Many people consider digital transformation one of the most critical factors having an impact on the EC industry. ELECTRI International had the recent opportunity to talk with Kathy Mazzarella, Chairman, President and CEO of Graybar, to learn more about how the firm is approaching the entire concept and how its long-standing involvement with ELECTRI International helps shape Graybar’s thinking.
ELECTRI: How did Graybar come to the conclusion that it needed to put significant effort into digital transformation?
Kathy Mazzarella: For decades, Graybar has been a leader in using technology to help our people and our customers achieve more. In recent years, we’ve seen a dramatic shift in the way companies deploy and use digital capabilities to run their businesses and transform them for the future.
ELECTRI: Was Graybar the only one examining digital opportunities?
Not at all. When you look at the amount of venture capital focused on technology in the construction industry, it’s clear that the opportunity for transformation is huge. Some of these technology companies are exploring some really innovative applications with artificial intelligence, machine learning, intelligence augmentation, 3D printing and construction manufacturing solutions.
ELECTRI: What will it take to achieve success in this arena?
As we strive for transformation, I believe one of the key factors to success will be creating an ecosystem where industry peers, universities, tech companies and companies outside of our industry can collaborate to develop innovative solutions. This diverse mix of perspectives offers far more potential than any one company can achieve on its own.
ELECTRI: What can you tell us about Graybar’s return on investment for its digital efforts?
There are many ways to measure our return. From a financial perspective, we are seeing tangible productivity gains and cost savings resulting from our investments in robotic process automation (RPA) and other automation platforms. These technologies handle routine tasks, so our people can focus their time and attention on serving our customers.
ELECTRI: What about investing in business intelligence? Worth it?
On this front, our focus on advanced data analytics is providing us with much deeper insights into our business and helping us anticipate customer needs. From a supply chain perspective, technology is improving the way we forecast demand. This leads to better inventory planning and higher fill rates on customer orders.
ELECTRI: What is Graybar doing to help its customers stay ahead of the pace of change?
Technology is vital to keeping our people and customers connected in a time of unprecedented disruption. While I am proud of the work we’ve done so far, I believe we are just scratching the surface of what’s possible, particularly when it comes to enhancing the customer experience. As our customers’ journeys are transformed, we will continue exploring innovative ways to remove friction from the supply chain, using technologies such as blockchain, IoT and intelligence augmentation. We look forward to harnessing the power of these emerging technologies to transform our business and our industry.
ELECTRI: Whether we’re talking about Graybar’s employees or its customers, getting people to change is a major undertaking. How is Graybar approaching this part of the task?
Our goal is to build a culture of innovation, focused on helping our customers achieve more. We are doing a number of very creative things, some with the academic community. Our Innovation Lab, located at Research Park on the campus of the University of Illinois, plays a vital role in developing innovative solutions and researching opportunities to bring value to customers, such as BIM integration, jobsite services and data analytics.
Graybar is also part of the Arizona State University Center for Services Leadership. This relationship allows us to learn about the future of professional services from other companies as well as university faculty. Our people can also take advantage of certifications and courseware through ASU, which equips them to stay current on the latest thinking and share it with our customers.
ELECTRI: What about in-house steps?
Last year, we launched a companywide innovation program called NEXT. Through innovation campaigns open to all employees, we gather ideas focused on enhancing the customer experience. As part of NEXT, we established an Innovation Council to prioritize ideas and move them from concept to commercialization. Moving forward, we hope to engage customers in this NEXT program.
At the same time, we’re expanding our Contractor Productivity Solutions by conducting ongoing education for our sales and service teams, so they can offer innovative services that provide real solutions to customer challenges.
ELECTRI. There are a lot of different initiatives on Graybar’s agenda. Has the company’s involvement with ELECTRI International had an influence on the way Graybar approaches its own business strategy?
As I mentioned, customers are at the center of our long-term strategy. We achieve our business goals by helping customers achieve theirs. Graybar’s involvement with ELECTRI over the years has provided us with strategic insights on future opportunities, as well as a clearer understanding of the challenges our contractor customers face. ELECTRI also keeps us connected with some of the most proactive thinking and valuable research in the construction industry.
ELECTRI: Can you give us an example?
Sure. Our original Graybar ESP (Efficiency, Safety, Productivity) program was the result of our 2007-2008 work on the ELECTRI Task Force teams addressing “Preconstruction Planning” and “Streamlining Office Operations.” We enhanced our delivery tracking capabilities based on insights we gained through ELECTRI. More recently, we’ve been working with ELECTRI on its “EC as Integrator” project. This project “connection” is helping inform our direction on solutions for security, wireless, audio/visual, 5G infrastructure and broadband.
ELECTRI: Are there specific research topics you would recommend for ELECTRI to consider and commission as part of its research agenda?
The “last mile” is no longer the biggest challenge in the supply chain. It’s now the “last fifty feet” that creates complexity and hidden cost for the electrical contractor, particularly in heavily populated areas. It’s also challenging for distribution, as we strive to deliver precisely what our contractor customers need, when and where it’s needed on the jobsite.
As new technology emerges and more contractors turn to prefabrication and construction manufacturing, an ELECTRI International series of reports detailing practical ways to improve the last fifty feet of the supply chain would be helpful.
ELECTRI: Considering the long-term impact COVID-19 may have on the construction industry around the world, how would you advise contractors to prepare for a comeback? What is Graybar itself doing to be ready for that upward turn?
I recently held a call with all Graybar managers during which I shared the following advice. It broadly applies to most of our businesses as we prepare for recovery.
- First, be realistic: We must accept the reality of our circumstances, and move forward with grounded optimism, even though we don’t fully know what the future holds. All of the current forecasts indicate that next several months will be difficult, and we all need to be prepared for a tough road ahead. At the same time, we must hold firm to the belief that things will get better and that we can all play a role in creating that new reality.
- Second, be responsible: While many aspects of our current situation are completely out of our control, we must focus our energy on what we can This is not a time to sit back and wait for the situation to get better. It’s a time for action. Early on, Graybar leaned into the crisis by adding inventory to provide contractors with fast access to the products they need. We continue to refine our logistics network to place the right amounts of inventory in the right places, and we’ve implemented extensive safety and social distancing protocols to keep everyone safe. We will continue to take steps to provide excellent service in a safe and responsible way.
- Third, be resourceful: One of the things I’ve seen over the course of my career is that when we are forced to do more with less, our people come up with some of their best, most creative ideas. We never wish for adversity, but times like this compel us to dig deep and show what we’re really made of. Right now is the perfect opportunity to explore new and innovative ways to serve contractors and transform our business. In fact, we are currently running a companywide campaign to gather these innovative ideas from our employees who work closely with our customers every day. We are excited to see their recommendations.
- Finally, be resilient: This crisis is a defining moment for all of us, and through it, we are learning important long-term lessons that will shape our companies and each of us as individuals. In spite of challenges that come our way, we must not give up. Together, Graybar, ELECTRI International, and NECA have weathered many past storms. I am confident that together, we will emerge stronger than before.