Andrew Horvath: Hello and welcome. My name is Andrew Horvath, and I’m a principal and lead of the distribution practice for the Alexander Group. I’m joined by John Drosos, who is also a principal and distribution practice lead for the Alexander Group. We would like to introduce the second part of our two-part podcast series, where we will continue the conversation on four leading trends that are impacting the distribution industry. We’ll also discuss best practices for distributors looking to succeed in a changing environment. In our last podcast, we covered the first two trends affecting distributors, which pertained to the go-to-customer model: the first, current challenges associated with industry consolidation, and the second, requirements and opportunities for e-commerce within distribution. Today, we will cover trends three and four, which are associated with talent: the transitioning workforce and its impact on distributors, and consequently the need for development of new roles. Now I’ll pass it over to John, who will start the discussion on trends related to workplace talent.
John Drosos: Thanks, Andrew. As you mentioned, the third trend we see is a rapidly transitioning sales force. Sellers in the industry are fairly tenured, and distributors are challenged with not only filling open sales positions but succession planning for the future. Finding and retaining the right talent in today’s more complicated selling environment is critical. More specifically, distributors need talent with technologically advanced skills to service today’s digitally savvy customer. In addition, newer entrants to the job market are looking for robust training programs, active management and a variety of tangible and intangible rewards. Distributors should focus on creating better organization and job designs, multi-ladder and varied career paths, true performance management and merit-based versus purely tenure-based rewards programs. I’m going to hand it back to Andrew, who’s going to cover our fourth trend as it relates to changes in workplace talent.
Andrew Horvath: Thanks, John. The fourth trend impacting workplace talent within distribution is the need for the development of new roles. As distributors determine how best to reach each customer segment, they also need to clarify how roles are defined and managed within the sales force. Traditionally, the sales manager role has been inconsistently defined, with too little focus on driving accountability of the sellers they manage. This is primarily due to the sales manager’s role being blended between sales operations and branch P&L. Sales managers acted more like GM’s than true coaches. Oftentimes, the individual occupying the role lacks the skill set required to think strategically and execute tactically on sales. This resulted in inconsistencies in sales representatives performance and accountability, allowing them to act as income producers rather than manage sales representatives. To combat the situation, distributors should focus on designing sales managers roles that are focused on coaching teams, and staff those roles with managerial talent, not just super sellers. Additionally, with the transition to smart products and the need for solutions selling versus product and features selling alone, the use of product or vertical specialists to better speak to the solution set are becoming the norm. Distributors should consider creating specialist roles to provide additional value to customers who require greater service levels and specific technical needs.
John Drosos: Thanks, Andrew. To summarize, four trends are impacting distributors. Today, we discuss the third and fourth trends, workforce transitions and the development of new roles. Our first podcast highlighted the impact of the first two trends, consolidation and e-commerce as they relate to go-to-market channel strategies. We hope that you enjoyed our podcast series. If you would like to learn more about Alexander Group’s distribution practice, please contact us through our website at alexandergroup.com.
