Quick Take: Becoming a radical intermediary
Can distributors transform their people into value-creating entities working on behalf of customers?
Imagining quantum intermediaries
I’m fascinated by the Schrödinger’s cat “thought experiment,” created to explore the functioning of quantum mechanics. The cat is in a box and exists as both dead and alive until the box is opened and the cat “experienced.” Only then is its actual state known.
Inventory in a distributor’s warehouse is like Schrödinger’s cat in its box. Inventory is a dead product in that it has no intrinsic value for the distributor until it is sold. At the same time, inventory is alive in that products are stocked intentionally to create value for customers. In this way, inventory exists as both dead and alive in a distributor’s box—that is, its warehouse.
I offer Schrödinger’s cat as an out-of-the-box frame (pun intended) for reimagining a distributor as a radical intermediary. In a previous Deep Dive edition, I wondered if the “Steve Jobs” of distribution would ever come along, a leader that might think differently about distribution in a radical way—and by so doing, reinvent the functioning and value of distribution. Jobs restructured the music industry by replacing albums with data and stores with iPods. As products become smart, like phones, the evolution may force a distribution revolution.
I’m wondering if B2B innovators might revolutionize distribution by reimagining their people, not products, like Schrödinger’s cat. In this frame, a distributor's people are dead until they are alive. While dead, people perform traditional tasks and are a cost to the distributor. Once alive, they create value for customers—by performing non-traditional tasks, working alongside customers in their business in a way that is directed by customers and accountable to them.
Here are two possibilities:
Finance. As distributor employees, finance people exist to manage sales and supplier incentives to drive profitability. Working side-by-side with customers, finance people might work on arranging funding for the customer’s growth, innovations, or digital transformation. These tasks are entirely new and potentially game-changing.
Operations. As distributor employees, warehouse workers exist to unpack and store received products, then pick and pack products for shipment. Working as customer team members, warehouse workers might set up customer operations to fulfill online orders or create a customer-led supply chain to achieve radical resiliency. (See this Quick Take for more on this.)
Once customer value is established, distributors, customers, and suppliers can work together to define business processes, capability needs, staffing, and rewards. Customers would direct and measure quantum employee performance. All parties may share in learning and development objectives and technology enablement methods.
The quantum employee concept might be implemented through ad hoc assignments monetized by reimbursed costs. Or, distributors might add a “collaboration fee” to customer purchases. Or, parties might negotiate custom contracts. Thinking even more out-of-the-box, distributors may offer their employees to customers via a platform business model, perhaps in the way that Uber connects drivers and riders, charging a fee for every ride.
Am I crazy? Maybe. Is the idea of a quantum intermediary with quantum employees a radical concept? I hope so. What are your thoughts? Have you seen anything like it? Please share your comments below or reach me at firstname.lastname@example.org