Change management and involvement

Elektroskandia is investing in a state-of-the-art distribution centre, in order to facilitate continued growth and meet market demands for faster, more flexible delivery alternatives as well as new, complex logistics services. The wholesaler is prioritising change management and training in an effort to retain expert staff and managers.

Sweden's leading wholesaler in electrical materials is intensely focused on improving the profitability and effectiveness of their customers' businesses, requiring investments in state-of-the art logistics. Which is why the contractor broke ground in Örebro on Monday, November 30, 2015, and began work on what will become Elektroskandia's newest and most advanced distribution centre in 2016. The new distribution centre will replace the existing facility, which has become outdated. Elektroskandia have retained Langebaek's services for the duration of the project, from the preliminary studies completed in 2013, to design and construction of the buildings, the warehouse layout, automation & IT, and internal processes and training, as well as the commissioning of the new distribution centre in 2017.

The new distribution centre will be located just outside Örebro, less than 20 kilometres from the existing site, a conscious decision by Elektroskandia's management. "It was becoming increasingly difficult to maintain the effectiveness we aim for in the existing facility, due to the fact that the infrastructure had become outdated. But we had a strong and highly experienced staff of approx. 250 office and warehouse employees, and retaining them was high on our list of priorities. Which is why we're delighted to be able to build a new distribution centre so close to the old one, and why the employees will be involved in all aspects of the move to the new location," says Elektroskandia's Logistics Director, Peter Landenberg.

Supply chain innovation
Like many if not most wholesalers worldwide, Elektroskandia have been affected by the digital transformation of the industry, and the resulting changes to market dynamics. Peter Landenberg continues; "Our customers expect faster delivery and as a result, we now deliver orders received by 18.00 before 12.00 the next day in most of Sweden, except the northern-most part. We also continuously develop value added services, as well as work with advanced warehousing concepts such as vendor managed inventory and consignment stock for our large customers. Logistics services are core to our value proposition, which is why we continue to invest so many resources in supply chain innovation.

Once complete, the distribution centre will be 38,000 m2. Most of warehouse will be 12 meters high, but the integrated high bay warehouse will rise all of 30 metres above the warehouse floor below. The high bay warehouse will be a fully automated, crane-operated pallet warehouse. The distribution centre will also feature an advanced OSR shuttle-system delivered by Knapp. The entire operation will largely be based on the principles of goods-to-man, which will reduce internal traffic significantly. Last but not least, a new Warehouse Management System, Astro WMS from Consafe Logistics, will be implemented.

Elektroskandia is Sweden's leading wholesaler of electrical materials having been founded more than a century ago. The company markets and sells electrical supplies and systems in segments such as power and automation, telecommunication, data communication and security, lighting, appliances, and electrical engineering. The company's annual turnover of nearly 6 billion SEK is generated by approximately 750 employees in 48 locations across Sweden. Elektroskandia is a part of the Sonepar Group, one of the world's largest wholesalers of electrical materials.

A large-scale transformation
"We have embarked on a large-scale transformation, involving the physical infrastructure, the logistic technologies, our management systems, as well as our internal processes. It's difficult to imagine a more massive change than this. This has quite naturally created some anxiety amongst employees, including management, which is why we have been determined to communicate openly and honestly about the company's plans for the future," says Peter Landenberg.

Elektroskandia have formed a change management committee, comprised of four specialists, responsible for ensuring that the changes will be as painless as possible. The committee consists of a HR consultant, a communications consultant, and two so-called culture-bearers - experienced employees who are highly regarded and well connected within the company.

"90% of the change management effort is engaging the organisation through dialogue. From the very beginning we have ensured a comprehensive flow of information and consulted all parties on the changes to come. Our objective is to make sure everyone is as involved and feel as secure as possible."

The company is also planning a comprehensive training programme in the new systems and processes for select super-users, who will in turn help cascade the training programme throughout the organisation.

A 50-year event
The entire project including planning, construction and commissioning of the new distribution centre is expected to take three years from start to finish. If all goes to plan the buildings will be completed by the end of 2016, and the 42,000 stock items and 250,000 non-stock items will be moved in the fall of 2017.

"This is probably the only time in a fifty-year period that the company will undergo a change of this magnitude, so it is a first for the entire organisation. Langebaek, on the other hand, do this sort of thing on a regular basis. As a result, they have a deep understanding of what it takes," Peter Landenberg says, and continues: "It is vital that we have an advisor who can bring the requisite competences to bear, and instil confidence in the entire process across all of the organisation."