Ways to Eliminate Waste

When the Manufacturers Group (NMG) of the National Electrical Manufacturers Representatives Association (NEMRA), Tarrytown, N.Y., began identifying and eliminating wasteful practices in the channel, one of its goals was to produce a white paper that did more than just sit on a shelf unread and unused.

NEMRA appears to be on the way toward accomplishing that goal, as several independent manufacturers' reps and electrical manufacturers have already begun to accomplish that mission. Several companies said the NMG study, “Eliminating Wasteful Activities in the Representative and Manufacturer Sales & Marketing Channel,” helped them eliminate waste in their operations. Following are several areas where manufacturers and reps have used the study to operate more efficiently.

Peer coaching

At the NMG Forum held during last year's NEMRA Annual Conference in New Orleans, Kurt Nelson, president, and Tara Lockie, director of corporate development, Nelson & Associates, Santa Fe Springs, Calif., reported on their company's coaching strategies. The rep firm's employees spend 30 minutes preparing for formal coaching sessions, which are scheduled private appointments. Topics discussed may include careers, sales performance, training and task completion dates. Nelson and Lockie said the process helped improve company morale, teamwork and communication.

“Over the last year, we have been coaching and have seen different teams struggle with the consistency of the coaching meetings,” says Nelson. “After all, it's easy to justify canceling a coaching meeting to land an order. It got easier and easier to postpone meetings. As a result, we came up with metrics to track and review the consistency of the coaching program in our leadership team meeting. About four months ago, we modified our coaching standards for each team, and our plan's new design addresses key areas of accountability — especially those that generate sales and let us meet manufacturers' objectives. The program only gets proven with time, so I would encourage people to hang in there. Have six-month reviews of the effectiveness of the coaching standards and solicit the input of as many associates as possible.”

Tom Fredericks, national sales manager, American Polywater Corp., Stillwater, Minn., took what he learned from the Nelson & Associates' coaching program and employed it at his company. He says in the past many decisions at his company were made at improptu employee-manager meetings, but that accountability sometimes was an issue. “Because there was no accountability, there was plenty of room to slide. By implementing formal monthly coaching meetings, we've done away with these informal sessions. More importantly, we agree on what's going to be done and we ensure that one person is accountable for getting something done.”

He says since this process began about a year ago, American Polywater's sales are up and its sales team is much more productive.

CRM programs

Depending upon how one defines CRM, it can mean either Customer Relationship Management or Contact Resource Management. No matter what its definition, two reps have used it to their benefit. Brian Chase, principal, Lester Sales Co. Inc., Indianapolis, Ind., believes CRM will help his company communicate more effectively with manufacturers. To help target his sales efforts more effectively, he hired an intern last summer to clean up his company's customer database. That effort helped Chase pare down the number of names in his company's customer list from 2,800 names to 1,100 names. He now wants to find the CRM program that will help him manage this database most effectively. “As a rep, one of my greatest challenges is to communicate with my manufacturers and outside sales staff who represent my first line in battle,” he says. “Our goal is to communicate effectively with them. CRM will let me do that.”

Ralph Bliquez, Ewing-Foley Inc., Tigard, Ore., says the goal of a CRM effort shouldn't be to just keep tabs on customers, and that it should include all of your network partners. “The people we deal with today — customers, manufacturers and distributor personnel — are constantly changing positions,” he says. “That's why whatever CRM system you decide upon must be dynamic. If you're going to manually keep track of all the changes, ultimately you're going to leave something behind. The system we use is one that can automatically be updated from any location and allows us to access accurate information at all times.”

Channel specialist

Employing a “channel specialist” has spelled success for at least two companies. Ken Hooper, senior vice president of sales, Ferraz Shawmut, Inc., Newburyport, Mass., says his company created a channel specialist position “to drive out every dollar of non-value activity of the processes between the manufacturer and the rep.”

The channel specialist spends time with Ferraz Shawmut's reps and reports back to the company on any issues. Her efforts have helped the company improve the accuracy of its Point-of-Sale (POS) reporting, which in turn increased accuracy of commissions statements to virtually 100 percent. Overall sales reporting has been improved, too, because it helped the company bring POS and direct sales reporting together. “As a result of our efforts with our channel process specialist, we've saved four days' time per month with all the people who are involved in dealing with reps,” says Hooper. “That includes customer service, accounting — anyone who has a hand in trying to fix an issue.”

Kelly Boyd, president, Southern California division, ElectroRep Inc., Costa Mesa, Calif., also created a channel specialist position. “We've taken customer responsibility away from the individual and asked him to look at our inefficiencies and fix them,” he says.

ElectroRep's channel specialist has supported new product rollouts; filtered e-mail from manufacturers by identifying the most time-sensitive messages; and helped train new employees.

When someone joins Electrorep's sales team from outside the industry, the channel process specialist sits with them for a week or so and explains everything from what's an OEM to how to call on a panel shop. “This has been a great help in time management and productivity,” says Boyd.

Multiple computer monitors

A rep and manufacturer said their investments in multiple computer monitors at work stations have saved time for employees. American Polywater's Fredericks said it's been especially beneficial in his company's inside sales, accounting and shipping departments. “We made this change because you have individuals working simultaneously on more than one computer program,” he says. “Working with the standard single monitor necessitates opening, closing, minimizing and maximizing programs several times during a transaction. What we've done is a huge time saver. You can look at an Excel spreadsheet on one screen, and on the other screen enter data related to shipping without having to leave one program to access another.”

When Brian Chase of Lester Sales remodeled his company's offices, he ordered two monitors for each workstation, too. “It's common for us to be working on a job takeoff at the same time we're developing quotes for a job,” he says. “In the past, it's been cumbersome to move from one computer program to another. Having the ability to operate off two screens simultaneously facilitates what we're doing and saves us time.”

EDI and electronic commission payments

John Hoffman, executive vice president of sales and market development for Legrand's Electrical Wiring Systems (EWS) division, West Hartford, Conn., says eliminating waste is in his company's DNA and that the company is always looking for methods to make its operations more efficient. According to Hoffman, implementing EDI and automatically depositing reps' commissions have helped eliminate errors in transactions and payment. “The benefits of EDI are easily experienced when you realize how much time and effort you save, not to mention the elimination of errors in the ordering process,” he says.

Automatic deposit of reps' commissions has been a big success, too, because it eliminates the time and effort related to generating typical paper checks. “There are nothing but positives to this move,” he says. “The rep gets his commission payment much faster, and he has to make fewer trips to the bank to make deposits. With those benefits it's hardly a surprise there was no resistance on the part of reps to make the change.”

Communication with reps

Legrand's Hoffman says quarterly marketing phone calls with reps have gone a long way toward filling communication gaps that sometimes occur because his company's reps are typically representing multiple product lines for Legrand, and when each line puts out a new product, the rep gets the messages from multiple sources at the company.

“We've found that with the multiple communications there can be a good deal of wasted effort, not to mention the possibility for confusion,” he says. “To counter that, on a quarterly basis we've implemented a Marketing Wave Packet phone call that walks the rep through our marketing plans. We contact reps ahead of time to let them know when we're going to be talking to them. Then we go through all the new product materials and bring them up to speed on all of our marketing efforts. This is a one-shot effort that eliminates a lot of other phone and e-mail messages and makes our joint efforts that much more effective.”

As he considers these and many other changes reps and manufacturers have made to achieve efficiencies in their operations, Hank Bergson, NEMRA's president and CEO, says, “These individuals serve as examples of what we were looking to achieve as a result of the NMG study. They've taken a number of easy actions that provide them with an immediate and measurable payback. By doing these things, reps and manufacturers free up the reps to do that which they do best — sell.”

The author is president of Foster Communications, Trumbell, Conn. During his many years in the electrical industry, he worked for the National Association of Electrical Distributors (NAED) when it was based in Connecticut. He is editor of Agency Sales magazine, published by the Manufacturers Agents National Association, Lake Forest, Calif. You can reach him at (203) 258-4628 or by e-mail at [email protected]. Check out the editorial archives at www.ewweb.com to find the many articles he has written for Electrical Wholesaling over the years.

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