David Meyer, VP and CIO of Graybar, sat down with Perficient’s Managing Principal for Strategic Advisors, Mike Porter, to discuss customer centric IT trends inspired from Forrester’s 2016 predictions, “With digital now reaching deeper into the domain of business operations and products, 2016 will be the tipping point where a new breed of Customer-Obsessed CIO becomes the norm.” This fireside chat, held during the Gateway to Innovation conference, focused primarily on how to leverage technology and culture to create a great customer experience.
What does “Digital” mean for Graybar?
- Creating a customer experience that meets customer needs regardless of where they are or how they chose to do business.
- Developing rich product content experience that is available online and in other forms, enabling Graybar to be a knowledge source for customers.
- Applying digital concepts, tools, and techniques to traditional tools to provide sales teams with tools they can leverage to better serve customers.
- Analyzing customer experience maps to learn how customers want to interact, thus gaining a deeper understanding of the challenges that need to be addressed.
What insights have you gained from experience mapping?
Customer experience journey maps and other customer understanding tools, both for internal and external customers, are critical in setting key strategies and vision for improving the overall customer experience. Contrasting feedback is a common result, but many customers identified the eCommerce platform, search capability, and cross referencing for products to be the focus areas of improvement. Some challenges were known to Graybar, but CX mapping provided meaningful insight to set key strategies and vision for improving existing processes.
How often are you using journey maps to understand your customer?
Graybar is at the beginning stages of journey mapping, but the couple of pilots they have completed have helped them validate road maps and goals they had established. They will continue to leverage them where it makes sense to drive the strategy.
How do you integrate competitive analysis with digital transformation?
Graybar is definitely aware of competitors and who is excelling in digital transformation. They are also aware of the retail industry leaders and the retail industry trends since wholesale tends to follow retail trends, specifically around marketing, eCommerce, and mobile applications.
Another approach Graybar has adopted is looking at new competition that wasn’t around when they started. Companies like Amazon that have an enhanced eCommerce platform along with integrated logistics components such as trucks and warehouses, which are very similar from an operational standpoint to Graybar.
How are you using data to improve the customer experience?
Graybar is rolling out a data governance initiative next month focusing on customer experience and starting with customer master data and records. The key emphasis will be on how data is 
managed and processed in a “clean” way in order to expose this information to customers and integrate across multiple channels allowing them to have a more targeted marketing approach. An example
given was an online shopping experience on a retail site: when a customer is buying something on a particular website and at the bottom of the screen there is a note saying “customers who bought this have also bought XYZ products.” All these analytics running in the background are being enhanced to drive marketing efforts.
Data has also become a big conversation with customers and they are leveraging it as a big differentiator. Graybar is bringing data metrics to customer meetings and centering conversations related to interactions, such as how many times the customer ordered a product and picked it up from their warehouses vs it being delivered to the customer’s site. This has become an eye-opening conversation and has given them insight as to how the customer is viewing operational efficiencies, such as time consumed picking up product vs time savings when product is being delivered to their site.
How aligned IT and marketing in your transformation?
There are definitely strong synergies between these two groups in their eCommerce team where there are members of IT and marketing driving development and strategy. The main divide that they experienced is digital marketing cohesion with more traditional channels of marketing. To overcome this roadblock, they have invested in new talent that has provided new vision and offers insights to integrate data and digital concepts to the more traditional marketing efforts. They are now implementing metrics to both traditional and digital methods such as measuring campaign success rate through hits and other similar quantifiable results.
With new hires comes change, how is Graybar adapting to that change?
The biggest changes they are seeing is in how data is being manipulated and integrated. Helping marketing from an IT side to analyze data in order to achieve desired metrics has been a focus.
Related to the IT organization, how are you balancing business enablement and “keeping the lights on”?
Graybar is moving towards a bimodal organizational structure deriving from Gartner’s Bimodal IT concept. By definition, Bimodal IT is the practice of managing two separate modes of IT delivery, one focused on stability and the other on agility. Mode 1 is traditional and sequential, emphasizing safety and accuracy. Mode 2 is exploratory and nonlinear, emphasizing agility and speed. (Gartner Bimodal IT Glossary)
In this fashion, Graybar has taken a portion of their IT group around big data and analytics and digital marketing and started a mode 2, having a single leader on top of all those capabilities. They are also measuring these two groups in a different way since they are focused on different metrics.
The teams have welcomed the change and Graybar is seeing changes from teams in mode 1 to mode 2. The mode 2 teams are experimenting on new tools and significant investment which in turn motivates employees and enables change in the way they think and do business.
Shrinking IT budgets are an issue, how is Graybar managing that?
Graybar’s leadership has demonstrated support in investing in technology given that there is a strong business case and the investment has a solid economic value. They will continue to invest in eCommerce to enhance the customer experience and other tools such as SAP. The main push back, if any, derives from how they keep day to day operations’ cost low so they can then reinvest in other innovative tools.
How do you view cloud?
- Innovative – There is a deep understanding that it is something that needs to be part of the company’s future direction and they have some projects that are “cloud-first”, specifically around new initiatives. Cloud is something they are looking for as well for different components of their infrastructure.
- Cost savings – there are definitely hardware and manpower costs associated with buying and running equipment, the cloud eliminates these costs. In addition, opportunity cost is also a factor. The time the teams are spending on researching and running on premise systems is time they can be spending on revenue generating activities.
One major challenge is getting out of silos. Do you have a success story / ways to address especially from a cultural perspective?
Silos are something that almost every company deals with. Graybar has experienced some wins with the eCommerce team where a cross functional team including IT, Marketing, and others was formed to build the new site. Enhanced communication and regular meetings and forums to ensure these teams are collaborating have proven very successful to build stronger teams and address questions regarding what the other teams are working on. This has also provided clarity to all involved in the level of engagement each team is focused on.
Methodology: If you are customer obsessed, you need to get there faster. Tell me about waterfall vs agile methodology?
Graybar is still including both methodologies in their business approach. Agile is applied primarily around their eCommerce and mobile tools (going back to Gartner’s Bimodal IT structure, Mode 2 is focused on agile). Agile is still a learning process and they are leveraging it to move forward with specific initiatives.
They are implementing a waterfall approach around ERP projects and core business process. They are moving some processes from waterfall to agile, but they will continue to utilize waterfall approach on their traditional IT stack.
Let’s end with one last question, tell me the top things that will enable you to create the right customer experience?
- Focus on Customer: spend time with external customers (not internal customers using IT systems). Spend time going to sales calls with key customers or suppliers and engaging them in conversation on how to be more effective. Both parties are typically looking at cost reduction, integration capabilities, and digital platforms. This practice also allows anyone to leverage information on other types of technology that may be available to use.
- Data – understand data to drive decisions and help drive conversations with customers as well as leveraging metrics being set for business goals.
- Integration – consistency across channels in the front and back end.
