As vice president of distribution for maintenance, repair, and operations (MRO) distributor Interline Brands, Jim Spahn heads up operations for the company’s cadre of brands, including Barnett, Hardware Express, Maintenance USA, Sexauer, U.S. Lock, and Wilmar. That’s no small task, as Interline has 53 regional distribution centers and 27 Barnett “pro centers” that serve as retail locations. Of the larger regional centers, 29 ship single brands while the remaining 24 ship items from as many as six brands to their customers. The pro centers — typically 5,000-8,000 sq. ft. — carry fast-moving SKUs for plumbing contractors.
You have a background in sales. How did that prepare you for operations and fulfillment?
To be most successful, you need to thoroughly understand people, all types — how they think, what motivates them, and how best to communicate with them. Communication is the key word. Operations professionals generally [see things in] black and white and lean to the defensive side. Customers and sales professionals are more abstract and perhaps lean to the emotional side. But we’re all trying to achieve the same goal: to satisfy our customers. My sales experience has helped me significantly to understand the full circle of people — the issues and the worries. Through effective communication, I am able to bridge all departmental gaps to ensure that we all pull in the same direction to achieve our business goals.
With all your disparate items — some quite small — how do you ensure that none get lost?
We carry more than 50,000 SKUs, including tiny ones such as washers and valve stems. Accuracy is a continuous challenge that involves every associate. Our accuracy process starts with our radio-frequency scanning process for receiving and put-away. This ensures that we are as accurate as possible when the product is put on the shelves. Then we have multiple levels of bin auditing and cycle counting, which we do daily. We also have a process that generates secondary and tertiary counts for discrepancies. I’m proud of the level of accuracy that our operations team has achieved over the past few years. For example, inventory accuracy has increased to 99.9%, compared with 99.4% last year. In the world of inventory accuracy, this is a significant improvement.
Interline is an acquisitive company. How challenging is it to integrate an acquired operation into your existing facilities?
Integration is very challenging. It’s about two organizations coming together. The facility issue is just one piece. Success depends on integrating the full supply chain starting at the purchasing end — through the IS systems to the distribution centers. The absolute key is buy-in and joint ownership of the process by the new company and the Interline team. We start with an in-depth gap analysis in all segments of the supply chain to thoroughly understand the difference between how Interline does things compared with how the acquired company does things. Change is inevitable, but we work hard at ensuring that any changes do not adversely affect the key business practices that made the acquired company successful.
If money were no object, what equipment would you like to bring into your operation, and why?
I would implement a voice recognition process for receiving, replenishment, and picking: Through voice commands and voice confirmations the associates confirm and reconfirm the movement of all products in the building. The inventory and picking accuracy is significantly improved.
What is the biggest challenge in the DCs?
Inventory and picking accuracy are certainly the operational challenges. The biggest challenge is to continuously develop and maintain a motivated, trained associate team. Whether you are an executive, a manager, a supervisor, or a team leader, if you have a solid team around you, all is well.
What’s the most interesting thing in your office?
A large pacifier. Whether it’s someone from the operations team or from the sales team, if you have ideas to solve problems, let’s talk. If you want to whine about things, well…