Automating data input and integrating that data to enhance business performance is becoming table stakes for distributors looking to compete. Data management has traditionally been a struggle for many companies, and the complexities are only increasing as technology develops.

“It’s been harder and harder to connect, extract, tie together and get meaningful data to work with in the first place,” said MDM CEO Tom Gale in a recent webcast.

While many distributors have access to analytics around modeling and forecasting, the next frontier is working with more unstructured data to formulate in-depth analytics and apply artificial intelligence to it, Gale added.

Think about processes that are still done manually today and how they can be automated as much as possible. Automation is “a twofold win,” Gale said, because it doesn’t require paying someone else to do it, and it’s more accurate than typing data in manually.

The business can gain efficiency and productivity when more orders and inventory management are automated. “Every time you have an inside or outside person entering orders line by line, that is time you might be able to find a digital solution for that, and then they can actually be selling stuff, instead of entering what has already been sold,” Gale said.

John Gunderson, vice president of analytics and e-commerce at MDM, said the distribution industry is “moving from a talking world to a written down or direct-into-the-system world. Your ERP [enterprise resource planning software] is still the heart of your business. Now there’s a lot of two-way communication from the heart of your business back to your supply base and the customers.”

Distributors should consider thinking carefully about whether existing technology can handle the automation that will be needed in the future. “If your ERP and other supporting systems can’t accomplish this, as they say in ‘Jaws,’ it might be time to get a bigger boat and consider some upgrades,” Gale said.

Getting Started

Start by creating a cross-functional team for the company’s transition toward more automation. “You have to have leadership from sales, finance, operations. Every stakeholder you have, you have to have involved. Otherwise, most projects are doomed to fail,” Gale said.

For bests results, distributors can integrate inventory management systems, ERPs, pricing systems and e-commerce systems. “Distributors that can integrate those top three really excel. The ones that supercharge their business have figured out a way to integrate their supplier data,” Gale said.

Visual representations of the data make a strong impact. “We are in an infographic world. All of us are using emojis every day and infographics,” Gale said. “Take your data and make it visual. You have to move your data collection process off of your associates’ desk tops and computer screens” and into an ERP or other connected system.

Gunderson agreed. “The ability to visualize data in a way that your CEO and leadership can understand is as inexpensive as ever,” he said. “You can do a lot of you can just organize your data in a business intelligence tool and bring it into a data visualization tool.”

Another key element is making sure the right technological skills are evident within a distributor’s internal staff. If not, it might be necessary to hire for the position. “The technology staff is a critical part of building out these capabilities to be able to manage data better and translate it into powerful analytics,” Gunderson said. “It’s a culture issue and a leadership issue and a talent issue.”

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