Target’s chief legal and risk officer helps retailer manage bumpy supply chains

With the start of the holiday shopping season, the retailer reported that it had 17.6% more inventory in its fiscal third quarter ended October 30 than a year ago, more than a 13.2% increase in sales.

Target is also facing complications seen by many companies this year, including manufacturing disruptions and travel restrictions due to the coronavirus pandemic as well as a tight labor market.

Dawn H. Liu, who has served as Target’s chief legal and risk officer for the past five years, said that preparing to ensure that holiday shelves are full and the season runs smoothly, risk forecasting, has been implemented by the board. Updates with members and results in coordination between teams. years.

Mr. Liu, who was new to retail before joining Target, said his background in corporate legal leadership roles at tech companies was helpful to Target as it incorporates technology into its core business. Prior to joining Target in 2016, he was secretary general and secretary of workplace technology firm Xerox Corp.

Mr. Liu, who manages about 500 people from the company’s Minneapolis headquarters, has also been actively involved in efforts to combat Asian-American hatred and support justice for victims of the attacks, including Asian American Justice. co-founded a non-profit alliance for

The Wall Street Journal spoke with him about how the company has managed calls for responsible sourcing and supply-chain transparency, how it ensures ethical conduct among its employees, and the goals it faces in the coming year. Their perspective on the risks involved. Edited excerpts follow.

WSJ: It’s the start of the holiday shopping season. What is your role in making sure Target’s shelves are full for the holiday season?

Mr. Liu: I think we knew well ahead of time that this year’s holiday season would be fraught with supply-chain challenges, from manufacturer to our shelf, and that each stage had different types of risks. . Supply Chain …. Our job is to identify those risks in advance, making sure our supply-chain team covers them in a way that is sensible, using their on-topic expertise to prepare using, and to ensure that we communicate effectively with those who need to know, be it members of the board or management team or our customers and our team members.

We are well aware of the trade sanctions that the US has placed on some imported products, particularly [those] from China, and we’ve had to get ahead of that curve to make sure we’re prepared to deal with the different kinds of trade restrictions that could come, to make sure people in our supply-chains are aware Help guide them through more of the rules.

WSJ: Responsible sourcing and supply-chain transparency are an increasingly hot topic among retailers these days. What is your role in this process at Target and how do you ensure compliance when supply chains are getting more complex these days?

Mr. Liu: We find ourselves learning not only at the national level, but also at the international level, not only in the political environment in which we operate. We have to invest in technology because responsible sourcing requires us to know the ingredients that go into our products and be able to do due diligence on vendors. [and] For example the conditions under which the vendor’s employees are working. All of this requires a huge amount of investment in technology on its own and using third party vendors to be able to help us to the extent we need it, either on the ground or because they have relative There was experience from which we can learn.

We use technology like Zoom or some variation thereof, but there’s also a limit to how much you can learn if you’re not in the factories yourself. This year we have better conditions to do something, but we have had to rely heavily on both technology and third parties to be able to do some of the work that we used to do ourselves. And it’s obviously been challenging, not just aiming for… we’ve had to rely on it significantly [communication from] Manufacturers themselves… which made for some travel restrictions.

WSJ: What kind of ethical issues are you handling in Target’s workforce?

Mr. Liu: During the pandemic, we had all kinds of issues regarding the more challenging ethical issues. What if a member of our team says, “I can’t wear a mask,” even though we are required to wear a mask at the store. It may be based on religion; This may be based on their health; It could be based on their politics. On what basis should we not allow our team members to wear masks and on what grounds should we say, “No, the claim of not wearing a mask is not acceptable to us. You must either not work in the shop or wear a mask.” This is part of the job of my Risk and Compliance team, working with HR to help come up with the right policies so we can implement them in-store.

We are facing this now with a federal mandate. What should be our policy for members of our team who refuse to get vaccinated or refuse to be tested, if you will, which will be required if you have not been vaccinated. So we’re still in the middle of that. We are in regular discussion to come up with our policy.

WSJ: In your opinion, what are some of the biggest risks in the coming year?

Mr. Liu: I think the risks are not going to be so surprising. Pricing is at the top of our list as a result of the inflationary trend. Labor risk… and the cost of maintaining your labor team so they can serve our consumer is a significant concern. We have a much better experience than other retailers. I think it helped a lot that we were ahead of the curve on the minimum wage front, going to the $15 minimum wage that most retailers have.

This story has been published without modification in text from a wire agency feed