Industry News

Grainger, Graybar, Cardinal share pandemic lessons from distributors

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The National Association of Wholesaler-Distributors held its annual executive summit this month with two notable differences from past years. One, NAW has a new president and CEO in Eric Hoplin, who succeeded Dirk Van Dongen in October. Two, the event was held online, joining the countless events that have gone virtual since the coronavirus pandemic took force last March.

And yes, the pandemic was on everyone’s minds. A Thursday morning session of the NAW 2021 Digital Summit offered a chance for leading executives to reflect on how they’ve weathered COVID-19 while preparing for challenges yet to come. 

Hoplin interviewed Grainger Chairman and CEO D.G. Macpherson; Graybar Chairman, President and CEO Kathy Mazzarella; and Cardinal Health President, U.S. Pharmaceutical Distribution, Debbie Weitzman. They shared lessons learned from 2020 and spoke about key issues facing distribution, including how the pandemic changed operations and what’s needed to find tomorrow’s best talent.

The pandemic tested people and business models

Macpherson and Mazzarella both shared how leading their companies through the early days of the pandemic was about managing people and the business simultaneously. Leaders needed to “deal directly with” their employees’ feelings and emotions, Macpherson said. 

Similarly, Graybar’s goals for employees started with employees taking care of each other and their customers. The company extended its leave and time-off policies, created an employee resource portal for COVID-19 issues. Mental health was a focus, Mazzarella said, and managers received training on being empathetic and caring for their teams.

Acknowledging the situation didn’t mean neglecting the business, either. Grainger leaned on its principles to help ground employees and enable them to focus on business imperatives. Graybar used the crisis to refocus employees on the importance of planning for failure -- assume almost anything could go wrong, Mazzarella said. Business continuity was another key focus for Graybar, whether it be personal protective equipment for on-site employees or improved IT infrastructure for supporting remote workers. 

Business continuity is tested during a crisis, but the foundation for success is laid during good times, Mazzarella said. Graybar was able to spend to remedy supply chain issues and other needs because it had built up a strong financial position.

After the initial shock

Cardinal Health remains in the thick of the COVID-19 battle, as vaccine distribution is still ramping up and the vaccine R&D environment continues to evolve. The challenges facing the company and other health care firms have been varied, complex and evolving, especially after the initial shock of the coronavirus. Cardinal has learned to “overcommunicate,” Weitzman said, and instill the belief that every employee at every level has a role to play.

Weitzman also emphasized the importance of documentation and debriefing during this crisis. Writing down and organizing such details can help teams understand what just happened while also preparing for the next wave or the next crisis.

Grainger experienced its own kind of shock, especially around what customers needed and where those customers came from. Grainger’s hospital business has always been “in the basement” -- not visible -- Macpherson said. 

That’s changed, with N95 masks being a prime example. N95 masks were usually bought by specific industrial customers, but after the pandemic began, Grainger saw an influx of medical and government buyers, requiring a complete rethink of allocation for the long term.

Customer acquisition as a whole is “way up” for Grainger during the pandemic, and that’s pushed Grainger to improve its capabilities for qualifying and contacting customers so it can create long-lasting relationships and generate repeat purchases, Macpherson said.

Building tomorrow’s workforce

While the pandemic continues, distributors also have to look ahead in other areas, notably the workforce of tomorrow. 

Hoplin noted that Mazzarella is one of only 37 women leading Fortune 500 companies, and she emphasized that diversity and inclusion is an area distributors can’t afford to ignore. Don’t think of D&I as a quota thing, she said. Instead, “an inclusive workplace” is another way to create career paths and belonging for employees, a way to better serve customers, and also “the right thing to do.” 

A mindset of diversity and inclusion can help distributors build workforces primed for competitive advantage -- if they know where to look. Mazzarella encouraged companies to think about diversity with a wide lens -- for example, recruiting from groups such as veterans, people with disabilities, the formerly incarcerated and people struggling with housing. Recruiting in these areas yields opportunity, she said, even if it might require a different approach to onboarding and skills training than companies are used to. 

NAW’s value

Hoplin closed with each speaker sharing why they valued NAW. They mentioned the value of networking with what Mazzarella called “best-in-class people who truly care about helping each other out.” The speakers also noted how NAW is an important voice for distribution in Washington, D.C., especially for companies that otherwise wouldn’t have a presence.

 

James daSilva is the longtime editor of newsletters such as NAW SmartBrief and SmartBrief on Leadership.