Ingram's Bradley Details Outsourcing, Restructuring

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Ingram Micro North America President Keith Bradley spoke with CRN News Editor Steven Burke about the company's offshore outsourcing and restructuring imitative that will eliminate 550 positions in North America.

CRN: What segment VARs are going to be affected by this move?

BRADLEY: I want to be clear that the vast majority of the impact to the VAR community is going to be the fact that we are moving West Coast (inside) sales (reps) to the East Coast to consolidate into the Buffalo facility where today 80 percent of our sales organization already resides. From a pure VAR perspective there should be very little noticeable impact. We are going to leverage the Buffalo facility and transition it smoothly. We are going to take our time doing it. I have been looking at this as to how do we transition from the West to the East being the main impact to the VARs. The bigger customers who are much more transactional and don't need that same level of value add we provide are more impacted by the offshoring arrangement than the VAR community. That is not to say that some of the VARs aren't going to be serviced by some element of offshoring.

I want to make it clear that the vast, vast majority of VARs are still going to experience the same level of customer service from within the U.S., and a small percentage are going to experience the same level of customer service they experience today but it will be from an offshore provider. The SLA (service level agreement) is still going to be there. The experience is still going to be there.

CRN: Will VentureTech members be affected by any of this?

BRADLEY: From a customer touch perspective the e-commerce group would be the element of the VAR community that will be impacted potentially by this. When I say potentially that is because the vast majority of the (VARS working with the) e-commerce group today have done the majority of their business using the e-commerce tools that we have invested in together. They only ever talk to an Ingram Micro sales associate when they have a query or an exception to their normal process using the Web or EDI, etc. Those exception questions would be answered by an overseas location.

The data, the systems, the process, the telephone numbers stay exactly the same, and then we manage the outsource provider to very tight SLAs. I went to the overseas location and one of the things that was very important to me was to make sure that customers would experience the same level of customer satisfaction.

We put a lot of due diligence into this over the last six months. The thing that is personally important to me is that unlike others who have outsourced functions, we have been very open and honest with our customers and vendors because we do have a partnership of trust and reliability that does require us to have this open and honest communication. We are not going to do anything that is ever going to negatively impact the customer.

CRN: How many sales reps on the West Coast will lose their jobs as you consolidate inside sales in Buffalo?

BRADLEY: That is the larger element of the story. The consolidation into Buffalo impacts more sales associates and does impact more customers. The consolidation has a bigger impact on customers than the outsourcing. It does affect who your sales rep is going to be, but again from an experience perspective and a service perspective it should be minimal given the fact that 80 percent of our core (inside sales group) is already in Buffalo. We have a large center of excellence already to leverage. We have got Six Sigma as part of our process.

The methodology we are using to transition will make sure this is seamless because we are doing this over a six-month period and we are sharing all the information we can with our associates. We were on call monitoring as normal Monday, Tuesday, Wednesday this week and all of our sales associates are motivated. They are still dedicated to working with customers.

Eighty percent of our national (VAR) revenue is served out of Buffalo already. The remaining 20 percent will now move across (to Buffalo).

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