The 2020 Mid-Year Economic Update_long

New Paradigms for Talent Development in Distribution

The coronavirus accelerated a number of changes in distribution talent management that were already underway, including new evaluation criteria for job candidates and an expanded view of work-from-home productivity.
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Over the last several years, macro trends have shaped the recruitment, development and retention of talent across distribution. Factors such as record-breaking economic growth and a steadily aging workforce ready to ease into retirement — without a steady flow of industry experts prepared to take their place — combined to make it an employee’s job market. But all of that has been turned on its head to varying degrees in the last few months, with COVID-19 bringing the economy to a halt; making those fortunate to keep their jobs hesitant to let them go, while many others have been laid off or furloughed.

Desired skill sets are shifting. Location requirements are upended. With this new landscape, what is the next step for human resources in distribution?

During a recent MDM Live webcast discussion, John Salvadore, managing partner and owner of GRN Coastal and GRN Global Recruiters Network, and Cory Calderon, director of organizational development at industrial distributor Valin Corporation, addressed that wide-ranging question based on their hands-on experience, with the context of several decades in the distribution field between them.

With all 50 states in varying stages of reopening, “there is a lot of available talent out there,” said Salvadore, and distributors are increasingly looking to fill positions left open during the peak of the spring shutdown.

Before the pandemic hit the U.S., Valin was among the distributors feeling the pressure of increasing competition for talent, Calderon said. Now that the power of talent acquisition has tilted in favor of the employer, he too is seeing a wide variety of available talent. That means becoming more versed in not just identifying talent, but also better able to screen and identify the quality of applicants. It starts with best leveraging technology, such as Zoom and Microsoft Teams, in recruitment efforts. And Calderon does not expect that element to change as people head back to the office or warehouse. “The ability to leverage video conferencing and technology in interviewing is going to be more critical as we move forward,” he said.

There’s a perception that many people who are in the job market now are there because they were not good enough to be kept on as distributors slimmed down, noted Mike Marks, MDM Live co-host and managing partner at Indian River Consulting Group. That may be true for some, but both Salvadore and Calderon agreed that layoffs overall have largely been less about individual employees and more about a greater critical need to keep the company afloat amid an unprecedented and sudden crisis. “A lot of companies have really been through a bad period of time here, which forced them to downsize,” said Salvadore. “So even though there’s people that probably aren’t quality people that are out there, there are quite a few people that would be readily picked up by any distributor — really tough people who have really good experience.”

Once the “Band-aids” of loans such as the Small Business Administration’s Paycheck Protection Program peel off, Calderon expects the third or fourth quarter of 2020 will better reveal the true state of quality talent availability in distribution. The immediate challenge for Valin, he said, is now that companies are turning the lights back on, “does their value proposition have a greater sticking factor than our value proposition? And how do we manage to that? … That’s going to cause a greater level of competition for talent.”

Talent Acquisition and Recruitment

GRN has more than 100 available candidates currently screened and posted on its talent availability website, with roughly an equal number of people now in stages of the pre-screening process. “I’m finding that distributors can be a lot choosier, and they can be very specific about what they’re looking for,” Salvadore said. For example, he’s doing a talent search for a distributor right now who is looking for an inside sales person who has a safety background and is proficient in a specific ERP solution.

The fact that many, if not the majority, of employees are working remotely right now is also changing the mentality of how distributors are selecting candidates to interview, Salvadore added. Location is no longer critical.

While in the recent past a distributor may have questioned the work ethic of an at-home employee, with three months of evidence under their belt, distributors now feel more comfortable that a remote employee can be trusted to put in a full workday. Salvadore is currently recruiting for several long-distance jobs, and recently placed a candidate in Maryland with a West Coast distributor, who was fine with the candidate’s location as long as they agreed to work Pacific time zone hours.

The use of skills-based assessments for job candidates dates back to the 1950s, but these evaluations continue to evolve — looking different now than they were even at the beginning of this year. It starts with a few upfront questions about today’s reality, Salvadore said: “How comfortable are you with working from home?” “How have you occupied your time during the pandemic?” “How do you stay motivated?”

Calderon advocated not only for candidate assessments but also management development assessments, particularly as the way employees are managed has changed dramatically. Valin uses the Caliper Profile assessment that focuses on attributes that would indicate someone is well positioned to succeed in a remote environment. For example, where does a candidate fall on the self-structured behavioral spectrum? Do they find energy in independent structure, or are they more motivated by external structures such as working in a group?

“We’re seeing a high indicative of success with candidates that are hired for a remote working capacity that have a high degree of self-structure,” Calderon said.

Learning agility — the ability to have a high level of adaptiveness when it comes to technology, for example — is also a high indicator of potential for remote work success, he added.

It also takes an ability to handle multi-tasking that brings on a different level of stress when you factor in realities of home such as dogs barking and, for now, kids whose summer camps or other activities that would get them out of the house during working hours are cancelled, said Salvadore. “We’re also seeing that employers are having a lot more empathy and understanding,” he said.

Sending employees home who have worked in the office for years or even decades is one thing, but for those brand-new to the organization, it can be a challenge to incorporate them into the company culture enough that they actually feel like they belong.

“Now, managers are going to have to be skilled as connectors and network enterprise leaders that can do the same level of job rationalization and introductions as far as onboarding is concerned. They have to be able to do that digitally,” said Calderon.

At Valin, in addition to more frequent communication, managers now take new employees through digital introductions with key department leaders and company stakeholders.

When a new person comes on board, it takes a top-to-bottom company commitment to their long-term success, Salvadore added.

Talent Development

The digital skills needed to manage and work in today’s distribution environment, not just remotely but also in a tech-heavy atmosphere, can be far from the traditional skills that got even the best distribution talent to where they are today. Calderon sees a multi-pronged approach to the ongoing advancement of talent development.

As noted by Salvadore, it starts with an organization-wide commitment to the next phase. Since the pandemic hit, Valin’s CEO Joe Nettemeyer has made a regular practice of holding one-on-one digital presentations with each of the company’s salesforce members — managers included.

The 15- to 20-minute Microsoft Teams digital presentations allow the employee the opportunity to demonstrate their ability to conduct a successful remote sales call, including a sales pitch, shared digital collateral through a PowerPoint presentation and other resources such as PDF handouts.

“That commitment, getting the CEO’s mindshare, for 12, 15 hours in the month just listening presentations, it’s showing the workforce that we’re taking this seriously now,” Calderon said.

Another prong, Calderon said, is proper resourcing. Valin’s IT team/help desk specialists were not only in charge of ensuring a smooth transition to remote work in the beginning, but they also remain readily available on live calls to provide backup if there is a webcam or audio issue.

“Employees feel supported, that they’re not going to get dinged on their performance review because they weren’t able to adapt,” he said. “And so that level of empathy and having that flexibility from a managerial standpoint is going to be critical.”

Promoting a culture of adoption versus a culture of resistance has gone a long way for Valin, especially in getting long-entrenched employees to embrace new digital technology. There are still naysayers, Calderon said, but having senior leadership — brand and culture ambassadors — who are showing an interest and willingness to participate in the technology and help others with it has made a big difference.

There is a lot of value in maintaining a balance between invigorating the organization with new blood who are already tech-friendly and those who are older and less digitally savvy but have a wealth of industry knowledge.

“If you can get the more seasoned employees to work with the youth of the organization, that’s a nice balance to have,” said Salvadore.

It’s up to the organization to create an environment where all employees are supported on technology.

“Digital enablement doesn’t mean, ‘Here’s the software deck, learn how to use it,’” added Calderon.

Instead, it can include redesigning workflow or job functions to encourage collaboration and leverage the unique individual strengths of each employee. For example, Valin has an inside sales guy who is a master at Outlook and other tools. Part of his job is to set up appointments for field guys who have less of a digital skill set.

Organizational Design

With much traditional structure disrupted, there is a growing emphasis on core organizational design and how it needs to change to reflect new work realities. Salvadore recommended examining your work structure during the pandemic to evaluate what worked for the company and what didn’t.

For example, how effective were outside sales representatives when working from home? Is there a new, happy medium that can be reached involving remote and in-person customer interactions? “The way people manage from an organization standpoint is going to have to radically change as you get more people working remotely,” he said.

Valin views organizational design as the organization’s ability to respond to external environment changes and remain effective. Through that lens, Calderon said the company is examining potential structural or procedural changes that distributors are going to be facing, in the context of pandemic-related consequences as well as the general changing nature of distribution.

For the past two years, they’ve had an ongoing discussion about building enterprise leadership to move from siloed organizational strategies and functional hierarchies to more hybridized or matrix organizations.

“It’s extremely difficult and challenging to develop and manage in a matrix environment,” Calderon said. “But the reality is that is the environment we’re operating in — different departments and different business units are competing for resources. The adage of doing more with less has been true even pre-pandemic. Looking at the economics behind this, the ability to restructure the organization and put a greater emphasis on teams and enterprise leadership is going to be highly important.”

Calderon anticipates a growing emphasis on employee experience in organizational design that centers around keeping employees well managed, engaged and productive in remote environments.

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