makes it really like, hey, let's keep it in the region, you know.

Scott W. Luton [00:40:04]:

Yeah, good stuff there, Tevon. And we're gonna, we're gonna have to break out the, the rulers and check everything when it comes to Texas. I know of a, of a little state called Alaska that might have something to say about, about that. Tevon. All right. You mentioned sustainability, Tevon, in your over on your response there. And of course Agustin mentioned sustainability probably about 17 times thus far. And of course it's something he is personally passionate about.

Scott W. Luton [00:40:34]:

And, and this is where I want to go next. It's about driving real, tangible, tangible sustainability outcomes. Right? That's where it gets back to action focused leadership. So Agustin, when it comes to that big Schneider electric supply chain ecosystem that we've been referencing a couple times here, share a few. It really innovative sustainability development driving outcomes that you find personally inspiring.

Agustin Lopez-Diaz [00:41:04]:

Where do we start? Right, so I will say again, our suite of products is really aimed towards decarbonization and efficiency. But I like to turn on a different topic that probably most people don't know about. Schneider, which quite frankly I found it when, when I learned about it, it made me want to come and stay in Schneider. Okay, so I probably got you there. There's a business that we have through the Schneider foundation, which is called Access to Energy. And Access to Energy is a self sustained Business, relatively large business that is supported by the Schneider foundation, where we develop products to help remote communities. I'll give you one example that I thought was incredibly inspiring, actually, if I may, I can probably share two.

Scott W. Luton [00:42:01]:

Sure.

Agustin Lopez-Diaz [00:42:02]:

These simple ones. So one which just broke my heart. I was actually running the sustainability business and access to energy is part of this function. And we developed a small hand lamp. It's a solar lamp for kids coming back from school. You know, when you are in, in some parts of Africa, for instance, the days are very, very hot, so schools have to happen at night. So children had to, you know, carry long, large, heavy lamps in their way back home. So one of our engineers had the idea to create a very simple solar lamp.

Agustin Lopez-Diaz [00:42:47]:

And with the help of the United nations, we actually made those available for, in large quantities for, for the kids there. And, you know, I think that was super incredible. And the second one is, you know, we do microgrids. So we partner with some external, sometimes customers or suppliers and you know, we help communities in the Amazons, for instance, you know, when you live in the Amazon and you are in a remote island, you know, kids have to, you know, pick up their little boats and you know, ride their boats to the nearest school. Partnering with an external company and with the government, we created microgrids to power Internet for these little islands in the Amazon so they could have access to education from Sao Paulo or Manaus, which is where they get the professors to teach the kids in these super remote locations. So that to me, that's kind of sort of the extent of how we think about sustainability in Schneider. It made me super proud to be part of this team.

Scott W. Luton [00:43:57]:

It should. I love the problem solving, do good nature of those initiatives you're talking about. And Tevon, I mean, from Africa and all the countries and, and communities and, and different customs and traditions that you can find across the African continent to the Amazon region to Andover, Massachusetts, all around the globe, driving real impact and helping solve problems and help others. Hearing that's a big part of the culture there at Schneider Electric. What'd you hear, Tevon?

Tevon Taylor [00:44:26]:

Yeah, you know, sustainability, everybody just thinks about emissions and carbon and that's important. Decarbonization is, is a world issue, not a local issue. But he took it to the human element of let's go take care of the communities that don't have everything we have. So just because things are, I mean, even in the US we have, you know, the pockets and islands of our own that we need to take care of. But I love the human element because that's, that's what sustainability is. It's sustaining humans. It's not carbon. It's sustaining our future generations.

Scott W. Luton [00:44:59]:

Yep. Well said. Look forward to learning a lot more about the Schneider foundation, which I think that's what's fueling those efforts. Is that right, Agustin?

Agustin Lopez-Diaz [00:45:08]:

Yeah, that's right. Also, you know, also with our employees. So we have another example here in the US for disaster relief. We spent 2,500 days of our employees volunteering. So the company puts forward the products and our employees volunteer the time to build these microgrids for disaster reliefs in the U.S. so really, really, it's a combination of both the company and the foundation, but also very, very importantly, there to say, even more important, you know, all our collaborators living and breathing this sustainability mindset.

Scott W. Luton [00:45:47]:

I love it. Deeds, not words. Certainly has big been a big theme over the last hour. So this, I got two more questions. We're going to find out how we can learn more from Agustin here in just a second. And then we're going to get Tevon Taylor's patented key takeaway from a really big conversation. You got a tough job with that, Tevon. I'm glad you do.

Scott W. Luton [00:46:09]:

Not me. All right, so, Agustin, really appreciate you being here today. Your passion is very palpable as you kind of walk us through the technology, the transformation, especially the people, the do good that you are doing via sustainability initiatives and much, much more. So we look forward to having you back soon. But how can folks learn more on anything you've shared and how can they connect with you?

Agustin Lopez-Diaz [00:46:32]:

Well, of course, there's always the Schneider Electric portal where you can read all our sustainability initiatives and hopefully join us and volunteering and, you know, being supported with, with, with all the efforts. And of course, you know, I'm always available in LinkedIn to, you know, to contact anybody and happy to, to connect with this with your audience.

Scott W. Luton [00:46:55]:

Outstanding. Big thanks to Agustin Lopez-Diaz, senior vice president of global supply chain in North America for Schneider Electric. What a great conversation. But before we go. All right, Tevon Agustin, a bit of a masterclass over the last hour or so. What's going to be your key patented takeaway for our audience?

Tevon Taylor [00:47:16]:

I've got more than just one. I mean, I, I took more notes in this conversation than I ever did in college. Just for the record, I will say the number one thing that's important is everything's bigger in Texas. We'll measure later. But the three things, and I like to do things in, in threes. Right. So there's a foundation you got Trust, sustainability, efficiency. Love it, people.

Tevon Taylor [00:47:41]:

So I heard collaborators, electrifiers, empowering the people. Don't be rigid, be flexible. And last but not least, we're here to take care of each other, right? Communities, you know, not individuals. Let's focus on taking care of each other. So I love that. That last point on sustainability was really kind of tugged on me a little bit because sometimes we think profits, we think about we're driven to win.

Scott W. Luton [00:48:04]:

The.

Tevon Taylor [00:48:04]:

That's important. But let's win together. Let's look at the team, human race and go from there. Right?

Scott W. Luton [00:48:12]:

Well said. Well said. Back to that holistic definition of supply chain so the whole ecosystem can win. I'm hearing a lot of that, too. Good stuff. What an outstanding show. I knew it would be, folks. Hopefully you've enjoyed this hour as much as I have.

Scott W. Luton [00:48:26]:

Again, big thanks to our wonderful guest, Agustin Lopez-Diaz with Schneider Electric. Really good stuff, Agustin. Look forward to having you back soon.

Agustin Lopez-Diaz [00:48:33]:

Thanks for having me. Scott and Devin, thank you so much.

Scott W. Luton [00:48:36]:

You bet. Tevon Taylor, always a pleasure to co host these conversations with you, my friend.

Tevon Taylor [00:48:42]:

What a great show. Thank you.

Scott W. Luton [00:48:44]:

No doubt. But for our audience members out there, hate to break it to you, but you've got some homework. You got to take One thing you heard here, especially from Agustin, but also Tevon. Tevon shared some good stuff, too. Take one thing you heard in today's conversation from Agustin and Tevon and put it into practice. Share it with the team. That's how we're going to change how industry is done, be it deeds, not words. So with all that said, on behalf of the entire team here at Supply Chain Now, Scott W. Luton, challenging all of our audience members out there.

Scott W. Luton [00:49:13]:

Do good, get forward, be the change that's needed. We'll see you next time right back here on Supply Chain Now. Thanks, everybody. Join the Supply Chain Now community. For more Supply Chain perspectives, news and innovation, check out supplychainnow.com subscribe to Supply Chain Now on YouTube and follow and listen to Supply Chain Now. Wherever you get your podcasts.