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Evolve The Digital Landscape

BUSINESS INTERVIEW

Evolve The Digital Landscape We talk to ERIC MARTIN, Vice President of IT and Digitalisation, at Groupe Deschênes, about his company’s vision for an integrated ecosystem of systems, processes and services, with human interactions at its core.

roupe Deschênes is a leading Canadianowned wholesale distributor that serves the plumbing and heating, electrical, waterworks, fire protection, HVAC/R, and auto parts markets, as well as measurement and control equipment to the oil and gas markets.

Founded in 1940 and based out of Montreal, Groupe Deschênes has made a number of acquisitions over the years, and now operates coast to coast, from the east to the west of Canada, down to the west coast of the US, all the way to Texas. Starting life with just one plumbing and heating company, it now has 16 companies to its name, and over 2 billion dollars in annual revenue. Eric Martin, Vice President of IT and Digitalisation, at Groupe Deschênes, says the aim is now to evolve the company to its next level. He elaborates, “In the last 16 to 18 months, four new companies have been acquired and this has generated a whole bunch of opportunities. I was brought in to the company to lead the digital transformation. I have a background of around 20 years as an IT executive, and experience in business management, so I am wellplaced to lead this team of fantastic individuals and make the transformation possible. We have our work cut out integrating 16 companies!” 4

The industry is expanding, with more touchpoints coming in from such areas as retail and ecommerce. Eric says that although Groupe Deschênes does business with large companies, the major bulk of its work is with smaller businesses and entrepreneurs. He continues, “Although we carry hundreds of thousands of products, and that is important, we place real value in human relationships and human 6

services. For us as a company, the differentiator is much more on the human interactions side.” Groupe Deschênes’ digital transformation journey started about three years ago with a diagnostic assessment. Although the strategy at the time seemed to be working, it was not sufficient for fully competing in the digital age. Eric was tasked with the job of designing a new strategy to evolve

“Our vision is very similar to many players within the industry, to generate an ecosystem within the market to connect customers, partners, vendors, and other groups that complete the business” Eric Martin, Vice President of IT and Digitalisation

groups that complete the business. We have a lot of work to do, integrating multiple companies into a more cohesive approach to the various markets.” the digital landscape to a more integrated ecosystem of systems, processes, services, and company. Eric says, “Our vision is very similar to many players within the industry, to generate an ecosystem within the market to connect customers, partners, vendors, and other

As part of the transformation, Eric and his team are changing Groupe Deschênes’ ERP. Eric adds, “The current ERP is more than 20 years old. It has been customised to fit the needs of each of the different businesses, but it is absolutely impossible to upgrade, connect and interact, so we are replacing

our old system with an SAP solution. Our initial goal is to integrate eight companies into that system, and progressively add more to the program as it makes sense.” The second element is based on process harmonisation and data standardisation. Eric says, “We have also decided to replace our ecommerce platform and move other strategic applications to the

So, how does Eric know if the transformation will be a success? He answers, “Part of the success factors of such a transformation include the involvement of the business and key stakeholders. It is too early in the process to say whether the transformation has been effective, either strategically or financially. However, from a business engagement perspective – working on the right priorities, having the right discussions, and challenging

“The current ERP is more than 20 years old. It has been customised to fit the needs of each of the different businesses, but it is absolutely impossible to upgrade, connect and interact, so we are replacing our old system with an SAP solution” cloud as we replace or upgrade them. All of the new solutions are preferably SAAS. At the same time, we are pushing on the data reorganisation and integration of all the platforms to an EIPAAS approach. We think we have a couple of years working on the foundation before we can start reaching out to our partners, sharing information in a more effective way. But, at the moment, there is lots and lots happening simultaneously.”

the paradigms that we have been operating in – I believe it will be very successful. Going forward, we may nosedive on a couple of these elements, and face some harsh realities that we didn’t foresee. But, as I often say to my team, it’s not falling that’s the problem – but not coming back on your feet fast! I think that we have an eyes-wide-open approach and the ingredients to be successful. It has been an interesting adventure so far!”

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Given the magnitude of the challenge, Groupe Deschênes elected to partner with other companies to manage the change and ensure they were having the right discussions at the right time. Eric says, “Talent shortage is a big issue everywhere. Although I have more than doubled the staff level in my team in the last 12 months, it is not sufficient. We therefore need to team up with companies that share the same

momentum, he adds, “AI is a hot technology topic, but it is still very difficult to implement on a broad basis. We are at the beginning of an efficiency curve where AI is concerned. I would say that everything related to data science is evolving quickly. Blockchain presents opportunities in supply chain, but we have a long way to go before we can see the benefits. I also believe augmented reality is maturing – probably not to where

“We have partnered with Beyond Technologies because they are excellent in their field of SAP implementation and integration” values and have competency in the areas that are important to us. We have partnered with Beyond Technologies because they are excellent in their field of SAP implementation and integration. It was an advantage to partner with a local and bilingual company because we have a language challenge being a Francophone based firm, headquartered in a French speaking province, but with operations across the country. We needed a company that spoke both French and English to be able to support us.” In terms of the latest technology trends that Eric feels are gaining

we would like it to be – but there are significant opportunities there. There are a number of important technologies we hear a lot about including quantum computing. I think quantum computing is going to revolutionise everything related to computing, but it will take a few more years before we get there.” Groupe Deschênes is taking multiple steps to grow the business including growth by acquisition, which is progressing well. Eric elaborates, “We have more than doubled the size of the business in five years. Organic growth will come through expanding in our markets, 11

and digitalisation is going to support that significantly. The investments we are making in combining the human-tohuman relationships and the digital side are going to help grow the business. We have a lot of opportunities since we have acquired companies in different markets, allowing us to penetrate further into local geographies. With the size of our network across the country, network optimisation is an area we can really benefit from.” Eric highlights the fact that Groupe Deschênes’ customers can visit a branch for advice, information and support, adding value to the business. He continues, “We are there to provide the products that our customers need, alongside the additional insights and services that you simply do not get online. We want to combine the ease of getting the goods with these value-added services and insights. As human beings, we need the human touch. Through the pandemic, we lived in the online world and craved human contact. At the same time, we have seen the value and efficiency that digital can bring, so it is an interesting balance.”

As a final point, Eric discusses his vision for Groupe Deschênes for the rest of 2022 and beyond. He concludes, “From a company perspective, there will be lots of change management, discussions, and hard work. The teams that are working on the various projects face intense complexity. The beauty is that the leaders in each of the businesses have shown openness and a constructive approach to solving these issues. My advice would usually be to tackle one big project at a time, and not to take on too many initiatives simultaneously in order to minimise risks. However, I do not believe the market dynamic will allow us to take our time. We need all hands on deck! I have been so impressed by our people, who are giving everything they have to make it a success. And I am having a ball working in a company that is very positive and constructive, with fantastic people that make us all look good!” For further information on Groupe Deschênes, visit www.groupedeschenes.com