Exploring Our Industry’s E-Commerce Staffing Crisis

by Bill Sitter

Distributor and manufacturer executives provide insights into the very real human resource challenges relating to internet/e-commerce initiatives at their companies.

Today, equipment dealers and manufacturers are generally rushing to develop and/or enhance web sites and to explore and implement a wide variety of exciting e-commerce strategies. Other articles in this issue of CED Magazine will drive home the conclusion that AED’s David Saidat prophesied in AED’s “1999 Electronic Commerce Report”: “Your very survival may depend on integrating e-commerce into your business. When your trading partners expect e-commerce and you resist, you can bet your bottom line that those critical relationships will be sacrificed over the long term.”

A hiring dilemma…several pertinent questions

Okay, we agree on the need to develop user-friendly web sites and to set up computerized systems that will encourage customers to do business with us versus our competitors. But…how do we staff for e-business? … And where do we find good technical people? …And if we solve these issues, how do we integrate young “techies” into a conservative equipment culture? These are key issues and we thank our construction equipment survey panel of industry executives for providing helpful insights.

Our survey included a broad mix of AED distributors and equipment manufacturers. In addition to our survey panel, we sought insight from key trade association electronic commerce specialists and even one dot.com industry source. The size and geographical mix of our survey respondents indicates that many of the same issues face small, medium and large dealers and various manufacturers. Our survey response was excellent and we thank each senior manager for their willingness to share ideas to benefit our industry.

Who is responsible for internet involvement and/or e-commerce at your company?

Every company responding has at least one manager responsible for these activities. The titles for these managers range far and wide. Several companies, especially manufacturers, have titles such as: VP of Information Systems, MIS or IS Manager, VP of Information Technology or Manager of Systems Integration. Distributors varied between these types of titles and the following: VP of Sales or Sales Manager, Marketing Manger (most common), Manager of Advertising and Corporate Relations, and even one General Manager. One large distributor for the mid-south recently created the role of Internet Marketing Manager so one key person can focus on developing and implementing an overall e-commerce strategy and then provide on-going oversight of the project.

Do most e-business managers also wear other key hats?

A follow-up question asked if the key e-business manager also performs other major duties in the company. For most dealers the answer is “yes” and the duties range from sales and marketing management to finance and accounting functions. Equipment manufacturers sometimes have larger e-commerce functions and are often able to dedicate more of the key e-business manager’s time to that area. However, at small and medium sized manufacturers it is not unusual for this person to have other key responsibilities. It is very encouraging to observe that many responding companies see the need to tightly loop their company’s e-commerce activities with their day-to-day sales and marketing functions, because failure to interconnect these has doomed many “slick” Internet initiatives.

What are the most critical hiring needs related to the internet and e-commerce?

Our survey probed the issue of critical needs, and there are many. The following positions have either just been staffed or will soon be filled, just within the companies represented by our panel: 8 E-Commerce Data Base Programmers, 6 Webserver Administrators, 5 Webmasters, 7 Content Coordinators, 5 Graphic Artists and 1 Senior E-Commerce Advisor. One large multi-state dealer uses the possible need for 12 to 15 e-commerce people as their initiatives ramp-up. Manufacturers seem to be critically short in a variety of areas including people who can relate logistics to e-business and savvy programmers who can implement systems which are responsive to customer requests resulting from web site hits. In other words, there is an urgent need for people who can tie-in a company’s internet/e-business initiatives to real world solutions that work today.

What are the best sources for internet/e-commerce manpower?

Posting technical job openings on a company’s own web-site was cited by over 50% of the respondents. Well over 30% of our survey panel uses executive recruiters and a similar percentage also access internet resume banks. Surprisingly low is the reported use of newspaper and magazine advertisements and a couple of firms also mentioned networking for candidates with their own MIS people.

Most companies have been unsuccessful in attracting e-commerce talent with equipment industry experience.

Well over half of our respondents reported no success in attracting e-business talent with significant equipment industry experience. This was not really a surprise as our industry has seldom been viewed as “leading edge” in the “techy arena”. However, it was encouraging to learn that over 30% have attracted people with some combination of internet or e-commerce experience and knowledge of our industry. One large northeastern dealer hires people with equipment industry experience and invests in the e-business training needed for these various roles.

Training success Stories.

Three respondents, one large manufacturer, one light equipment manufacturer and a sizable dealer shared success stories of how they have trained and developed people to lead e-business initiatives. “We expose them to training seminars and provide expert mentors to guide them through the process.” “We encourage interface with (MIS/e-commerce) service providers and encourage seminars and training, and we have people who are dedicated to self development courses and to professional reading.” “We believe in blending teams of people who have business/industry experience with technical whiz kids. This combination provides the best overall results.”

How do you deal with a potential cultural clash when young “dot com technos” join a team of “more traditional” managers?

One sizable mid-western distributor admits that MIS type positions represent the highest turnover category. However, the dealer principal states: “We train on generation differences, but also tend to hire with the requirement that new people can fit into our corporate culture.” A major northern dealer advises that cultures may have to flex, without compromising core values: “Generation Xers need the freedom to get their jobs done”.

One large equipment manufacturer indicates: “Age and cultural differences can best be gapped by allowing development teams to integrate with our total business strategy and vision.”

Finally, another fairly large manufacturer stated: “Top management must support an atmosphere of technological change and must provide the tools needed to train employees on the daily use of these (new) systems.”

A large multinational manufacturer executive challenges the cultural clash premise. “I disagree, it is a mind set. Age has nothing to do with it. If you keep up with today’s world, and do not let old traditional thoughts get in the way, and constantly ask yourself, “What if?” Then, anyone can move ahead. But you must be willing to look for new and innovative ways or you will be left behind, regardless of your age.”

Most companies outsource some website or e-commerce needs.

Nearly ¾ of our survey panel reports significant outsourcing. The activities outsourced most relate to web site development or web site maintenance or polish and to various computer programming services. Dealers tended to outsource more of their needs than manufacturers, which is not surprising, when we consider economies of scale.

Several dealers use AED Web Services to host their web site and only one large dealer (who was very complimentary of AED) plans to develop and host their own site as part of an “all in-house e-commerce strategy”.

One executive suggests that wise use of proper research will allow a company to acquire knowledgeable outsourced services while keeping the organization’s head count low.

Another dealer executive has benefited, both in outsourcing and e-commerce hiring, from being headquartered in a metropolitan city with a major university which provides ample new talent.

A mid-south equipment manufacturer provides solid outsourcing advice. “Make sure you understand what you are getting, not what you think you are getting. If not, you will be paying twice. Have a sample of what you really want, not just an idea.”

We are grateful to one western equipment manufacturer executive for his caution on outsourcing: “Be sure you know what you want to achieve; how much you are able to pay; and be sure there is someone in your organization who is knowledgeable in e-systems to watch over all issues managed by the out source supplier. You are responsible for what goes on in your business…not them!”

Another progressive manufacturer feels that the wise use of outsourcing “may be the best way to maintain the leading edge, with regard to technology and best practices.”

Closing Thoughts…this e-commerce human resources shortage may open the door to attract thousands of new and highly talented people to our industry.

It is clear that our industry’s use of the internet and e-commerce systems is exploding. The growth can be exciting and full of opportunities and promise. We cannot close our eyes to the tremendous need for new talent. E-commerce growth may provide the perfect opportunity for equipment distributors and manufacturers to attract more females as well as a whole “new crop” of younger employees to our industry.

For 35 years I have been privileged to participate in and study the equipment industry, in the US and abroad. As a pre-boomer who just turned 60, I can recall the pre-computer era and the days when parts were tracked on Cardex systems and carbon paper was essential. 14 years ago I purchased my first PC and now we have twice as many computers as people at Jordan-Sitter Associates and two separate networks one for the Internet and one for confidential internal transactions, we use high speed phone lines and are experimenting with video conferencing. Our Associates vary in age from a young computer whiz kid to yours truly. As exciting, productive and yes, troublesome as these technological developments have been…we have just seen the edge of the cutting edge. We feel that our industry’s success, and perhaps its very survival, depends in large part on how effective we are at developing innovative and exciting human resource programs. We must attract, train and develop, and then retain a new cadre of e-business savvy people who will want to be part of our changing equipment industry and who will make their respective companies true “players” in the world of e-business.