By Christine Imbs
Perhaps the best advice Bob Reynolds ever received was from
his father.
He was right out of college and dead set on a business career.
The question was: where to start? His father was a market manager
for Graybar and had been working for the Company for as long
as Reynolds could remember. But did he really want to go that
route himself?
“I didn’t particularly have Graybar in mind,” he says smiling.
“But my father said, ‘It’s a good company. Just go for the interview
and see what happens.’ Thirty-five years later and I’m still
here.”
Not only is he still with Graybar, but today Reynolds is leading
it. As chairman, president and CEO for the St. Louis-based FORTUNE
500 Company and its 8,400 employees, Reynolds has far exceeded
his own expectations.
“I had visions of being a branch manager and then maybe a district
manager,” he explains. “Most people, when asked how they got
where they are, will say, ‘by accident.’ Well, me too. I never
envisioned that I’d be working at the corporate headquarters,
much less in this office.”
Headquartered in Clayton, Graybar specializes in supply
chain management services, and is the leading North American
distributor of high-quality components, equipment and materials
for the electrical and telecommunications industries. It ranks
number 450 on the 2007 FORTUNE 500 ranking of America’s
largest companies, and made its sixth consecutive appearance
on the FORTUNE America’s Most Admired Companies list
in 2006.
In addition, Graybar also has a long history of being an employee-owned
company. Originally established in 1925 as part of Western Electric,
it was purchased by the employees in 1929 for $9 million. Today
the $5 billion company is one of North America’s largest employee-owned
companies, with 250 distribution centers throughout the U.S.,
Canada, Mexico, and Puerto Rico.
Reynolds began his career with Graybar working in the company’s
warehouse in Boston. Although he took part in a management-training
program offered by the company, he says it did little back then
except differentiate college graduates so they could be paid
a little more. Outside of that, he says the only promise Graybar
ever made was that you’d have a job and most likely progress
to the next stage.
“From there, it was all up to you,” he says. “I remember when
I told my father I was going to work for Graybar. He said, ‘I’m
happy for you. But understand you have to make your own way.’
My two sons work for the company now, and I tell them the same
thing.”
Although it’s not so unusual today for Graybar employees to
have several family members working at the Company, that wasn’t
the case when Reynolds started work.
Reynolds says the majority of Graybar employees are in it for
the long term. He says this is what makes the company so unique.
“There’s a real family feel to Graybar,” he explains. “You can
see this in the number of employees that remain with the company,
the number of families that get involved, and the close friendships
that develop. You just don’t see this in other companies. I
think it’s good and I think it’s healthy. But there are a lot
of people who don’t agree with me.”
He points out that colleges teach that an individual is going
to work for at least five different companies and work at several
different careers during his or her lifetime. It’s something
he believes hurts people more than helps.
“They don’t understand the practicality of business,” he says.
“They need to get out in the real world and see what really
works, because in the long term, they’ll build a nice nest egg.
This is especially true for Graybar people. But if you jump
around from job to job, you won’t.”
Reynolds explains that Graybar’s benefits package is pretty
much geared toward this principle. “It’s a tremendous package,
but you really have to be around for a while to take advantage
of it,” he says. “We offer pension, profit sharing, a 401K,
and stock. Most companies only have one of these. I don’t think
anyone else has all four.”
Although employees fund their 401Ks, their pension and profit
sharing accounts are 100-percent company funded. Graybar’s $20
stock price has not fluctuated, so employees can invest knowing
the Company most likely will buy it back at full face value.
And unlike most employee-owned companies, where only the employees
can own stock in the company, Graybar extends that privilege
to its retirees as well. Since 1929, the minimum cash dividend
paid annually on this stock has been 10 percent.
“We do this because it’s the people that make Graybar so successful,”
Reynolds says. “And we’ve had some very good people working
here. We focus on our people because they are our number-one
asset. And we know that asset can walk out the door any day
and not come back.”
Reynolds looks at his career path with Graybar modestly. “I’ve
taken some risks. And by taking those risks I got to perform
and was offered the next job,” he says with a shrug. “I guess
it’s just one of those hard work or good luck stories.”
In all likelihood it’s more of a hard work story. Reynolds joined
Graybar in 1972 and throughout the 1970s held positions as sales
representative, branch operating manager, branch manager, and
national consumer products accounts manager. His latter role
was in the corporate office, which at the time was in New York.
By 1990 he reached what he thought would be his pinnacle—a position
as district manager. But throughout the 1990s, he far surpassed
his own goal by receiving several vice president and senior
vice president positions. And by 2001 he’d not only been elected
to president and CEO, but added chairman to his title as well.
“I remember asking a man I once worked for, and who’s now retired
after 43 years with the Company, what his next job was,” Reynolds
comments. “He told me, ‘I consider every job I have to be my
last and I just enjoy it. I never try to be the author of my
own career.’ And I don’t try to be either. It just happened
this way.”
Looking back over his career, Reynolds says it’s hard to choose
what he’d consider his biggest accomplishment. “It varies by
where I was and at what point in my career,” he explains. “There
have been so many, but it’s not what I’ve done. It’s what everyone’s
done here.”
One project in particular that took everyone’s cooperation and
effort led to Graybar receiving the 2004 Spirit of St. Louis
Technology Award from the St. Louis office of Deloitte and the
St. Louis RCGA. Known as PACE (Performance, Agility, Collaboration,
Efficiency), the $100 million project was an enterprise transformation
using technology as a catalyst to streamline operations and
increase the tempo for all in-house processes.
“It wasn’t just about putting in new software. It was really
change management and getting everybody in alignment. We aligned
the corporate strategy, the officers and the districts all the
way down the field, so that when you go out and do a district
review, it’s consistent throughout the 13 districts. You’re
seeing the same initiative being worked on and the same performance
measurements being looked at. It’s this alignment that’s helped
catapult the Company.”
Graybar is reporting $5.01 billion in net sales in 2006, an
increase of 16.8 percent over 2005. It also shows a net income
of more than $57.39 million, up 242.3 percent compared to the
prior year.
Much of this, Reynolds says, can be directly attributed to the
Company’s ability to harness business information through its
new system. But getting here wasn’t easy. And Reynolds admits
he wasn’t exactly the most popular person during the process.
To help ease the pain associated with the new changes, he visited
every district two months after the system went live just to
let them know he understood what they were going through.
“It was a painful process. There wasn’t anyone in the Company
that wasn’t touched by it,” he says. “I told them, ‘I know you
hate us. And I know we’re kind of like the people who came to
shore and then burned the boat. There’s no turning back.’ But
today they love the system.”
Currently, Graybar is working on the next step—an external system
to provide better customer service online. Unlike the internal
system, which took five years to complete, this is expected
to be in place by the first quarter of 2008.
“We have state-of-the-art internally, and now we want to have
state-of-the-art externally. And it has nothing to do with change
management,” he says smiling. “Thank goodness that’s over.”
As you can imagine, Reynolds’ job is demanding. Still he manages
to give back to the community through such organizations as
the Boy Scouts of Greater Saint Louis, the United Way of Greater
Saint Louis, the Saint Louis Club, Civic Progress of Saint Louis
and the St. Louis RCGA. He also has chaired the Private Sector
Infrastructure Council for the past five years. The Council
is made up of members of Civic Progress, RCGA, and the Regional
Business Council. Their most current focus, and the one most
people are talking about, is the new I-64/US40.
“Basically, we’re helping MODOT come up with the right plans
and driving it to make sure it gets accomplished,” he says.
“And like the new internal system we put in place at Graybar,
this is something that’s going to touch everybody. And it’s
going to be painful. But in the end, I think everybody will
be pleased.”
Reynolds also serves the industry nationally. Last year, he
chaired the National Association of Wholesaler-Distributors
(NAW). NAW is the Washington, D.C.-based association that represents
the wholesale distribution industry. It’s active in government
relations and political action; and research and education.
“I thoroughly enjoyed my time on that,” he says. “It was a seven-year
commitment working through the chairs. Basically what you’re
trying to do is move big government on initiatives that we think
are important to business and in particular, the wholesale distribution
business. It’s been a very exciting and rewarding opportunity.”
Even with what seems like an impossible schedule, Reynolds says
he can’t imagine doing anything he’d enjoy as much as what he’s
been doing.
“I don’t look at anybody’s career out there and say I wish that
were mine,” he says. “Of course, you look at different things
and say that would be fun. But what if I were a professional
golfer? What a miserable life that is. Every week you’re going
to a different city, living in a different hotel. So all jobs
have pluses and minuses to them. I play golf just to remind
myself how much I enjoy my job.”
As for what he does for relaxation, Reynolds says in a position
like his, relaxation is really a myth.
“I’m not sure you find time to slow down. I do like to play
golf, but I don’t get to play as much as I did with other jobs.
I’ve had people say, ‘Boy I wish I had your job. I could play
a lot of golf.’ Well, that was the other job,” he says.
But he does take time to relax and that’s thanks, in part, to
his wife, Cathy.
“She’s a partner in the true sense of the word. I couldn’t do
this job without her,” he says. “She’s the one who says slow
down or speed up. I guess you could say she’s kind of like my
CEO. Now, that’s a tough job.”
This year marks the 25th year since Graybar moved its national
headquarters from New York to St. Louis.
“It’s a milestone,” Reynolds says. “And we’re very happy to
be here. We chose St. Louis because we wanted to improve the
quality of life for our employees. It’s my adopted home. When
I retire, we’ll stay here. But I don’t plan on retiring any
time soon. I enjoy what I’m doing too much.”
