IndustrialSage

Hello, welcome to today’s episode on IndustrialSage. I am joined by Kylene Zenk who is the manufacturing marketing director at Kronos [which, since filming, has become Ultimate Kronos Group]. Kylene, thank you so much for joining me today on this episode. How are you doing?

Yeah, I’m doing great. Thanks for having me, Danny. It’s nice to be here.

Well, I’m excited to jump in today’s conversation. We’re going to be talking a little bit about workforce development, which– challenges in the workforce right now, which, I don’t think there are too many. That’s a stupid joke. There’s a few going on. So, but for those who are not familiar with Kronos, if can you tell me a little bit about your organization, what you guys do, and what your role is?

Yes, so as you mentioned, I am the director of the manufacturing marketing practice at Kronos. So my role is really around developing and executing the go-to-market strategy to help educate and build awareness for how technology can help manufacturers and drive employee engagement and improve organizational performance.

Great, well, there’s a lot going on right now, obviously, relative to COVID-19. Everyone knows, unless you’ve been living under a rock. And even then, I think it’d be difficult to not understand what’s going on. But relative to a lot of the changes that have been happening in the space, how have you seen industries shift this year relative to COVID-19?

Yeah, I think there’s been an interesting dynamic in manufacturing because the reality is, many organizations in manufacturing are essential businesses. So while they have had to shift and adapt to increased risk and concerns about health and safety, they’ve also had to maintain that business continuity in order to develop products that we need to support the global community, whether that’s food and pharmaceuticals or medical devices and different aspects. So I think the emphasis has been on maintaining business continuity, adjusting to supply chain disruption and other types of disruption, but most importantly, emphasizing the focus on health and safety of the workforce and creating an environment where employees feel safe coming to work who have to go to work.

Yeah, exactly. It was interesting, and it’s funny. I still feel, you’re mentioning with the supply chain, we are still, there’s still a lot of effects that have continued to happen. Obviously, they are not as severe as they were initially back in March and April when– obviously, the great toilet paper run of 2020, which has yet to be discovered why– obviously, causing a huge chain. And you’re seeing that across several different products. I think I heard, I was listening recently, was it pickles and pepperoni, for example, was something that was on the list, right now, of– and it’s a revolving list– as these companies are trying to really adapt to what is going on. So when it comes to optimizing potential in the wake of this pandemic, what areas are manufacturers really struggling the most, and how can technology help to solve that, some of those challenges?

According to a recent study I read by Odin Technologies, 94% of manufacturers have experienced some change in demand, whether that’s, they’ve seen an increase for their products or a decrease because of people not making certain buying decisions at this time. So, regardless of how, whether it’s going up or down, manufacturers are having to figure out how to align labor to demand and really optimize their production schedules and processes while, at the same time, maintaining social distancing guidelines and so many other things. So I think that is incredibly challenging for manufacturers to think about. Scheduling the workforce is already really challenging in manufacturing. You have employees that have certain skills requirements or certifications that are needed to run equipment and things like that. There’s union policies and other regulatory requirements that you have to keep in mind around overtime.

And now you’re saying you have to make sure they’re six feet apart on a production line, and not all production lines are designed in a way that can be reconfigured as such, so you have to put up barriers and all these other things. So I think technology has been able to help a lot of organizations, particularly a lot of the clients we work with because they’re able to, now, think about how do they adapt their scheduling processes to align with those shifts. So, for instance, a lot of organizations are creating new shift patterns so that they can have smaller groups of employees working together. So you’re limiting the number of people that you’re interacting with at any given time. And we can help with, technology can help automate that process and make sure you’re taking all those considerations into play. Another factor a lot of organizations are doing is, there’s an increased pressure to have sanitization and different activities happen between shifts.

So if you’re bringing one group of employees out, you want to make sure you’re cleaning appropriately, so extending to time between shifts is something that a lot of people are doing. So, again, technology can help align those shifts and produce those breaks so that you make sure you have that appropriate time. And there’s also just concerns around the number of people that are lining up at the door to get in the facility or, in many cases in manufacturing, lining up to clock in. So how do you make sure that you have enough staggered time between shift start and end starts? You have all these employees that are coming in. That’s a major concern that everyone’s contending with. And as more and more regions continue to experience influxes and infections, it’s an ongoing cycle where you’re having to continuously figure out how to adapt to what the present day is bringing. So it’s definitely a bit of a challenge.

That’s a very nice way of putting it, adapting it to what the present day is bringing you because everything is changing by the hour. Maybe it’s every two hours, now. It’s slowed down a little bit. But—

Just about.

It totally depends. The reality of it is, what you’re talking about it from, the ability from being able to adapt it and having technology in place to be able to put these different things in place is one thing so that we can look at, from a health and safety standpoint. But you have this whole other pesky thing. Let’s talk about operational efficiency. Very early on, one of the first things that a lot of manufacturers were doing, was saying, like you mentioned, “Hey, we’re shifting schedules and shifts. We’re going to have a little bit of a delay.” Lunch was a big thing, breaks, times were being all staggered. And that’s great in certain areas except when you can’t do that or you’ve got, things are layered. And so, just from an output standpoint, you’re getting hammered even more, especially you’ve got a reduced workforce on top of trying to adhere and make a safe environment. But, yet, at the same time– so much to really consider. So I imagine having some sort of technology to be able to help optimize that and look at different areas and trends is pretty important.

Yeah, absolutely. I think your point is, a lot of companies are experiencing labor constraints right now. Employees are potentially sick. Many organizations have had to do layoffs or furloughs, and they’re working with a reduced headcount to begin with. So they’re trying to manage around all of that. So, really, it’s about optimizing your labor resources that you do have and aligning them to the work that needs to get done because, ultimately, you are trying to produce products in an efficient way. And in a way that’s high quality is always a major consideration as well. So I think technology can definitely play a role in optimizing the performance of your people and aligning your people to those production schedules and demand that you’re experiencing.

Yeah, absolutely, 100% critical. So moving forward on that, in regards to creating those environments, managing a large, changing workforce, let’s talk a little bit about contact tracing. We hear about that a lot on the news in other industries, this is how we’re going to–when and if, essentially, you have an outbreak, how are you able to really isolate and basically, really mitigate the risks that you have associated with it? What has been your experience from Kronos’s perspective?

I think from Kronos’s perspective, we’ve actually introduced a contact tracing tool that’s part of our workforce management offering. But also, we’ve done some research and really fielded some research in this area as well, so I could talk a little bit about both those dynamics. We just completed a study in July. And our research found that 9 in 10 employees, actually, based in the US, we were focused on the US, believe that the employer has an obligation to let them know or notify them if they might have potentially come in contact with a coworker who has tested positive for COVID.

People are concerned about their health and their well-being, and they want to know. And at the same time, the employees recognize that, for an employer to know that information, there’s going to have to be some level of disclosure involved. And 86% of US employees, they’re also relatively comfortable with the idea of some type of employee-based, employer-based contact tracing. So providing that information is something they want and need. What’s a little bit disconcerting is that, according to another study by Mercer, who’s a consultancy in the benefits and labor space, they have said that only 54% of US companies are either planning or have already started to implement a contact-tracing program.

Wow.

There’s a big discrepancy between what employees want and need to feel comfortable going to work and what a lot of organizations are actually planning to do. So I would say, from Kronos’s perspective, our philosophy is, in many cases, you’re already capturing information about your employees. We develop workforce management tools, so you capture where employees are through their schedules, what departments they’re working in, who else they’re working with. We capture time and attendance information. When are employees getting to work? When are they leaving? So you can have access to that information about where your employees are throughout the day and who they may have worked with so that in the event you are notified by one of your employees that they’re sick or potentially sick, you can let people know they should be starting to think about potential quarantines or testing and things like that. So the faster you can get the information out to your workforce, the more effective you’re going to be, as an employer, in reducing the risk of an infection which can have a detrimental impact on your entire business if you’re not able to control that quickly.

Absolutely.

So contact tracing is critical to that development.

Yeah, no, 100%. Good word, detrimental, really, to the operations there, if you’re not able to isolate very quickly and figure out so that, otherwise, if that takes over– We’re hearing stories, early on, where huge manufacturing facilities were getting, department of health was coming in and saying, “No, you’re shut down,” and hearing about tons of people calling out because they were sick. One thing that I’m curious about relative to the contact tracing piece, and this is something that, I’m curious about your perspective on this, and that actually is around HIPAA and privacy. Now, if it’s a little bit more generally accepted that, okay, if I suspect that I’ve got the coronavirus, I should go get tested and all that good stuff. But as it relates to notifying your employer, there’s a whole privacy component to that. Do you have any insights you can share with that from Kronos?

Sure. I don’t know if this is, necessarily, Kronos’s philosophy, but I can say from what I’ve learned in talking to some of our clients, what they’re doing is, in order to protect the individual privacy of any individual, they set up very specific protocols in terms of if you need to report a potential illness or illness, there’s usually some type of a generic hotline or number. So it’s not that you as an individual are talking to someone you know. And then, that information gets passed through the appropriate channels, the safety and compliance group particularly, or potentially HR because you’re right. Protecting people’s privacy is really important. So the contact tracing is not about identifying that Jim Smith might be sick. It’s about identifying someone that you worked with last shift could be ill, and we wanted to make you aware of that. So it’s certainly something that organizations are aware of, and you need to be thoughtful about.

Yeah, great thought and consideration in terms of, for those organizations that haven’t set something. You mentioned, there was a pretty big stat of manufacturers who have not set these things in place to the extent that employees are hoping and expecting for. So that’s a great thought there. So, obviously, 2020, everyone would like to hit the reset button. Everyone wants to hit redo a little bit. There was a lot of initiatives and things in plants. A lot of manufacturers, in regards to workforce, I’m sure, were looking at implementing, and because of the disruptions, said, “Okay, we’re going to table this.” But what are some of those things that manufacturers need to be looking at that, it might not necessarily be an on-fire, immediate, urgent matter quite yet, but it’s probably, could be a little bit of a ticking time bomb, on a back burner. Are you seeing anything like that right now?

Yeah, one of the things I’ve been following for the past several years is the skilled labor shortage that is occurring in manufacturing.

Yes, yes.

So pre-pandemic, organizations were struggling to find employees with the appropriate skillsets that are needed to do certain types of jobs. And we’ve done our own research in this area, and a number of organizations have said that either attracting or retaining talent was a problem. Well, that is going to get a lot more difficult in the next few years because a large percentage of the existing manufacturing workforce is going to retire. 25% of the manufacturing workforce is over the age of 55 and thinking about retirement in the next 5 to 10 years. And unfortunately, younger, the next generation of employees aren’t necessarily looking to manufacturing as the most viable career options. Manufacturing has a bit of a reputation challenge in terms of not being seen as an exciting or high-tech place to work. And for those of us that work in manufacturing, we know that’s not true. Technology’s all around us in the amount of digitization that’s happening on the plant floor and automation.

So manufacturers absolutely need to be thinking about, even with all the distractions of what’s happening today which are extremely important, how to build a talent strategy for the future. How do you think about, what are you doing as an individual organization to educate students in your local communities and build that talent pipeline? What can you do in that regard? Or how do you think about upskilling and retraining some of your current workforce to support roles that are going to be opening up in the future? So I think that talent management and talent supply chain idea is something that needs a lot of attention. And we can’t forget about it just because we have a lot going on otherwise. I think if we wait, it’s going to be too late. So just keeping that front-of-mind and recognizing that that challenge hasn’t gone away. It’s still going to be there when this all unfolds.

Yeah, absolutely. That’s something that I do feel, personally, a little passionate about, or a lot passionate about because, like you mentioned, it’s almost like the manufacturing space has gotten a bad rep, and “I want the cool Silicon Valley.” “I want the cool marketing–” Well, I guess we are in marketing. But different; “I want to be in the B2C space,” and “I want to work in a technology software company.” I guess you guys are a software company here. But the reality of it is, is that there is amazing ingenuity going on right underneath our noses. And when people realize, when you look at the last 100 to 130 years of, let’s look at the US history from an engineering and ingenuity and innovation standpoint, it is amazing what we have accomplished, and that was largely due, in part, through R&D and innovation and engineering and manufacturing, right there.

100%, yeah, absolutely.

So I get excited about it. And I think that, yes, it has gotten a bad rep. And I’m excited to see that challenge be solved. We’re starting to see it a little bit more, maybe pre-COVID. It’s still definitely going to be there. But it’s definitely a big thing. I agree 100% with you that it needs to be solved. But I think it can be, so that’s great. Alright, my last question: Is there any best practices or anything that we haven’t covered that you think that a manufacturing company or organization should be focused on right now?

Yeah, it’s tied a little bit to the last conversation we had around attracting that next generation and how to make manufacturing exciting, because it is exciting, but how to make people aware of that. I think the other thing that we need to be thinking about in manufacturing is how to create a better employee experience for the workforce. So I think traditionally, manufacturing management, there’s a lot of legacy, old-school mentality about manufacturing and shift work, and the reality is that the world of work is changing so much. Technology is impacting every aspect of our personal lives, and it’s starting to influence how we work and where we work and our ability to adapt. So that really influences the whole employee experience. Your employees are going to come into the plant or the facility and expect to have access to information. They’re able to look at their cell phones every, single day and get any bit of information they need, so they need the same access to information at work. So how do you empower them with information, is something that I think is really important, and also flexibility.

And this is an area a lot of manufacturers think, “Oh, we can’t provide flexibility to our hourly employees. They can’t work from home. They need to be there.” But if you create an environment where you have flexibility in terms of giving people input into which shifts they work or what jobs they work or just give them flexibility to make changes, if anything, we’ve learned during this COVID situation is, our lives have all changed dramatically. Outside of work, we’re all balancing family obligations and obligations with children. And so, you have to, as a manufacturing leader, think like a human being and recognize that your employees have this completely different experience happening outside. So how can you support them in that? Give them flexibility. If they need to request time off because they’ve got to take care of their kid or deal with homeschooling for the day, give them the opportunity to do that. Provide those easy avenues to make last-minute changes and adapt. Your employees will appreciate it a lot and know that you recognize the challenges they’re facing outside of work. So I think just thinking about a holistic employee experience and not just what they’re doing when they’re on the job, but how do you facilitate and create that work-life balance that many other employers and other industries are able to do. So if manufacturing can’t do it, it’s going to be challenging to attract talent when they can get it somewhere else.

100%, absolutely, yeah, that makes a lot of sense. Well, Kylene, thank you so much for spending some time with us today. I really enjoyed our conversation. I learned a lot, especially how, one notable thing was how a lot of manufacturers have not put some of these practices into place. Obviously, rehashing and looking at the workforce attracting and retaining talent challenge. If an organization who is watching this say, “Hey, listen, we might need to talk to these guys,” what’s the best way? Should they go to your website? What’s the URL so they can find out more about you guys?

Yeah, easy enough, it’s kronos.com, K-R-O-N-O-S dot com.

Perfect, alright, so we’ll make sure we put this in the show notes that companies can have access to that if that’s something they would like to learn more about. I’m sure you have lots of resources there. And yeah, thank you again, so much, for your time today.

Oh, thank you for having me. It’s been my pleasure, Danny.

It’s been great. Alright, so that concludes today’s IndustrialSage episode. I am tired. It’s been a long day. But thank you for listening or watching. Listen, if you have not subscribed, you need to go to IndustrialSage.com right now, and you need to subscribe. Why? Because you’re missing out on all kinds of great content like this episode that we just had with Kylene, and so you can be a better manufacturer. You can be a better leader in the organization. We have news. We have insights. We have data, webinars, all kinds of things that you’re missing out. So go subscribe today. That’s all I got for you. Thanks for watching or listening. I’ll be back next week with another episode on IndustrialSage.

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Hey, so let’s jump into today’s episode. I have Mr. Paul Konrath here from Custom Control Sensors. He is the VP of marketing and sales. Paul, thank you so much for joining me today at IndustrialSage.

My pleasure.

All right, so you’re coming in from LA. We were just talking about this before, beautiful weather, it’s perfect, and you’re going to Lake Arrowhead this weekend. That sounds awesome, sounds like good times. But for those who aren’t familiar with Custom Control Sensors, tell me a little bit about your company, what you guys do, and maybe some of the products that you guys make.

All right, yeah, well Custom Control Sensors was actually founded back in the late ’50s. It’s a family-owned business. Some of their early products were actually used on the space programs, the Gemini, the Apollo, and Mercury programs, and that got them started into aerospace, and they eventually moved from aerospace into industrial products as well, components for the most part. And the types of products that we make are typically called pressure, sense switches and sensors. They react to fluid pushing against the part of the switch or the sensor and giving out some kind of an electrical output.

Yeah, no, that’s awesome. I’m sorry, go ahead.

They’re fairly popular. I mean if you look at the average airplane there’s probably a hundred or so of these types of components on an aircraft. So you don’t necessarily notice them, they’re not a consumer item, but they’re heavily an industrial and aerospace product.

So are you focused just exclusively on aerospace and aviation, or are there other industries?

No, we’re one of the few companies that are more broadly-based, where we have a very sizeable aerospace component of our business, and we basically deal with all the majors, and most aircraft that are flying. We have some military applications as well, both airborne and on the ground. Anywhere you might have fluids and pressure. And then on the industrial side, we tend to use industrial as a broad umbrella, but a lot of oil and gas-type applications, a lot of processing, industrial processing. We have some other things in the energy power, your utility company probably uses some of our products as well. And then everything from Disneyland to Papa Gino’s Pizza uses our products.

So I’ve got a quick question, for those who aren’t familiar then with… you mentioned the Gemini project. So in aerospace, for those who aren’t familiar with that, what did you guys do? This is a really cool story, I’m an aviation and aerospace geek, so this I think is super cool.

So okay, and that goes back in time in the beginning of the Space Race back in the late ’50s and early ’60s. One of the first manned rockets that NASA put together was started with Mercury, and then the Gemini program, and eventually the Apollo. And what they did was obviously put a gentleman on the top of a rocket and fired it up into space, and the concern was when the spacecraft was coming back from outer space, or somewhere on the orbit, they had to be concerned about deploying the parachutes. How could you deploy the parachutes? Perhaps this person was injured, or who knows what happens. So they worked on coming up with a way to automatically deploy the parachutes for all of these spacecraft. And one of the ways they found was using a CCS switch that reacted to the atmospheric pressure.

So as the spacecraft fell back to the atmosphere, the atmospheric pressure built up, they monitored it, read that pressure, and at a certain altitude, the pressure in the atmosphere got enough to actually flip the switch, or flip our switch, and that closed the circuit that then started the sequence that deployed, well it knocked the cover off the spacecraft, and eventually deployed the parachutes out. And obviously, as you can know now in history, the landings were always successful. But it was a CCS, actually there were a couple redundants, which was just in case, but there were a couple of CCS switches that inaugurated the launch and the landing sequence. There was a switch in the main display on the main console, you had to set it to automatic. So it was sort of automatic just in case. But you could also deploy the chutes manually by flipping the switch the other way.

Oh, that’s cool, I think that’s a cool story.

And it certainly got our start. In fact, I was talking to, because it’s the 50th anniversary of the landings on the moon, Apollo is now starting to get a lot of recognition. And I did a little speaker run, showed it around, and the president said “Hey, we were also on the Lunar Lander, we were also in the Rover, the spacecraft, the buggy that they rode around.”

That’s awesome, that’s pretty cool.

Yeah it is.

That’s awesome. Do you have any other really cool applications like that?

I’m like you, I love airplanes, and… and we see applications like the… the SR-71, the black…

The Blackbird, yeah.

And B-52 Bombers, it goes way back in time. So we do some of that but most of our applications nowadays, well like the other day we were talking about one on the Abrams Tank, which you don’t think about. So we get a lot of those unusual applications from that standpoint. On the other hand though, anywhere there’s water, we come up on things, so anywhere there’s fluid we can get involved and that takes me all around the world.

That’s awesome, definitely some very cool applications. So let’s kind of talk about some of the sales and marketing a little bit with that. I would imagine obviously aerospace, defense, all these different areas, definitely have some unique challenges in terms of the procurement process, and selling. So I guess what would you say, how are you guys… I guess what techniques are you using, essentially, to get that message across and develop new business?

Let’s talk about the aerospace a little bit. Not that it’s totally unique, but it offers an interesting… The aerospace industry is changing from older engineers and old ways of doing things to the younger people, and it presents two different ways of… two different entry points into the industry. And we generally are a technical product, we have to deal with engineers, we design parts for usually some kind of specification. So an engineer is almost always involved. And we are a relatively small company. We’re not quite as big as Boeing, and so it takes a while to get into people, and finding the right people. Some of that is done the old-fashioned way, where you call on people, you ring them up, but we’re finding more and more the younger people don’t want to be bothered. And when I say younger, you know. But they don’t want to be bothered, if they want something they’ll look at the internet, they’ll look and see who’s using whatever.

So while we still do the old, we go to the Paris Airshow, we have a booth, we put out flyers, we make sales calls, we follow up, we try to make it easy to be seen, and easy to visit with. We also are finding that we need to find more ways to reach out to the people and get them to be aware of us. And once you become aware of us, then you can work them through the customer journey, as we call it. So that’s where we’re finding more with digital marketing, how to get people who don’t go to the airshows, who don’t necessarily knows us from, we have a long history, and a lot of people in the aerospace industry, once they know you and they’re comfortable with you, they’ll continue to use you. As the younger people come up, they’re not ones that designed the old aircraft, they’re designing new stuff. So we’re trying to find ways to get in front of them, to help them become aware of us, to help them reach out and see our products, and as I said, make it easy to do business with us. And that’s where the digital marketing that we’re putting forth is starting to show results.

That’s great, so we talk about digital marketing, a lot of times it just can be a big, nebulous term. What are…what have you guys… What are you guys doing? And a follow up question to that would be when did you start?

Not soon enough.

Okay, all right, all right.

It probably goes back to about 2005, six, seven, eight, I don’t know. But it was one of the old, kind of… it was a website. And then we thought that was all you needed to do. And a couple a years ago, about four years ago, not long after I started with CCS as a company, it stopped really doing us any favors, the website we had. So the first thing we thought was we need to have a platform so that you can bring us into the modern capabilities. Everything from building awareness, all the way through to eCommerce, to have an interaction, so that… Amazon’s a great example. But everyone gets their asset. So they said okay, the one thing Amazon doesn’t necessarily do is create an awareness. Everybody already knows it, but it doesn’t build an awareness to your product, because it’s the same. So we redid our revamp and actually started a brand new website. That allowed us more flexibility. Portals, communications, where you could look something up, you can come into our website and see what you’ve ordered, or want to buy. You can search for things. And at the same time, it did a much better job of allowing us to put content on it. And that was part of the search engine optimization, which is part of digital, my understanding, search engine optimization is a part of digital marketing, but it’s not the only thing out there.

Right.

We spent a year and a half, it is a whiz-bang, I encourage you just give it a shot. We sat back and said “Okay, now we’re going to see customers coming in,” and while there was an increase, it wasn’t to the level we thought was necessary, or that we wanted. So then we did a little more research and realized that the website is only one aspect of digital marketing. It’s a big one, and it can be in the industrial market, probably the biggest, but you also need, you mentioned earlier- personas. You need people looking for you, you need to find those people, or find a way to encourage them to come to your website. So we went out and we put together, we did the research, and we put together what I would say, from an industrial component and a product like ours, a roadmap, you know?

And so we realized that we have to find our audience, build our personas, look at who we do business with, or who we want to do business with, and create that audience, or that profile of that person. And we’re in that stage on that area, to build our profile and then look at our contacts, whether they’re our engineering peoples’ contacts, our diversity people, our salespeople, marketing people, and build up a customer relationship database, and put them in the different personas. And we do business with tire pressing, when we sell a switch that goes on a tire press, that makes tires that prevents the worker from being exposed to hot steam at high pressure. We also put things on the Orion spacecraft that they’re working on. We don’t want email blasts that are geared to this space to show up in the tire manufacturer engineer’s mailbox. So some of that where you’re sorting out your customer.

And after that, then there is the email blasts, where you do the whitepapers, blogs, anything you can, segment it to those specific personas, and set them up for those people with links to your website, or somehow to find your website. And once they’re there, we hope that there’s enough there to keep them interested, or at least to make them aware of CCS so at a future time, when they get into the product consideration point, they go “You know, that CCS had a pretty easy website to work with, let’s see what they have.” And ideally you have a call to action, whether it’s to request a quote, ideally at some point they’ll be able to buy the part, or specify a part. Then one of our salespeople would call them, and get in touch with them, and say “Hey, I see you looking at this substantive product, can I help you out with that final decision to buy it?” So does that give you enough understanding, or do you need more?

No absolutely, that’s great. That’s the… So you said about four years ago you started going into that, after the whole website change. Is it… How long do you think it took from “Hey, we’re doing the website implementation,” to getting to where you’re talking about now with having segmentation your emails, and content specific to those different personas. What would you say… How long did it take to kind of develop that and integrate it?

Ooh, that’s a trick question, and… It’s a never-ending process in some ways. But I would say that we seeded a three or four year program. The website took a lot longer than we expected, but I would say we were naive in both what was expected, what it took to really put out a good website. And that part of it was just looking at all our competitors, looking at some of the better ones out there and saying “What can we do, what does the budget allow, or what do we want the end product to be?” And then we went out and found somebody to help us with that. And while they’re a big company, we aren’t the only program on the block, and fortunately the gentleman in charge on our end put together a very clear profile of what we were trying to do. And that kept us from wandering off, because there are a lot of distractions that you can come upon when you’re doing that.

Yeah, absolutely, just a few shiny- squirrel!

Yeah, yeah, exactly.

Oh, I totally get that. So I’m curious, from an organizational standpoint, when you guys started going down this road, was there a whole lot of buy-in that you had to get, or was it just more generally accepted saying “We really need to start going down this road,” or what did that look like?

Well first of all I have very enlightened… the people who run our business, they’re very enlightened. My boss, the owner I should say, he recognized that the website wasn’t doing us any favors. And so when we brought the subject up that if you want to grow as much as you want to grow, we need a better platform to do that with. As a good boss would say, “Show me the plan,” and the stakeholders- we’re a relatively small company, so it’s relatively easy to pull together the key stakeholders. And he bought in, we did the whole plan, the budget, what was expected. We underestimated the time it would take, and the internal resources that were necessary to build up the databases that were required. But once we got the program rolling, it moved along. There were some parts where it dragged, where we had an agency help us. We held a pretty high standard, and we tried some new things, and they tried some new things with us, and I think we underestimated the complexity, but in the end the final results, just by pushing through, the final results bore out what we expected, and it came out real well, so. And he was happy, I’m sure at points he looked at the checks that were being written, and looking at it all, saying, how do you get a return on investment with a website? Well, it takes time. It’s not a switch, but we had buy-in from his level, and full support. And in fact there were days that he’d make sure we had regular updates, and weekly meetings and what have you.

Yeah, that totally makes sense. And that can be a scary thing obviously, writing the checks and saying “Hey,” you know. ‘Cause the reality of it is that this stuff takes time. Like you said, it takes time to implement, and not only, okay fine, it’s implemented,” and we flip the switch, it’s not like voila overnight, everything’s happening. Anecdotally, unless you have the data, I mean how long do you think it took to say “Hey, we’ve got a positive ROI on this thing, or at least we’re seeing some strong KPIs that okay, this is good, and we’re moving in the right direction”?

I would say we’re not quite there yet by his standard. We are… From a user standpoint we are seeing good metrics on the users on the website. People are coming, they’re spending more time. We have a very good global distribution base, and very good participation from their side, which is good, it’s a good measurement. We go out to all around the world, “Hey, you using the website?” “Yep, loving it, it’s great.” We see a little bit of reduction in workloads on some of our people here because people would call us up or come to us for questions, or certain things. Now they go on the website and they find what they’re looking for, and they’re happy with it. So I mean that’s part of the ROI that’s kind of hard to measure. It’s not just how many people on a website, it’s hey, we’re getting business that we didn’t have to write the quote, do the research ’cause people would go on there, find the part they wanted. And we have 10,000 parts, so some of that data and putting it out there took longer than we expected. But now that it’s out there, updating is pretty easy.

Yeah, so you mentioned another thing a little bit earlier, we were talking about eCommerce a little bit. And so you’ve kind of set up, do you have a fully-fledged eCommerce, from a payment system standpoint, or is it from more product catalog that’s an online kind of thing?

At this point it’s more of a product catalog. You come to us with your needs, and they will sort through your, do you want it in an explosive or nonexplosive? Do you want it in this environment or that environment? Do you want it made out of this material or that material? And it will steer you from, like I said, 10,000 parts, down to a couple. And in the end, at this point it’s not an eCommerce site, but now you can declare your needs: “This is what I want, how much will it cost, how soon can I get it?” So we see the eCommerce still a few years away. It’s a goal, it’s our, what do you call it, that’s our goal.

Yeah, no, absolutely. And so you mentioned it already before, and I probably should’ve asked this, and I didn’t think to ask ’til just now, but you mentioned your distributors. So are you…

Yeah.

What percentage of business do you do through distribution versus direct?

Okay, we use distributors in the aftermarket for the aerospace. Aerospace is, and in some ways it’s similar to industrial, but obviously if we sell to the aircraft manufacturer, that’s OEM, that’s ultimately adding things to the airplane. Airbus, Boeing, Bombardier. And then once they sell that to an airline, now that part has to be maintained. And so they would look for the CCS part wherever they can find it. And as you know, there’s a lot of airlines out there, a lot of people looking for parts around the world, and they generally want the part immediately, because the plane needs it to fly. So we’ve taken on a distributor that is a global supplier, and they put our product on a shelf, and that way anybody looking for my parts in the aftermarket would call them, granted there’s a premium ’cause it’s on a shelf, but that handles the aftermarket in the aerospace. But repair, I mean it’s overall type of requirements. That’s one.

On the industrial side it’s not unlike that, it’s just more diverse. So we obviously try to sell to people like General Electric that use our parts, GE, turbines, what have you. Once that gets put out somewhere in the industry, now people have to maintain it. And that’s where our distributors would come in. On the other hand, because the world’s a big place, and we’re a relatively small company, a lot of our distributors also sell to OEMs. And most of our industrial business tends to go through our distributors. We have… Yeah, the majority of it goes to distributors, and we’re good with that, because they build a local business, local customs, they handle the shipping, and where appropriate, they keep it on the shelf. Or if not appropriate, we might ship direct to the end customer, but we deal with it through the distributor. Either the sales rep, or as a distributor.

So bear in mind, with all of that, how is the, with the website and all the other digital marketing activities you’re doing helping to support your distributors? What benefit have they driven off of, let’s say having the product cata- catalogued, can’t talk… on the website?

Well, the first one is, customers, they need a part. Some of them know part numbers, some just know what it has to do. So they in the past would call up a distributor and say “I need a pressure switch, and I need it for this kind of pressure, and this kind of temperature environment, and this kind of a setting.” And the distributor would have to get out the old catalog and flip through the catalog, “Oh yeah, look at this one. Oh, that one too, well let me get you a price, let me see what I have here.” And so the first phone call is to the distributor, Him and the guy looking for a part. And the distributor says “Okay, let me get back to you while I look through the catalog.” And then he finds the part, and maybe he goes back, and he talks to the person about “Is this the right part? I’ve got this figured out there,” “Well what’s the price?” “Well let me get back to you, I’ve got to find the price.” “What’s the lead, when are you going to deliver it?” “Well let me find that out.”

The website is set up so now either the distributor or his customer can go into it and knowing the product, the pressure, the characteristic he’s looking for and the specifications, he can narrow it down to- it’s all drop-down menus- and filter it down to “Oh, that’s the part I could use, or that part.” And you read a little bit of either one of those two. Then when he calls the distributor, he now has a part number, says “I’m looking at this one, or I’m looking at that one.” The distributor can go “Okay, well let me go online, let me go to the portal,” and he can come back and say “Well I have some on my shelf,” or “I don’t have any of that, but CCS will have one tomorrow if you want it, let me get you a price right now while I’ve got you on the phone.” And the whole interaction, one phone call all the time, and then the customer can place the order if he wants to. Or if he doesn’t want to deal with the distributor he can come with us and put a request for our website. We get it, we respond to it, in our case it actually does go back to the distributor because we want the distributor to feel part of the interaction, and to have that chance to pick up the phone and talk to the customer as well. So we want to make it easy for the customer to do business with us, but we certainly want to make sure that we keep the distributor in the loop as best we can, and as automatically as we can.

Yeah, no, that’s fantastic, and I love that. We talk about this a lot, just ways of being able to make it easy for your distributors. Obviously the end customer, but when you’re working with distribution, essentially you’ve got kind of two different audiences a little bit there. You want to make it really easy for the distributors, so “Oh, this is great to work with these guys, ’cause they’ve got my back, information, I don’t have to go through all this rigamarole.” And the same thing for the end user, that customer there. So that’s fantastic. So-

Yeah.

Sorry, were you going to say something?

I was just going to say yeah, you made a good point about making it easy for the distributor because the distributor probably has, for that matter any salesman has a lot of products to sell. And you try to make yours as easy as possible, and at the same time you get a share of his mind, and that’s what you try to do is keep them, “Wow, it was easy to sell this product, or it’s easy to do business with them, so I’ll give them more of my mind share,” Because he’s got limited resources too.

Exactly, it reminds me of an episode we just released, by the time your episode that we’re shooting right now is released it’ll be a couple weeks later, but actually I had my father on for a Father’s Day edition. And he’s actually an independent sales rep for about, I dunno, 18 to 20 manufacturers in high-end building materials, so it’s fairly niche, if you will. But that was one of the things that we talked about was actually the challenges of independent sales reps relative to manufacturers. And just what manufacturers can do to make essentially their life easier. It’s sort of the same thing for distributors. And if you’re repping that many different products or companies, sure: price and rebates and all that good stuff is certainly part of it, but making it easy so that it’s like “Man, they made my life a million times easier, this is great.” That’s a huge win.

Yep, and so CCS has their foot in both sides, because in the aerospace market we have manufacturers, reps as you refer to them… and that’s usually done on a country basis. Again, it’s so they can talk the same language, they can reach out and be there quicker. And generally we look at areas where there is aerospace. Whether it be Europe, obviously, Germany, France, China, Japan. So we understand that something else the customers like to deal with is they like, at some point, to talk to somebody on a comfortable basis, and maybe the sales rep is not the top technical guy, and we don’t expect him to be. We look for him to be the relationship person, the person who knows the customer, who can talk to the customer, who can help along, keep that relationship moving, keep the discussion going. And yeah, tell us when we’re off the beam. Say “Hey, if you want to do this, you’ve got to do this, this is how people in Europe do it, or people in China do it.” So the U.S. is a little different because we have American distributors here. So some of them would call themselves manufacturer’s reps so they don’t carry inventory. I’m okay with that. Whether or not you carry inventory, long as you get the customer and you get the sale, I’m okay.

It’s all good, make them happy. So as we look to wrap a little bit, I guess my last question would be for those manufacturers that are on the fence and they’re trying to figure this out, trying to dial up, maybe they haven’t seen that ROI, or they’re a little nervous about it, what’s your message or your piece of advice to them?

Well first of all, thanks to people like Google, and Google Analytics, you can get a pretty accurate assessment of your return on investment from your digital marketing, or your website, I should say. You can see people click on the website and how long they stayed, what do they do, and ideally in your website there’s some call to action. Okay, I send you this, when you go to the website you place a quote, you ask for more information, some kind of a link, excuse me. Something that makes them do something. So you can see that I sent out this email, and that link was to this part of the website, and yep, the traffic picked up, and we got a lot of quotes for that kind of a product.

There is a leap of faith, no question about it, but the numbers, we’re starting to get enough data that says if you’re not out doing this, you’re missing a large opportunity. And you can keep going to trade shows, but how do you know your return on investment from a trade show, right? Or a print ad. And I’m not saying print ads are bad, or trade shows are bad, we do a little of that from time to time. But I like the idea of this website, Google Analytics, SEO optimization, because you do get numbers, and you can see the increases in the traffic, and the increase in the time people spent on your website. And the drop in the bounce rate. And ideally if that’s not increasing sales, then you’ve got a different problem, you know? You see “Wow, I’m getting more potential customers, getting more looks, getting more people interested in my-” These are people who are there not because they’re just cruising the internet, they have an interest in your product. If you don’t see a resulting increase in sales, maybe you have something else missing in the equation.

There you go, what’d they say, the famous saying that says information is power. I mean that’s really in this day and age, in the informational age it’s just that, we have information, and it’s powerful, and you’ve got the data.

No question, yeah. And as I tell my people, your perception’s one thing, but the data doesn’t lie, show me the data. Bring the data, let me see, see what you’ve got. And then you can start, you can move them wherever you want, you can interpret it how you want, but it’s data that you can use. And I do find that much more available in the electronic age, your website, and the digital marketing.

Absolutely.

That is one of its strengths as people get more comfortable with the data.

Exactly, yeah, yeah. Well, hey Paul, well thank you so much for joining me today on IndustrialSage. For those who would like to come check you out, your website is ccsdualsnap.com, I get that right?

That’s better.

All right, awesome, so let’s check out the snazzy website, we’ll look at the product catalog. Obviously if there’s manufacturers out there that could use your product, give him a call. But thank you again for your time, and just sharing your insights, and your story, because I think it’s really helpful, and it will resonate with a lot of other people in our audience.

Good, well hey, it was a pleasure, I certainly enjoyed it. I was a little nervous at first, but you do a very good job, so thank you.

No reason to be nervous, thanks so much. All right, okay, so there you have it. Listen, I really enjoyed this episode, there’s a lot of key takeaways that I have. The things that are coming to mind first is I really loved hearing Paul’s story about how they started doing the website, and if I have the metric right, it was about 2005. It’s 2019 right now, that was four years ago if my math, or I’m sorry, that was 14 years ago if my math is right. And it’s an iterative process. It wasn’t something that was happening overnight, and I think that’s the biggest takeaway. And you’ve just got to keep dialing it in. And kudos to their owner there who was saying “Yes, we do need to do this.” And kind of punching through a little bit of that fear, saying “I feel like this is the right thing,” but sometimes you don’t necessarily get that immediate ROI, it’s going to take time.

And as you continue to grow and you continue to do that, you’re going to start seeing some of those benefits, you’re going to start seeing a lot of residual opportunities and different things, like for example, where customers might have questions about things, or where you might have to have phone support for that. But now, because of the information that’s on the website, they’re able to get access to that when they want it, which could be three in the morning or whenever, and is also helping their distributors. So… And I love the whole workflow of just kind of how they’re generating leads, and sort of processing it through the website, to be able to basically provide that information and that value to them. So hopefully you have a couple key takeaways yourself. Take one or two, implement them today. If you’re still trying to “Hey, we need to do this,” see what you can do, learn from Paul and what they’re doing, to implement it in your company.

So that’s all I’ve got for you today. If you have any questions we’d love to answer them for you. You can reach out to us at IndustrialSage.com/questions, we’ll answer them for you there. If you’re on any of the podcasting stations, we’d love a review. Hey, if you’re on social media, share the love. And last but not least, if you’re not on our email list, subscribe. You really, really want to do it, and here’s why. We have a lot of great content that you’re not seeing or hearing on the website. If you’re on the podcast or anything, there’s a lot of great stuff. There’s a lot of offers, there’s a lot of great tools and resources to help you be a better salesperson, be a better marketer in your company in that manufacturing and industrial space, and to learn about all the great new things that are coming out, ’cause as you and I know that marketing, all this stuff keeps changing. The core hasn’t, but the wrapper does. So anyways, we’ve got some great stuff for ya, I’ll stop hammering that. I’m done, I’m done yapping. Thanks so much for watching, and I’ll catch you next week with IndustrialSage.

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Well, thank you for joining me today on today’s IndustrialSage Executive Series. I am joined by Matt Yearling who is– he is the president and CEO of PINC. Matt, thank you so much for joining me today on the Executive Series.

Thank you for having me. Looking forward to the conversation today.

So I’m looking forward to it, as well. So for those who aren’t familiar with PINC, what do you guys do?

Well, we’re a deep, dark secret.

Excellent.

We’ve been around for several years. We focus on an area of the supply chain that is a blind spot. So our core business is focused on yard management, and that’s trailer yard management. So in the context of supply chain, we sit at that intersection between transportation and warehouse. And not many people know this, but for every trailer that you see on the road when you drive down the freeway, there’s four trailers like that in a facility somewhere that’s full of goods that pretty much is unknown in terms of state and within facilities. We focus on automating the orchestration of assets and inventory within the facility, in the four fences of a facility. That’s our core business, software solutions.

Excellent. And so we’re going to get into all this good stuff here later on in the episode, but before we jump into that, I always like to ask about my victim– I mean my interviewee here, and that’s you, Matt. I want to get to know you a little bit more. I’d love for our audience to learn a little bit more about you and how you got into the space. I think these stories are fascinating. Take me back. How does your journey– where do we begin with that?

Well, so some people say they pick it up; some people don’t. But I was originally born and raised in the UK. So I’ve spent most of my years stateside, so most of my life has actually been in the United States. But born and raised in the UK, and I came over in my 20s with Oracle. I was an electro engineer for a long time and then got into computers and, specifically, into databases. And so that’s why I became an expert at databases within Oracle in the UK and then moved over from the UK to the US and had a very lengthy career within Oracle. And that really gave me a good foundation in computers. So that’s where I’ve been and where I am today. Always being around driving enterprise value with business solutions, software SAAS solutions, whether or not that’s ERP, CRM, security, or supply chain. Supply chain is what I love dearly today, so I feel like I’m in the best space of them all at this point in time.

Yeah, it’s an awesome space. There’s a lot going on right now, and it’s super exciting; it’s hot. A lot of transformation taking place. That was happening before, but even more now: that’s for certain. So in your career path, in your journey, is there anyone or anything that stands out to you that really helped to influence your career, your path, or growth? Is there anything that jumps out to you?

Well, so I think there’s a combination of a few things. I think the core drive, in terms of being who I am today, the person that I am today, I think was really driven by a near-death experience in my teens. I almost got killed on a motorcycle, and that was an experience that basically, waking up lying in a hotel bed– sorry, I mean a hospital bed—

Oh, interesting story.

That’s for sure, for sure, for sure a hospital bed. But looking at, okay, where am I going to go from here? It was a case of, okay, I need to do something with the rest of my life. And that was, really, that put me on this path of being more thoughtful in terms of how I pursued my career. And it really was driven by, once again, you’ve got to have, be thoughtful around who you believe is your mentors. So in the context of the business setting, there were very specific mentors which I aligned to over the years that really helped me go to the next level. And there were more than one. And some of them are clearly good friends as it stands today. So it’s being thoughtful in who you’re aligning to, how you can help your mentors achieve what they want to achieve, and you’re getting to achieve what you need to achieve, too. So there was a couple people in my life that I felt very aligned to, very loyal to. And they were definitely my mentors.

Excellent, no, good. I can only imagine having an experience like you mentioned. That resets you a little bit and shifts priorities a little bit, like you mentioned. Say, hey, you know what? Need to focus on a few other things here. And let’s do this. Do you still draw on that today?

Oh, yes, absolutely. Yeah, no, it’s always there. I think it’s very humbling, too. We are all delicate people. We all have to live for the day. It’s good to understand that you’re here one minute; you may not be here the next minute. What is the legacy that you want to leave behind, and what do you want to be known for? Really, it’s also how you choose to interact with other people. In terms of being a leader, are you a bully, or are you humble? Are you collaborative in the way that you want to lead? I think these are choices that are definitely formed by experiences over the years. I think we’ve all gone through experiences which we’ve learned from, including myself. I’ve never been perfect in terms of how I’ve led and managed. Where I am today, I feel very good about where I am, what space I’m at right now, and having a team around me that’s aligned to the goals and objectives that we feel that we need to drive for the benefit of our customers. That’s really, it’s having talented, motivated people driving to satisfying our customers or, obviously, drive value for all those that are participating in that as we go forward. So I think it does, your experiences do impact your frame of a person over time.

Yeah, absolutely. Let’s jump ahead a little bit here with PINC.

Yes.

Did you start it? Are you the original founder?

I am not. I am a part of a subsequent chapter. The founder is still being associated with the company. But I joined the company in 2013.

Okay, excellent. So jumping forward a little bit on this, what changes have you seen? Let’s talk pre-COVID and then post-COVID and, then– well, pre-COVID, during COVID; I guess we’re still in it– and then we’ll get into a little bit about what we think is going to come down the road. What are some of those big, significant changes that you’ve seen in the industry? How have you guys been impacted?

Well, I think you would be lying to say if you’re not impacted at all in terms of this. It’s changed everything in terms of how you transact and do business. Pre-COVID, I would say we are still in a part of a market that’s still emerging. We are the number one provider of yard management solutions. We are single-digit penetrated in a large market. And whilst it started we focused on North America, there’s a lot of global opportunity associated with our solutions. Then, coming into the pandemic, what it did highlight was all of the lack of technology enablement that exists within the supply chain gets emphasized and amplified even more. Everybody’s wrestling with the similar issues, but it’s amplified many times more. And everybody’s second-guessing themselves in terms of how they’re operating.

And so, the nice thing is that when we look at servicing our customers, they need us, and it’s a solution that helps. And it’s a solution that actually solves some of this lack of technology enablement in the supply chain. It’s just emphasized the need even more. So the level of interest is more, but the problem is, is that to be able to implement and get customers live requires, sometimes, being there with the customer on site. So there’s a lot of things that we can do remotely in terms of enablement and getting a customer operational, but there are some times when we do need to have that on-site implementation capability. So I think the general consensus is that it’s slowed things down, although interest is rising at a faster rate. So it’s an interesting dilemma between supply and demand right now.

Yeah, absolutely, yeah. Lots of conversations, but on the other side, it’s like, well… from a fulfillment standpoint, that’s difficult. How have you guys been able to manage? Is it easing up now in terms of being able to get on customer location sites, or is that still sort of a mixed bag? What does that look like?

Well, as you pointed out, we’re not out of the pandemic. We’re not going to be out of the pandemic for some time to come. So we are delivering cloud-based solutions. We’re delivering a connected system, and we’re connected to our customers. We understand how the customers are transacting, and we understand the volume of goods in the network. So we could see changes in shipments, trailer shipments, real time.

Yeah.

We could see when things were going to go sour in the automotive space versus the grocery space, what was going on around the grocery during the pandemic when everybody was hoarding product and nobody was buying cars. So you could see a lot of dynamics associated with that. And what we see now is that we see volume levels the same or higher than pre-pandemic levels. So we see, across all industry verticals, good volume. But we are still somewhat fearful of what the pandemic might bring in the coming months. Do we double-dip? Do we shut down again? That’s a big backdrop that is an unknown for everybody. But you’ve got to be prepared for that, so we are prepared for that. But what we are seeing is that, we are seeing, especially in the food supply chain, we are seeing customers that are still impacted by breakouts in regions within the facilities. And that’s causing a little bit of impact in terms of how they deal with that, as well as, how do they deal with change and implementation of systems and things like that. So it is tactically impacting the roll-out of technology, and things are moving to the right by weeks and months.

Yeah, absolutely. So as far as trends that you’re seeing in the industry, what do you think? We’ve talked to a lot of different people; we’ve heard a couple different answers. Certainly, e-commerce, especially grocery, retail, significant changes happening there. What have you seen, and what do you think we’re going to continue to see in terms of some trends?

So we’re going to see a continued acceleration of online sales, so that’s going to drive. We’ve seen some of our customers pivot in the way that they’re distributing based on the shift in demand, from their traditional brick-and-mortar stores to online presence. So we’re seeing that, and they’re reconfiguring their network on the fly to make that happen. So I think, to what we were saying earlier, that the pandemic has actually accelerated some of the decisions. It’s highlighted some of the deficiencies, so it’s accelerated the search for solutions to be able to address some of the problems. And it is accelerating. It’s accelerating the move to online. There’s absolutely no doubt that it’s shifting that. And the network, supply chain network to be able to support that is going to look different, so a lot more focus on distribution and less focus on the stores. What people don’t necessarily realize is that there’s probably over 4 million stores in the US. There’s over 100,000 plants and warehouses, over 100,000. And every day, I think, you see, maybe, Amazon opening another fulfillment center. So this is the new norm. You’ll probably see less stores being built, more fulfillment centers being built, even those in shopping malls getting repurposed for micro-fulfillment, as well.

Yeah.

So the network is going to look really different as time goes on. The whole buying experience is going to look very different. And, fundamentally, the fundamental problems still exist. The supply chain carries too much inventory. They have no ability to plan effectively to link the supply and demand. And inventory is stored everywhere. And for us, for selfish reasons, it’s actually pretty good because a lot of that inventory is actually in trailers in the facilities. People lose track of that; they don’t know where stuff is. That’s part of, one of the value propositions that we focus on. But a lot of people are carrying too much inventory. That’s true. And people want to extract more value from their investment in supply chain.

Of course.

Supply chain is a huge expense for any customer. It’s, depending on which industry numbers you’re looking at, somewhere between 8 and 10% of GDP, $1.5 to 2 trillion. The vast majority of that spend is transportation. And transportation is only moving 10 to 15% of inventory at any point in time. Most of the inventory is actually in a warehouse or in the yard or in a store. And that’s where people don’t necessarily understand that, where all of their inventory is and how do they get it to the consumer and get that fulfilled as quickly as possible. So we are all programmed to have instant gratification. We know what we want. We need it now. We don’t care if we’re in a pandemic. We don’t care what’s going on, whether it’s a holiday or anything like that. We just need it now. And everybody needs to react. And the nice thing is, is that all of these large companies, whether or not you’re shippers or 3PLs or whatever the case might be, they still lack a lot of technology enablement. They lack sophistication in how they address certain aspects of the supply chain. And for companies like ourselves that are enabling that from a software perspective, the future is bright in terms of how to make that more efficient as time goes on.

Yeah, absolutely. Great opportunities, and I can only imagine that, when you were mentioning some of the volume with the movement of shipments that were happening, massive movements, huge spikes in, what was it, March or so? Then, dropped a little bit, but you mentioned it’s picking up there. I can only imagine that having strong yard management tools like, I’m assuming like you guys provide is critical in terms of being able to coordinate the logistics of all of the movement of everything that was happening and, now, it’s spotlighting– obviously, all of the entire supply chain, the entire spectrum, from raw-goods sourcing to last-mile delivery has all been spotlighted. It’s saying, oh, my gosh, we didn’t realize. And I think a lot of people, to be honest with you, not in this space, but consumers in general, and it’s funny when you have family members you talk to, people do not realize how fragile the supply chain is. And it’s incredibly intricate, incredibly intricate just to understand how this cup, all of the resources and the moving pieces that it takes to, not just manufacture this, but also get this to here.

Yeah.

And so– anyways, I kind of geek out on it. I think it’s incredibly, I think it’s amazing, to be honest, on how that all works. But having this kind of technology you’re talking about to help to optimize and streamline this is critical.

Yeah. At the beginning of the conversation, I said to you, I’ve done many different SAAS space solutions, ERP, CRM, and the like. But supply chain is… to me, it’s more tangible, so when you look at supply chain and you understand what’s going on, you’re helping orchestrate and move that product more efficiently that how it’s done in the past. And that’s really quite compelling. So you can see that in the context of, for example, I always like to buy my customers. I’m wearing clothes that are my customers’.

Smart move.

I’m driving a car that’s one of my customers’. So I always like to buy from my customers. But I’ve also been to the manufacturing plants as well, so I see how we help. In the context of yard, it means different things for different industries. For automotive, that’s all about how do you minimize the disruption to the manufacturing line and make sure you automate the goods from the yard to the dock door at the right time to get that product on the manufacturing line. So, but that’s not the case for grocery, which I always shop at my customer, too. So in a grocery, it’s always, okay, we’ve got goods coming in from our shippers, our customers bringing supplies into our distribution centers. and then we’re orchestrating waves of deliveries to our stores. And that’s, the way that they do that is very different than how yards are managed in automotive. So every different vertical is a different use case. How you make mayonnaise is very different than how you make clothes and distribute clothes. It’s very tangible and very real.

And, to your point, that’s why I’m very passionate about the supply chain because it is very real, and it’s also resilient, too. So we’re not Airbnb, or we’re not those that are getting impacted by the pandemic. We’re not a hotel chain. It’s like, okay, so how do we pivot from this curveball that we’ve just been given? People need to eat. People need to consume. We’re a consumer society, that’s going to continue. The mix of what we consume is going to shift and change. But you still need to have, until they figure out how to teleport goods, we’re still going to have to have a supply chain. But one thing’s for sure: the supply chain today is inherently inefficient, and everybody’s trying to do everything faster, better, cheaper. And the only way to do that is with technology enablement. And so in terms of where we are, it just adds yet another reason why you should be doing more technology and making everything more efficient. So that’s why I say, the pandemic is a double-edged sword. It’s bad in terms of moving actual implementations to the right a little bit. It’s good because it’s actually created more interest in solutions that will help with problems that are now bigger problems than they were before the pandemic.

Absolutely. Yeah, so Matt, we could probably have another three-hour discussion about this because I think it’s super exciting and there’s so many intricacies and all that. But, unfortunately, I don’t have another three hours. But, for those who would love to learn more about PINC, what’s your website so that people can go check you guys out?

Yeah, pinc.com, P-I-N-C dot com. You can come to us. You can email me at matt, M-A-T-T, @pinc.com, as well. I’d be happy to receive any email from anybody that cares to, want to know more about what we do and who we do it for.

Excellent.

We do it for the largest companies in the world, so you’re in good hands with us, for sure.

Well, so, yeah. So for those who would like to learn more, go to the website. You guys can check them out. Matt, thank you so much for spending some time with us today on the IndustrialSage Executive Series. I really enjoyed it. I feel like I learned a lot. And I really enjoyed hearing your story.

Thank you, thank you so much.

Alright, thanks. Well, there you go. We’re wrapping up another IndustrialSage Executive Series interview. I really enjoyed this one. The big talk about digital transformation and technology, a very, very similar story that we keep hearing about e-commerce and online, and really– people want things better, faster, cheaper. How are we going to solve that problem? It’s got to be technology-driven. A lot of change has to happen, and technology is really going to be leading that in there. So, anyways, go check out pinc.com. Check out their solutions, and I think you’ll like what you’ll see there.

So that’s all I’ve got for you today. I want to encourage you, if you are not on our email list, go to IndustrialSage.com and subscribe because you’re missing out. You’re missing out on news. You’re missing out on other Executive Series interviews and episodes that we’re doing. And we have other shows that are releasing out soon, so you don’t want to miss out so you can learn from your peers. You can learn from other organizations that are going through things that are similar to what you might be going through. And so we can be better together. Not to use that cliché phrase, but I’m going to use it. So, anyways, thanks for watching. I’m Danny Gonzales, and I’ll be back next week with another episode on IndustrialSage.

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Hey, so let’s go ahead and jump in today’s episode. I’ve got Mike Drapeau here from SBI. Mike, thank you so much for coming and joining. Mike’s a great friend. But for those who don’t know you or SBI, tell us about you.

Thank you, Danny. So, again, my name is Mike Drapeau. I’m a partner at SBI. SBI is a management consultancy focused on sales and marketing, on revenue growth. And our mission in life is to work with our clients to help them improve their top line, and to do so via initiatives and projects, and the sales, marketing, customer success, and customer experience functions. So thanks, Danny.

Awesome, so it looks like you have a little bit of experience at this.

A little bit yeah.

So, to say the least. But what we were talking about, what are the big challenges that we hear all the time for not just manufacturers but across the board, but still, it applies, is this misalignment between sales and marketing. And it’s a big challenge. What are some of the key missteps that you see on how people are kind of missing the mark? What does that look like so we can kind of lay that foundation?

Well, gosh, we could have a show that lasts 10 hours on that topic.

I’m sure.

We really could. And for those out there in the marketing function or leading marketing functions, I’m going to kind of speak to you all because there’s a unique opportunity for you to really drive the engagement you have with your parallel Chief Sales Officer. So many marketing officers, especially those at around my age, have come into that from the B2C function. They’ve been classically trained, price, product, position, place, and that is completely antithetical even, there’s no way for a salesperson to understand that. And so there’s a language barrier that causes a complete inability to talk. Also, many marketing leaders don’t understand the coin operated, day-by-day, quarterly ability to hit numbers. And so they don’t have a number.

So the second fault line is when we work with, especially industrial companies, we give, we ask the marketing person, what’s their number? First question, they don’t have a number. So putting that number together so that both share it, that’s what we call revenue marketing. So revenue marketers walk into every meeting with the Chief Sales Officer understanding, “Hey, I own a number, and the number can be defined various different ways.” Let’s say, for instance, the number of net new leads generated in a buying persona that are not part of the existing sales go-to market. So that’s a way for a marketing person to say, “Hey, I’m going to owe you 10 of those each month,” each quarter, whatever, and that then becomes something that we can rally around.

Same thing with campaigns. Sales leaders don’t understand campaigns. It’s sort of voodoo. Marketing puts the campaign out and suddenly leads fall from the sky. We don’t know…we know that’s not real. So when we work with CMOs we make sure that they give a role. Every marketing campaign, every single one, should have a role for the salespeople, sales manager, and sales rep. And literally giving them the scripts, giving them the custom emails, giving them the text message content that they need to send so they can play their role in the campaign, and then it occurs to them, “Oh, that brand message, that video, that value statement, that’s connected to the campaign where I was given, that I’m supposed to execute with five or six or 10 of my clients.” So that ability to connect the tissue.

And the last thing I would say is personas. So every marketing leader knows about personas. They kind of erupted 20 years ago through the agency interaction and through making sure that content advertising was created and aligned to an individual, great. And they were never ever used by the sales force. It was literally a construct that was limited to just a handful of people in the marketing department. Useful for them but utterly useless beyond that. So one of the things that we do is we use the persona as a connecting tissue. It’s a way to draw both parties into the conversation and own, jointly own the persona. So it’s not just so that you can create content against it. It’s also so that you can inform your sales process.

So for instance, the persona is integrated into the sales process. So it’s literally, if I’m a sales rep, and I’m going to go have a call. Then one of my motions, my internal motions is break out the persona, sit down with my sales manager, make sure I understand the fears, the values, the ideas, the messages of the persona, and I look at my presentation I’m going to give. Does it include those things? Yes or no? What are my objectives of the call? Do the objectives of the call meet with what the persona is likely to want? And just that level of tangibility to the persona makes them so much better. And then the content that comes out from marketing slips right into the salesperson’s bag in a much more effective way than it used to.

Right, no that makes a lot of sense. For someone- dialing in on a couple things… So let’s talk about, you were talking about the number. Having your KPI or whatever, why do you think that’s not a thing?

Well I think because most marketing people, especially in the industrial sector, have not grown up through their career being held accountable for production. And yes, you have to have a correct video, you have to have a good piece of content, or you have to have a campaign that has an architecture to it, yes that, but not an actual number. And the fault line for this has been the whole who owns the lead development rep group. So it usually… it started off in the marketing department, because it was sort of an outgrowth of, “Hey, I’ve got leads, they’re not ready for sales, what do I do with them? I’m going to have some human middle-ware to try to massage them and nurture them.” And then the salespeople saw that, and that’s very much a numbers business. And they saw the marketing person not really doing a good job managing that, so, “I’m going to take it.” In those cases where the sales leader had that authority they did, but then rapidly degenerated into an appointment setting group, which is the antithesis of what you want for lead development rep, which is long relationships, complex sales, stimulating a thought of a prospect or a client. And so it became, it then suddenly became ineffective, and then suddenly it was killed.

So what’s happening now is because there’s more and more Chief Marketing Officers, or VPs of Marketing who are revenue marketers and they understand this, and they have begun to understand the need to manage quantitative people in their business, that they’re now taking this function back. And the complexity and the sophistication of the tools that are being used and the processes that are being used, and even the platforms, the social platforms, that are all being pulled into the LDR. That LDR actually becomes a strategic resource. It used to be thought of as the lead development rep is the least important, most tactical, most sort of you-can-fire-them-in-a-moment person. They’re actually now the opposite, because they’re your over-the-horizon targeting. They’re listening to the market, they’re hearing what clients, or not really clients, prospects are saying way before the sales rep. All the self-serving that’s going on out there where buyers are self-serving themselves, that’s happening, the rep doesn’t know. And the LDR, though, is getting in that conversation. They’re introducing themselves into the thought stream of a potential buyer. And so they’re collecting, “What are they thinking? What are their impressions? What are new changes to the market? What’s the customer saying-” Or, I’m sorry, “…the competitor saying or doing?” And so they become- our recommendation, because they’re so strategic to our clients, is: don’t ever outsource that. That’s the crown jewels. And not only have that person and enable them with technology to process, but use them as a competitive weapon, right?

Absolutely, yeah. Well they’ve got their ear to the ground, like you mentioned there. And so, I mean that, if you’re doing it right, is going to feel, what you talked and mentioned before, the personas. So we understand what those challenges are. Not just like, your target market of, you might traditionally think, “Oh well, male, female, age, whatever.” No, it’s getting into the pains, the challenges. This person, what are their fears? Well their fears, they want to make that next promotion. Or whatever.

Absolutely.

How do we help them solve that challenge? Not just sell more or whatever.

Absolutely.

So let’s talk a little bit about the next step which you’re talking about with the campaigns and making sure that those were integrated in a sense that we are aligned, that it’s a cohesive effort, ’cause right now it’s, or a lot of times, marketing is thought of as, “Okay, go do the flyers and the brochures, and the trade show booths.”

Right. “And then get out of the way.”

Right exactly. “We’re going to sell it,” whatever. Versus saying, “Hey, we’re going to do this whole campaign that’s aligned with the whole sales coordinated effort.” And providing, I think you mentioned, those messages, those scripts. “Here, text them, text them this. Here’s the sequence or the cadence that we’re going to have.” Because now we understand what those challenges are and those pains versus we’re just going to put this out there. I think it leads back to that challenge thing, not having that accountability initially where marketing before was just awareness. “We’ve got to get our…the more we see our brand out there, that means we’re doing a good job.” Can’t really measure that. “We must be doing well, so…”

“All good!”

Yeah! Right? How do you, for maybe an organization that is not doing that right now, what were some practical steps you’d say, “Hey, be thinking about with your, having a coordinated campaign,” what are those first steps that you would recommend them taking?

Well, there’s two ways to go on that, I think, in terms of if you’re saying, hey, I was VP of Marketing, I’ve inherited an organization that’s not really maybe sophisticated, that’s doing things the old school way. All right, so you can take two paths. The first path would be, “I’ve got a set of large customers, probably the majority of my revenue, but a few number them,” right? And let’s say the revenue’s declining of those, where it’s stable, it’s not increasing, I need to do more there. So you have a limited subset. We would call that a working prototype of clients, of customers, and you direct marketing via something like account-based marketing, ABM, you’ve probably done shows on that.

Little bit.

Yeah, okay, so yeah, so you have this small universe, highly important universe, and you have an incredibly stylized, customized, specific detailed one off. So every single marketing campaign is specific to the customer. They may have an overall theme that they share, but it’s complete customization, and you get a couple of the reps, and maybe not all of them because some reps are just going to be dug in, they’re not going to want to play. So you need to make sure that the rep involved with the account is willing to participate in the campaign, and that you go that way and you can see results. And with all these results you’re looking for leading indicators of adoption. You’re not looking for revenue right away because you’re not going to get it. And in addition, and this is the big one for the CEO, is you’re never going to get a situation where a sales rep raises his hand and says, “Hey, that piece of business was won by marketing.” Right? It’s just not going to happen. So you have to have the belief, the understanding, as long as you’re a revenue marketer, that this collaborative effort, this coordinated effort, which is meant to have an impact on lead gen, is a shared responsibility.

And by the way, you want it to funnel through the sales rep. You want to make the sales rep elemental to the customer, and that’s a way for you to differentiate your product and services through the sales rep and the interaction you’re having. But they become armed with better content, better messaging, better ideation. In some cases people call that commercial insight. And all of that is meant to then give you the edge, maybe create a new piece of demand that wasn’t there before or give you the edge in an ongoing competition for maybe something structured. So that’s the ABM route. The other route is sort of the path not traveled. So a lot of times in sales forces you’ll have sort of wizened old dogs, the legacy reps, they own the majority of the revenue, they’ve been in the saddle for 20, 25, even 30 years. And they’re just not going to change. Why? Because they see no reason to. And there’s some legitimate reason for that.

Sure.

But then you have the up-and-comers. Either maybe some people retire and they have a new sales rep or you’re trying to expand in the new go-to market or a new geo or sector, you have new reps. And those are kind of younger-ish typically. Maybe in their 30s or 40s, because they need some sector experience, but you want some runway in their career. They’re going to be, by virtue of their age and their newness to the company, they’re going to be more open to embracing sort of this marriage of digital technologies and face-to-face go-to market. So, in those cases you’re looking for that’s your defined group, the newish sort of employee. And to have a bit of a blank slate, typically. You might get some inherited accounts, but they probably have a patch that includes a lot of prospects.

And now you have, you can pretty much say to yourself, “Hey look, this is working. Previous new reps, here’s how long they took to onboard. Here’s how long it took them to bring new accounts in and whatever, here was their average revenue per year or per quarter. These new reps are using these new marketing technologies and approaches, much more.” And that’s usually what convicts people. And when we talk to folks, unless there’s a massive customer bleed we say don’t go the ABM route, because you’ve got too much headwinds with your own sales force. Go this other sort of customer marketing route with newer people, and then when that shows evidence of working, and it will, now you have the prima facie case to move over into the rest of the organization.

Once you’ve made that… I guess, maybe making that transformation a little bit, moving, so THEN? That’s interesting, okay.

Correct.

Interesting. So what you were touching on about, sort of the aging workforce, you’ve got sort of two different camps. It’s interesting, there was a study that Google, when we talk about this in IndustrialSage all the time, there’s a study that Google came out with, this is 2015, so bear in mind that’s four, maybe five years ago

Almost five years ago.

Depending on when that was released. But they said, back then they said nearly 50% of B2B buyers were millennial. Whether that was influencers of the decision or the actual decision maker. Obviously, that was four or five years ago. I think I can do math. I think that that number I think it’s going to increase.

Yeah, think so.

I’m gathering that. So that’s a really big challenge that we hear all the time on here: “How do I have that transfer of knowledge? How do I…” I think a lot of people are trying to change, I don’t want to, uh…you mentioned these, the ‘old dogs’ or whatever?

Yeah.

Listen…

I’m one, so…

Then I can’t say that.

No you can’t. I can.

But there’s a lot of resistance to change, and I totally get it. You said there’s for sure some legitimacy there.

Sure, yeah.

Big time, big time. But there’s this gap between, you hear a lot with CRM, oh a lot of our subscribers either don’t have CRM or they’re bringing it in and they’re like, “Oh, well, you know, that’s such a huge challenge. How do we get people in to do all this?” And it totally is, but then there’s this whole transfer of knowledge and there is some legitimacy in the sense of saying well wait a minute, all these new tools. All the sales automation and all of these great things aren’t necessarily, that’s not, what do you, what are your recommendations in terms of bringing on, you mentioned onboarding that younger generation that maybe doesn’t have as much of that industry experience.

Wow, all right, so lots of questions there. So let me tackle the first one, which was sort of a CRM technology question. And I would say to anybody out there listening or sharing this with others, be very wary of adopting the sort of legacy cloud CRM technologies. You know what they are.

We mention them a lot.

Okay good, good. So be very aware, not just because of the expense. Much less so, because they do not support the convergence, the omnichannel convergence of information. They’re built from the ground up. In fact, for example, they have the worst lead management capability on the planet. So we all know leads are people, from the marketers out there. But you can have somebody who is the same human being who’s coming at you in five different personalities, in three different emails, some of which are anonymized, some of which are not. And you get five different leads. And even when you know they’re all the same people, bringing them together for one coherent view of the human being so that you can nurture that person effectively across the channels, impossible with legacy CRM technology. There are newer platforms right now (new, as in the last couple years) that are established and that are built from the ground up, understanding the omnichannel view.

So why does that matter? If you’re a lead development rep, forget the sales rep for a second, if you’re a lead development rep and your productivity is the number of qualified leads that I create each month in a buying persona, which is typically somebody senior, right? That’s hard. Could be two or three a month, tops. I need to have a complete holistic view of that human being. I need to know everything they’ve done, in what channel, at what time, over time, so that I can then use the best means of connecting to them and be able to draw those, kind of combine those flavors in, and then even work across the organization from Betty to Sally to John, all in the same organization, all with that omnichannel view. And when I have that I am so much more effective now, because I have a new piece of content, a video, a white paper, even a message statement. And I can now deliver that easily and see what happens in response. So often we’ll get something on a device. But then we’ll send it to some other device. Or we’ll remember it coming in as somebody else. And there’s no way to create that connecting tissue. So if you care about leads and if you care about qualified leads and if you care about the productivity of your lead development rep, then you want a platform that makes that easier. And the legacy CRM providers just don’t do that. Currently. Maybe one day in the glorious future, but not now.

So your second question was not about technology, it was more about onboarding and these new reps and how do you…there’s a gap, right? You have a 50 something year old person who’s been in the saddle for 20 plus years and you have a brand new person, 30 something, got a lot of fire and a lot of energy, not a lot of sector experience. Maybe they worked at a competitor or somebody in the general ecosystem for a while. But they don’t know anything. They don’t have product knowledge. They don’t have organizational knowledge. They don’t have competitive knowledge. They don’t have all the different things, even referential and who’s who in the zoo and the customer. Even worse, the customers out there, they may not own those relationships. So what do I do? How do I onboard that person effectively?

There’s lots of great self-service cloud tools, and if you had some form of onboarding program that’s more than just stuffing them full of product information, right? What’s the engagement strategy? Do I have some form of a mentor who’s making sure, and one of the one’s who’d been around for a while, the more seasoned folks, and have a structured mentoring program with role playing and shadowing and so forth. That’s how you get the new person up. And one of the things I’d like to say to help provide a lead indicator metric, because people focus on the lagging. How much revenue do they produce? And revenue is so lagging and it’s unfair because that new person oftentimes gets thrust into territory where they’re not familiar. So you want to say, “How do I know that they’re being successful?”

Right, how do you measure that?

So, one of the ways when we install onboarding, that’s one of the things we actually do, is we say, okay, the new person coming in has– I don’t know– let’s say 10 accounts, okay? So 10 accounts, and we have, there’s a buying decision team of five people, let’s say, right? All right, so that’s 10 times five is 50. There’s 50 human beings that that new sales rep has to engage with. They have to know who he or she is, and so how do I know that they’re doing the right thing? Well, probably when they arrive they’re not going to be LinkedIn connected to any of them. So now in the industrial world not everybody has a LinkedIn profile, right? Some don’t. But most do and certainly, to your point, the younger buyers do. So of the 50, maybe 45 or 40 have a LinkedIn profile. So I’m going to measure how many LinkedIn connections to the buyers, the buying decision team, does that sales rep have? Now does that mean that that’s a deal? No. Does it mean they’ve even got a qualified opportunity? No. But what it does is a proxy for ability to engage. I mean, the industrial automation, the manufacturing buyer’s kind of a crusty sort. So they’re probably not going to accept just a random LinkedIn email or connect request from a brand new sales rep. So you have to build a reason for that person to want to then say yes to your connect request. So there’s actually, it is a good proxy for selling an engagement potential.

Yeah, absolutely, that makes a lot of sense. You mentioned, not a lot of everybody has, it’s funny, too, I mean even some of the, I’ve noticed, even some of the younger sales, by and large most of them are going to have a LinkedIn account, but there’s still a big number of, certainly in the leadership role…nope. Or you have an account, but you have like five connections, which means you’re not using it.

Exactly.

Okay, I’m going ask you another question. This is off, a little off-topic. I mean, it’s not off-topic, but we didn’t discuss this beforehand. I like doing this sometimes. So oftentimes with a lot of, let’s take away the industrial automation type companies away and let’s just look at the manufacturing. A lot of times, most of the time, you’re going through distributors. You don’t have that direct, you might not necessarily have that direct touch to the customer or the end user, or you may have two different degrees of separation there.

Yep, multichannel, yep.

So what do you do… a sales and alignment perspective, from that challenge, what are some of the recommendations that you might have relative to, “We have totally different audiences.” And maybe in a lot of cases, most cases, limited budget to be able to touch…

How do we get there?

Exactly.

Right, so this issue of multichannel distribution is one we face a lot with our customers, and one of the things they find is you’ve been happy for many years, selling through partners or partners of partners and so on. One day you wake up and realize, number one, “My end user doesn’t really know me,” number one. Number two, “My sales are flat. And I can’t, I’m not successful in influencing that partner community, that sort of overall ecosystem, to prefer me. Maybe now there’s a new competitor. Maybe there’s some governmental intrusion, maybe there’s some trend out there, but whatever it is, I’m almost handcuffed.” So, when that problem is presented to us, and we’re talking with management, the only way out of that is to come up with a strategy that gets you to be able to touch or listen and learn from the end user customer and to provide information and value to those channels, those different levels of distribution. And the other way is to just cut out completely and go direct in some form or fashion.

Whether it’s ecomm or whatever.

Could be direct eCommerce for the lower level. It could be maybe sales reps in a new market. It even could be a form of direct through indirect. And what I mean by that is I may hire a channel partner who does the selling, but the commercial relationship requires that I get visibility through and ability connecting contact with the end user as part of the quid pro quo of them, and developing a profit through my solution. So now if you say to yourself, ‘I’m afraid of eCommerce. I’m afraid of establishing a new channel, whether it’s me direct or a different sort of channel partner that gives me visibility. I want to go through my existing ecosystem.” That’s the hardest thing to change. Why? Because there’s a real reason why you’re not able to get to the end-user. They don’t want you to. And/or there’s a competitive offering that they don’t want to tell you about because they don’t want to have an uncomfortable conversation.

And so you’re just losing by default and you don’t know it. Nobody sends you the memo and says “You lost because I’m not taking your calls anymore.” It just doesn’t happen, right? The deal doesn’t come. So the way to do that is, the one power you have is the sales reps in channel communities are by and large lazy. They want to get the most amount of money for the least amount of effort, right? Which is fine. So play to that. Play to their fundamental laziness. Give them a reason, show them that, “If you work with me on this deal or on those sorts of deals, or every deal that looks like this and some sort of use-case selling. Then I will do x for you. I will do the selling. I will take over this.”

Make it easy.

Make it easy. Because probably there’s some frictions that have been introduced along the way that you’re not even aware of. And one of the ways we do that is, now there’s a whole big thing on EX and CX, right? The whole experience element, customer experience. And that’s typically thought of because of the B2C model, in terms of relationship with the provider to the end user. Fair enough. But if you have this multichannel distribution, you can’t get there, then take those same CX attributes and qualities and apply them to your ecosystem, your distribution ecosystem and treat your distributor as your customer or the distributor, the reseller and distributor, both of those together, and then find out what’s truly ailing them. Now, eventually they’re going to tell you, “You’re too expensive, your product’s not good enough,” whatever whatever. And you have to feed that into your organization. But even if that’s completely true, that you are trying to merchandise an expensive product that doesn’t have the right features, you still can play upon the fundamental laziness, you can still increase your revenue share or your market share with that distributor if you deliver net new things of value.

Now people are always looking at the bottom line, and you don’t want to do something, I’m not saying take them out to an endless number of steak dinners, right? I’m talking about… their currency is time. So if you can think of a way that you can actually save time for them, an easy example is pricing configuration. One of the biggest frustrations from a distributor or channel partner is it takes forever to get a quote from. Or, “When I get the quote it’s confusing. It looks like some Byzantine organization listed and nothing makes any sense, and then I have to redo it and present it in a simple manner to the customer. I hate doing that,” right? So, or maybe billing. Maybe the way that they’re billed. Your bills are late, they’re confusing. “I have somebody from accounts receivable who’s calling me up and annoying me all the time,” and whatever it is. So you can put in some listening paths along the way with different functions to that customer or that distributor, that channel partner, and then you can transform that relationship and say “Look, hey, it’s not just about the product. It’s also about the whole relationship.” And then what that opens up is, I would like, in a certain set, I would like some access to the end users.

So SBI has several clients where we actually helped them understand that you don’t have to, it’s not, you don’t go from zero to 100. You don’t say, “I would like to talk to every end user of all your customers.” But, “There is a compelling reason to allow me to access these end users under those conditions because I can provide value. And by the way, I’ll make you look better,” because guess what? They’re competing, too. Sometimes a provider forgets that the channel partner has multiple different channel partners against which it’s competing.

100%.

And so they want an edge also. So you, accessing the end user, can give them the edge. As opposed to “Hey, I’m going to cut you out of the equation,” and what have you.

That’s a legitimate fear, yeah.

And it is, and so if you’re going to go this route you have to make it clear that this, and you can do that commercially or just through conversations and joint business planning. But “Look, hey, this is the value that me accessing the end user’s going to get you. This is how you’re going to win not just the next deal but future deals that you’re not even winning now, and let’s work it together. And you, by the way, you’ll get access to all the information that I’m getting access to. It’s not like I’m going to keep it close. But I will be able to provide you better solutions.” And by the way, that’s a great story. They’ll probably be convicted by it, but if you do that and a year later you don’t have one new product, you don’t have one new offering, you haven’t actually created any value for them. They’re going to say, “You know what? You told me your story, sounded good, where’s the there-there?” So there has to be a commitment on your side as a vendor to actually produce, to actually innovate.

I love it, I love that because, if I could really just put it in a nutshell, “How can we make it easy to do business with us? How can we help you solve your challenge?” Because…lazy or whatever, because typically, it’s funny, a lot of the challenges and the answer you hear is, “Oh, well, we can get more business out of them if it’s based off margin. So we just need to, we’re going to-“

Blow the margin!

“That’s how we’re going to do it! That’s how we’re going to be able to compete. That’s it!” And that’s not, there’s so many other–

It’s not sustainable either.

Not sustainable at all. It’s a race to the bottom. So, anyways, well, Mike, this has been, we could probably go on for another three hours. So we might have to do this again to keep going. But I really, really appreciate you coming on. Thanks for talking to the IndustrialSage audience and sharing a lot of great, a lot of great value. There’s a lot of takeaways that I have from this. If anybody would love more information, you guys have a load of resources, where’s the best place for them to learn more about you?

Well, I would go to… we have many properties and platforms. Easiest is to start at our website, which is www.salesbenchmarkindex.com. It’s a long domain, but the riches are there.

It’s all good. All right, sounds good. So there’s promise.

Thank you.

Thank you so much for coming on.

My pleasure.

All right, so all right, so there you go. Man I love that episode, we talked about a lot of different things so just a couple of key takeaways that I have, I know you’re going to have a lot as well, this misalignment between sales and marketing, we talk about this all the time, Mike talked about three really key areas on how to kind of bring that together, the first one was if you or a marketing leader is making sure that you have that accountability, a number. Every campaign, everything you’re doing, making sure that you’re able to measure against that and keeping yourself and your teams accountable.

The next piece is making sure that you have connected campaigns that you are doing stuff in coordination with your sales team so it’s not just like, hey, we’re doing brochures and flyers and we’re doing things over here on our own and sales is over here, bringing that together, saying hey listen, we’re going after this segment. Here’s how you guys are going to be able to participate in this. We’re going to be able to generate leads and do these things over here. Whether that’s webinars and email campaigns and all these different things, that it’s cohesive. We’re together. And the last piece on there is really looking at personas. We talk about this all the time. Don’t forget we have a great resource that you can download on how to develop your personas, and we walk you through that. And putting all that together. And then we talked about, I don’t know, a million other things. We talked about… one of my favorite things was talking about just really solving some of that challenge of how to create more value, really, for your distributors. How to get to that end user because that’s a big thing we focus on.

So anyways, I hope you enjoyed this episode. Listen, we’d love for you to make any comments on social media, share it with a boss or a colleague who needs to hear it. If you’re not on our email subscriber list, make sure you get on there. We’ve got all kinds of resources that we’re sending out every single week that you’re missing out on if you’re just listening on iTunes or you’re even just watching the video on our website. Get on the list. So that’s it. That’s all I’ve got for you this week. Thanks so much for listening. I’m Danny with IndustrialSage, and I’ll be back next week with a really another awesome episode.

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Well, welcome, and thank you for joining me today on today’s IndustrialSage Executive Series interview. I am joined today by Seth Patin, who is the CEO and founder of LogistiVIEW. Seth, thank you so much for joining me today: coming all the way in from Raleigh, North Carolina.

That’s correct, yeah. I went all the way to my office for this fantastic Zoom call. Definitely a little different than it used to be, but great to be here virtually.

That is very exciting. Is it your first time back in the office?

No, actually, I’ve spent most of my time through the pandemic in my office. So one of the advantages to being the founder and CEO of the company is you can kick all the employees out and have them work from home and then be a social distancing champ in 7,000 square feet all by yourself, all day long.

I may or may not have done that myself. So I hear you. It’s really hard to work from home. I don’t know; do you have ki– we’re getting off-topic, but it’s fine.

Yeah, I have three young daughters, and during the first part of the pandemic, they were doing school and everything. So my home office was reallocated to them.

Yep.

I’m, obviously, on the phone all the time and, of course, three young girls aren’t quiet.

Exactly.

My wife is a saint for taking care of them, and it’s allowed me to keep my focus a little bit through all this.

Yep, same exact thing. There’s only so many times you can say, “There’s a pack of dying squirrels outside my door. I’m sorry. That’s what’s going on.”

Right?

Anyways, so for those who aren’t familiar with LogistiVIEW, can you tell me a little bit about who you guys are and what you do?

Yeah, so LogistiVIEW is a software company that has a software automation platform. We’re best known for our vision picking technology. That’s where we’ve had the most notoriety over the last couple years. We’ve been around for several years now; I started the company in 2014. And we specialize in human automation and robotic automation connected together. And, so, that is our focus point. We’re new to the industry by supply-chain standards anyway. We’ve been selling since about 2018, so we’re still fairly newcomers to the overall market.

Oh, excellent. I’m excited to get into that a little bit more, get into the nuts and bolts of what you guys do and looking at challenges. But before that, I want to get to know you a little bit better. So tell me, how did you get into this space? Take me back.

So, yeah, my history in warehouse management software, which is really where my focus has been, distribution technology, warehouse management, et cetera, goes all the way back to the very beginning of my career. My education is in computer engineering from the Milwaukee School of Engineering. And when I was an intern there, I started working at a company that many folks in our industry remember, RedPrairie. And, so, RedPrairie was where I started my career. And over the course of time, obviously, RedPrairie became JDA and then became– now just recently became Blue Yonder. But I spent about 18 months there, then ended up going to work for one of– a RedPrairie customer, then have been in consulting for about the last 15 years. Having that experience, I also have another company called Accelogix which I founded in 2012. We are a systems-implementer and consulting firm that specializes in implementation of Blue Yonder WMS services and associated automation and technology solutions for warehouses. So LogistiVIEW came out of my experience in that field and some opportunities I saw for improvement.

Excellent, well, yes. During that journey, was there somebody that had a big impact on you, a mentor or somebody that you’ve taken a lot of insights from?

I would say I’ve had several mentors. In the early days, it was technical mentors who helped me develop my skills as a software engineer. And then over the course of time, I’ve had a number of folks who were pivotal in structuring my understanding of the business end of this business, both from the logistics side and from the technology and consulting perspective. I remember my first boss, or I should say my first boss at my second job after I left RedPrairie recruited me to the company and had a really, really cool approach where he gave me the ability to really get ingrained in, not just the nits and nats of a WMS but really understand the business as a whole and the IT operation as a whole. And that really had a profound impact on my future because it gave me the ability to think bigger-picture than just well, hey, this is a support issue on a WMS, or this is a small mod, but really understand the big picture from a, it was a public company, so I got to see the inner-workings of IT at a publicly-traded company and learn from that. It was a great experience there.

That’s awesome. So obviously being an entrepreneur, starting a new company, a new venture, getting into something new has got its unique set of challenges. Walk me through your decision-making process to say, hey– I think you said you were in consulting and then– I want to go start this venture. What did that look like for you?

Yeah, it was a bit of a process, one that most people would call me insane for. It actually started when I was 24, just on the tail-end of my role with the company I just mentioned, the video game distribution company. I had a couple of folks who were consulting for that company had started a company, a consulting firm themselves. I ended up joining that firm as the third partner and third employee at a very young age and with, obviously, a lot to learn, but some strong technical skills and the willingness to learn. That was an interesting process; over the next four and a half years, we built that up a little bit. And then for a number of reasons, primarily wanting to go different directions with my focus on LogistiVIEW and software development, in 2012 we went separate ways, and I started Accelogix and then later was able to start LogistiVIEW as Accelogix grew and was more successful. So the early part of that story is that I chose to go ahead and take that path after my wife had just gotten pregnant with our first daughter. I went to her, and I said, “I want to quit my job.”

Good timing.

Most people would have said, “You’re insane. Why would you do that now?” whatever. Like I said, she’s been a bit of a saint over the years, supporting me on this journey. She said, “Sure, why not? Go for it.” And it was a good decision.

So what was that– those moments, though, I think comes to every entrepreneur that you go through that process. You think, okay, hey, I want to do this. Maybe I don’t– I should– here’s the pros and cons. But, and there’s a definitive moment where you say, “I’m doing this, and I’m setting my sights on this.” What was that moment for you?

I think there– I’ve always had a bit of a drive from the very beginning. I always wanted to do something of my own, so to speak. And it wasn’t really about, necessarily, having this lightbulb where, all of a sudden, my mindset shifted. But rather, I had been seeking entrepreneurial opportunities, really, even in high school and college. I was always very curious about how I could go about starting a business or finding a market in which I could start a business. There’s all those challenges that you don’t understand when you don’t know what you don’t know. When the opportunity presented itself to join a couple other folks who were older than me and had a bit more experience than I did, I found that opportunity to be very compelling because it was an opportunity for me to, what I believed, was start with something that I could build, that I could truly have an impact on while not necessarily being the only person responsible for making it all happen. Again, that did end up working out fairly well in the long run, and it was a pretty easy decision when I had to make it.

Awesome, awesome. So let’s move into some of the industry challenges and some things that you’re seeing in the space. Obviously, being in the technology space, digital transformation is, well, was a big deal, and now it’s– it was critical before, but now it’s even more critical. What are some of those challenges that you’re seeing right now?

I think there’s, obviously, that the number one challenge we’re all facing is, I think, this overwhelming feeling like we don’t really know what’s coming next.

Yeah.

That’s an unsettling feeling for any company, but it’s particularly unsettling for logistics and supply chain because it’s an industry and a focus inside a company that’s focused entirely around predictability, around consistency, around quality, and you’re in a situation where you just don’t know what’s coming next. Where will the next demand come from? What will product development suddenly pop out of a hat because, you know what, the marketing team went and found that the market wants an entirely different thing for an entirely different reason. All of this changes, and it impacts my customers very directly. And that’s been the most substantial challenge over the last 90 to 120 days, certainly since the pandemic started taking hold of America. It’s about seeking ways to be flexible while still delivering at the level of service that you’re mandated to deliver at. That’s a complex thing, especially when you’ve built systems that are meant to work a certain way but maybe don’t fit the models so well anymore because of what’s changed.

Yeah, no, absolutely. I think that the flexibility piece is key, but, then, also, you’re still held to that high standard from a deliverability standpoint.

Well, and what’s worse now is that now it has to get cheaper, too. It’s like, “Hey, do it as cheaply as possible.” It’s like, “Well, you can’t get all three.”

Well, the old trifecta, yeah. Better, faster, cheaper, right? “Now, make it two times as cheaper and three times as better.”

Yeah, exactly.

Exactly. And we need it tomorrow.

Yesterday, actually.

So if you were to take your crystal ball out, what are some of the future predictions that you’re seeing relative to how markets are shifting, maybe potentially other challenges that are popping up as we start coming out of what we’re coming out of, whenever we come out of it?

Well, and I think that’s– part of the challenge is whenever we come out of it. That’s the part that we don’t know yet. There will be a new normal that appears. I’m not going to call it post-pandemic. Maybe a better term is pandemic-normalized. I don’t think we’re there yet. Things are still changing, like just this week things like the unemployment stimulus changing and various other stimulus packages expiring, and the reality that, whoa, wait a minute. We’re still in really rough shape. How does that play going forward? And, presumably, that’s going to last for another 6 to 12 months. I sincerely hope that normal comes, or the new normal comes a little sooner than that, but I’m preparing myself for that kind of change, and so are most of my customers. What they’re analyzing is, for example, what does Black Friday look like in 2020?

It’s a whole different world. What does that look like? What used to be a retail distribution rush is now going to become a massive e-commerce distribution rush. How many warehouses are prepared for that? How many systems are prepared for that? When you don’t have the retail shopping that you were going to have before in-store throughout the entirety of the busy season, can your e-commerce presence handle that? Those kinds of questions are profoundly relevant right now because it’ll mean life or death for brands that can’t get their products to consumers online.

Yeah, exactly, that or even from a fulfillment and inventory standpoint. It’s like, from an inventory forecasting, what do I need to even have on hand? Is our sales, are we going to go through the roof? Or are we going to go down because, from an economic standpoint, are people going to buy the same amount they’re going to buy? So, yeah, to your point.

The other thing we’re seeing, too, is disruptions farther back in the supply chain. So what you anticipated, what you forecasted, what you ordered may not show up. How do you handle that problem? All of those variations right now are forefront in the mind of most supply chain practitioners.

Yeah, it’s also forefront in the mind, too, of consumers, as well. Even you look at the big, bad– or however you want to characterize that– but you look at Amazon and just all the shift on how, from– obviously, beforehand, everyone was, from a consumer standpoint, you were predisposed to saying, hey, I need to get my stuff in two days or less, maybe even an hour, depending on where you are. Now, it’s like the ability of being able to try to expedite some of that stuff is completely gone. Gosh darn it! So the dependability, it’s a whole, it’s a cluster.

Absolutely. Well, it’s something that you wouldn’t have predicted. You take a look at how Amazon, particularly, has responded to the pandemic. I don’t think they’ve done a terrible job of executing, but they’ve had to prioritize.

Yeah.

And the prioritization has come at the cost of their third-party marketplace; it’s come at the cost of smaller vendors who relied on Amazon; and it’s come at the cost of their own team, to a certain degree just because COVID has impacted their facilities. Everything that you thought you knew about Amazon on March 13th, by April 13th had broken down. Two-day Prime, forget it.

Yep, done.

Next day, forget it. Not going to happen. And anything in the world that you want, you can get on Amazon in two days. Forget it. Not a chance. It’s all been completely turned around. And it’s something that, again, if you had said on– March 13th was the Friday after MODEX.

Yeah.

And it was the day we were all going home with the realization that, oh, my God, next week may be the biggest change in the history of the country, the virtual shut-down of a good chunk of our economy.

And it was.

And it was. And the impact of that was just completely unpredictable. And, certainly, no one would have expected Amazon’s supply chain to break. But if Amazon’s supply chain can break under those circumstances, what about everyone else’s?

Exactly.

That’s the thing that’s really been fascinating to watch and understand. A lot of our customers are in food and beverage and restaurant supply. The difference is, the grocers are off the charts—

Yeah.

But their demand is for products that they can’t even stock. They don’t have enough stock for them. So that’s been a challenge. Then, you’ve got the restaurant suppliers and the event suppliers and catering suppliers. They’ve got stuff just rotting in the warehouse. And they’re trying, obviously, to move it in different places, to be efficient with it and whatever. But this kind of disruption is unprecedented in history and, now, everybody has to respond by– and, sadly, this is the part that’s going to be hard to plan for– when will this happen again? Well, God, I hope never. But, at the same time, I don’t think your CEO is necessarily going to say, oh, well, COVID was a one-time thing. We don’t have to worry about that anymore. Now, you have to plan for it or, at least, be prepared for it, be prepared to react. That requires a technology investment in greater flexibility and more software orchestration and, really, less steel bolted to the floor as the solution. A lot of companies are just now beginning to plan that reaction process.

Yeah, business continuity plans are going to be, yeah, the thing now. They were important before, but, obviously, very neglected, one of the– It’s a reactionary thing, so being a very reactive response. Let me ask you about, how are you guys really helping your customers or prospects to be able to get through this? What are things that you’re doing, your technology, are enabling customers and other companies to be able to do?

So I think the number one thing that we’re trying to help our customers through, both on the consulting firm side and on the LogistiVIEW software side is helping to plan for disruptions or to plan through the disruptions, I should say. Especially in the first few weeks of this, our grocery customers were getting really pounded, heavily. They were experiencing unprecedented volumes. The was all the pandemic buying and everything. Getting them through that process and ensuring their systems were stable and the existing systems were in place to make all that work and running smoothly was a pretty big priority. And, so, we actually, for a while, we were offering free support for anybody who needed to call us because it was like, okay, if your system’s crashing, and you don’t have a plan in place already, we can help. And that was, thankfully, I think we’re past that now where folks now, are they’ve at least adopted, they’re adapted to the what I’ll call the pandemic normal. But now the question is, what do we do next?

And, so, for a lot of our customers, a lot of our customers are evaluating that. A lot of our prospects are evaluating that. And we’re trying to help them think differently, I think, is the best way to really describe it. How can I design systems from scratch? How can I design processes from scratch that are built around the ability to adapt to changing consumer behaviors, the ability to adapt to changing inventory availability or different SKU profiles and order profiles. All of that is changing and, depending on the company, it’s changing in very different ways. Some of our customers have been completely decimated by this, and their order volumes have dropped off to less than 20% of what they were before. Others have been relatively unimpacted, and still others are at record highs, like the grocers. Each of those requires a slightly different analysis process.

And, interestingly enough, the solution involves the same ingredients almost every, single time. You need to focus on flexibility. You need to focus on the business processes and channels that are likely to be active at any given point in time. Obviously, you don’t know for sure. And you need to optimize those channels to achieve whatever profitability you can out of them. Obviously, the answer might be that you can’t be profitable, but let’s optimize to try and lose less and prepare you to come back strong. Those are all difficult conversations to have in a lot of cases, but that’s what companies like us have to be helping our customers think through right now.

Absolutely, yeah, and kudos to you guys for jumping in there. Who you’re talking about, offering the free support and really just, essentially, being really customer- focused, obsessed with being help– providing value and really jumping in there. My last question: We talked a lot about the pandemic and the doom and gloom and the bad things that have happened and the changes and whatever. What are the changes, what things have you learned through this that have been positive? What are some positive impacts that you have either experienced or that you foresee in the future?

There’s actually a lot of positive impacts. As much as you talk about doom and gloom, I would argue that it’s not even doom and gloom. What the pandemic has done is, it’s reminded us that change is inevitable. And I think that’s a really good thing. I always find some folks are really, really obsessed with supply-chain planning, and I often laugh because the plan never really happens. In fact, a lot of times, it comes a long ways from happening because just stuff got disrupted. I think a lot of companies are now, and a lot of leaders are now asking themselves the question, “How can I be better prepared to respond?” rather than, “How can I have the perfect plan?” And I think that’s a good transition. Obviously, you don’t want to go into something with no plan; that would be foolhardy as well. But the idea that, “Hey, I can and I should design and build supply methodologies and distribution methodologies and technology methodologies that support the ability to respond to change.” That’s driving a technology shift in our industry that was already happening. It’s also driving behavioral changes in consumers.

Consumers were going online before; now, they’re going online way more. Distribution, particularly, has been heading towards or talking about autonomy and robotics and AI and intelligent orchestration for a number of years. And it seems like now there’s more need and more reason than ever for that technology to advance with purpose because there is a clear reason. We can’t just– it’s not going to be, we’re not going to be high on the hog forever. We had 10 years of really, really good economic conditions. It wasn’t a matter of if. It was only a matter of when. And, now, with a new breed of technology that really didn’t even exist 10 years ago, I think there’s a way to re-imagine distribution, particularly, in a new light. And that, I don’t think we want to deal with that pain because it’s certainly not fun. At the same time, I believe it’s going to make companies better on the back end of the pandemic.

Yeah, absolutely. I couldn’t agree more. Seth, I’ve really enjoyed our conversation. I could probably go on for a few more hours.

Me too.

But for those who’d like to learn more about you guys, so maybe your website? What is your website, actually? We’ll throw that out there.

Absolutely, so if you want to learn more about us, certainly, you can search for me on LinkedIn or any other place. I’m pretty easy to find. Feel free to reach out. Love to chat with you. Also, check out our technology at logistiview.com. Then, if you’re looking for consulting services and/or want to work a little bit more with your WMS, then, definitely check out accelogix.com, A-C-C-E-L-O-G-I-X. We’d love to chat with anybody and, if nothing else, just share experiences because these are interesting times.

Awesome. Well, Seth, again, thank you so much, and best of luck with the two ventures.

Thanks, Danny, you too.

Alright. Well, there you go. That wraps up today’s IndustrialSage Executive Series interview with Seth Patin, CEO and founder of LogistiVIEW.

Listen, if you liked listening to this episode, or watching it, if you’re watching, you need to subscribe. And here’s how you can do it. You go to IndustrialSage.com, if you’re not there already, and what you can do is get on our email list. You want to do that because we’ve got great episodes like this that come in every, single week on top of other content, like our manufacturing news and sales and marketing insights and a lot of other articles and other pieces of content, webinars and all that good stuff you don’t want to miss. So go ahead and subscribe. We’d love it. If you’re listening or watching on social media, we’d love– jump in the conversation. Engage, add a comment, like, share, all that good stuff. So I’m it– I’m Danny; that’s what I meant to say, and I’m done. And thanks so much for watching today. I’ll be back next week with another episode of IndustrialSage.

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