A View of the Post-Recession Economy
Join me as I climb my own personal Mt. Nebo. Once on the craggy summit, I place my cupped hand over my brow, strain my eyes and peer off into the not so distant promised-land. Unlike the land viewed by Moses, my horizon isn’t flowing with milk and honey. Instead, it is filled with a new kind of economic growth. Suddenly, I notice – there are others standing along side me on the mountain top. The National Federation of Independent Business an organization of small and midsized business shares my view. They report the highest confidence level amongst their members in 16 months. As the recession slowly grinds to a halt, more and more companies are walking with a confident dash in their step.
But before we run down the opposite side of the mountain and disappear into the happy sunset, it’s important to understand the effects recessions have on business trends. Strategies emerging during recessions have a tendency to quickly become the post-recessionary norm. Immediately following each of our recent past economic downturns, a whole set of business realities emerged. Each downturn brought an accelerated rate of change.
To illustrate, let’s look over an MVP list of recessionary trends. Right-sizing and re-engineered organizations climbed out of the recession of the 80’s. A decade later, integrated supply agreements sprung up after the downturn in the 90’s. And just a few years ago we saw, off-shoring and outsourcing explode out of the ashes of our post 9-11 recession. Well guess what; this recession is pushing along some major new trends of its own.
For those of us in Electrical Wholesaling, recognizing newly developing trends and positioning ourselves for the future is a “must have” skill. So with this in mind, let’s devote the next few minutes to examining what lies just over the horizon.
The supply chain is tightening up
The supply chain is the interconnection of all the organizations that interact in the manufacturer and delivery of a product. The very magazine you hold in your hands today has a supply chain. It probably started with a forest products company providing pulp to a paper mill and it ended with the mailman dropping the finished product into your mailbox. All the intermediate steps of printing facility, ink plant, distributor, trucking companies and the rest are lumped together and called the supply chain.
The best supply chains provide the lowest cost materials. Duplications in the supply chain lead to excess cost. This recession put the squeeze on the whole system including our suppliers and customers. We generally don’t think of ourselves as part of the supply chain but we are. And one of the duplications in our world comes in the form of redundant sales teams. Think about your vendor partners and consider that supplier sales team you used to work with – where are they?
Across distributor-land, more and more folks are finding their supplier’s sales team missing in action. If your key lines had five people supporting a territory in early 2008, today they have maybe three. The bigger the company the greater the chances – the local sales team was down-sized. This impacts the Specialist world. Do you find yourself responsible for factory quality issues? How about expediting? Repeatedly Specialists are telling me they are doing work once reserved for the vendor’s sales team. Good or bad, it’s a fact.
The very best organizations will turn this into an advantage. The rest will talk about the good old days and grouse about the way things have changed. I believe competitive advantage will come to Specialists who focus on three things.
- Technology and Product-based Training
- Value Metrics
- Competitive positioning
Technology and Product-based Training
The biggest impact may come with training. In years gone by factory people carried much of the training burden. While there have been big gains made in the world of computerized and web-based training, an urgent need exists for a local-based “live person” trainer. This is true not only with customers but inside our own selling organizations.
Think of the new technology hovering in that not quite ready for prime time state. LED lighting, green technology of every kind, new generation automation controls, wireless sensors of all kinds, new electrical safety regulations and a whole lot more are about to meet a newly reconfigured workforce.
In the post recession times, the distributor Specialist will be the go to guy for locally based training. As the economy heats up, you need to have a plan for training.
Nearly everyone will be thinking about customer-based training but few will look at ways of bringing their own teams quickly up to speed. I suggest you begin creating an internal plan – first. The first step is to build a core competency plan, here’s a sample to get you started: