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Top 20 Stories of 2016: #4 Eaton CEO Speaks at NAED National Opening Session

Top 20 Stories of 2016: #4 Eaton CEO Speaks at NAED National Opening Session

 

Every weekday in December, tED magazine is counting down the Top 20 Stories of 2016. Below, the #4 most-viewed story of the year, originally published on May 12, 2016.


 

Another NAED National Meeting is officially under way, this year in Washington, DC. NAED Chair Glenn Goedecke kicked the opening session off with the final speech of his tenure. Goedecke thanked the association for the opportunity to serve for the past year, and officially announced that Larry Stern of Standard Electric Supply Company will be the 2016-2017 NAED Chair. Geodecke then invited Bill Elliott of Elliott Electric Supply to introduce the first speaker of the morning, Sandy Cutler, Chairman & CEO of Eaton Corporation.

Elliott spoke about Cutler’s integrity and leadership, saying that, in Cutler’s words, “We care about how we get results.” After a rundown of the successes Cutler has had across his career, Elliott presented Cutler with a lifetime achievement award, saying that Cutler “has been a friend to the electrical business and distribution. We appreciate Sandy’s leadership.”

Cutler began by applauding associations like NAED for being an integral part of the industry, making it stronger every year. He then shared his perspective on a number of milestones that have changed our industry, saying that, “The rules of the road of the future will not be as clear as they were in the past.”

Cutler said there are some things that will not change in the electrical industry: “The fundamental growth of our industry has been very closely aligned with GDP in this country,” Cutler pointed out. “This is a fundamental industry. This is a base industry. This is an industry that drives growth, it drives productivity, and most importantly, it delivers safety to the audiences who use electrical power every day.” He added that distributors are the rock of the industry, and will continue to be into the future.

What Cutler says will change, however, is technology. Specifically, e-commerce and cyber safety. When speaking about e-commerce, he asks, “Is this yesterday’s news, or tomorrow’s opportunity?” The answer is ‘both’. Cutler warns distributors, “If you’re behind, you’ve gotta catch up. If you’re ahead, you better move faster. The fundamental disintermediation power of real-time communications and the internet is enormous.”

Cutler goes on to say that e-commerce is not simply about conducting an online product reference—it’s about doing business fundamentally differently. He says he knows change is hard, and taking new competitors seriously is a challenge when you are busy with your own business. He says what you do today has to be different than what Amazon can do for your customers. “Take turf and provide new value.”

Cutler wrapped up his session with a warning that all distributors need to take cyber attacks seriously. If your system was compromised, he asks, “Could you withstand a denial of service that shut off all your systems for a day?”

“If you buy into the importance of e-commerce and digital enablement, then you need to make a real investment in contemporary cyber-security. The threats are getting more sophisticated, and so must you and your organization. Harden up your defenses, and keep upgrading them. Last year’s defenses are not adequate for this year.”

Cutler then opened the floor to questions, which yielded the following piece of wisdom:

Succession is the most important responsibility to your organization… Don’t be a flat thinker. One of the biggest mistakes organizations make is that they hire great people, but don’t allow them to think and work differently – they stall and never go anywhere. You need to develop your talent, then let them run. Also, recruit from outside your industry, and embrace change.

In closing, Cutler calls distributors to, “Please take care of our industry – it’s a mainstay of this country.”

 

 

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