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As we approach Industry 4.0, most of us are enamored by the new technology advancements providing exciting opportunities for our businesses — 3D printing, IoT, predictive analytics. In the midst of this excitement and curiosity, it’s tempting to lose focus on more mature platforms and capabilities while we chase the next “shiny object.”

Fundamental digital capabilities such as transactional websites, eProcurement and mobile commerce are key capabilities for the industrial distributor. But we tend to think about these capabilities in a box. When we “check that box,” it’s tempting to move onto the next big thing. This can be true for individual companies and for our industry as a whole.

It’s important to realize that core digital capabilities can be valuable underpinnings for success as more advanced technologies evolve. If we don’t focus on continuous improvement with those core capabilities, we can never begin to leverage all of the possibilities available to us with Industry 4.0 technology. In short, Industry 4.0 technology rests on fundamental digital competencies.

So what drives success and where should we focus? It’s important to focus on five key areas of digital capabilities: Presence, Relevancy, Effectiveness, Engagement and Customization.

Digital Presence

Most of our companies enjoy strong name recognition in our markets. We’ve all worked to deserve the sound reputation we’ve built, and have been rewarded with new and repeat business. As digital becomes an even stronger influence, how competitive will your brand be? Will new customers understand your full value proposition and the value proposition of the industrial distributor? As you expand your capabilities and services, are you being heard?

Most of us know that SEO stands for search engine optimization, and we understand how important it is for us to be present when a potential customer tries to find a product or service through a search engine like Google. Do you understand how to be successful? Are you staying in touch with the constantly changing search engine strategies and monitoring your performance through SEO analytics tools? Do you understand how paid (PPC) and organic (SEO) search work together for maximum visibility where you want it the most? As you invest in new platforms and services, don’t forget to continuously improve your SEO position. It’s worth measuring, planning, enhancing each and every month. As SEO models change, don’t be left behind.

Digital Relevancy

While you can read a lot of white papers on “digital relevancy,” the two words say it all. How relevant are your digital platforms (website, eProcurement, mobile app) to your audience and the desired behavior you are looking for? Digital relevancy is something you must continuously strive for and it can be a moving target with ever-evolving buying patterns, personas, and an increasingly competitive landscape, particularly with pure etailers now fully in the mix with industrial B-B.

Our customers and their processes are changing. Website and mobile technology and associated best practices are changing. When is the last time you evaluated your website against new best practices? Are you investing in digital as well as sales and logistics?

The challenges will keep coming with Industry 4.0 and growing customer expectations for operational content and analytics platforms. We all believe we understand our customers but the nature and frequency of our touch points are evolving. As an example, just look at the trends of phone vs. email and text in your business. How has mobile affected those touch points? Further, how many third parties now stand between you and your customer? As eProcurement platforms evolve, we must evolve, too.

We must truly understand the multiple stages of engagement on the digital front and how successful we are at each stage. Like anything else, this should be measured, quantified, and continuously improved. Customers want seamless engagement and if we lose them on our digital platforms we will likely not be successful as technology will become more dominant in our space. While not espousing any specific measurement tools here, they are ubiquitous. Digital relevancy is a complex undertaking and deserves a disciplined approach and honest and quantifiable evaluation.

Digital Effectiveness

It goes without saying that presence and relevancy are useless if we don’t deliver or if a customer doesn’t perceive value. But digital also has a role in basic blocking and tackling. As distributors, we all continue to face the age-old challenges of quality product content, effective product search, accurate lead times, transparent delivery dates, application expertise, and responsiveness.

We’ve all invested in training and we are committed to customer service. Most of us have a plan for continuous improvement in each of these key areas. But have we aligned our digital plan accordingly? Have we invested in tools to help our salesforce deliver “post sale”? Do our personnel have easily accessible information to service the customer according to expectations? Have we challenged our supplier base to collaborate on information exchange and connectivity? These are all questions that deserve ongoing attention. If basic foundations are not in place and responsibilities aren’t clear, then progress will be stalled and it will be difficult to compete with those who’ve invested and included digital as an integral part of the company strategy.

Digital Engagement

Our customers don’t typically sit in front of our websites ingesting all the good things we are serving up for them. They are trying to solve problems. They might be working with multiple ERP and Maintenance Management systems. Many have invested in eProcurement technology. Some are faced with new ERP system upgrades and all are challenged with better asset utilization. The point here is that you have to meet the customer at the source of the problem. You must understand how their product decision and buying process works. To engage with your customer digitally often requires that you engage with them personally. Is your website simply geared towards the sale or does it offer solutions? Do you have a strong feedback loop for customers to seek service or report a problem? Do you understand how you are performing though net promoter scores or other tools? Engagement doesn’t start or end with a procurement transaction and all industrial distributors must look at the impact that digital engagement will have on the success of their business.

Digital Customization

In order to fully engage, you must accept that customization is key and determine how to do this economically and effectively. This can mean a lot of different things from system-to-system integration, website personalization, and configurable workflow. The best place to begin is to understand the buying process and stages of engagement, establish buying personas and scenarios and map this to your internal capabilities. There will be some obvious gaps and you must prioritize filling those gaps. Understand what process, data, performance metrics and platforms are of highest priority to your customer. Allow your customer to make choices. One size doesn’t fit all, so you might have to determine which customers are currently most at risk from a digital perspective. As industrial distributors face new challenges with Industry 4.0 technologies and customer expectations, customization capabilities will be key to success.

Ellen Holladay
SVP, Chief Information Officer and Operational Excellence Officer for Motion Industries

Over the past decade, digital technologies and tools have provided exciting opportunities for industrial distributors and their customers. The next few years will be phenomenal as Industry 4.0 becomes a reality and we have both the opportunity and challenges of ubiquitously connected devices, advanced analytics, predictive models, and machine learning. The stakes will be high and a strong digital foundation will be key. As each of our companies respond and continue to add capabilities in order to compete, we must remember the value of continuous improvement. If we continue to enhance core capabilities, we can look forward to a more robust role of industrial distributors in the era of Industry 4.0.

Ellen Holladay is SVP, Chief Information Officer and Operational Excellence Officer for MRO products and services distributor Motion Industries — No. 6 on Industrial Distribution's 2017 Big 50 ListHolladay has led the development of Mi’s highly refined supply chain capabilities, including a comprehensive integration platform designed to address the complex requirements associated with B-B transactions among North America’s top manufacturers and suppliers. Holladay has more than 30 years of experience in IT and supply chain management, with the last 27 at Mi. Previously, she served as a management consultant at Ernst & Young, focusing on Information Technology, System Design and Technology Planning within the Manufacturing and Distribution practice. For more information, visit MotionIndustries.com, or if on the go, download the Motion Mobile app.

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