Jozef Opdeweegh- Why Autocratic Leadership Should be a Thing of the Past

In the HR departments of companies, big and small, the importance of value-based leadership, diversity, inclusiveness and openness is being touted as core to the success of the company and its main asset, its people. Similarly, headhunters sell their services and their candidates with an emphasis on the soft, human side of the management talent they suggest to their clients for leadership positions. Undeniably, this is the right approach to recruitment, talent development and human resources management.

Why then is there such a large gap between theory and practice? Why do shareholders and boards condone authoritarian, Machiavellian leadership to attain their goals? Why do CEOs often engage in behavior that no book about leadership would ever propagate? Why does society view so many politicians as strong, determined leaders, when these politicians in fact lack the capability of self-censorship or empathy, and are probably woefully insufficient for the job at hand?

An autocratic and self-centered person, who views contrasting opinions as a threat rather than embracing them, is a weak and insecure leader who will never attain the full potential of the company and its people. Strong leaders excel at showing empathy, listening, being self-critical and having the ability to change their opinion based on well-founded arguments. They embrace opposing views and are not fearful of showing their human and vulnerable side. They seek diversity in their teams to supplement their own strengths and neutralize their weaknesses. They are humble and understand that they are there by grace of the team who works with them, rather than the other way around.

Everybody’s opinion matters.

Companies spend inordinate amounts of energy and money on attracting and developing talent. The cost of a talent acquisition and development team is significant. The money spent on headhunters and leadership training can be equally large. Unfortunately, the valuable insights and creative perspectives of many of the talented people being recruited and groomed will never see the light of day. A considerable number of them will end up working in a hierarchy that simply does not value their opinion. Is there a purpose to surrounding yourself with talented people, only to then disregard their point of view? Every single soul in an organization has something to add to its success, whether janitor or executive. Modern, value-based leadership creates an environment that entices all of its associates to share their views. It then takes those views into consideration and includes them in decision-making.

Admit when you are wrong.

All of us make mistakes; oftentimes we are convinced we’re moving in the right direction, despite having made decisions in isolation, either in impulse or without full consideration of the facts. A respected leader is capable of publicly changing his or her opinion based on well-founded arguments, which are encouraged in the inclusive and creative environment the leader has helped foster.

Don’t fear your weaknesses, you are human.

When you stand in front of an audience of your co-workers, few things are more endearing than your ability to show your human side. While you may be the last one in the room to come to the realization, you are no superhuman and everybody knows that. What’s more, you are likely not the smartest or most talented person in that room. You are a valuable and integral part of a team, as are your co-workers. So, it is okay to show your weaknesses, to give testimony to mistakes you have made in the past, to talk about insecurities, or to solicit input and help. It will make you look stronger and more approachable.

Embrace diversity, different is good.

So often in corporate life, those involved in recruiting will focus on a very narrow subset of available talent. Shareholders, boards, CEOs and headhunters will tend to look for clones of what is proven and tested: comparable educational background, in-sector job experience, stereotypical personality profiles. Rather than creating an intellectually challenging environment where professionals can learn from one another’s different cultural, ethnical, professional or educational background, these companies cultivate their narrow definition of talent. The most successful companies and the best leaders do not define talent narrowly or even individually; they strive to compose a team of complementary, yet diverse professionals.

Never be a bully.

The ultimate sign of weakness in a leader is lack of containment. Raising your voice, losing your patience, pounding tables? You just lost the battle. Your associates deserve your respect. They deserve a calm and composed leader, who always puts the interest of the company and the associates before self-interest.

About Jozef:

Jozef Opdeweegh, also known as Jos, has served as CEO for over 17 years of global technology, distribution, and supply chain optimization companies with 5,000 to 20,000 employees, public or privately held. Opdeweegh has extensive board membership experience on 4 continents with related and unrelated companies.


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Jozef Opdeweegh and Leadership- What Makes a CEO Successful

No two business leaders or executives boast the same leadership style. Because circumstances always vary, there is no correct, one-size-fits-all way to lead. Nevertheless, there are certain traits excellent leaders share. Not only do these traits drive the company forward, they also foster admiration among employees.


Jozef Opdeweegh, known as Jos, has served for over 17 years as CEO of public and private companies in global technology, distribution, and supply chain optimization. Opdeweegh has extensive experience leading different groups of people and teams of varying size in multiple industries.

His long career as a leader has provided him with intimate knowledge of the traits a good executive should display. These traits or attributes are not only crucial for the success of the company, but also to assure employees are inspired and empowered by the CEO.  Such an environment results in positive growth.

Opdeweegh has outlined 5 traits that make for a successful CEO, and he has included observations from former employees.

1. Makes Decisions Decisively

CEOs, like most leaders, must make numerous daily decisions, both large and small. A great leader can make tough decisions and take accountability for subsequent consequences. According to the Pew Research Center, “Intelligence and decisiveness are considered ‘absolutely essential’ leadership qualities by at least 8-in-10 adults.” The same study goes on to note how men and women both agree that being honest, intelligent, organized and decisive are also integral qualities. The capacity to make decisions, especially tough ones, is seen by employees as a trait of a strong leader.


2. Engages People

The ability to engage people is an imperative trait for a CEO, and it is one well-recognized by people who have worked with Opdeweegh. Former employee Tim Oglesby says,

“One of the key things you need in a leader is the ability to be engaging. Jos is very engaging with people in various roles. It could be the associate driving a forklift in the warehouse, all the way to the top including team leaders, the executive team, shareholders, and potential investors. Jos is able to engage a broad team and get everyone on the same page, moving forward in the same direction.”
Oglesby has worked with Jos in different capacities for over 10 years. He first worked with Jos at Syncreon as CIO, at Americold as CIO, and then at Neovia as CTO. At each company, Jos presided as CEO.

3. Puts Employees First

Typically, when thinking about the hierarchy of an organization, the CEO is at the top, followed by the management team, and then come the rest of the employees. Opdeweegh focuses on flipping that pyramid upside down and putting employees at the top. Doing so puts more emphasis on employees who have direct contact with customers. Putting employees first also makes for a better communication flow. Not only does this leadership style empower employees, but according to former employee Carey Falcone, it can create a completely different environment.

“When you flip that pyramid upside down, it starts to seed a different culture. Jos truly created an environment where people were focused on a common goal but not limited by the traditional way of getting there. He encouraged people to think outside the box and to speak up. Jos fostered an environment where everyone started to think about how they could drive the business forward,” says Falcone.

Carey Falcone was recruited by Jos to come work with him at Americold. He credits Jos’s leadership style and the culture Jos created as key things that attracted him to the role and working relationship. Falcone served as the EVP and Chief Customer Officer at Americold for over two years. When Jos left to become CEO of Neovia, Falcone went with him and worked as the EVP and Chief Commercial Officer for three years.

4. Communicates Clearly

Leaders and CEOs must have excellent communication skills. They have to be able to communicate clearly and effectively, not only to their management team, but also to the broader organization. A study by Navalent found that “top executives are consistently transparent and balanced in their communication. They effectively translate their view of business potential and challenges, as well as expectations for action using succinct, direct and readily understandable language in doses that are easily digestible. They devote time to their connections.” Communication is invaluable in the world of business, especially between a CEO and his or her team.

5. Inspires People

Employees will be more committed to the success of the company if they feel inspired by leadership. A successful company generally boasts a roster of employees who enjoy working there. For example, employees consistently rate Google as one of the best places to work. Giving employees a voice, equipping them with the knowledge they need to succeed, and inspiring them to drive the company forward is beneficial to the company at large. Carey Falcone agrees, saying, “The most important people were the people who actually touched our customers. The senior leadership team was truly there to empower, support and enable people who were customer-facing to really do their jobs. Management supported them and showed them they had everything they needed to be successful.”


About Jozef:

Jozef Opdeweegh, also known as Jos, has served as CEO for over 17 years of global technology, distribution, and supply chain optimization companies with 5,000 to 20,000 employees, public or privately held. Opdeweegh has extensive board membership experience on 4 continents with related and unrelated companies.

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Jozef Opdeweegh: 7 Reasons Why Private Equity Acquirers Fail to Mesh With Incumbent Leadership Teams

When a private equity fund sells a successful company, the company’s leadership team would seem to be a valuable asset for the new owner. After all, the team built shareholder wealth and it has intimate knowledge of the business. But in many cases, the executive leadership team does not survive the change in ownership, even if its performance was stellar. According to longtime CEO Jozef “Jos” Opdeweegh, “Unless the ownership transition is undertaken with great care, it can undermine the continued success of the company and its value.”


Opdeweegh, a veteran of four private-equity company transitions, notes that when a private equity fund initially invests in a company, it is common for the purchase to be based on an investment thesis. “Such a thesis may be based on premises like turn-around, M&A, organic growth, SG&A reduction, balance sheet optimization or a combination of these elements. The company leadership team executes to that thesis to build shareholder wealth. When the end of the investment horizon approaches, a private equity fund will sell the business to the highest bidder.”

So, what are the issues that can prevent a new owner from meshing with the incumbent leadership team? Below, Opdeweegh explains why, when, and where things tend to go awry.

1. The inability of the leadership team to participate in choosing the new owner


In an auction, which is the typical process used to sell a company to the highest bidder, the executive team is not typically invited to weigh in on the selection of the new owners. According to Opdeweegh, “This can lead to a dissonant outcome. Oftentimes, a clash of strategic views and corporate cultures occurs.”


2. The new owner’s failure to recognize the importance of the management team


“Some private equity owners view a management team as an end to a means, rather than as a valuable and continuing asset,” cautions Opdeweegh. “In determining their future strategy, they quite often they will trust the judgment of a less qualified consultant over that of a seasoned management team with a proven track record.” Additionally, notes Opdeweegh, “Private equity fund leadership often fails to appreciate how challenging it will be to achieve the post-purchase target return, and consequently, they fail to recognize the importance of the management team.”


3. An unbalanced payout to the owner compared to the management team.


Opdeweegh says, “There is an institutionalized lack of balance in the economics of private equity deals. It is not uncommon to have deals in which an individual private equity partner earns a larger payout than the entire management group.” He goes on to explain that the inequity in compensation illustrates an apparent lack of appreciation for the complex and demanding work of management teams.


4. A clash of corporate cultures


“It is not atypical,” says Opdeweegh, “for a clash of cultures to arise between a new shareholder group and an existing executive team.” The acquired executive team typically has worked together for an extensive period and has developed a shared set of core values. This set of values, which constitutes the corporate culture, may be very different from the behaviors the new owners wish to instill into their company vision. Says Opdeweegh, “If values such as fairness, openness, inclusiveness, the speed of decision-making and respect are not aligned, cultural and business issues will surface.”


5. Preconceived notions and impulsive decision-making by new owners


Opdeweegh says that new owners often jump to conclusions when assessing the talent in their acquired business. For instance, during management presentations, they might conclude the CFO is lackluster or the COO is nontraditional. “A rush to judgment is not only unfair to management,” he warns, “it can lead to a crisis for the new owners because a forced executive replacement usually triggers an executive team exodus. Such a migration will significantly impact the business with the loss of much institutional knowledge.” Opdeweegh adds that hasty management churn can easily result in a three to four-year setback in revenue, EBITDA trajectory, and performance.


6. Disagreement over the new strategic plan


Speaking from his experience in the business, Opdeweegh explains how a new owner will develop a strategic plan to form the foundation of their investment decision. “This strategic plan is based on assumptions relating to organic growth rate, diversification across geographies, customer and industry verticals, M&A activity, balance sheet structure, cost of the back-office functions, and other relevant aspects of value creation.  The incumbent executive team may view some important aspects of the plan as unattainable or undesirable for shareholders’ wealth creation.” Disagreement about the strategic direction of the company and the key underlying initiatives is another classic reason for a failed relationship between the acquirer and the acquired executive team.


7. Second guessing of management team decisions by the new owner


Even if the new owner and the incumbent management team agree on the strategic plan, the new owner can undermine success by continually second-guessing management decisions. Says Opdeweegh, “Private equity funds recruit from a pool of the best and brightest professionals, but these individuals have spent their careers building experience in the grueling PE environment and therefore tend to lack concrete corporate leadership experience. Undoubtedly with the best of intentions, these hardened professionals will have an opinion about many facets of the day-to-day, tactical and strategic management of their portfolio companies.” Adds Opdeweegh, “Consequently, the management team spends an inordinate amount of time communicating or justifying the rationale of certain decisions to the shareholders. The resulting drag on time and morale can cripple efforts to reach target returns.”

About Jozef:

Jozef Opdeweegh, also known as Jos, has served as CEO for over 17 years of global technology, distribution, and supply chain optimization companies with 5,000 to 20,000 employees, public or privately held. Opdeweegh has extensive board membership experience on 4 continents with related and unrelated companies.

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Jozef Opdeweegh- How to Sell Your Business at the Most Attractive Valuation

Picture this: Your business has enjoyed an excellent run over the past couple of years. Revenue is following an upward trend, and EBITDA (Earnings Before Interest, Taxes, Depreciation & Amortization) is keeping pace with your growth.
If a private equity fund owns the business you are running, there is a good chance the owners are contemplating a sale. A sale may be based on considerations such as how long the fund has owned the business and the perceived attractiveness to interested buyers.

On the other hand, if you personally own the business, you may be looking at bringing on fresh equity and operational know-how to expand your success.

Whatever the motives driving change may be, a tremendous amount of incremental value may be unlocked through the way you approach the process of selling your business. The most attractive valuation can be achieved by focusing on a number of key factors during preparation and execution of the sale.

Jozef Opdeweegh, a Miami businessman with over 17 years of experience as CEO, Chairman and Board Member of private and public companies discuss how to sell your business at the most attractive valuation.


7 Key factors for valuation

1. Timing

The right time to sell is when: (1) there are many prospective buyers, (2) there is a significant amount of private equity money (that has yet to be deployed and is actively pursuing new deals), (3) the IPO market is hot (if you are contemplating going public) and (4) the general economic climate is attractive (specifically in relation to the industry vertical(s) your company serves).

2. Business Performance Sustainability

Business performance in the years preceding the sale process is a main driver in maximizing enterprise value. Simply put, a buyer will only be willing to pay a certain multiple on your EBITDA if that buyer is sufficiently convinced the run-rate level of cash flow is sustainable in the future. By way of example, not a single buyer will pay a 10 times multiple of cash flow without conviction that the company will be able to generate that cash-flow level for at least 10 years.

3. Investment Bank Expertise

First, it is important to select an investment bank (or a broker) with a proven track record in your industry. When selecting an investment banker, exercise balanced judgment of your valuation expectation– do not simply pick the banker who promises the highest valuation.

Having access to a competitive set of bidders for your business will likely yield a positive impact on the obtainable valuation. Therefore, it is typically advisable to organize an auction with a broad set of participants.

4. Memorandum and Management Presentation Effectiveness

You will command the highest price if you spend a large amount of time on preparation. You simply need to produce the most comprehensive, compelling and best Information Memorandum and Management Presentation. You, along with your fellow presenters, should excel and be confident in front of an audience. Demonstrate knowledge of every detail related to the business, and be agile and quick in your thinking. Eloquently answer all the questions from the buyers’ community. Be enthusiastic, perseverant and energetic. It is a worthy investment to practice presentation skills with your team.

5. Team Strength and Cohesion

When you are selling your business, you are also selling your management team. It is important the buyers are exposed to the entire senior team at some point during the sale process. The management team should be fully aligned on culture, core behaviors and strategic vision. Any dissonance will be viewed as a weakness, which may negatively impact price. If you are planning on selling your business, avoid making meaningful management changes in the 12-months prior to the sale. A tenured leadership team reflects stability. It also reflects your ability to plan for the long run and to provide the best, most scalable team to a buyer.


6. Strategic Plan Integration

The ability to work well with a new ownership team depends on the business’s strategic plan. The sale process, which typically runs over an extended period, allows for extensive conversation around this topic. Therefore, the level of consensus surrounding the business’s strategic plan (post-ownership change) becomes clear.

If you, as the business owner, are in the position of being able to singlehandedly select the buyer, you can vigorously drive this point home. If you are running a company owned by a PE investor, you typically do not have the luxury of weighing in on the future ownership decision. In the latter scenario, spend sufficient time with the acquirer to demonstrate the merits of your strategic perspective and proposed direction.

7. Cultural Alignment

You and your new shareholders should share the same value set. Disparate perspective on culture and core behaviors will lead to significant future issues with your new shareholders. Often, this is the reason for failed acquisitions. Again, during the sale process, focus on corporate culture to assess alignment to maximize future success.

About Jozef:
Jozef Opdeweegh, also known as Jos, has served as CEO for over 17 years of global technology, distribution, and supply chain optimization companies with 5,000 to 20,000 employees, public or privately held. Opdeweegh has extensive board membership experience on 4 continents with related and unrelated companies.

Related Articles: Jozef Opdeweegh- 6 Core Organizational Values and the Importance of Corporate Culture
Jozef Opdeweegh – 9 Key Characteristics of a Successful Distribution Business

How to Transform an Underperforming Business: 7 Tips from CEO Jozef Opdeweegh

All kinds of companies—both publicly and privately listed—fail to reach their full potential for a myriad of reasons. Perhaps the business is family owned, but the ownership group is content with generating an adequate level of recurring cash flow, despite underperforming against peer groups. Or, perhaps the business is publicly owned, but the management and the board are not incentivized to explore new avenues of growth and diversification. Rather, they are compensated to remain risk averse.


In both cases, there is the potential to unlock incremental shareholder value. And in the case of public companies, the board and the leadership team may even have a fiduciary obligation to do just that.


It can be empirically argued that for most businesses, there is a direct correlation between the size and level of diversification on one hand and the enterprise value of that organization on the other hand. Additionally, key drivers of shareholders’ wealth creation are cash-flow resilience and the comparative performance in terms of growth and profit margin versus direct competitors.

Common Business Issues & How to Successfully Address Them

No Well-Defined Strategic Plan

If a company does not have a clearly articulated strategic plan and a shared end goal, it is rudderless and its employees are unable to cooperatively work towards a future state.

An effective strategic plan describes what the company should ideally look like in a defined period (typically 5 years), and it sets key milestones.


The strategic plan needs to be simple, focused on no more than 5 key criteria, and it should be universally understood throughout the organization. It is imperative for the leadership to actively go out to its workforce to explain the strategic plan, its merits for all involved, and the importance of the contribution of each employee to the achievement of the end goal.

Lack of Organic Growth

Companies that fail to grow organically will risk a weakening of their position in the marketplace. For many organizations, mediocre performance essentially becomes institutionalized. The sales force lacks the right sales playbook, because these companies fail to sufficiently invest in the training and assessment of their sales force, and they have incentive schemes that do not incent the right behaviors.

Key to turning around the revenue trend of an organization is the continuous comparative assessment of sales people based on objective criteria, combined with (1) tailored sales force training, (2) a redesigned and simple incentive opportunity, and (3) a clear program of relevant KPIs to assess performance quality. In a situation where the sales force as a whole is underperforming and requires upgrading, forced ranking of talent with predetermined levels of attrition and inflow of new talent may offer an effective tool to enhance the overall quality of the sales effort.


Outgrowing the Leadership Talent

As a company grows and becomes more diversified in terms of its product/service offerings and geography, it is certainly not unusual to have to upgrade the leadership team in tandem. The demands on the executive team of a small and geographically concentrated business are vastly different from those imposed on the leadership of a rapidly growing and geographically expanding organization. It is important to ensure the quality of the leadership team is in sync with the ambitions of the company. The recruiting policy must be such that the talent attracted is scalable to lead the company through the 5-year horizon of its strategic plan.

Lack of Aligned Culture and Core Values

Once a company has clearly defined its mission, its vision, and the supporting behaviors through a process of consultation, it is imperative that the leaders of the organization demonstrate those behaviors in their professional and personal lives. Any form of lack of adherence or dissenting behavior should be addressed in a direct conversation. If the individual continues to openly or otherwise fight the agreed-upon core behaviors, the individual should be let go (in a fair and respectful manner). The biggest threat to the strategic plan is to allow festering passive-aggressive behavior— especially at the leadership level. While cultural alignment is extremely important between the associates, it is equally important that this alignment extends to the board and, in the case of a privately owned corporation, the shareholders of the company. Too often a cultural divide, and not the performance of the team and the company, inspires ownership groups or their representatives to make impulsive management changes.

Inconsistent Quality in Operations

The long-term future of a business is negatively impacted if it does not provide world-class levels of quality in its products and services. The company should develop a detailed operating system that is prescriptive in nature and that defines how its facilities and back-office functions should operate across each geography or location. Such a system will guarantee a predictable and excellent customer experience. The operating system should focus heavily on concepts of lean manufacturing, six sigma, continuous flow and first-time-through quality.

Lagging IT Infrastructure and Business Analytics

Any business benefits greatly from a thorough and modern ERP solution that covers the entire spectrum of financial accounting, distribution or supply chain management, manufacturing, human resources and CRM. Businesses also benefit from access to relevant business analytics in each of these areas. While boards are often reluctant to implement a new ERP solution (it can be costly and can cause distracting business interruption), the ERP solution is truly the engine of the business. Not only should a business invest in modern ERP solutions, it should also expect to constantly reinvest in modernization and to upgrade every 10 to 15 years.

SG&A Overhang

A company needs to identify how much it is willing to spend on the sum of support functions, based on a comparison to its peer group and its strategic ambitions. It also needs to institutionalize the notion that SG&A is scalable, up and down, and to think of it as a semi-variable expense. When a company hits a rough patch, the impact on its cash flow – and even its survival – is often defined by its ability to scale down SG&A. Conversely, when a company grows, it should take advantage of the scalability of support function. SG&A-costs, expressed as a percentage of sales, should decrease as the company grows.


About Jozef:

Jozef Opdeweegh, also known as Jos, has served as CEO for over 17 years of global technology, distribution, and supply chain optimization companies with 5,000 to 20,000 employees, public or privately held. Opdeweegh has extensive board membership experience on 4 continents with related and unrelated companies.



Related Articles: Jozef Opdeweegh- 6 Core Organizational Values and the Importance of Corporate Culture

Jozef Opdeweegh – 9 Key Characteristics of a Successful Distribution Business






Jozef Opdeweegh – 9 Key Characteristics of a Successful Distribution Business

At its core, a successful distribution business functions to add value to the customer, by flawlessly delivering the desired product or set of products at the right point in time, without quality defects and in the most cost-effective fashion. It is imperative that a successful distribution business operates with the costumers top-of-mind.

According to Jozef Opdeweegh, a Miami businessman with over 17 years of experience as CEO, Chairman and Board Member of private and public companies, there are 9 key tenets that make up an ideal distribution business model, that will not only emanate in the highest level of customer satisfaction but will also reward associates for their contribution to the success of the company and shareholders for their confidence in the company’s strategic plan.

  1. Quality of operations 

The breadth of the product range, fill rate, on-time delivery, competitive pricing, a multi-channel approach, along with extensive and up-to-date product information, are vital in creating an excellent customer experience. In order to satisfy these demands, the logistics operations behind the distribution business need to be of exceptional quality: qualified and well-trained personnel, real-time inventory visibility throughout the cycle, continual optimization of the process flow inside the distribution centers, a relentless focus on continuous improvement/six sigma/lean manufacturing and the automation of put away and pick processes are key focal points to differentiate the business from its competitors. Furthermore, the choice of like-minded transportation and last-mile delivery partners who equally view customer service as their core mission is key to the overall customer experience.

  1. Organic Growth

The key differentiating factor as well as the proof of concept, and one of the main drivers of shareholder wealth creation, is the achievement of organic growth exceeding that of the relevant competition. Customer empathy, SKU (Stock Keeping Units) proliferation, relevant information and excellent knowledge about the product range, as well as the overall quality each aspect of the supply chain are indispensable characteristics that define a better distribution business. This type of distribution business will garner outsized customer loyalty and recurring sales.

  1. Gross Margin Management

One of the most relevant success factors for a distribution business is the laser-focused management of gross margin, both in percent of sales and in terms of currency. In some instances, the sales force has not be provided with the analytical tools to allow them for the promotion of those products that generate the highest margin potential. This is of particular importance in a landscape with certain SKUs (Stock Keeping Units) that have identical characteristics and can serve the customer requirements with the same effectiveness, which is often the case. Additionally, in their quest for revenue, the sales force may be inclined to engage in price discounting, which harms the margin potential of the sale. Finally, a number of distribution organizations lack the sophistication to keep track of ancillary services that may have been offered to the customers or are reluctant to charge for those services, which further erodes the margin.

The key is to develop the business analytics and IT infrastructure that will allow for the identification and sale of the highest margin product in order to serve customer’s needs at the right price. This also allows for the appropriate charge to the customer for the ancillary services and the delivery method he or she enjoys.

  1. Back Office Efficiency

Many distribution businesses maintain a back office that is inert, too large and costly. By virtue of their business model, large distribution businesses operate via geographically dispersed distribution centers. Lack of an integrated ERP (Enterprise Resource Planning) solution and the absence of a standardized operating platform often create a detrimentally decentralized management structure. This leads to a large discrepancy in customer experience, in product and service offerings, and in the quality of operations across geographies. Furthermore, it may lead to an erosion of the leverage the distributor otherwise would be able to exercise on its suppliers. Lastly, it creates duplication in management and support structures – efforts and costs that can easily be avoided. In a successful distribution business, the operating system and the SKU management should be centrally managed, with the execution residing in the different regions, but based on a provided prescriptive playbook.

  1. Network Optimization

A large number of distribution businesses operate from a suboptimal set of distribution centers. Often their network consists of a combination of too many facilities and less than optimally located distribution centers from a geographic perspective. This leads to duplicative inventory and inflated working capital requirements. A distribution business needs to constantly assess the size and location of its distribution facilities, so it can live up to its (next day) customer delivery promises from the fewest number of distribution centers. Case studies show huge savings can be generated in the area of network optimization, with a payback that often is less than 12 months, while at the same point in time enhancing the overall customer experience.

  1. E-commerce

Since an online sales model does not require brick and mortar, and it does not require a direct sales force and the related costs, the bottom-line profitability of e-commerce sales vastly exceeds the profitability of the same SKU through another sales channel. A successful e-commerce sales effort requires a user-friendly web experience, impactful SEO efforts, detailed product information, breadth and availability of inventory, and on-time delivery of the entire order. It is also essential to have a simple return policy and a great back office to deal with product information, defects, and returns. Online sales may be boosted through the creation of an online user community consisting of customers who have purchased the product and can provide others with first-hand product information and applicability. Most often than not, e-commerce is one of the channels through which sales can be generated, in a multi-channel strategy that also includes direct sales and catalog sales. It is most certainly the most cost-effective and agile sales channel.

  1. ERP-Solutions (Enterprise Resource Planning)

A distribution business may handle as many as 1 million distinct SKUs. In order to effectively run the distribution organization, it is imperative the company has real-time global inventory visibility to know exactly where different SKUs are stocked. This level of visibility allows for the avoidance of duplicative inventory, the calculation of appropriate inventory levels in the network through demand forecasting, and the minimization of risk of obsolescence. In many regards, the ERP solution is the engine of the distribution organization and is an invaluable part of network optimization. While implementation of a state-of-the-art ERP solution may be costly and time-consuming, with the cost amounting to as much as the equivalent of one year EBITDA (Earnings Before Interest, Taxes, Appreciation & Amortization), it is hard to imagine a world-class distributor that does not possess such a tool. 

  1. Customer and Supplier Segmentation

In any distribution business, there are a number of items that are high volume. Conversely, there typically are a number of products that are only sold very occasionally and may have a negative impact on the profitability of the organization. In a similar vein, the average distribution business will spend time, effort and money maintaining relations with suppliers who provide low-demand products. It is important to continually reassess the contribution margin of low-selling items and to cut certain parts of the long tail, both in product and in supplier range.

  1. Private Label

A distributor can significantly enhance its gross margins by focusing on the sale of private-label items, or items that have the desired functionality but that are being sourced through contract manufacturing and branded under a proprietary brand name. Certain competing suppliers may react negatively towards competing private-label products. Nevertheless, in the area of more generic SKUs, a distributor should aim at selling its own branded products and ideally, private labels will constitute 15% or more of overall revenue.

About Jozef:

Jozef Opdeweegh, also known as Jos, has served as CEO for over 17 years of global technology, distribution, and supply chain optimization companies with 5,000 to 20,000 employees, public or privately held. Opdeweegh has extensive board membership experience on 4 continents with related and unrelated companies.




Jozef Opdeweegh- 6 Core Organizational Values and the Importance of Corporate Culture

Whether you have taken the bold decision to start your own business or have been tasked with running an existing company, the asset you are managing may well have multiple areas that deserve your special attention. For example, your business may be lacking organic growth, its leadership team may need to be recruited or upgraded, and the organization may require a couple of tangible successes to reinvigorate the team.

Transforming a business from its current state to a desired future state demands not only passion, but also disciplined planning. This requires: (i) a concise, well-articulated strategic plan, (ii) a description of the benefits of the desired future state to the associates, as well as to the long-term future of the company, (iii) the reassurance that the associates, collectively and individually, are mission critical to the success of the company, and (iv) a clear glide path to the end goal, with key milestones and a rigid project management approach.

In addition, any transformational activity is largely facilitated by a shared corporate culture. According to Jozef Opdeweegh, a Miami businessman with over 17 years of experience as CEO, Chairman and Board Member of private and public companies, “Corporate culture plays a critical role in the success of a company. The value and impact of a set of shared beliefs and behaviors can hardly be overstated when convincing a group of people to meticulously undertake a challenging change initiative.”   

Opdeweegh uses a definition of corporate culture based on a commonly shared notion that a company’s culture consists of the sum of beliefs and behaviors that determine how associates and management interact with each other inside and outside the workplace, as well as with other relevant constituencies, such as customers, suppliers, the board of directors, lenders and other outside parties. Notes Opdeweegh, “Corporate culture, however, should ideally also extend to the development of a collective perspective on societal and environmental considerations, for instance, the role of the organization in the broader community, or the efforts to minimize a corporation’s carbon footprint.”


Opdeweegh adds that when suggesting a set of core values to the organization, it is important to come forward with values that are highly relevant to the corporation and its success, yet are universal in nature, and impossible to contest. Says Opdeweegh, “Nobody will object to a core value of ‘fairness.’ Nobody will raise their hand to state that they do not believe in ‘creativity’.” He notes that the process of agreeing on the most relevant core values or behaviors for an organization is an iterative and democratic process, with the ultimate end-result coming from many group sessions with a relevant diagonal slice of the company’s associates.

Opdeweegh cites 6 core behaviors that are very powerful in driving the right strategic initiatives of the organization. He encourages using one or more of these for discussion purposes as you go through the collaborative process of defining your corporate culture.

  1. Creativity: “Think outside the box and share your perspective.”
  2. Customer centricity: “The customer is central to everything we do.”
  3. Empowerment and accountability:” Push decision making down in the organization and hold people accountable.”
  4. Fairness: “Be fair and respectful in everything you do.”
  5. Openness: “Be open and open-minded, listen and allow the best idea to win.”
  6. Speed: “Make quick, analytics-based decisions.”

About Jozef:

Jozef Opdeweegh, also known as Jos, has served as CEO for over 17 years of global technology, distribution, and supply chain optimization companies with 5,000 to 20,000 employees, public or privately held. Opdeweegh has extensive board membership experience on 4 continents with related and unrelated companies.