How did your company react when the COVID-19 pandemic hit?

For Electrocomponents, being a global, omnichannel business and having a presence in China was a real advantage in certain ways. For one, as the virus was emerging in China, before many worldwide were paying sufficient attention, we established a crisis management team to be able to respond quickly to the needs of our customers, suppliers and employees. As the virus spread to other countries and eventually became a worldwide pandemic, we were able to implement business continuity plans quickly and efficiently across the globe. In addition, because of digitalization (ecommerce and our digital platforms) that was already in place, 63% of our revenue was due to online sales. This helped us better withstand the disruptions COVID-related lockdowns had in regions globally, and we were in a terrific position to adapt and evolve our other service offerings.

The relationships we’ve built over the years and the breadth of our product offerings really allowed us to adapt quickly and meet our customers’ urgent demands. With a multitude of transportation restrictions and many factories shut down or significantly reduced in output, certain products were in short supply. But, because we have a global distribution network and more than 500,000 products from 2,500 suppliers on offer, our teams were able to find alternative products and sources to help our customers. For critical supply areas that were needed by organizations to fight COVID, we set aside certain products to help develop and supply essential medical equipment, such as ventilators, respirators, oximeters and more.

What types of employee support have you found to be helpful during this pandemic?

Very early on, we set up an employee assistance program and well-being hub to keep colleagues connected, as well as offered some structure and support for their shift to a home working environment. Our people have shown true resilience and appreciation of the support we’re giving them. Personally, I’ve been impressed by their adaptability and team spirit. They’ve let the sense that they’re making a difference drive them to support each other and critical businesses around the globe.

In our 12 distribution centers around the world, we adapted existing operating procedures—such switching to split shifts, social distancing and PPE wearing—to ensure we could keep our employees safe while limiting impact to our customers. Across the enterprise, our people have been dealing with a very challenging work environment yet have worked relentlessly and shown terrific innovation to meet (often rapidly changing) customer demands and the needs of our communities. For example, they’ve worked holidays to provide needed parts for respiratory systems, performed same-day calibrations of thermometers for a hospital in the U.K., and delivered critical parts needed by a U.S. Navy hospital ship on very short notice.

At a community level, we also got creative to help parents educate their kids at home due to school closures. We launched a campaign called Kits for Kids, giving families educational kits that teach children how to use single-board computer products.

How important have digital capabilities been for your company and customers during these unprecedented times?

Even before COVID, in the electronics industry and in the manufacturing industries, companies were better understanding how much digitalization could improve their margins and productivity and many were well into digital transformations at least in certain areas of the company. When COVID-19 hit, we saw that companies that had partially or entirely embraced digital transformation were better positioned to adapt to the disruptions wrought by the pandemic. Those companies that were at least somewhat digital and had established an ecommerce platform were able to more quickly shift to online sales and service offerings.

In general, COVID is accelerating the need for businesses to shift to working digitally. McKinsey reported that more than 90% of sales moved from ‘in-person’ interactions to digital sales. Some 80% of companies claim they will sustain these changes for a year or more at least. Companies that have made the shift are able to purchase more efficiently and are seeing both faster revenue growth and a 40-60% reduction in sales costs.

Data is becoming increasingly important to understand customer behavior, as well as to identify trends and be responsive to changing needs and expectations. Our own experience shows that personalizing digital offerings is an important part of the mix, and that personalization also hinges on the types and quality of data collected. Data is also critical to understanding the market and what businesses might need in the future. Digital requires a significant shift in culture and speed. Manufacturers need to be agile and move fast in order to regain and/or retain their share of the market.

"Whether working from home or in a factory or other on-site environment, how a company treats its employees will likely become an even more significant factor post- COVID than it was before"

At the start of the pandemic, 75% of companies suffered supply chain disruptions due to transport restrictions. How can companies prepare for the possible disruption from new waves of COVID or other types of emergencies could bring?

The pandemic definitely demonstrated how fragile global supply chains can be, especially if they involve single-source products. In normal times, companies should be ensuring supply chain continuity as part of their enterprise risk management plans. Yet, the Institute of Supply Management reported that almost half of the companies they surveyed had no contingency plans for supply chain disruption.

There are a few things companies can do. One is to consider supply options from multiple and geographically disparate sources, if possible. Because so many supply chains run through China, this pandemic, especially at the start, showed how important that diversity is. Companies also gain an advantage from having a diverse range of suppliers and limiting, as much as possible, single-source suppliers. A third piece of advice would be to stay engaged. Because our company maintained proactive engagement across our supply chain we were able to maintain a strong inventory and consistency of supply.

What do you think recovery will look like in the manufacturing world globally?

I think the easiest thing to predict is that the industries and markets that were least impacted by the pandemic—such as pharmaceuticals, chemicals and manufacturing—will be the first ones to recover, or even show growth. Then we have markets like automotive and aerospace that have been hard hit by the pandemic and may have more trouble recovering, especially anything that’s travel related. Our society and markets may undergo certain permanent or at least long-term changes that could affect these type of industries for years to come.

In the manufacturing and distribution world, we’ve talked about being “disruptive” and innovative for so many years. Now that this virus has been extremely disruptive, it is a test of how agile companies can be, how adaptable and, yes, how disruptive in terms of finding new ways to be resilient. Many companies will have to reset their strategy and rethink the diversity of their product offerings and supply chain for this new post-COVID world. Companies will need to use data, technology and automation to the fullest to remain more agile in changing environments.

Lastly, but not least important, companies will have to prioritize the safety and well-being of their employees because, ultimately, their productivity and resilience will drive recovery as well. Post-COVID, the number of employees working remotely is likely to remain higher than pre-pandemic levels and is predicted by Gartner to represent up to 50% of the workforce on average, compared to 30% before. However, while more than 70% of employees in B2B services can typically work from home, in manufacturing, the figure is just over 20%.

Whether working from home or in a factory or other on-site environment, how a company treats its employees will likely become an even more significant factor post-COVID than it was before. Given the demands COVID restrictions and precautions have placed on families and society, employees may need additional levels of support for their mental and physical well-being. Keeping employees connected has become more difficult (and expensive), but it’s also become more crucial, so an increased focus on communication, digital communication tools and team working tools is essential.

At Electrocomponents, we have found the effort and expense has resulted in a more resilient, engaged and loyal workforce. Not only are our teams better prepared to go the extra mile when needed, they are also more dedicated to innovating to overcome disruptive challenges for our customers. And most important of all, they are better positioned to take care of themselves and their families during this unprecedented challenging time.