AHTD tightens membership rules
By Staff -- Industrial Distribution, 7/1/1998
Hilton head, S.C.-- Implementing cutting edge business practices in electronic commerce and managing a 21st century sales force was the key message at the Assn. for High Technology Distribution's spring convention, while AHTD's new membership policy had many members up in arms.Surrounded by the picturesque Palmetto Dunes and a myriad of golf greens, nearly 430 distributors and manufacturers mixed business sessions with fun at the beachfront Hyatt Regency on May 13-16.
But an announcement of AHTD's new membership policy and recertification criteria caused a big stir among participants. With more than 60 companies awaiting word on their applications for membership, the qualifications have been rewritten to make sure AHTD members are automation solution providers and not merely product or commodity-focused.
According to the new criterion, members must add value with services such as design and application engineering, offer technology-based products such as automation controls, and operate free from direct or indirect control by manufacturers. For example, to qualify, members must derive at least 81 percent of their operating income from the buying and reselling of automation products within their area of primary responsibility. AHTD will provide its detailed eligibility criterion to applicants.
"You asked us to better define high-tech distribution and rewrite member requirements to better qualify new members and requalify existing members," Bob Dietz, a member of the advisory board and president of M&D Controls Co. in Frazer, Pa., told members during the general session.
Applications for recertification will be mailed out this month and should be returned well before AHTD's fall meeting Oct. 8-11 in Chicago. AHTD President Greg Pfleger, of Shingle & Gibb Co. in Moorestown, N.J., said the intent is to re-establish focus on the quality, not quantity, of members. He expects some companies will not be recertified.
During one business session, consultant and author Jack Shaw warned that distributors who do not implement "highly integrated" electronic commerce in the next three years will be at a disadvantage. Total Internet commerce is expected to catapult from $600 million in 1996 to $17 billion this year, and rise to $327 billion by 2002, he said.
Shaw, president of Electronic Commerce Strategies in Marietta, Ga., said that to improve their business processes distributors should go beyond common uses of EDI -- purchase orders, invoices and quotes, for example -- and establish rules-based decision making. Paper flows and employee time may be reduced when routine purchase orders and invoices are approved by computer, while managers become involved in approving orders only for non-routine items, he said.
Highly integrated EDI systems also allow distributors to track a customers' inventory better, while end users may see how a product application works with a virtual reality tour, he said.
"The real benefit is you improve your forecasting by working together," he said. Shaw predicts the World Wide Web will not replace EDI for business transactions, but will supplant it.
Other talks included management and sales consultant Rick Barrera's presentation, "Embracing the Challenges of the 21st Century"; sales consultant Jim Pancero's formula for managing an effective sales team; a look at what's in store for specialty distribution by John Henderson, executive vice president of Frank Lynn & Associates; and consultant David Massie's practical workshop on activity-based costing. Participants also met in roundtable discussions of topics like electronic commerce. I
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