Wise Council

GAWDA distributors and vendors find mutual value in advisory councils and user groups.

What if you had the opportunity to bring your customers together and seek their input on the problems affecting their business and how you can better serve them? A number of GAWDA Associate Members already do this on a regular basis through distributor advisory councils and user groups. These councils serve as a forum for exchanging ideas and fostering communication. The structure and tenure of such groups varies from company to company, but all exist to provide an important benefit to both the vendors who organize them and the distributors who participate in them.

Getting Started
The central purpose for any type of advisory council is to encourage feedback and dialogue, and that’s true whether a group has existed for weeks or for decades.

Computers Unlimited (Billings, MT) created its users group over 20 years ago, and the group continues to flourish. “We wanted greater input from our users, particularly on the direction of the software,” explains Heidi Thometz, director of sales and new business development. “We have a tight relationship with our users, and we want to make sure we’re not making assumptions about what they need, but that they’re telling us what they need. That’s why we founded the users group.”

A similar sentiment sparked the creation of Tregaskiss Ltd.’s (Windsor, ON, Canada) distributor council seven years ago. “We decided to create a council to gain feedback from our distributors on how we’re doing and to address areas that we could improve on,” says Darren Grey, director of marketing. “We also wanted the opportunity to bounce ideas off of them about new products or programs, and just to be able to brainstorm as a group.”

For 20 years, BOC (Murray Hill, NJ) has considered its distributor advisory council—commonly abbreviated as DAC—one of the most important elements of its relationship with distributors. “Not only does the DAC provide us with a way to introduce new products and services, it also facilitates the all-important networking opportunities between distributor and vendor that allow for an exchange of ideas,” says Terry Hall, vice president-independent distributor business.

TrackAbout Inc. (Moon Township, PA) decided last year to explore the possibility of creating a user group for its software customers. The company conducted an online survey to gauge customers’ interest in the creation of a “user community,” and the response was overwhelmingly positive. “We were dealing with our customers one-on-one, and we wanted to give them a forum where they could get together in one place and share ideas,” says Chairman and CEO Jim Glessner. “This way, they would not only have TrackAbout as a resource when they have questions or problems about the software, they would also have each other to use as a resource.”

The user group met for the first time in May, and Glessner expects the group will get together once annually in the future. The company is in the process of developing a community Web site for the user group to facilitate dialogue between meetings. “I imagine there will be a lot of other kinds of interaction, like focus groups, online chats and conference calls,” says Glessner. “From the response we’ve gotten so far, we’re very encouraged that this will be a productive organization that will really work toward the good of all users of our software.”

Membership Has its Privileges
Advisory councils and user groups share a common purpose, but they tend to differ in terms of their membership. In general, a user group is composed of all users of a given product who wish to participate. In an advisory council, the membership may be more limited.

BOC’s distributor advisory council is composed of key BOC – ISP (Industrial and Special Products) executives and independent distributors from across the United States, and the group meets every six to nine months, depending on the activity in the marketplace. “We try to select distributors who represent the distributor group as a whole,” says Hall. “They are selected by geography and by the size of their business. We want to make sure we listen to companies that compete in different markets and vary in market share.”

Tregaskiss keeps its distributor council membership limited to five to eight participants per meeting, and that membership rotates so that no distributor participates in back-to-back meetings. The council meets once or twice annually, and Tregaskiss found that similar questions often arose during meetings, particularly those held during the same year, so it was to the company’s benefit to create as diverse a pool of opinions as possible. “We usually develop a list of candidates and then target them for participation,” says Grey. “In the early stages of our distributor council, those tended to be just our key distributors. But over the last few years, we’ve tried to get a mix of not only the distributors who are on board with us in a big way, but even distributors who are on the fence with us, because it’s important to understand from their perspective what it is about Tregaskiss that might be preventing them from doing more business with us.” The company also is careful not to invite distributors in the same market to the same meeting in order to avoid conflicts.

By contrast, approximately 75 percent of Computers Unlimited’s customers are members of the users group, so the group’s annual meeting can draw anywhere from 160 to 280 participants. The group is run by an 18-member steering committee, composed of users who are chosen by their peers in the users group to sit on the committee. The members of the steering committee elect a chairman, vice chairman, secretary and treasurer. The users group has a formal charter and collects dues to cover meeting-related expenses. To avoid having to pay taxes on the dues, about 20 years ago the users group incorporated as a non-profit organization. The group as a whole meets once per year for a two-and-a-half-day event with training classes and open forums; a second meeting is held mid-year primarily for members of the steering committee.

“The users group has what we call advisory committees, and each of those is chaired by someone on the steering committee,” says Thometz. “The advisory committees are made up of users who specialize in certain areas of the software, and they help us evaluate possible changes in the software. We rely on them a lot to define where we’re going to go.”

Location, Location, Location
Getting distributors or end-users together in one place can be a challenge. Many organizations, including Tregaskiss and Computers Unlimited, traditionally host council meetings at their facilities.

“Hosting the event at our headquarters in Billings, Montana, means that not only do our customers get to meet all the people they talk to on the phone, but our employees get to meet all the customers as well, which is nice,” says Thometz. However, the company is breaking with tradition this year and instead will host its users group meeting in Las Vegas. “We did a survey of our customers who weren’t coming to the meetings,” Thometz explains, “and they replied that they found it hard to get to Billings, but that they would like to come if it were held at a bigger city that’s easier to get to. Vegas was their number one choice.” If the change in venue is successful, the company plans to alternate meetings at its Billings headquarters with meetings in other cities.

TrackAbout took a different approach for its first user group meeting, choosing to hold the gathering in St. Louis, home of one of the company’s oldest customers, Cee Kay Supply. The event included a tour of Cee Kay Supply’s facility and a baseball game at the St. Louis Cardinals’ new stadium. “It was a great opportunity for our users to see TrackAbout in action, and for them to share success stories,” says Glessner.

Invaluable Benefits
The key to the success of an advisory council is that it be beneficial both to the host organization and to the participants. If it’s done right, both will walk away having gained invaluable knowledge.

“There’s nobody like the people who are in the business to tell us what the problems are with their business and how we can help them run their business better,” Thometz says. For the distributors who participate in the users group, the number one benefit they cite is the networking opportunities. “We bring people here from all over the country who are in the same business, so they have a great opportunity to learn from one another,” says Thometz. “Plus, the people who are active in the users group get a serious voice in what CU does with the software.”

COMPANY MEMBERSHIP MEETINGS CURRENT FOCUS
BOC Distributor
Advisory Council
Every 6 to 9 months

Computers Unlimited
Users Group
18-member steering committee chosen by members. All users eligible for to participate. Once annually for full users group, once annually for steering committee. The group is divided into advisory committees, each of which focuses on a different element of the software.
TrackAbout User Group All users are eligible to participate. Annual

1. Implementation issues
2. Features and functionality

Tregaskiss Ltd.
Distributor Advisory
Council
5 to 8 members on a rotating basis Once or twice annually 1. Selectivity of distribution
2. protecting and growing margins
3. Foreign competition

“One of the main purposes of the DAC is gaining ideas from our customers,” says Hall. “It enables us to continue to improve our distributor program. The meetings allow us to listen to new ideas, communicate new offerings and network with our best customers.” BOC’s advisory council has provided a wealth of ideas over the decades that have benefited both BOC and its distributors. Hall cites as an example a meeting in 2005 where DAC members suggested the company use webinar technology to relay industry trends and market conditions so that distributors could better inform their personnel. “We did it, and it has enhanced our communications to all distributors,” he says. The company also offered Total Quality Management to over 80 percent of its distributors in the 1990s as a result of DAC discussion.

Another idea that arose from a DAC meeting in the early 1990s was the Airco Distributor Association (ADA). “The ADA is still one of the most successful buying groups in our industry,” says Hall. “It received BOC’s coveted Innovation Award in 1995 as one of the most significant business ideas. And it probably would not have happened were it not for the exchange of ideas DAC provides.”

BOC frequently relies on its advisory council for initial feedback on new products and services. If the council membership likes it, BOC proceeds to offer it to all distributors; if not, the company goes back to the drawing board. “Generally, about 30 percent of DAC meeting time is dedicated to addressing concerns and ideas from our distributors,” says Hall. “Sometimes, though, the networking and social interaction are where the most exciting ideas come from.”

“The benefits for Tregaskiss are twofold,” says Grey. “The ongoing communication with our distributors is vital, but it also helps in just solidifying relationships. It’s helpful to meet with them both socially and on business.” Grey also cites the networking aspect of the advisory council as a benefit for participating distributors. “Being able to interact with their peers and talk about best practices among other distributors who are in the same situations as they are is important to them,” he says. “It also gives them the ability to have some input into our strategy as a manufacturer.”

Grey stresses that it’s Tregaskiss’s goal that distributors who participate in the company’s advisory council know that the feedback they provide is taken to heart. “We know distributors are being pulled in a lot of different directions, so we try to make the council as useful an exercise for them as possible,” he says. “We show them that there’s action being created out of these meetings, so they know their time is being used wisely and that we value their input.”

Glessner believes the importance of advisory groups cannot be overstated. “They are truly the place where ideas get shared and the gases and welding industry improves itself at a grass roots level,” he says.

And from grass roots ideas grow industry-wide success, as advisory council participants can attest.

Gases and Welding Distributors Association