Over the past year, MDM Editor Lindsay Konzak and Associate Editor Jenel Stelton-Holtmeier spoke with several distribution executives to find out what keeps them awake at night. The question was part of “7 Minutes With …” executive interviews, a regular feature on MDM’s free monthly Executive Briefing webcast available at www.mdm.com/executivebriefing. The first year of programming is now available on DVD at www.mdm.com/ExecutiveBriefingDVD.
Over the past year, the economy has dominated headlines, and uncertainty continues to be the main message. But for most of the 12 distribution executives who participated in MDM’s 7 Minutes With… audio interview feature in the past year, the top issue wasn’t the economy; it was people.
“First and foremost, I ask, do I have the right team on the field and are they focused and motivated?” says Joe DeAngelo, CEO of HD Supply, Atlanta, GA.
“The ultimate challenge for any leader of a business is to create an environment where their team can deliver great performance,” Larry Davis, president of master distributor ORS Nasco, says. “And that includes focus on the culture and sustainability of the people in the business.”
While “people” beat out the economy as a top concern, the two are no doubt related.
“You can’t do this business by yourself,” says Dave Griffith, president and CEO of industrial holding company Modern Group Ltd., Bristol, PA. “We’re blessed that we’re an employee-owned company. We’re blessed that I have over 40 percent of my population that has been with me 20 years or more. But I worry about folks right now going through what we’re going through.”
On the other hand, for Womack Machine Supply CEO Mike Rowlett, strong demand is adding its own stresses for people. “My third biggest concern is keeping our people from burning out during this rapid growth period,” he says. “…Because our folks are dedicated, they’re going to do whatever it takes to take care of the customers and suppliers, even to the point of hurting themselves.” Womack is an industrial distributor based in Farmers Branch, TX.
Executives from industrial distributor MSC Industrial Supply, Melville, NY; HVAC distributor Johnson Supply, Houston, TX; and industrial gases distributor Airgas, Radnor, PA, also included people among their top concerns.
Executives are also focused on customers and suppliers. “The customer is the boss, and it’s one of our core beliefs,” says David Sandler, CEO for MSC.
“Without customers, I have no reason to exist,” Griffith says. “So I worry about their access to capital, their markets, the things that they’re going through that drive their business to make sure they’re surviving.”
The economy continues to be top of mind for many. “Every month that goes by, we’re seeing a strong recovery,” says Harry Dochelli, COO of MRO distributor Lawson Products, Des Plaines, IL. “But I think in all of our minds we’re asking ‘Is that real? And is it going to continue?’”
“I haven’t believed since probably the first quarter of (2009) that we were going to fall back into a double-dip recession, just based on what I was hearing from other customers,” says Joe Gallagher, president of Gallagher Fluid Seals, Inc., King of Prussia, PA. But despite positive signs, there was enough uncertainty for Gallagher to keep the economy front of mind.
For others, including Hisco President Bob Dill, specific economic trends have moved to the top of the list. “Right now, the big thing is price increases… and the ability to pass those on,” Dill says. “If you don’t execute that well, then you’re just going to have a lot of erosion on your gross profit, which certainly is not good news for anybody.” Hisco is a distributor of electronic and industrial materials
based in Houston, TX.
Other economy-related issues mentioned: gas prices, access to capital and increased lead times. But while
current conditions drove many executives’ answers, some emphasized issues that matter despite the economy.
“What really does keep me awake at night is making sure that in all the different touch points that our vendors have with us and all the different touch points that our customers have with us, we’re delivering a consistent message,” says Jeff Crane, CEO of industrial rubber distributor Lewis-Goetz and Co., Inc., Pittsburgh, PA.
“…. We recognize it as a vitally important part of communicating that value proposition.
“And so we spend a lot of time thinking about it, talking about it, and making sure that people understand what we should be saying and should not be saying to customers, vendors and internal associates about our strategies and how we’re executing them.”
“I think change – dealing with change and the ambiguity of surrounding change – is something that’s really important, because customer’s needs change all the time,” says Peter McCausland, president and CEO of Airgas.
“And this is a perpetual thing because change is just continuous.”
Listen to the complete interviews with industry executives at www.mdm.com/7Minutes.