It’s fair to say RS Components is planning a bit of a splash at electronica in Munich (November 8-11). A bigger stand has been booked, close to 150 personnel are being deployed and the piece de resistance, the RS Live lorry, which transforms into a presentation area showcasing products which guide visitors from concept to production, will be driven down to Munich and parked in the showgrounds.
This enhanced presence highlights the distributor’s progress since Lindsley Ruth was named Chief Executive Officer of Electrocomponents 18 months ago.
“I once was lost but now I’m found” could sum up that period though Ruth asserts there is still plenty to be done. So far he has brought direction and dynamism to a business which trades as RS Components in most of the world and Allied Electronics in the Americas.
In a recent trading update Electrocomponents said it expected a “stronger than expected” first half performance delivering a profit of £54m up from £31m in the previous year. Cost cutting has sliced £15m of expense and two per cent sales growth is forecast.
So what’s behind the transformation from distribution plodder to one with a spring in its step?
The most important action for Ruth is, he declares, “Putting the customer back at the heart of what we do.”
The inference is that RS Components had become too inward looking and too bureaucratic and too bloated.
Research among 80,000 customers highlighted concerns including stock availability, delivery delays and poor handling of complaints.
These issues are being addressed alongside upgrades to the company website. These include improved product search, investment in products and content with more pictures and videos, site access speed upgrades, and an enhanced customer acquisition process alongside SEO and social media initiatives.
Rising customer metrics suggest these actions are already having a positive impact.
“People look to leadership to improve performance,” says Ruth. “They want direction.”
With that direction Ruth will also devolve responsibility.
The first question Ruth addressed is fundamental. “Is this a UK business with international operations or an international business with a UK operation?”
With the answer favouring the latter, Ruth has put responsibility for profit and loss back into the regions of the RS business. These regions will now hold their future in their own hands.
If they grow the business and demonstrate the need for more investment, they’ll get it.
The message from Ruth is “You grow, we invest.”