Ken Newman: Understood. For my follow-up here, I really wanted to clarify the CSS guidance for the year. I think if I — after the re-segment and backing out the acquisitions, I think, the guide implies organic growth for that segment being in the low to maybe mid-single digits in 2023. One, I just want to see, is that right, and if so, that seems a bit slower than I would have anticipated just after all the positive commentary on the backlog that you guys mentioned in the prepared remarks?
Dave Schulz: Yeah. Ken, so we expect our CSS business reported sales will be high-single digits and that does include about the benefit that we will get for both Rahi. And remember, though, that the CSS business doesn’t have the same pricing carryover as the other two SBUs. The pricing in CSS has been low single digits throughout 2022, we don’t get that same carryover benefit that we get with EES and with UBS.
John Engel: Hey. But just a comment on EES. Ken, was your question EES?
Ken Newman: No
John Engel: It was CSS
Ken Newman: It was CSS specifically on organic growth, but I will
John Engel: Okay. I got you.
Ken Newman: definitely welcome any
John Engel: Okay.
Ken Newman: comments you have on EES as well.
John Engel: No. No. No. Dave gave that guide, too. I mean, he said EES’ outlook is mid-single digits. UBS and CSS are high-single digits as part of the construct and the guide for 2023. Just we talked about throughout 2022 about the supply chain constraints as it started to heal and some recovery. It was different by product category and supplier obviously. CSS was still feeling severe impacts throughout the majority of 2022, started to heal late in the year, and you saw the improved results in 2020 and then in the fourth quarter and that’s continued to start this year. So that’s what serves the basis of the guide for CSS stepping up its growth rates in 2023 versus 2022.
Ken Newman: Got it. Very helpful. Thanks, guys.
Operator: The next question comes from Christopher Glynn with Oppenheimer. Please go ahead.
Christopher Glynn: Thanks. Good morning, everybody.
John Engel: Good morning.
Christopher Glynn: I was curious — good morning. I was curious, for CSS, how are you thinking about prospects or market backdrop for sort of price reclamation on a deferred basis as the supply chains normalize. I know it’s not in your guide?
John Engel: So I think Dave mentioned that briefly, Chris, but we started — we saw an improved contribution from price in CSS in the fourth quarter, I mean, it goes hand-in-hand and in concert with the supply chain’s healing as well. So — and we do expect that we will have — that kind of sets us up well for the beginning of 2023. Dave, I don’t know if you want to add to that commentary.
Dave Schulz: Right. I mean, we are still monitoring what the suppliers particularly those that service our CSS business, where we are in conversations with them, how are they thinking about capturing price cost, obviously, we have not included that in our outlook at this time for 2023. But again just to reiterate, we haven’t seen the same frequency and magnitude of supply price increases from our suppliers in the CSS category. That’s been low single digit throughout 2022 and we would not anticipate at this point any incremental price increase activity. But, again, we will continue to monitor that with our suppliers.
John Engel: I mean, the backdrop is those strong secular demand, secular growth and you look at our Rahi results, which shines a spotlight on our global data center solution, that’s very encouraging. So, look, we will — we are pricing value as part of our gross margin improvement program. We will — and the sales force is very focused on optimizing that. As we said, I want to reinforce, that program has tremendous legs left in it and we are incentivizing the sales force for incremental gross margin improvement. That’s where they get the increased compensation in the kickers. So it sets us a floor, as a starting point, what we did last year, and so again, there’s tremendous incentive in place to sell our full value proposition to customers.
Christopher Glynn: Thanks. Appreciate that filling color. And then digital transformation, a lot of mention of acceleration of the deployment and yields on that. I am curious if any metrics you could share around operating efficiencies or service levels that you are seeing more or less directly tied to your big data utilization ramp?
John Engel: Chris, great question. We have that on our road map to begin to start disclosing that. We have not done that yet, so let’s put a pin on that and say that’s something we are going to get to. I won’t foreshadow, is it one or two quarters out or at what point, but clearly on our road map to start to provide that. I will say that, and we have mentioned that we got a new digital — digital’s impacted a series of applications across our company. I have cited those before our Investor Day last year. We put a finer spotlight on that at our Investor Day. And they include what we are seeing tremendous benefits from thus far, our AI-enabled product search, our intelligent pricing application and something we call unified sales desk, which is brand new and kind of knits together all the applications and the behind the scenes work we have done on our big data in one master data lake and making that — turning that into more valuable information that we can use as we — as the sales force engages with customers in developing their solutions.
It also includes products that are — that include an as-a-service capability like that AV-as-a-service that we highlighted a year ago and so we are getting very nice momentum with those as we continue to also build out the tech stack that we took you through at Investor Day, where we have got a new finance app implementation, a new human capital implementation, they are in place and continue to be expanded and we have started with our WNS team to that’s rollout .
Christopher Glynn: Thanks, John.
