William "Gus" Pagonis is a legendary logistician, first serving under General Schwartzkopf as the logistics commander during the Person Gulf War in 1991. As General Schwarzkopf’s logistics commander, he functioned as the single point of contact and was responsible for all logistics (food, shelter, fuel, ammunition, transportation, contracting). Pagonis then served as Executive Vice President of Logistics for Sears, Roebuck and Co. where he was responsible for all of Sears Supply Chain and directed logistics for more than 2,500 stores. He is now Vice Chairman of the Board for Genco Supply Chain Solutions, one of the largest third-party logistics providers in North America. The Open Kitchen caught up with Gus for insights into logistics, leadership and his keynote address at NextLevel 2012 this February 20.
What was your number one lesson or observation from 1991′s Gulf War?
Integration of logistics is the one key factor. Let’s be clear: When people say distribution and transportation, they are really talking logistics. When people talk supply chain, they are really talking logistics chain. In the military world, it’s making sure that all of the system’s parts are being evaluated. I used to give Schwarzkopf a one-page report on logistics every week, how many planes were off-loaded, how much ammunition we had in the field. That way he could look at the sheet and know exactly what he needed to know. The lesson of logistics is even more vital now in the corporate world. Corporate America is finally waking up to logistics as the last frontier. It’s the place where people can really, really maneuver to get an edge.
How can you use logistics to get an edge?
One key is getting logistics translated financially to the bottom line, a profit and loss statement that the whole company can understand. You can do some great things in logistics, but if you can’t demonstrate how what you’re doing affects the bottom line, the people you’re supporting don’t understand it. The logistician has to make sure everything he does gets translated to the bottom line. In the supply/logistics chain, we don’t do anything that doesn't add value. We don’t do anything that can’t be quantified.
What does it take to be a leader in corporate logistics?
First of all, you always work on your leadership skills. Leaders are developed, not born. If you can’t communicate, then take a communications course. I've had subordinates tell me what I was doing wrong. They would secretly write it down, and I had to address it. If you don’t practice your leadership skills, you’re going to go down the tubes.
The secret of logistics is never losing sight of your customers. Once you have that, you've got to take all of these things and integrate them to make it work. You've got to look at total costs and total integration. That’s the fun of logistics, and we need real leaders that are going to step up and transform the function of logistical planning.
Thank you, Gus, for your insightful comments. In part two of our discussion, Gus will talk more about leadership and about not being afraid to fail.