Today’s conversation covers the inception of Open Supply Hub and its evolution. Executive Director Natalie Grillon recounts her time in Uganda, working with an agricultural development company as part of a global fellowship with Acumen. This experience, coupled with her exposure to the aftermath of the heart-breaking Rana Plaza collapse, fueled her determination to make a change. She realized the powerlessness of consumers and farmers alike within the opaque supply chain and set out to empower them with the data they deserved.
Open Supply Hub is at the forefront of a revolution; its impact ranges from remedying worker’s rights violations to facilitating collaborations that lead to better standards and reduced emissions.
Transcript
Jim Fruchterman [00:00]
Welcome to Tech Matters, a bi-weekly podcast about digital technology and social entrepreneurship. I’m your host, Jim Fruchterman. Over the course of this series, I’ll be talking to some amazing social change leaders about how they’re using tech to help tackle the wicked problems of the world.
We’ll also learn from them about what it means to be a tech social entrepreneur, how to build a great tech team, exit strategies, the ethical use of data, finding money, of course, and finally, making sure that when you’re designing software, you’re putting people first.
Today, I’m interviewing Natalie Grillon of Open Supply Hub. Now, what’s so cool about Open Supply Hub, and Natalie? Well, first, Open Supply Hub is a terrific example of succeeding with an idea which usually fails. When someone suggests building what I call the one true list, a database on the internet, including everything of a certain kind of thing, I try to talk them out of it. It’s so hard to build such a database in the first place, and 10 times harder to sustain it over the years it takes for it to matter. Natalie is the counter-example that proves the rule, the 5% of a time when a generally bad idea turns out to be a great idea.
Second, they’ve found a sustainability model, both economically as a nonprofit social enterprise, and for growing and improving the quality of their database.
And lastly, the Open Supply Hub team is building a crucial piece of tech and data infrastructure, which lends value both to the nonprofits and government agencies as well as to the software vendors and companies in the global supply chain. And I expect them to have an outsized impact on human rights and society’s response to the climate crisis.
Natalie Grillon [1:46]
I started my journey in tech for good, actually working in an agricultural supply chain. I did a global fellowship with an organization called Acumen. They help to eradicate poverty through disruptive business models. They invest in social enterprises. And so I was fortunate to have the chance to move to Uganda and work with one of their social enterprises that was an agricultural development company. It was such an incredible experience. I had lived and worked in Africa before, in West Africa as a Peace Corps volunteer.
So I was familiar with the types of economies and societies that — of course there’s differences in East Africa and West Africa — but what was fascinating to me about this social enterprise, this agricultural development company was it really was almost like a holy grail of what you would like to see out of a market-based poverty alleviation approach, right? They were buying produce from the farmers after they had trained them in organic practices and best agricultural practices. It was in Northern Uganda, an area that had been ravaged by decades of civil war, with the Lord’s Resistance Army and Joseph Kony. And you could see the change happening, harvest to harvest, moving from a thatched roof house to a house with a metal roof, being able to pay your kids’ school fees. And these farmers were growing cotton, sesame, chili peppers for sale in global markets. Wow, this is incredible. This is the beginning of the supply chain. They’re selling into the supply chain. Why aren’t there more social enterprises like this?
I was very interested in how we could have more solutions like this for poverty alleviation at the time. And while I was working there, the Rana Plaza factory in, or building I should say, in Bangladesh had collapsed, killing 1,100 garment workers. It was truly a… I remember exactly where I was when it happened and thinking to myself, we’re buying this product from these farmers and selling it off into a market and we don’t know where it’s ending up. And then I’m also wearing a shirt from some brand that I’d gotten it for probably $10, $15 that could have been made in a factory like that. It was this moment of clarity where I realized I had no power as a consumer in terms of understanding where my stuff was being made. And the farmers had no power in terms of their action in the economy, in terms of selling into the markets. That’s where I became very interested in the data side of things in supply chains. Why is this information not flowing? Why don’t people have better information?
I started my first — co-founded, I should say — my first enterprise called Project Just, that was all about trying to find information about brands’ practices and their supply chain and overall their sustainability and providing that information to consumers. We were interested and had the philosophy, the theory of change that if you gave consumers information and you empowered them with what brands were great brands and which brands did not have such sustainable practices, that they would be incentivized to buy from the good brands. But what we found in that endeavor was that while there were certainly consumers that were interested, it was very difficult to actually gain the information from the brands and retailers and to find the information out there because the data flows were so poor. That’s how we went to launch what would eventually become Open Apparel Registry and Open Supply Hub to create a common centralized database of supply chain information that everyone can access.
Jim [5:57]
And so wasn’t part of the Rana Plaza story that brands didn’t know that their products were being built, were being made in that particular factory that collapsed? That they were buying from good factories, but those good factories were subcontracting out, building it in other factories that weren’t so safe? So the data issue’s bigger than just consumer to brand. It’s also like brand knowing what’s really going on in their supply chain.
Natalie [6:24]
Yeah, you’re exactly right. I mean, that’s what we discovered is that the brands had no idea. In the aftermath of Rana Plaza, activists were digging through the rubble for months to pull out the clothes, to look for the labels, to hold someone accountable. So we really have no idea where things come from, how they’re made. And in the 10 years since Rana Plaza, organizations, brands, retailers, corporations at least try to understand their tier one. But as you start to think about moving upstream in the supply chain, so down the supply chain, if you will, down towards raw materials, it becomes very difficult to understand because supply chains are really webs of relationships. They’re not direct lines often.
Jim [7:08]
And, and just, just for our listeners, tier one is the first level of spy. Like, like who are you buying the manufactured clothes from, but you don’t know where they bought the cloth and you don’t know where the cloth was processed and you don’t know what farms and so on and so forth. So I assume the supply chain is opaque. Not just because it’s hard to find the data, but because some people don’t want the data to be found. Or is there a proprietary advantage to your data being secret? I mean what are some of the dynamics of why this data is not readily available?
Natalie [7:43]
It’s a great question. Historically, where you source from, who your suppliers are, has been considered proprietary information, or even intellectual property. “I built these relationships”. “I own my entire supply chain”, let’s say from the farm all the way to the factory where the t-shirt is made. But all of those concepts, if you will, all of those… what today I would say are typically actually not truth, comes from the past where we didn’t operate in a globalized economy. It was much more… you were sourcing from your own country or in your own region. But in the 80s and the 90s, the 2000s, we became much, much more globalized in terms of our sourcing. Cotton could come from the US, like Arizona, then be shipped to Switzerland to be bailed and processed, turned into thread. Then it could go to India to actually be turned into cloth. And then it might go to China to be made into a t-shirt. You might change that supply chain depending on the type of t-shirt you’re making or the season. And so year over year, it really becomes a web at an ecosystem. And you share that ecosystem. You do not control the means of production. You have outsourced it.
The second thing is, from an intellectual property standpoint, I think, yes, are there some things in the world like the latest VR goggles or silicone chips being used for processing, really top-tier technology that for national security reasons or for technological innovation reasons, you need to keep secret. Those circumstances exist. But for a ballpoint pen or a lamp or a pot, these things are not products that really have the kind of innovation that would require you to keep that information quiet.
And then I think the third thing is that a lot of the data is out there, whether through customs databases, through civil society organization research, through trade information that is publicly available. I think some would be surprised to know how much of this data is actually already out there, even if it isn’t necessarily affiliated with the corporations that it’s sourcing. Everyone has a phone in their hand. And to think that, in this day and age, you’re going to be able to keep that information secret and say, oh, I’m not going to share my supply chain information, it’s a concept of the past.
Jim [10:40]
Oh, I mean, it was surprising to me, there’s this whole open source investigations effort that go off and discover state secrets that governments don’t want you to know, like, no, no, no, we’re able to track this down because people are sharing secret stuff on their cell phones or on their personal exercise apps, or whatever it might be.
So, okay, you’re approaching this issue of, you know, there’s this disaster, you’re in the supply chain, and you’re realizing how disconnected it all is. And so you’re inspired to start working on this to bring justice to the victims of the Rana Plaza disaster, and to many other similarly situated people to empower consumers. So how do you go from, I think there’s something that needs to be done here, to actually figuring out what to do, and getting the cooperation or begrudging acceptance from people who might not want to see you succeed?
Natalie [11:35]
So we started out with the realization that very simple data… what we have in Open Supply Hub is phone book data, names and addresses of supply chain sites, along with their GPS coordinates, the type of facility, the number of workers, and then the organizations that are affiliated with that supply chain site based on the crowdsourcing approach we take. But because I think we took such a simple approach and said, what if we just tried to get the names and addresses of these facilities correct? If we were able to take in the data from a variety of different sources, process it through our algorithm and find matches, get the best name and address and promote it to the top and give it a unique ID, we would be doing a huge service to everyone because the name and address information is so poor, because it’s been closed, it hasn’t been shared historically, it’s been black box data. But also because supply chains are dynamic, they’re constantly shifting and changing, factories move, they close, they open. And so being able to just get that name and address right is sort of an unlock for being able to then aggregate a bunch of other information about that facility.
And so we started with that simple approach and because it was such a problem that everyone from brands and retailers to auditors to certification bodies to civil society that workers rights organizations that they had all faced, it was… and because we focused on those core data points, we were able to get something up and running in 2019. We started out with 8,000 facilities in the database within a few years, we were at 90,000 facilities, we had grown 10X because there was such adoption of this approach of, wow, we can all get better data if we all contribute to the global commons here to the public good.
And I think some things that helped us were definitely having civil society pushing for transparency in supply chains at the same time, number one — was definitely very helpful. But number two, the changing regulatory environment that is pushing for more and more due diligence in supply chains, necessitating corporations to get this data, to actually understand where their supply chains are. Because when I say due diligence, I mean, due diligence in the context of supply chain is referring to: is my supply chain, does it have proper standards in terms of human rights? Have I checked it for forced labor? Have I ensured that human rights violations are not occurring in my supply chain? That’s what we mean by due diligence.
Jim [14:41]
No kids made this…
Natalie [14:43]
Exactly. Yeah. So that regulatory framework that’s happening globally, really — US, Europe, Asia — all of these laws are coming up down the pike. That is also… it gave us the tailwinds to get more and more data into our platform.
Jim [15:02]
Well, that’s really cool because often people build something and work on it for years and then go out and advocate for policy change that would actually help them be successful. But this was happening in parallel with you doing it.
So talk about, crowdsourcing is not easy, right? And what was the incentive of people to actively engage in this? Was it purely the activist organizations saying, we gotta make a list of all the bad factories or what about the good factories? I mean, how does that work?
Natalie [15:34]
That’s a good question. Number one, with our focus initially on the apparel industry and the push in the aftermath of Rana Plaza for greater supply chain transparency, this aligned very well with our approach. Civil society was interested in having standardized data. Rather than a corporation or a brand just publishing their supply chain information on their website, please contribute it to this platform where we can see the information from multiple organizations all in one place. So we definitely had the push from civil society helping there, and I wouldn’t diminish that in any way. But second, the apparel brands really saw benefit in contributing because of the service we were providing in helping clean up their data to a certain extent.
I cannot tell you that a number of times that brands have uploaded their lists and our algorithm and our geocoding has detected issues in their data, where an address won’t geocode or geocodes to the middle of the ocean or an address that is clearly in Italy, but the country is listed as China. There really was a benefit in helping them clean up the data.
The third benefit that many organizations realize in uploading to the platform is being able to use the open supply hub ID. We call it the OSID. Anyone can get a free ID for the production site. Kind of like we all have social security numbers in the US, it’s like a social security number for facilities. Many facilities share the same name or similar addresses. This OSID sitting alongside their data helped them calibrate systems internally, but also connect with other databases externally.
The final benefit is really collaboration. Supply chains, as I said earlier, are shared. We need to understand that we are operating in a dynamic shared ecosystem when we talk about a supply chain. Being able to upload your data and see where you overlap with other organizations in the supply chain is a huge benefit in terms of immediately remediating issues in the supply chain. We have so many case studies of a violation of a worker’s rights, someone being wrongfully terminated, a worker’s rights organization being able to go on our platform, identify the facility, look and see which brands and retailers are working with that facility because they’ve contributed to our database, reaching out to them and remediating the issue to the satisfaction of all parties, being able to get that worker reinstated or back pay or what have you.
There’s also case studies we have of organizations being able to identify who else is working in a facility or who else is sourcing from a facility to be able to talk about investment in the region. Let’s retrofit a facility or being able to just share data: Hey, I have some GHG scope three emissions data from my supply chain and I see that you overlap with 20 percent of my supply chain. Could we exchange data?
Jim [19:17]
Yeah, and of course, one of the things that some of our listeners might not know about is that there’s more and more regulation on big companies and brands around their CO2 emissions. And so, and they have to, again, drill into their supply chain to find out the different, you know, this step in my supply chain contributes this much CO2. And so, again, it’s another case of regulation helping put more pressure to come up with more transparency and data in the supply chain.
Natalie [19:49]
Absolutely. Yeah. And I think you’re going to see more and more of that as we approach 2030. There’s a real realization from many corporations and service providers who work on aggregating data to help corporations measure their footprint that scope three emissions, scope three emissions are your supply chain emissions, that this is actually where the majority of emissions are coming from. In some cases, 80 to 90% of a corporation’s emissions are in their supply chains. That’s really from a materiality perspective, where you want to be focusing your efforts to reduce emissions.
Jim [20:27]
So this is cool. So you’re building an essential piece of infrastructure and it’s not open source software as much as it’s open data, this unique ID that has been vetted where you’ve done all this quality control where people are regularly checking this. And now it feeds into socially desirable things like, no kids or slaves are making these products; that they comply with different regulations; and link into climate change. And I think it’s mind blowing that, I mean, every consumer in the US, the industry has incredibly refined data about, but the supply chain where, I don’t know, 90% of the world’s activities is going on, before you showed up, that really it was the wild West. No one knew what was going on at all.
Natalie [21:15]
Yeah, I think… when we think about shared data sets that globally we all use… the weather, right, you can go anywhere in the world and pull up information about the weather. Wikipedia, right? Anybody can go on wikipedia and look up information. Or Google Maps, or Open Street Maps, right? These shared resources that we have built our society and our economy on… but supply chains — we all rely on supply chains to get us the milk we drink, or the bread we eat. We consider ourselves a piece of the puzzle in building shared digital public infrastructure upon which we can build a more resilient economy
Jim [22:04]
Well, you know, I often talk to people about why building a giant database in the sky usually doesn’t work, and I’m really excited when I run into one where it did work. And so you’ve talked about how you gather the data, how you crowdsource it, the social impact of having this shared piece of data infrastructure, this common ID, this vetted set of information. What’s your sustainability model to keep this going?
Natalie [22:27]
So we have a hybrid sustainability model. On the one hand, and historically, we’ve relied on philanthropic capital to fuel our growth and our scaling. But we’ve also built a set of premium products that are paid for features. That’s our API as well as our embedded map. The API is a more sophisticated interface that a programmatic interface, right, that allows you to connect your computer to our database and pull in information programmatically. The embedded map is a mini map that you can upload your data into our database and then take a snippet of code and then embed your own little mini map of just your data on your website. That’s a real fan favorite. We have everyone from Columbia and Levi’s and Amazon using our embedded map to showcase their supply chain on their website. And both of those are paid for features. So it’s a way for us to build out sustaining income that maintains the database and keeps the product itself humming along and then the idea is in the long term, we grow those premium features and the sales of those premium features, the philanthropic capital that we continue to raise can be used for innovation and impact generation.
Jim [24:06]
Well, I think that’s one of the great things about tech for good is there usually is a revenue model. And so many people need to remember that when you deliver a product for free, someone’s paying for it. And this freemium model, which you might call it right, I mean, a GuideStar, right, you can you can go and look up any nonprofit in the US, and have great data on them for free. But if you want to, to find out a salary survey that’s analyzed all that data in a way that gives a pretty good idea of what people in your state get paid who run nonprofits of a certain size, well, GuideStar sells that as a premium product that helps them pay for the free product. And I think that’s, I mean, that’s how you make this thing sustainable so that it continues delivering value, because if it was to die tomorrow, that would hurt everybody.
Natalie [24:53]
Yeah, absolutely. And I think we’re open to the fact that as we build out this database and grow and scale, there will be opportunities for us to deliver insights to our users and our stakeholders on top of that data that can provide real value and will generate additional revenue. But I think the key for us right now, in where we are, is all about scaling and getting the database to a point where we can confidently say, yes, we have every single production site in supply chains mapped. This is a comprehensive data set and a public good that we all need to keep updating and adding to for the benefit of all.
Jim [25:47]
So let’s talk about sort of that arc. I mean, that’s a long way to come in less than five years and you started an apparel and then you got pulled into the wider supply chain and now your ambitions are to have, you know, global coverage of all industries in the supply chain. What else is on your sort of announced public roadmap for the future innovations from Open Supply Hub?
Natalie [26:10]
Good question. We were actually just talking about some of that earlier today. One of the things on the roadmap for this year that I’m really excited about is the engagement of a critical stakeholder in global supply chains: the production sites and facilities themselves. So historically, it has been an extractive process. Data is asked of them, and they give the data to whoever’s asking, but what do they receive in return? And so we are improving what we call our facility claims process, where a facility can claim their profile and add information about who they are, what they do, and where they are, such that the facilities have greater ownership over the process, but also so that they can add additional data attributes that really let them spotlight who they are and what they do, that they derive benefit from contributing to this commons.
So that’s an exciting innovation that’s happening this year. We’re also making improvements to our API over the course of the next year. And then in terms of our stakeholder engagement, we’ve started doing what we call data sprints, where we’re highlighting particular areas of data, like cocoa in Colombia or agriculture in Bangladesh, highlighting the data set, highlighting the contributors who’ve added that data, but also pulling in public data from that general sort of theme. And we’re excited about it because we think we’re going to be able to help a broader set of users dig into the data, understand the narrative and the power of what this information holds, but then also start to understand some of the issues with these themes. Why are we interested in coffee in Brazil? Why is that tied to issues around deforestation, right? So that’s something we’re excited about.
And then looking to the future, we just launched our new three-year strategy last year. We’re excited about building some new premium features as well that we think will help our users and just constantly scaling the database as well, right? Like getting, nobody knows how many factories or production sites there are in the world, right? That is not a known thing, but we think there’s tens of millions.
Jim [28:53]
So how many facilities do you have now, given that you’re aiming for tens of millions?
Natalie [28:57]
Yeah, we have 230,000 right now, and we’re aiming to get to 5 million by the end of this three-year strategy.
Jim [29:07]
Wow. Okay. So that’s quite a bunch of scale up. Well, I think that’s one of the things that happens is that when you set up ambitious goals and then you start to meet them, you set a new set of ambitious goals. Well, so is there anything else that you want to share about Open Supply Hub?
Natalie [29:21]
I think there’s one thing to highlight that is unique about our model that may be interesting. We very purposely set out to have a very strong governance model. We have a multi-stakeholder board of directors from everything from a union seat to a facility seat to corporate seats on our board. It’s really positioned us as a neutral organization that is serving all of the stakeholders in the industry or in supply chains. Not only has that sent a message to our stakeholders and users, but it’s also made sure that there’s very strong representation at the table that everyone is represented equally.
When you’re doing the work we’re doing, I just think that’s absolutely critical. I’m very, very proud of our governance structure, and I think it’s often something that’s underestimated when you’re building out a social enterprise, and I’m very happy to talk to anybody about building out a board and building out a governance model. It sounds boring, but it’s actually really important and can be really interesting.
Jim [30:36]
Great. So let’s go back to sort of things that you would share with a budding social entrepreneur who, you know, let’s say has a, who’s like 10 years earlier in their path than you are, and say, you know, what do you wish you knew then that you know now?
Natalie [30:53]
So two things that I think a lot about. One is as a leader of a nonprofit social enterprise, it is very easy to feel like you are being neglected compared to the for-profit social enterprises. There’s accelerators, there’s competitions, there’s Fast Company articles, right? This, at least in the US, this concept of, well, doing good and making money, right, at the same time is possible. And I think that is the case in some circumstances. I would encourage those listening to think very carefully as they start out and thinking through their idea around what governance model or what business model actually makes sense because the resources and the impetus and the societal pressure is, oh yeah, go make money, go be a for-profit. And that might not actually be right for the social good that you’re trying to generate. And there are resources out there for nonprofit tech for good platforms. They’re just, in some cases, I think, a little bit more difficult to find. The third sector approach can and does work and we have to help each other.
The second thing I would say is to not burn out, really focus on your mental health. I think in some ways Gen Z is better about this than the millennials are or other generations. And I’ve come close to burnout a couple different times because the drive and just keep going and work, work, work, work, you gotta let the work teach you and you should, but you also have to take care of yourself and make sure to connect with the resources, whether it’s exercising, hanging out with friends, mental health resources. It is hard being a social entrepreneur. It’s hard being an entrepreneur. It’s really hard being a social entrepreneur. It’s not a track meet. It’s a long marathon.
Jim [33:06]
Well, yeah, one of the things that I’ve seen in the field just in the last five years is the like the Well-Being project actively tried to help social entrepreneurs and their teams deal with this because often social entrepreneurs are working on the front lines of society’s most horrible problems. And it’s, it’s a lot of stress when you feel like the weight of the world is on your shoulders. So hopefully more social entrepreneurs will will try to maintain that balancing act while they’re trying to navigate this.
So, this has been great. Any final thoughts or words that you want to share before we wrap up?
Natalie [33:47]
I think that we are, even though we’re celebrating our five-year anniversary, I think we’re on the precipice actually of scaling in a super exciting way. And that makes me thrilled, you know, a little terrified, but I think sometimes if a concept or idea scares you because it’s so big and ambitious, then you’re potentially onto something. So, yeah.
Jim [34:19]
Well, hopefully your next five years will exceed your expectations as the first five have. So delighted to speak with you today, Natalie, and thanks a lot for telling your story to the listeners of the Tech Matters Podcast.
Natalie [34:32]
Thanks so much for having me, Jim. It’s been a pleasure.
—
Jim [34:36]
We’ve just heard from Natalie Grillon of Open Supply Hub. If you know somebody who would enjoy this podcast, please share the link and feel free to leave us a rating on your favorite podcasting platform.
For transcripts and related articles, check out our website at techmatters.org. And is there something that you found particularly insightful about this episode? Anything maybe you disagreed with? Something you wanna know? Be sure to let us know by sending an email to [email protected].
I’m your host, Jim Fruchterman. Thanks again for listening and for being interested in seeing that technology serves all of humanity, not just the richest 10%.