Episode 225: Tackling the Promo Products Labor Shortage with Rory Young, Delegate CX

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Hi friends, I'm Bobby LeHew, Chief Content Officer at Common Skew. A few weeks ago, we released a report with our friends at DelegateCX called Tackling the Promo Products Labor Shortage. Longtime listeners will know that DelegateCX is the outsourcing company founded by former distributor Craig Dunlap. Craig's been a guest on our webinars and he spoke at Skew Camp as well. Today I'm talking with one of the partners at Delegate who many of you know as well, Rory Young, Senior Vice President of Sales. I worked with Rory and his team on the Labor Report, which you can find in the show notes at community.commsq.com, and you can also find it at delegatecx.com. But today we cover the highlights and we break it down to some of the most crucial challenges and opportunities facing business leaders as they develop a high-performance team. Rory has some fantastic insight on hiring, the recruitment process, and we dig into this whole idea of outsourcing, if to do it, why to do it, how to start. We talk about what you can outsource versus what you can't outsource, obstacles people have when it comes to hiring overseas, the impact on culture, the opportunity for diversity, and a ton more. Rory is fantastic. I always enjoy talking with him because they at DelegateCX are deeply passionate about what we are passionate about, which is helping leaders scale their business and grow. And real quick, we started a new series on our blog at community.commonsq.com called Secrets to high-performance teams. The article we dropped today talks about the two sides of the promo brain, creative and logistical, and how both sides are vital for success. But if you're not a reader, I'll be sharing insights from the series in a webinar titled Unlocking Secrets of High-Performance Teams on Thursday, May 26th at 2:30 PM ET. You can register at commonscue.com/webinars. Today's episode is brought to you by CommonsCue, the work-from-anywhere platform that powers your connected workflow enabling you to process more orders and dramatically grow your sales. To learn more, visit commonscue.com. Now here's my chat with Rory. Rory, we are all experiencing the volatile effects of hiring, recruiting, retention, the Great Resignation. But you and your team at Delegate have a unique view into what's happening with hiring labor right now. Why is it so difficult at this moment compared to years past?

Yeah, I mean, there's a lot of things happening at once. I think a lot of people have talked about a lot of these things, but simply, I think, you know, on a general scale, the market has shifted. There's a lot of reasons, but I think it's a job seeker market, which is pretty unique for most business owners that I come across right now. I haven't really experienced that before. And like talking a little bit more about our industry, I think that coupled with the fact that it's probably been an issue for a while now and we just didn't have to deal with it has now made it feel incredibly overwhelming.

Overwhelming. Are we having to deal with it now more because of the growth? Like, people are back in growth mode, so now it's like we're hiring.

And that's absolutely, absolutely right. I mean, people— and it's come in such waves. So the fact that people had to make decisions about their business in 2020, some people had to limit some of the resources that they had, right? Um, and now all of a sudden business is in full growth mode, and we had to, you know, navigate with, uh, probably, uh, less than full staff. It's made things harder. And I think it really speaks to some of the industry issues that we'll have to start solving for, which is, you know, how do we build a pipeline of talented individuals to learn about this industry earlier on, right? It's things that we've always struggled with. Marketing degrees that don't touch on what we do, right? And not a whole lot of awareness across the board. So there's already a bit of an issue there. There's a job market which has completely shifted. There's less available talent and more competition for that talent. Then we have some struggles with keeping our own talent. I mean, look, there's a lot to kind of navigate right now, right?

Right. A couple more things to add to that. The demands for clients— demands from clients have gotten more complex. So projects we're working on, more complex. Also, the ballot for talent has actually gotten more expensive because of all these challenges you just mentioned. But all of these things you're talking— we'll get into onboarding and training in a minute because that's a big part of some of our challenges right now. But for the moment, one really important aspect of all of this is actually a bit of a relief for many people is the fact that now that we can hire from anywhere and then we have hybrid offices or virtual offices. I mean, can you imagine if we were locked into our own geographic area just for the— with this challenge? But, but now we have this incredible problem, but we also have an interesting opportunity, and then we can hire talent from anywhere. How are you seeing suppliers and distributors adopt this, uh, hire from anywhere attitude and helping them build a winning culture?

Yeah, I mean, mostly really well, right? And I think there's been a huge shift even just like in this year alone where people are getting more comfortable with it. Now I have conversations all day long. You know, obviously we help with some hires and people always come to me, right, about just best practices and if I know anybody. And more and more people are willing to try to build out their teams all over the country and take advantage of the situation. And it's kind of fun when you think about like kind of flipping their mindset instead of like bemoaning the fact that this is so hard these days and saying, wow, like what an opportunity I have now, right? And so I think people have done well. You know, DCX, we have a bunch of team members in the States and we're all over the country. And I just think that there's lessons that are learned. And if you take advantage of it, this is a huge opportunity. I mean, I know you guys do that as well, right? A little bit at Commerce Cube.

Yep, absolutely. And, you know, I had a distributor friend recently tell me that one of their top people just moved to my market. And, you know, back in the day, you would lose talent if they moved, you would lose the talent. And now, you know, what a great opportunity you have.

Yeah, I mean, we could talk about the retention side, right? Not that this is a catch-all for everybody, but imagine when one of your best team members now decides that they want to make a major life change. Well, that doesn't necessarily mean they have to leave the company. And that's right, amazing too, right? And giving somebody that flexibility, the belief that they could make a life change and still keep everything else in place, is a huge retention like a plan, right? Yeah.

Let's talk about onboarding for a minute. So in an article in TechCrunch, the article is called Hiring Top Startup Talent on a Budget During the Great Resignation. Greylock partner Glen Evans said regarding a recruitment process, create a process that is structured, organized, and repeatable where you have clear lanes and coverage areas for the interviews. Don't make it too rigid, but have some structure so you can train new hires. That was his big tip. And I, and I know it sounds basic, but honestly, a lot of us have not really had that. We've sort of built our businesses in an apprenticeship model. Where folks just learn right beside each other. But now that we're virtual, we are actually having to codify a lot of these plans. What are you seeing in terms of best practice, folks, with onboarding and bringing new people into the business?

Yeah, it's just like making the most of what their previous process was and letting it sort of live a little bit more evergreen and be able to exist in a virtual world, right? You know, that quote's cool though, because he's also talking about the beginning stages of actually hiring. And I don't think nearly enough people really put a plan plan in place for that, right? We post a job on a job board, we have multiple people that are sort of reviewing that. Our interview process can sometimes be a little bit outdated and slow-moving, I'll just say. So starting there to try to make this easy, to try to make it really attractive for a potential candidate to want to apply for your job and get through the process and have everything be very open and honest through that. And then when somebody actually is hired, You know, keeping it simple, creating opportunities where people can continue to learn through osmosis and follow people, but getting the stuff on paper right and creating a little bit more of a standard process for this so that it can happen.

Yeah. And something you mentioned to me before and we've talked about is that we need to actually start selling to the employee base audience and to the potential audience. And so our marketing, our websites, for example, are myopic. They're very one-visioned toward the client. And we have a little bit of space for recruitment But we need to kind of balance that out. And here's another reason why. This year, ASI recognized Peter at Harper Scott as the Salesperson of the Year. The backstory is Peter was a client for years buying merchandise, and then he became, right, a part of the Harper Scott team. So like, you never know where talent is gonna come from. And the fact that you're marketing that and speaking in that language and using our marketing prowess that we're really strong at, for recruitment is like a big switch that many of us have to make.

I think so. And it's there. It's there for everybody to take advantage of. I mean, yeah, how many distributors put together hiring retention programs for their clients, right? How many of them are actually using some of the stuff that they literally dream up on their own and present to clients for their own businesses? Right. We have these skills. We have a leg up. We have an industry that is exciting and fun. A lot of us come from a sales perspective so that we can figure out a way to get someone's attention and, you know, sell, right? Create value. All that stuff should be done for the hiring process too. Yeah. So it's easier than people think.

What have you seen that works when it comes to recruiting and hiring top talent? I know it's, I know it's a big question, but what are a couple of key things that you've seen work?

I think it was Mitch Silver at Printable has been a big proponent of this, but the first step is to make it very easy, right? Yeah. You know, make it very upfront and very easy for someone. Be willing to move fast. I talk to people so often and you're kind of stuck in your, your, I mean, sorry, little old ways of doing things where you put them through multiple interviews and you think on it and you want to see like 10 different people and we don't, we don't have time for that, right? You know, if we really want to attract the best talent, we need to be decisive. We need to come up with a good way to collect all the information we need for these individuals so you can make quicker decisions, right? Yeah. You know, I think you and I talked before, and I compared this to the real estate market, right? You gotta make a decision in 30 minutes, right? Like, that's how it is when you're gonna buy a house, right? Not that fast with this, but you do need to be really quickly. And, you know, those are some of the things to, to start with. And then, you know, just put together, put together the whole package. Think about everything, right? Think about ways that you can, uh, provide a great environment for someone to succeed and make sure that's very clear for them to see. Um, and then really prove to somebody that you're going to be supporting them across the board. Comp is one thing, right? Like, vacation time is great, work remote is great, but I think people want to feel like they're supported and they will have the opportunity to really take advantage of that and grow.

Yeah, that's a great point. Support and development. Just a few days ago, Warren Buffett delivered his annual shareholders' address and said that the one thing you can do when inflation is high is to sharpen your skills. Quote, he said this: quote, skills unlike currency are inflation-proof. If you have a skill that's in demand, it will remain in demand no matter what the dollar is worth. Whatever abilities you have can't be taken away from you. They can't actually be inflated away from you. You said the best investment by far is anything that develops yourself, and it's not taxed at all. The reason I bring it up in context of this conversation is because you just said investment in folks, you know, there's the salary compensation, but what a lot of folks are looking for is development. And we have this kind of gap in making sure once we hire people that we have a process and a way to bring them through and to show them that we want to invest in their education, in their training, and then moving up in the industry. Those are things that today's, you know, today's employee is looking for.

I think so. I think so. And, and it's hard, you know, we're hiring right now because there's a need, and so there's a tendency to sort of make a hire to relieve some pressure and dump a whole bunch of stuff on somebody, right?

Right.

But we want to bring them in and really cultivate that environment. And I think some people do a great job with this. I mean, I've, you know, traveled and met with tons of different distributors, and they are investing in leadership training across or they're getting key people to learn more about the business besides the one thing that they're responsible for. Right. But I would encourage staying in that lane, having people, you know, go attend some conferences every once in a while that are purely educational, right. That are not necessarily about trying to network and create sales, but just better themselves and invest in the support. And I think this will be a common theme across the board. Right. But make it so that people actually feel like they have some time to think during their day, that they can actually spend some time to just better themselves and that they are properly supported across the board so that they actually have that freedom. That freedom is incredibly valuable.

Yeah, that's a great point. Building that into your culture and letting them know they have, especially in our business where we're incredibly driven by deadlines and the pressure is always on, giving them the permission and the latitude to actually invest in themselves is huge. Yeah. And leaders have to actually exhibit that by example and talk about it.

They do. You have to show by example. You have to, because if someone is just going to watch you, you know, run around like crazy and never take a vacation, they'll just feel like they have to do the same thing. Yeah.

So yeah, that's a key point. Outsourcing is your expertise. So let's talk about that for a minute. Can you speak real practically? Is something a lot of folks probably want to know when it comes to outsourcing, particularly overseas. So correct me with any of my assumptions. DelegateCX is partnering with folks in the Philippines for outsourcing. And let's start with the basic question of why would I want to do that if I'm a distributor?

Probably the most simple way to put this is one of the easiest ways to scale your business.

Okay.

One of the easiest ways to actually provide that support for your employees to get properly staffed across the board so that your business can grow. Right. If we all had the ability to, you know, hire whomever we want for any amount of money, we would probably do it way more often, right? Like we would really set things up so that there is a structure in place to take advantage of all the software opportunities and all the business and just all kind of run as smooth as possible, right? And this is the best way to be able to make that a reality is to use an all-star model for certain roles inside of the business.

Yeah, I said distributors too, but obviously I meant suppliers because you're working with both suppliers and distributors. The labor report that I mentioned in the intro that we just released together, the thing that we're passionate about, both of us are, are scaling, scaling, helping businesses grow. And so in our case, technology helps with those efficiencies. In your case, outsourcing some of those roles helps with those efficiencies. I think if you match the two, which is why we did the report together, it's magic for your business. So, but let's talk a little about how to do it. Folks are reluctant. There are folks that sort of, they love the idea, they talk to you, and they're, and I'm sure Now it's a lot easier for you than it was, you know, a couple years ago pre-pandemic. But how about how to do it? Like, if I were— if you were to sit down with me as a distributor and I have a team of maybe 10 to 20 people, what would be one of the first steps that you'd walk me through?

Yep. So I mean, the first thing to do is just figure out where are some inefficiencies, uh, where do we feel like we're a little under-supported, and target, I guess, probably some of those entry-level type roles, right? You know, the bulk of our hires probably do end up coming on the sales side of things, which makes the most sense, right? It's usually the biggest part of everyone's team.

They're not salespeople, but they're in the support roles for salespeople.

Yes. And, you know, support roles and really thinking this as like a support layer that you can add is a great kind of mindset, right? So sales is the easiest way. How do we figure out how we can get somebody to start helping with that administrative burden that comes with every single project that we take on? You mentioned it earlier, everyone's job's harder than it's ever been, right? There's more steps, the orders are more complex. Every single one has a dropship list of 300 addresses we need to get it to, right? So there's so many places inside of there where we could get somebody to help with that specifically, get really great at learning all those little details, how to product source, how to build presentations, you know, and get the salespeople away from that work whenever possible. Yeah. You know, I think that's the problem that I see all the time is that incredibly high performer, incredible salespeople are sometimes doing work and A, they might not be great at it and B, there's better things for them to be doing. So we start there, obviously on the sort of production side of things, there's a lot of great opportunities for somebody to come in here and manage that stuff and it doesn't take years to master that kind of stuff in the industry. And of course, you know, all the other departments probably have similar situations like that, right? There's almost always one more layer down that we could go and we can start to take some of those responsibilities off good people's plates.

How do you handle resistance when folks, you know, new changes can be threatening a little bit? And so if you're a sales rep, sometimes sales reps find comfort in a lot of those tasks, but it's not the best use of their time. And we all know that even the salesperson working on it knows that. So how do you, how do you handle resistance when you're talking about that? So for example, you've partnered with us, maybe the CEO or the owner of a distributorship or supplier gets it, but now you've got to sort of sell it internally. Is that a part of your process?

Oh, huge. And it's actually one of the harder things that happens sometimes. We get the buy-in from the top, which you would think is like the hard part, right? Right. Not always, right? Getting everybody else to feel like they're, they're bought into this, that it was their idea from the jump, right?

Yeah.

But, but I get it, you know, delegating is hard. I struggle with it myself, right? We all think that we can do things sort of the best. We— you're right, we find comfort sometimes in putting ourselves through the wringer and almost feels like. I don't know what that says about us. Right. But we do it. We all do it. So it's important to show them, A, of course, you know, how this could potentially work. Our experience, obviously, in this industry comes in handy here because we can literally talk about the experiences that we've had. We can show someone sort of a bit of the blueprint of how it might work. We can get in the weeds with that work and sort of, you know, show them kind of what next steps and what it'll do for them. And I think the big thing, especially with sales teams, is really hammer the point that if you stop doing this, you will make more money probably too, right? Like, this is how we do it. This is how we grow. And here's how this is really great for your career. I don't know. Once most people actually figure it out, start to experience it themselves, and they hear from their friends that it's been a positive experience, you know, they're quickly onboarded.

And that's the good part. How about what not to outsource? I know that sounds like a really basic question, but the reason I also ask it is because when a salesperson understands that they— what they can outsource, they'll realize what they can double down on, what they can't outsource. What can you not outsource?

I think the two biggest things that come to mind here in our industry is relationships and pure creativity. And not to say that somebody couldn't be creative in another country, but no one will be as creative as the industry vets, right? The superstars that exist in this industry. All of the work they've done over the years, you know, understand different products, understand different campaigns. That stuff cannot be outsourced, right? Yeah. But relationships are the same way. People should be spending their time on those relationships, talking to their clients, figuring out what sort of next steps to building really looks like and not everything else. So those are the two things that, you know, there isn't a— that's where we need to invest in our teams in the States are those two things. That's incredibly rare. Yeah.

Do you have an example of a distributor or supplier who was really successful, who was kind of resistant at first, but they, but they were really successful at this transition?

Yeah, I mean, there's been a lot. I mean, you know, I think most people were very reluctant. My first few months on the job were a lot of nice people that were willing to give me a half hour or an hour, but basically ended with, hey, good luck with all that. I hope it works out for you. So look, that's, that was the natural inclination of most, but there's a A ton of great success stories, a lot inside the CommerceFu community, right? Like, yeah, just the first thing comes to mind is Paperclip.

Yeah, yeah.

Good friends of Ruth. Yep. And Soul and Swag. Okay.

Oh yeah.

I talked to them. They were, they were probably my first call back to back. Wow. Back in January of last year. And both of them had major reservations. They thought it was a good idea. You know, Soul Cola now has 2 employees through us helping different parts of the business. Ruth and her team team are just going through the hiring process actually. So we can't speak to pure success yet, but that's how long it took them to get there. Right. But now they're seeing how this is, how it goes, right? Our buddies at Thumbprint, of course, I had a really great relationship with them and they're, you know, definitely, you know, industry leaders in general. They were a little bit easier to sort of sell on the idea. Sure. Took a little bit longer for it to come to become practical now, but they found ways to make their customer experience run even smoother with the help of an offshore person, right?

Yeah.

To really let their best people really dig in deeper with some of these amazing relationships that they have. So they've seen now tremendous growth and not just on our team, but just across the board. And I think that's been a pretty cool success story.

It's almost like the splinter theory of selling, right? Once you introduce them to the option, they have the splinter in their finger and every time they bump it, they're like, we shouldn't be doing this. We need to get this out. Like, we should outsource this. And so it takes some time for you to go in your business to look at those processes processes and go, oh, I'm really tired of bumping into Splinter, I need to get this done.

That's of course, uh, a brilliant notion there that I'm definitely going to steal now. But, uh, no, that's, that's what it is, right? And most of our relationships start with one employee.

Yeah.

And it kind of makes sense, right? Because like, this is a process that's a little bit of a change. Yeah. And somebody needs to experience it. They may need to make sure that everything I'm saying is actually true, and all of their friends that have had great experiences too. But Very interesting to see that once you can make that connection and you start to see the value, how it can actually quickly bloom. So yeah, that's exactly what happens.

How about culture? Like, what's the—

what's—

how do you respond to someone who says, you know, I am not sure I can actually engage employees virtually, especially folks in another country? It's a different experience. Like, how are you bridging that problem with, I don't think that we can create a strong, solid culture?

A bunch of—

Is it just not true? Really?

Yeah, it's just not true. Right. And like a respectfulness that it will be some work and sometimes it takes some process changes, but it's all on the table. Right. And I've seen this happen. It's probably the thing I'm most proud of in all of this has seen the way that people, especially in this industry, have tackled this problem. You know, one of the big things I get worried about outsourcing in general sometimes is this it's all about sort of the bottom line, right? Some companies, and I think this has been practice that's happened across other industries, bring on somebody on the lowest level jobs, let them work behind the scenes, right? And it's all about saving a buck. Literally every single distributor partner I've had, and suppliers as well, sorry, every partner inside of the industry has done, has been really bought into the idea that we're going to welcome these employees into our team. Yep. And we're going to ship them a box of swag, the biggest thing we possibly can, so they can be decked out in our stuff. And we're going to set up a camera in our conference room so that they can sit in on every meeting if people really truly are in the office all the time, or any vendors come in to talk about their product line, right? And we're going to have time for these employees not just to be working on, on tasks all day, but get to know each team member, even if they're not necessarily working hand in hand, so that they feel like they're part of the team. Yeah, all on the table.

So people have done a great job We think of culture in terms of reducing or reduction, but actually Sarah White with Fareware taught me this, and she said that we need to start thinking of culture as additive, not looking for people that are like us, but looking for people precisely that are different so they can bring strong opinions and differing perspectives to the table. And I love that. And on our own team, I remember Dave Schultz and I were at our last headquarters meeting. Dave turned to me and said, I've never seen such a diverse team. We have folks from Pakistan and from China and from Russia that are working in Toronto, working with us and our team, and what amazing perspectives they bring to the business. So it's, it's It's more expanding your perspective than it is limiting and expanding your culture rather than like trying to worry about something you have to control.

It is, uh, obviously a big thing that I think, you know, the industry has a lot of work to do to try to achieve. Yeah, yeah. Kind of scary sometimes to figure out how the heck do we solve for it, but it's that— it's, it's baby steps. It's, yeah, being open to it, and you start to make gains when you really expand your horizons, and it's incredibly valuable to an organization. And I don't even know if we need to put that value on it. Yeah, it's, it's really important. So this is a very easy way to have that.

Yeah. And we have a diversity problem in our industry. So this is a great way to bridge that as well. What's the difference between a supplier's outsourcing and a distributor's? Are there specific— like, what are the specifics?

I mean, not a huge amount, but I would say there's, there's one major difference right now, which is that Suppliers, from what I can tell, most distributors, if they're going to be frustrated with their supplier partners, there's usually one reason why. They don't feel like they are getting the support, the answers that they need in order to take care of their clients, right?

Right, right.

So from my standpoint, where I see the opportunity for suppliers to really take advantage of this is to beef up this layer of, of support, of customer service, because that's a differentiator. If you are the type of supplier that has the ability to get all the information out, to let distributors know what they're dealing with, you don't have to solve every single problem or have amazing amounts of inventory, but you have to make it clear that what the case is, you have a huge leg up and the ability to grow. Like, that's what distributors are looking for. So a lot of our partners that way are focusing there to make sure that their salespeople have tons of support, make sure that their reps across the country have somebody else that's helping kind of get these answers. To just serve us really quickly.

Yep, excellent idea. I know you and Craig and the team think a lot about this, the future of work. Let's talk about the immediate future. How do you think inflation might impact jobs and the battle for top talent in the near future?

It's a, it's a huge challenge across the board, and I think people need to be prepared that they're going to have to invest if that's something that, that's important to them, right? Um, we've talked about all the little things that we can start to do, but comp is going to go up and we're going to have to be just more willing to invest in I envision a scenario where that can become the norm again, where companies will start to really be able to invest in that, maybe because they expertly took advantage of a situation like this, right? Bringing people into the right seat is a notion that I think about a lot. Fill those roles the right way and make sure that you have room to be able to invest in the top talent, because it's going to be at a premium for a little bit, right? I don't think there's anything that we can necessarily do to fix that.

True. Okay, last question. Long-term thinking, 5 years, what do you predict will happen in our industry regarding our attitudes toward virtual teams and specifically global teams?

I mean, I think we're on the right track right now. I mean, maybe I'm a bit biased because I'm in this weeds every day, but I'm seeing people be open to the notion of this. I'm seeing people love the experience and be very focused on scaling and growing their business. Like never before, right? And so this, I think, is just part of that process. And people are trying to figure out more streamlined ways to get in front of clients. They're trying to find more creative ways and better ways to run their business efficiently. And I think that they're willing to invest in their team across the board. So I hope that this is done very strategically, but people are really taking advantage of it so that they can, you know, really build something out that's that's longstanding.

Rory, I love it. I know I speak on behalf of my team here, but we love and respect what you guys are doing. You and Craig and the whole team, you're going to make a huge impact on our industry through this. And I know it's a business of yours, but it's also a mission and it's just a really great, great experience. So thanks for joining me today on the SkewCast, my friend. I really enjoyed having you.

Thank you, buddy. Really appreciate it. And right back to you guys. Thank you so much for everything you do for the industry and for your friendship.

Thanks so much for tuning in to this episode of SKUcast. Be sure to keep up with our latest content by subscribing to SKUcast on iTunes or to our blog at community.commsku.com. Until next time, friends, thanks so much for listening.