Editor’s Note: This is the condensed, free version of the MDM Premium article by the same title — the second in a three-part series. You’ll find deeper analysis in the Premium version. It will appear in our July Premium Monthly report, which can be purchased from the MDM Store in August. See Part 1 of this Premium series here, and see the condensed, free version of Part 1 here.
We resume our analysis of Wesco International’s past, present and future state with a look at the electrical distributor’s additional major enterprise strategies.
Wesco’s recent news releases state that the company continues to focus on three key enterprise strategies.
- “Extend our industry-leading scale and value proposition.” (the subject of Part 1)
- “Further develop our team and our culture of excellence.”
- “Digitalize and transform our B2B business.”
In this piece, I will focus on No. 2 and No. 3. Stay tuned for Part 3. Soon after this series is complete, MDM will publish a comprehensive Wesco analysis report that is complimentary for Premium subscribers and available to purchase in the MDM store.
Developing the Wesco “Team and Culture of Excellence”
Wesco’s three business units — EES, CSS and UBS — are complex, heavily associate-driven businesses. They concentrate on winning large commercial, utility, datacomm, security and government projects.
If you look at key metrics like the number of customers and number of associate numbers you will see that Wesco has a high sales per employee number when compared to Grainger, Motion, Fastenal and other public companies that are sometimes considered to be peer group distributors. Find detailed metrics and details on this in the Premium version of this article.
Wesco’s construction project business and large customer focus consists of large bills of materials with many products/lines that are competitively bid from engineered plans and specifications.
To serve this spec/bid/buy business, it requires highly-trained associates to serve the end customers and earn orders.
Wesco’s EES, CSS and UBS segments have many associates with titles such as quotations, lighting specialist, network engineer, sales engineer, automation engineer and project manager to name a few.
This specialization requires investment in training and development by Wesco to retain and attract the best and most experienced talent in the business.
This on-the-job training 101 approach means the more experience you acquire, the more valuable to the end customers you become. I can share from my own experience that as your skills improve, your value grows to your employer, and the end customers.
If you follow Wesco, you see that it is committed to aggressively communicating with its end customers, its associates and potentially top talent at other distributors.
I know many readers might be skeptical of social media’s impact on business, but it is obvious that Wesco is communicating relentlessly a message of “we value you as an associate”.
Wesco Strategy — “Digitalize and Transform Our B2B business”
At the start of 2024, Wesco International reaffirmed its commitment to digitalizing and transforming its business.
The channel Wesco serves is complex. Electrical, datacomm and utility distributors have millions of SKUs in their system that they sell with very complex part numbers. Wesco has to manage millions of part numbers with long nomenclatures that have many variables. This creates some unique digital challenges.
So, how does Wesco tackle this immense digital and data challenge?
![](https://s33009.pcdn.co/wp-content/uploads/2024/07/Wesco-Pt-2-2.png)
This past Spring, Wesco shared its vision of this ongoing transformation. The graphic above shows the focus and investments for improving its enterprise systems (front office, mid-office and back office) and digital services (omnichannel, products and platform).
In my opinion, Wesco is smartly investing in its business digitally. We dive into Wesco’s digital approach in more detail in the Premium version of this article.
The Wesco Takeaways
So, what can you learn from Wesco to apply to your distribution business?
If you are a distributor or manufacturer with a great breadth of SKUs (number of SKUs in your distributor system and sold), you have to have build it on a foundation of data excellence — what Wesco calls Big Data.
In the “full-service” traditional distribution, digital is less transformative and more additive.
Secondly, everyone is competing for the limited number of experienced and highly-trained associates. Wesco has an obvious focus on its people and why they make the difference.
It reminded me of a quote my first distribution mentor Dick Schmid used to use: “In the absence of communication, people make up their own reality.” He advocated relentless communication to our team and to our customers on why we were committed to our people.
The Wesco team is relentlessly communicating internally and externally to the entire channel a “Why Wesco?” message. Are you?
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