People to People
Act I: The rapidly changing and accelerating needs and expectations of customers
Introduction
Instant gratification. It’s the mantra of today’s “gotta-have-it-now” world. You go online, click, pay, and expect immediate delivery.
Technology is driving the ability to satisfy demands as quickly as possible. But is that really a new concept, or just another step in society’s progress? More importantly, when technology is in the driver’s seat and speed and price are the primary concerns, what are we in danger of losing?
Graybar’s nationwide electrical distribution network was established at the start of the 20th century, and products came and went as people’s needs and desires changed. In the 21st century, Graybar has embraced exciting new technology, including a landmark investment in software that once again revolutionized the business and blazed a trail for the industry. Nevertheless, it’s Graybar’s people—with our experience, expertise and personal attention—who offer what online-only competitors lack, and we take pride in anticipating and responding to customers’ needs, just as we have for 150 years. But today we have more and better tools to help get the job done.
Time Is Money
The speed of information exchange and complexity of projects means that customer expectations continue to rise. While most customers appreciate convenience and great prices, the best way to improve their bottom line is by making a job faster, safer and more efficient. And this know-how comes only from direct personal experience.
Sometimes, the lowest price can be found on a website, but that doesn’t account for the inevitable pain points that follow when there are so many moving pieces. Perhaps the wrong material arrives or is sent to the wrong jobsite. Maybe 25 pallets of unmarked boxes show up along with shipments from three other suppliers. Someone has to open everything to figure out what’s needed today, because bad weather or schedule changes could mean that what you ordered three days ago isn’t useful for another week. All this stuff is tough to move and tough to store, and when you buy from an online-only company, it can be difficult to reach an actual person to help.
Graybar has always put a high premium on making sure its customers are well taken care of, but there was a time when the business was not organized around its customers. A big shift occurred in the 1960s and ’70s, when stagflation was at its worst. Graybar had organized departments by product—inside construction, outside construction, power, lamps and lighting, and communications—until Charles Kirkpatrick’s Chicago district made the bold call to reorganize its departments with the customer in mind—electrical contractor, industrial-commercial, power utility, and communications.
“For several years, Chicago was the only district that was facing its customers,” said former Graybar CEO James Hoagland. By 1972, the entire company had been restructured around these customer segments.
Customer service and inventory management got a boost from technology in the late 1980s, when Graybar implemented our first mainframe computer. This system united the company on a single platform, which transformed our ability to serve customers from coast to coast. In 2003, the mainframe system was replaced with an Enterprise Resource System, which continues to support the growing needs of the business and our customers.
Technology aside, Graybar recognizes that all customers are unique. Many are set in their ways. However, even those who might sometimes be tough to budge can’t help but appreciate something that saves them time and money. And the roots of this realization stretch back to the founding days of the company once known as Gray & Barton.
Act II: Go-Getters
Let’s go back in time a bit and see how we got here, how Graybar went from supplying the electrical industry to serving a diverse base of customers with specialized needs: from rural farmers to military contractors to the biggest and most complicated construction projects of today that rely on advanced power, lighting communications and data solutions.
In the mid- to late 19th century, telegraph and telephone were all the rage, and customers flocked to Graybar forerunner Western Electric. Then came the little incandescent light bulb that revolutionized the world. The mix of customers quickly changed. The Western Electric supply department redefined an industry, offering “all electrical supplies for which there is demand” and representing dozens of well-known suppliers. By 1901, the supply catalog exceeded 500 pages. By 1919, 42 offices were in place, and the supply department described itself as the “largest electrical jobbing organization in the world.”
Not content to rest on its laurels, the company went in search of new customers and new ways to use electrical products. Cities were fast becoming electrified, but rural America was slow to follow. And in 1920, a lot of people still lived outside of cities.
Beginning in 1917, Western Electric set up booths at county and state fairs showcasing “ALL the principal apparatus that we have available for the farmer.” But these farmers were hardly an easy sell.
The silver screen offered another avenue. Western Electric produced a silent film in 1920 titled The Go-Getter. Filmed on location at William E. Shetrone’s Pennsylvania farm, the fictionalized story centers on a young man just back from World War I who wants to modernize “the old well, dim kerosene lamps and the innumerable back-breaking farm tasks,” and convince both his father and his sweetheart “that life on a farm can be made both enjoyable and profitable.”
Finally, the father relents, and we see the labor-saving and profitable benefits of electricity and running water. Production increases substantially, and the young man sells his family’s butter to the largest hotel in the world, the Hotel Pennsylvania in New York City. The film ends with an annual statement of the newly electrified farm, showing the value of time saved and additional profits.
“What was accomplished here can be done wherever brains and grit are mixed with a practical desire for betterment,” the narration proclaimed. The movie opened up a vast new territory to Western Electric salesmen. It made a powerful case for farmers on the threshold of a new age.
Wartime Changes
In the 1940s, the business changed rapidly, with activities devoted almost entirely to furnishing material and equipment to the largest new customer ever: the government—another group that is known to be slow to change. When Graybar shifted to supporting the war effort, it had to do so efficiently and effectively, and while losing one-quarter of its employees to military service.
The biggest challenge was not selling products, but finding them. Amid materials shortages and war rationing, substitution became the name of the game.
When a defense manufacturer needed a certain type of safety switch for a secret control—quickly—a Graybar employee adapted a standard switch in stock and delivery was made in 24 hours.
When Pan American Airways received an emergency call to build military housing at an air base, Graybar reviewed the construction plans, identified all the required electrical materials, started to secure supplies and made initial deliveries—all within a day.
When the Panama Canal needed to operate efficiently, the company supplied 50 miles of telephone cable, and when telephone calls between the U.S. and British governments needed to be kept secret, it was technology developed in Graybar’s New York City warehouse that did the scrambling.
The Carterfone Decision
In the postwar era, one of the most influential events in telecommunications, the 1968 Carterfone decision, sparked changes that transformed the telephone equipment industry into the highly competitive marketplace it is today.
Before Carterfone, customers were prohibited from plugging their own equipment into the AT&T phone network. The Federal Communications Commission’s ruling ended that directive. And just like that, Graybar had new opportunities with new customers in the interconnect industry, which installed and maintained business phone systems.
While the changes were disruptive for Graybar in the 1970s, they set the stage for innovation and the robust growth of its communication/data business starting in the mid-1980s.
“Within a few years of the FCC’s Carterfone decision, America had become a motley world of funny receivers, slick switch boxes, and rickety answering machines,” stated an article on the 40th anniversary of the Carterfone decision, specifically citing the “modulate/demodulate” devices, soon known as modems. A 1999 FCC policy paper backs this up: “Without easy and inexpensive consumer access to modems, the Internet would not have become the global medium that it is today.”
Too Much Tech?
The Graybar customer base continued to grow to include more types of customers, from general commercial contractors to industrial, government, utilities, you name it. As the internet became a global phenomenon, labor-saving technology became an increasingly crucial part of businesses large and small, and the information economy changed how people view the trades.
Today, lots of people want to be app developers. Far fewer want to be electricians. As a result, we get labor shortages and tech-driven downsizing, with more of our customers eliminating their warehouses and in-house logistics services.
And yet, expectations for speed and price are sky high, thanks in part to e-commerce. “Amazon went after low-hanging fruit, the pick/pack/ship/movers,” said Steven Horst, Director of Operations in Graybar Seattle. “It made industry smart enough to understand that it should be easier to do business with your supply chain.”
So how did Graybar adapt? What could we provide that others could not? How could we make it easier and more profitable?
ACT III: From Commodities to Services
Everything old is new again. At least when it comes to understanding our customers—and giving smart advice and personalized service. Handling each customer individually continues to make a huge impact, and this is where Graybar services come in.
With Graybar’s extensive supply chain capabilities, we can often manage our customers’ logistics and supply chain more efficiently than they can on their own. When we do that, we can improve their efficiency, which can also increase profitability.
For example, Graybar’s “Waste Walks” help uncover the root of a customer’s anxieties. Pre-project meetings allow Graybar to transform onsite material management to Just-In-Time (JIT) delivery. The days of 25 pallets of unmarked boxes are over. With JIT, we can deliver material room by room, according to installer schedules, unboxed, on wheels—visible, portable, easy to install. With Graybar’s Kitting services, customers can order prefab assemblies rather than doing the work on the job site. And with Graybar’s SmartStock managed inventory system on site, our customers can run real-time reports, see usage (to understand efficiency of workers and capital expense) and view inventory.
Of course, another huge piece of Graybar’s customer value is our people and physical locations. With zone warehouses and about 290 locations, Graybar continues to anticipate and meet contractors’ demands. This came in especially handy when we were called on to work on one of the biggest stages: the site of Super Bowl LII in 2018.
Mixing Brains and Grit on the Gridiron
Graybar was bleeding purple when construction began in early 2014 on U.S. Bank Stadium, the new home of the NFL’s Minnesota Vikings. Two electrical contractors in the Twin Cities turned to Graybar for help.
The new 1.75-million-square-foot stadium aimed for LEED certification. It would be the first in the NFL to use LED lighting, which had the potential to reduce installation loads by 37 percent, and consume 75 percent less energy than traditional lights. Beyond the sheer size of the project lay an even bigger challenge: limited space on the jobsite. “We provided a solution so that the contractors didn’t have to take everything on site all at once,” Branch Manager Brett Wilson said. “We took the bulk of the material and stored it in our warehouse, delivering to the jobsite as required.”
Graybar Minneapolis, just two miles from the jobsite, supplied switchgear, lighting, wire, cable, fiber, fiber connectors, racks, cabinets and more. The Minneapolis warehouse also was used to stage and store material for the switchgear, including more than 750 panel board tubs, and Graybar’s wire and cable management services helped the contractor save time, money and material by performing more than 4,500 wire cuts on more than 91 miles of feeder cable for the project.
In the Graybar warehouse, stadium contractors “set up shop . . . to unbox fixtures, assemble parts and pack the preassembled material into crates, while Graybar coordinated the delivery of material to the jobsite. Electricians on the jobsite simply needed to grab material out of the crate, install it and move on to the next item. Graybar then took empty crates back to the warehouse to be refilled. Adding to the savings for the contractors, Graybar recycled all of the cardboard from material unboxed at the warehouse.”
Graybar also helped with the data communications side of the project, providing 1.5 million feet of cable, 125,000 feet of fiber, more than 4,000 fiber connectors, and a combination of more than 75 racks and cabinets. We provided components for two of the largest and highest-quality HD video boards in the NFL, too.
Of course, high-profile Super Bowl stadiums are great, but similar results can also come in more modest packages.
Solutions Large and Small
When the McGuire Group, a family-owned long-term health care and rehabilitation provider, came to Graybar for some advice on LED lighting, it was a story that truly echoed our “Go-Getter” past. Northgate Health Care Facility Manager Al Carroll was reluctant to pursue a lighting upgrade. But he went forward with it, and Graybar’s PowerSmart solution had an immediate impact. “Our employees have commented on how much nicer and easier the new lighting is on the eyes,” Carroll said, “and residents have nicknamed the first completed hallway the happy hallway!”
The bottom line was pretty happy too, with annual savings of about $19,610, not to mention a sizable utility rebate. Convinced, the McGuire Group, Northgate’s owner, chose Graybar to upgrade lighting at all of its facilities.
Person to Person
When the internet disrupted how people lived, worked and communicated, we put people and plans in place at precisely the right time. Today, digital disruption has the potential to change the world in new ways. The good news is that this disruption can give us deeper insights into our business and our customers. It can also provide our people with tools and technology to achieve more than they ever imagined.
At Graybar, everything starts with the customer. And it’s our people who make sure that having Graybar in your corner means getting the job gets done right.
