Delivering for Best-in-Class Wholesaler-Distributors
April 5, 2018  |  ByJoseph C. Nettemeyer

You may be asking, “Why is it important to innovate?” Let’s go back 40 years and look at a company that was at the top of its game.

I was just entering the workforce, and one of the premier companies to land a sales trainee position with was Eastman Kodak. The company had its choice of who to hire, and making the cut was difficult. One of my classmates made the cut and we collectively thought that he had won the lottery. Little did we know that a new brand, Fuji, would emerge and start the assault on Eastman Kodak’s business model! Eastman Kodak suddenly had competition that went head-to-head with it on quality, and this competitor was more aggressive in providing incentives for shelf space at retailers. If an aggressive “me-too” product was not enough to diminish Eastman Kodak’s star, along came innovative digital technology that has all but made the company’s legacy business a footnote in history.

What is ironic is that Eastman Kodak was a leader in developing digital products! The company had the technology, and yet its management focus was on defending the status quo. The company abdicated technology leadership to hold on to products that were its past glory. The company refused to innovate.

Today manufacturers and distributors are having their traditional value propositions challenged by information technology. How we disseminate information and how the new generation entering the workforce wants to receive that information are being transformed at such a rapid pace that it can seem overwhelming. But in that chaos of change are hidden opportunities that will be exploited by innovators.

We as leaders must stimulate the type of thinking within our organizations that is transformational and will keep us relevant. We must attack our business models with new ideas before someone makes us a footnote in history. When the pace of change on the outside is faster than change on the inside, you are standing on a burning platform!

We all face significant challenges such as:

  • Technology investment
  • Development of original content to provide thought leadership in the marketplace
  • An aging workforce
  • Management development
  • Designing new relevant sales processes to drive above average growth.

At Valin Corporation we began tackling these issues in 2012. We sought out expert advice on how to address these challenges and recognized that we could not make the leap in a single year. We sought input from academia, industry experts, and thought leaders on innovation. We participated in industry research consortia through the Council for Research on Distributor Best Practices (an alliance of the NAW Institute for Distribution Excellence and Texas A&M University), utilized their best-practice findings, and integrated the measurement of those practices into our business metrics. We invested aggressively in the development of our personnel to ensure that they were comfortable with the tools and could utilize them properly to gain an advantage.

Transformation is a journey, not a bold leap off a cliff. To effectively transform your business, you must

  • Identify your challenges
  • Map your route to the destination
  • Be prepared to launch parallel initiatives that will allow you to optimize your investment in technology
  • Staff those initiatives with tough-minded individuals who stay focused on the goal.

Transformation is an organizational learning experience. It requires organizational flexibility to rapidly restructure around the capabilities of new digital tools. It is not a journey for the faint-hearted, but help is at hand. The NAW Institute for Distribution Excellence has worked diligently to address these issues with its Distinguished Fellows and other thought leaders over the past decade to help all of us in distribution make the necessary changes to remain competitive and profitable. That body of work can be utilized by you and your staff to map a way forward. And, if you weren’t able to attend the NAW Executive Summit a couple months ago, or if you were there, but want to replay thought leadership from experts, take 37 minutes and watch one general session from the NAW Executive Summit where the NAW Institute Fellows engaged in a powerful panel discussion – watch here.

The bottom line is, to get the job done it will take all that you’ve got as a leader. I wish you success in your transformational journey.

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Joseph C. Nettemeyer

Joseph C. Nettemeyer

Joseph Nettemeyer is President and CEO of Valin Corporation, a privately held, employee-owned company providing technical solutions for the technology, energy, life sciences, natural resources and transportation industries. Joe took over as President in 2001 and has transformed the company from simply being a distributor to a complete turn-key solutions provider. Prior to joining Valin, Joe worked for Emerson Electric, a multinational manufacturer of Industrial products, for 21 years where he held senior management positions.
Joseph C. Nettemeyer

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