Carter's and KPMG discuss how prioritizing a strong governance and compliance foundation for their SAP RISE transformation led to a record-fast quarter close and prepared them for future AI innovation.
In this insightful discussion, Matthew Joos from Carter's and Vaibhav Gunjal from KPMG explore the drivers and successes behind Carter's impactful business transformation.
Key to the project was the implementation of the SAP RISE platform, designed to create a scalable and efficient operational backbone. A significant focus was placed on establishing a robust GRC (Governance, Risk, and Compliance) framework, ensuring the highest ethical and compliance standards from the outset. This foundational work was essential for building trust with internal and external auditors and has paved the way for future innovations, including the integration of Artificial Intelligence (AI).
The dialogue emphasizes the successful collaboration between Carter's and KPMG in navigating complex audit requirements and driving effective change management to empower users. The transformation has already yielded impressive results, including a record-time financial quarter close and an improved GRC posture, positioning Carter's for accelerated growth and continued innovation.
[0:08] Vaibhav Gunjal KPMG: One of the things I was always curious when we started our journey, that one line, if they could stay little, a little bit longer till their Carter’s wears out. That was a really powerful metaphor, and I was always curious how you came up with that metaphor for driving your transformation on SAP RISE.
[0:30] Matthew Joos Carter’s: Sure, so I, I think it's a fantastic metaphor. We all know that our kids grow up very quickly and the business needs to match that speed. So being able to use that as a platform and modernize our systems to match that speed will be critically important for the future.
[0:45] Vaibhav Gunjal KPMG: That's really great insight but there are a lot of things which need to rise up behind the scenes, for example, systems, data, processes, governance, and innovations like AI, assuming that you are a futuristic company and kids are your consumer, I was just wondering, how did you balance your controls governance with this futuristic approach so that you become a sort of, you know, an innovative company?
[01:18] Matthew Joos Carter’s: So first and foremost, Carter's prides itself on being a very ethical and compliant company. It's part of our DNA. When you're dealing with children, it has to be. Trust is ultimately earned, and I think it's really earned at an individual level. So throughout our projects, we made it a point of emphasis to work with our IT risk and compliance team, our internal auditors, and our external auditors to get them involved as early as possible and show them. The GRC framework that we had created and the foundation that would ultimately become AI in the SAP RISE platform. For us, it was all about laying that foundation, making sure that we got all the controls correct, and that we built that strong foundation before we begin to build an AI on top of it. Over the last several weeks, we've tested that and gained some confidence, and now we can really begin to accelerate our journey and continue to make progress.
[02:13] Vaibhav Gunjal KPMG: That's really amazing. One of the things, you know, I, I said, yeah, the final thing I want to understand, but I want to dive more on the compliance controls and reporting to street perspective, because auditors, internal and externals were key player in this transformation. Would you like to shed some light on how did you manage your auditors? Like, like I said, I was sitting on this side, you are facing them, but you navigated that complexity really well. Without their blessing, we cannot use AI, we cannot use all the innovation. So would you like to shed some light on that too?
[02:49] Matthew Joos Carter’s: Sure. I think that was one of our lessons learned from the program. The amount of work that went into the audit and compliance work stream. We may have underestimated from the Carter's perspective a little bit. But we knew as we got further into the program, it was an area where we needed to spend that time to make them feel comfortable and for ourselves to feel comfortable so that that we can unlock the value of AI in the future. Thankfully, with the partnership of your team, and just the guidance we created a relationship not only between KPMG and Carter's, but also with our auditors and brought it all together. So I think we all feel really great about what we've built on that foundational layer.
[03:27] Vaibhav Gunjal KPMG: So I was just wondering how did you take care of your people because at the end of the day, they need to use this technology and processes and this fancy AI. So any thoughts on that?
[03:37] Matthew Joos Carter’s: We made sure in our journey to bring all the people along. We spent a lot of time working our change management framework and identifying powerful super users throughout our user community and use them as evangelists to spread, the communication and the skills and the coaching to make them feel really comfortable in the new system before we rolled it all out.
[04:00] Vaibhav Gunjal KPMG: We also measured a few outcomes, there were few values which we could capture. How are you looking at that and what's your perception of that value?
[04:10] Matthew Joos Carter’s: Sure, so I, I think the most impressive thing that we were able to achieve is that our first quarter closed in record time. That's impressive in and of itself, and we had no significant issues. Now add to that the improved stance from a GRC perspective and controls, that positions us even better for the future. And like I said before, you know, we have this enormous opportunity ahead of us. So laying that foundation for AI and further business efficiency is what excites me most about the future.
[04:43] Vaibhav Gunjal KPMG: Awesome, amazing. Uh, so, any final key takeaway you want to share with us?
[04:50] Matthew Joos Carter’s: Well, I, I think you're absolutely right. Children grow fast and our business needs to evolve and adapt quickly too. The SAP RISE platform allows us to do that. Now that we've built the trust in the system and the AI solutions, we look to leverage that in the future and see just how much we can get out of this new tool.
[05:09] Vaibhav Gunjal KPMG: Awesome, that's really great. I really appreciate the kind of insight you brought forward. Thank you for that.
[05:17] Matthew Joos Carter’s: Well, thank you for having me, Vaibhav. Thank you.
