I was working with a private client last year on some personnel changes. The client was getting fed up with the lack of performance and direction from one of his branch managers. He wanted to make a change. At the same time, the company was contemplating the possibility of opening a new location. The opportunity was right and the company had existing sales in the territory. I convinced the client that we should clean up the current branch manager problem before shifting focus to the new opportunity. Bad things happen when you take your eye off the ball.
Before we made a hasty change, we decided to look at the existing talent pool for an acceptable replacement. Since most privately-held distributors prefer internal promotions, we started reviewing potential candidates. This is where our plan came to a grinding halt. There were no acceptable internal candidates in the local branch.
Undeterred, we decided to look company- wide since the locations were within a reasonable distance from one another. Again, we hit a dead end. After looking around the company, an ugly truth emerged. We could not move forward because the company had failed to build a solid bench.
Many of you might suggest that we could have gone outside the company to find an acceptable candidate. This was certainly an option. There were probably some very skilled managers that could have come in and done a reasonable job, but they would have been lacking one crucial component— cultural familiarity.
Just how important is culture in a small, privately held distributorship?
I’m not sure if this question warrants an answer. At the risk of stating the obvious, it matters a great deal. It is often the glue that binds all the distribution functions together. It dictates how we treat the customer, what we are willing to do in the name of customer service, how we price products, how much inventory we stock, how we compensate employees and a myriad of other distribution considerations. The culture of a business is more than a vibe. It is often the key element that dictates success or failure.
I have seen several talented individuals fail in a company because they could not assimilate into the company culture. I have personally tried to bring in sales managers and other higher-level personnel from the outside. In most cases, the hire falls flat on his/her face. It has nothing to do with a person’s experience or knowledge of the industry. It is a cultural mismatch from the beginning. I have friends who have made it work, but that’s certainly the exception, not the rule.
In my experience, many successful managers are homegrown. They come up through the ranks of an organization. They know how the company conducts business. They have learned from their predecessors. They understand the customer service philosophy.
They know the suppliers and how to get the most from them. Their ascension through the ranks has earned them a level of respect from the team, which is a tough hurdle for an outsider.
If we are going to carry on the tradition of growing our own talent, we need to formalize the process. As my client came to realize, his company did not have a method to develop future managers. When his company was small, it was easier to manage the progression.
He could coach and advise people along the way. As an entity grows, it’s tougher to make sure people are ready to make the leap. Many distributors, like my client, are still trying to develop their employees the same way they did 20 years ago. The first step in breaking out of this paradigm is to define your progression.
I suggest you gather a small group of employees together and rough out the perceived progression. Most of us will start the process in the warehouse. I happen to put newbies in picking, but the starting position is up to you. Once they graduate from the warehouse, they could join the sales counter. Then they could move to an inside sales or customer service position. Often, an employee will move on to a telesales role or outside sales position. Management may be in the future.
Remember, the path doesn’t necessarily lead to sales. I often see diversions from customer service roles to purchasing or operational management positions. There are many different ways for employees to progress. There is no reason for them to stagnate.
Once you outline the progression, create a list of skills associated with each position. In the case of my client, we broke counter sales down into four positions—counter one, two, three and lead. We defined the skills a person had to master in each position before moving on to the next role. The candidate worked through the list, learning how to perform each task. As an employee advances, the skills should become more difficult to master. The beauty of the program is seeing who is willing to work on mastering each skill. Some are more motivated than others.
Use this approach for all levels of the progression. The challenge will be defining all the skills necessary for mastery. The skills will change as policies, technology and the business climate change. In order to break down the enormity of this process, hand pieces of the progression off to different individuals within your organization, those who are closest to the jobs at hand and who have a handle on skills required to flesh out the progression.
A clear progression is a great way to attract new blood into your organization. Let’s face it, most of us didn’t go to school with the intention of entering the wholesale distribution industry. Unless you were born into it, working in this industry probably didn’t cross your radar early on. Most of us started working summers in a warehouse and came back after graduation with the intention of having this as a short-term gig until we found our “real” career. The years flew by and we found ourselves reading trade magazines and association newsletters— go figure.
While many of my contemporaries experienced this situation, I don’t think modern distributors can solely rely on this method to fill their ranks. Good distributors do more recruiting than hiring and offer something more than a job and a paycheck. The latest generation of employees is looking for opportunities that provide a constant stream of new challenges. If these employees perceive monotony, they will go elsewhere. Do we have a constant stream of challenges in distribution? Do people move through the ranks at a fairly rapid pace? We can fulfill the need for constant stimulation. We just need to learn how to sell it.
You will always face the need to replace personnel in your organization, whether by choice or happenstance. By creating a formal process for moving and educating your employees through a progression, you ensure that you are constantly developing a bullpen of promotable talent.