Ask the Expert – April 2012

Q: Prudence, I am trying to figure out if I need to look again for another position. In March 2011, I moved from one distributor to another  Recently I realized that the difference in the way I was being paid for mileage versus a car allowance resulted in a net loss of $500 a month. Prudence, I really enjoy my Industrial Sales position with them and they have an excellent image and product offering, except that my compensation is $500 less a month. What would you recommend?

A: There are two issues at hand, first was the car program clearly laid out in your written offer prior to your acceptance? If so, then you understood prior and they’ll not be compelled to address it. If not, then you do have the argument that you accepted what you thought was ‘x’ and it ended up being ‘y’ although after the fact it’s likely not going to have a huge impact on how they pay. I’ve found that distributors have set programs across the board for their car programs without exception. The other issue is compensation versus benefits, a car program falls to a benefits program rather than compensation so you’d have to weigh out if the current and potential compensation can make it up. I hate to say that the reality is, you agreed to their deal and it is what it is and now it’s up to you to decide if you can make up the difference in commissions. It’s a tough spot, I don’t envy you. – Prudence


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8th Annual Women in Industry Survey

Diversity: the condition of having or being composed of differing elements: variety; especially: the inclusion of different types of people”.

For 8 years we’ve reviewed the number of women attendees as a small viewpoint into how the industry is changing. Albeit this is not the most scientific survey but the results confirm the obvious; we are a male-dominated industry, and worse; we’re not changing to meet the demands of the near future. There are elegant rationalizations for that; the distribution industry was launched in it’s current form from the end of World War II, when the returning soldiers represented an extraordinary influx of labor at a time of government sponsored construction projects; where the availability of materials was a major contributor to the efficiency of our re-birth from the War. The industry was started by servicemen and has remained virtually male-only for 65+ years. Dad’s turned the business over to sons, and a handful of daughters, but a strategic process of attracting a diverse workforce into distribution and even electrical manufacturers simply never gained traction.

Here are the results for 2012:

Category          # of Females    Total # Attendees       % Female       Executives

2005    Distributors           20                  322                 6.2%

2006    Distributors           22                  316                 6.9%

2007    Distributors           21                  323                 6.5%

2008    Distributors           25                  396                 6.3%

2009    Distributors             9                  159                 5.7%

2010    Distributors           22                  254                 8.7%

2011    Distributors           15                  243                 6.2%

2012    Distributors          17                  208                 8.2%         12 (5.8%)

2005    Manufacturers       27                  381                 7.0%

2006    Manufacturers       17                  358                 4.7%

2007    Manufacturers       17                  331                 5.1%

2008    Manufacturers       23                  348                 6.6%

2009    Manufacturers       21                  221                 9.5%

2010    Manufacturers       23                  289                 8.0%

2011    Manufacturers       24                  282                 8.5%

2012    Manufacturers      23                  254                 9.0%          9 (3.5%)

2005    Total, above          47                   703                 6.7%

2006    Total, above          39                   674                 5.8%

2007    Total, above          38                   654                 5.8%

2008    Total, above          48                   744                 6.5%

2009    Total, above          30                   380                 7.9%

2010    Total, above          45                   543                 8.3%

2011    Total, above          39                   525                 7.4%

2012    Total, above          39                   462                 8.4%       21 (4.5%)

My professional interpretation? Although there have been some fluctuations throughout the past 8 years, there are no significant changes in diversity. And the facts reveal the rapidly diminishing relevance of the NAED conferences.

This year I decided to look more closely at who those women actually are. 12 of the 17 women attendees from Distribution hold titles of VP or higher. 9 of the 23 manufacturing women hold VP or C-level titles. As a total, 21 of a meager 39 total women attending held executive level positions at VP through C-levels. Male senior executives represented 165/208 distributor attendees (79%) and175/254 manufacturer attendees (69%).

Expressed another way; there are a total of 360 senior executives attending this conference. Women represent 21 of those: 5.8%

In a recent Harvard Business Review study by Zenger and Folkman* that compared leadership effectiveness of women vs. men, it concludes that women outscored men in 15 of 16 leadership competency variables they tested. They tested over 7,000 leaders across multiple industries and reported that the average number of women at senior executive levels is ‘only’ 22%. The NAED industry conference is arguably considered one of the top gatherings of industry senior executives and it has an executive representation of only 6% women?

The 2012 conference is the first conference in many years that actually has talent development on the agenda. The conferences have largely been formulaic: how to improve gross margins or cash flow, manage rebates, decrease inventories, etc. Darwinism will take care of companies that can’t figure out how to manage inventories. The real gorilla in the room is talent to succeed in an industry that is going through disruptive changes due to technology. The industry needs to talk and exchange ideas on: new channels, new technologies, risks/rewards of entering new markets, how to attract or train talent to up-sell, how to maximize government stimulus dollars, how to Topgrade your organization, etc? Those topics can only be addressed with diverse input. Talking to the exact same 360 legacy executives over and over again won’t help the industry adapt to ‘new’.

As rapidly as the industry is evolving, it’s time to stop talking about rebate dollars, SPA credits and RMA policies and move to real business discussions on how to access the 2.1M commercial buildings across America that are using outdated lighting and electrical equipment and would be eligible for incentives to modernize them. The same discussions could occur for other areas of growth; alternative energy, data centers, smart grid, etc. Just as conferences have emerged and grown for specialty applications (Automation Fair, LightFair, Strategies in Light, AWEA, CEDIA, BICSI, EmergeAlliance, etc.) the industry needs a vehicle to attract the leaders of the industry into discussions of real value. As an example, Strategies in Light had 5,000 attendees. NAED can’t find 500 people to show up. NEMA is too small but NAED could provide the medium of helping the industry address its legacy hangovers: diversity, technology, channel fragmentation, and competitive threats from corporations that dwarf the largest US electrical manufacturers. It’s time for either NAED to step up or an alternative organization to arise.

In short, do you want to grow and become more profitable? Then you need to attract people who look at this industry as a step into the future; where electronics and low voltage applications will dominate everything: lighting, controls, factory automation, building management, security, as well as: TV’s, sound, voice and all computing. Technology is emerging now for behavioral control through color. The industry needs to be at the forefront of this R&D and deployment.

Let’s break down the barriers and promote real idea exchange, with women, minorities and consultants who view the industry from the sidelines. Some of these people play golf, too.