Delivering for Best-in-Class Wholesaler-Distributors
April 16, 2020  |  ByMark Dancer, NAW Institute for Distribution Excellence Fellow

The conduct of business will change as the Coronavirus crisis recedes, but it’s too early to know the new normal with certainty. Just as first reporting in any emergency often proves to be inaccurate and wrong, so too may early predictions about a new normal for doing business miss the mark.

It’s easy to accept that the COVID-19 pandemic will result in a shift to customers embracing e-commerce, employees working at home and stronger distributors getting stronger. These predictions feel “right” now because they fit preconceived notions. They are outcomes long-predicted by experts and now enabled by the crisis. Following early predictions about the new normal may or may not be a formula for failure, but following them is certainly a missed opportunity to lead.

So far, surviving the crisis is about taking quick action around preserving cash, managing liquidity and protecting customer relationships. Leading to the new future requires challenging assumptions, looking for subtle insights and sharing a compelling vision.

The most impactful outcome from social distancing may be about online ordering. It could equally be about augmented reality tools for collaborative problem-solving. Working at home gives flexibility to employees and diminishes the need for office space. However, that can come at the expense of unplanned human interactions that are essential for creative problem-solving. Strong distributors may ultimately become stronger. Nevertheless, entrepreneurial leaders may come up with game-changing solutions that weaken incumbents.

Over the last few weeks, I have listened to and participated in many discussions about responding to the crisis and innovating the new normal. I’ve distilled three initial ideas for challenging the emerging conventional wisdom. I offer them to help kick-start new mindsets, creative leadership and thoughtful planning:

  • From working at home to working among partners. The new normal isn’t that employees can work at home, but that they can work in places other than the distributor’s office. Working with others in the same physical space builds opportunistic problem-solving, relationships and culture. The new normal may be about asking customers if a distributor’s employees can borrow a desk and work onsite. Or inviting customers to do the same at the distributor’s location. This potential new normal can be about colocating with partners (customers, suppliers, key vendors and more) as ways of building personal connections and “being there” when a new idea or need emerges.
  • Don’t distribute products; assemble goods. In an earlier Distributing Ideas blog post, I explored whether it was time to rename and rebrand distribution. The new normal that emerges from this Coronavirus crisis may be that the value of a distributor is not to stock products and distribute them when ordered. Instead, the role of the distributor may be to help customers when help is needed — during crises and also during digital transformations, labor shortages, market disruptions, facility expansions and on and on. In this new normal, distributors may play a leadership role by “assembling” products, ideas, experiences, vendors and more to create “goods” in the economic sense — positive outcomes achieved by overcoming the scarcity of solutions.
  • From products sourced afar to value created locally. There is an emerging narrative that global supply chains will transform as businesses decouple from distant sources offering low-cost labor. This change may happen, but its story does not explicitly position distributors as an essential partner for a new normal. Distributors must tell their own stories, starting with a radical mind shift — something like “distance kills, intimacy thrills.” Customer value is optimized by partners that stand beside customers where they work and live, in local markets and communities. Distant sourcing is a singular pursuit of low-cost labor yields, inflexible sourcing and fragile profits. “Localness” creates shared experiences that enable predictive risk and rapid mitigation solutions, as discussed in this recent Distributing Ideas post.

As a Fellow for the NAW Institute for Distribution Excellence, I am committed to helping distributors come out of the Coronavirus crisis stronger than before and to leading customers and suppliers to the future. My new report Innovate to Dominate: The 12th Edition in the Facing the Forces of Change® Series is a roadmap for innovation by distributors. It is much more than a report on trends; it is a foundation for distributor leadership with customers and for revitalizing the value chain. I welcome your feedback, direction and questions. Please feel free to reach out to me at mark.dancer@n4bi.com.

 

 

 

 

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Mark Dancer, NAW Institute for Distribution Excellence Fellow

Mark Dancer, NAW Institute for Distribution Excellence Fellow

Mark Dancer founded the Network for Business Innovation to drive awareness, advocacy and excellence for B2B innovation, and to enable an exchange of ideas between leaders on business transformation, technology adoption, social impact and community engagement. For more than 30 years, Mark has worked with leading companies to achieve go-to-market excellence across a wide range of industries in developed and emerging markets.

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