KOMAL FOOD PRODUCTS COMPANY LTD.

PRESENTED BY: Group C-12Subhash M (12171)Varun Kumar (12175)Vinay Prakash (12178)Yugandhara Ramesh M.

(12180)Sarthak Rohatgi (12182)

SALES AND DISTRIBUTION MANAGEMENT

CASE FACTS• Komal Food Products Company was founded in 1935.

• Manufactures grocery and other food products

• Vast enterprise having offices and branches in almost all the important cities of India

• Annual sales – Rs. 50 to 60 lakhs a year

• Head office and Factory located in Calcutta

• 5 Zonal sales offices

• 25 District sales offices

EXISTING ORGANIZATION STRUCTURE Head office

North Zone East Zone West Zone Central Zone South Zone

Each District Sales Office has one District Sales Manager

5 District Sales Offices

5 District Sales Offices

5 District Sales Offices

5 District Sales Offices

5 District Sales Offices

ORGANISATIONAL HIERARCHYZONAL MANAGER

PERSONAL MANAGER

ACCOUNTS MANAGER

SALES MANAGER

OFFICE MANAGER

On matters related to sales the zonal manager receives advice from the Sales Manager

DISTRICT SALES MANAGER

3 PRODUCT MANAGERS

5 SALES SUPERVISORS

Salesmen

• Experts in their respective fields

• Travel with the Sales Supervisors of various Districts

• Advice the District Sales Manager and the Sales Supervisors regarding steps to be taken for promoting sales in the districts

• Tasks of Product Managers• Study the market for company’s product • Study the competitive position of company’s product • Study the dealer and consumer reaction • Sales trends • Monthly reporting on the sales activities of the company to the Sales Manager

PRODUCT MANAGER – DUTIES AND FUNCTIONS

• Select, train and supervise his sales supervisors

• Make a study of the nature of consumer demand, changing market condition, existing stock and formulate sales campaign, promotional methods

• Fix the sales target

• Formulate the credit policies to be followed

• Develop better team work among the sales supervisors and salesmen

• Customer satisfaction

• Undertake other functions and duties which are assigned to him by the zonal manager

DISTRICT SALES MANAGER - DUTIES AND FUNCTIONS

• Conflict between District Sales Manager and Product Manager

• Perceived loss of control over the sales supervisors because of too much interference from the Product Managers

• Structural issues

• District Manager (Mr. Shankar) communicating with the Zonal Sales Manager (Mr. Rajan)

• Very wide span of control to Zonal Manager

• Lack of proper root cause analysis by the Zonal Sales Manager

• Decline in the sales in that particular district

ISSUES IN THE CASE

QUESTION 1

• Identify the reasons for the conflict which has arisen between the product managers and the field sales staff? Give suggestions how they can be overcome.

REASONS FOR CONFLICTConflict:

A process that begins when one party perceives that another party has negatively affected something that the first party cares about.

• Task Conflict

Conflicts over content and goals of the work. There was friction because of the task of advising the DSM and the Sales Supervisors carried out by Product Managers

• Relationship Conflict

Conflict based on interpersonal relationships leading to disagreements and incompatibility. This could have existed between the PMs and the DSM.

• Process Conflict

Conflict over how work gets done. Maybe the PMs were interfering with the work of Sales supervisors.

• Role Conflict

Conflict over the roles and responsibility taken over by Product manager and Sales Manager

POSSIBLE ROOT CAUSE OF THE CONFLICT

• Dilution of authority• Lack Interpersonal Skills• Easy access to top

management

• Resistance to new plans and ideas

• Lack of support from top Management

• Problem of reporting to too many bosses

• Supply of inadequate information

PRODUCT MANAGERS SALES SUPERVISORS

THE CONFLICT PROCESS

CONFLICT MANAGEMENT TECHNIQUES• The various techniques of conflict management that should have been used by the Sales Manager are:

Conflict Resolution Technique Methodology

Problem Solving via open discussion

Fact to Face meeting of the Product Managers and the District Sales Manager

Subordinate Goals The Sales Manager could have formulated goals that could not have achieved without cooperation from PMs and the DSM

Smoothing Playing down differences while emphasizing common interests between the conflicting parties

Authoritative Command The Sales Manager could have used his formal authority to resolve the conflict and then communicate its desires to both the PMs and the DSM

Altering the Human Variable Using behavioural change techniques such as human relations training to alter attitudes and behaviours that caused the conflict

Altering the Structural Variables Changing the formal organisational structure and interaction pattern. The report on the market trends could have been sent by PMs to the Zonal Sales Manager who then passes it to all the DSMs in his zone.

THIRD PARTY ARBITRATION• The Sales Manager could have used Third Party Arbitration in order to resolve the conflict between the

PMs and the DSM. The arbitrator needs to carefully selected (someone who is respected by both the parties and whose judgements are considered just by both the parties)

• The object of arbitration is to obtain a fair resolution of disputes by an impartial third party without unnecessary expense or delay.

The following are the advantages of Third party arbitration:

• Choice of Decision Maker – Conflicting parties choose a person as arbitrator mutually agreeing on the abilities of the person.

• Privacy – Arbitration hearings are confidential, private meetings. Final decisions are not published, nor are they directly accessible. This is particularly useful to the employer who does not want his ‘dirty laundry’ being aired.

• Convenience – Hearings are arranged at times and places to suit the parties, arbitrators and witnesses.

• Flexibility – The procedures can be segmented, streamlined or simplified, according to the circumstances.

• Cost Effective

OTHER RECOMMENDATIONS

• Mr. Rajan should first know the root cause before giving instructions

• Product manager should think from the company’s prospective

• Weekly Reporting by Sales Supervisor to District Sales Manager

• Fortnightly reporting by District Manager to Zonal Manager

• Monthly meeting of DSM, SM and Zonal Manager.

• Monthly evaluation rather than quarterly evaluation

• Line authority :

• Zonal manager to Sales Manager and district sales manager

• District Sales Manager to Supervisor and sales people

• Staff authority:

• Product manager to line managers relationship should be like that of Sales Manager and District Sales Manager

• Functional authority:

• Advisory relation directed towards the goals of the organisation

• Better Span of Control

• No person should have more than one boss

• “If a person receives instructions from multiple sources, it may lead to chaos”

OTHER RECOMMENDATIONS -BETTER DEFINING OF ORGANISATIONAL AUTHORITY

QUESTION 2• Draw out the organisational Structure of the company and examine

whether any changes are needed in reporting relationships of the sales personnel with a view to ensure better cooperation between line and staff.

CURRENT STRUCTURE (LINE & STAFF)

Zonal Manager

District Sales

Manager

Salesmen

Sales Supervisor

Personal Manager

Accounts Manager

Sales Manager

Product Managers

Office Manager

Line Function

Staff Function

Span of control The number of people directly reporting to the sales manager

Unity of command Each person should report to one boss only

Hierarchy of authority

A clear and unbroken chain of command should link every person in the organization with someone at higher level

Stability and continuity

Jobs should not be assigned without due regard for the talents and preference of current employees

Coordination and integration

The jobs of sales people should be integrate with customer needs, and coordinated with the jobs of other employee and department in the organization

Homogeneity Formal authority and responsibility must be co- terminus and co-equal

Objectivity Each division and sub division of the organization should be in harmony with the objective of the organization

Specialization The work of every individual in the organization should be confined as far as possible to the performance of a single leading function

FUNDAMENTALS OF ORGANIZATION PRINCIPLES

PROPOSED ORGANISATION STRUCTURE - 1

Zonal Manager

District Sales

Manager

Salesmen

Sales Supervisor

Sales Manager

Product Managers

Personal Manager

Accounts Manager

Office Manager

PROPOSED ORGANISATIONAL STRUCTURE 2

Zonal Manager

District Sales

Manager

Sales Supervisor

Salesmen

Sales Manager

Product Manager

Personal Manager

Accounts Manager

Office Manager

PROPOSED ORGANISATIONAL STRUCTURE 3 - DECENTRALIZATION OF POWER

Zonal Manager

Sales manager

Product manager

District Sales

Manager

Salesmen

Sales Supervisor

Personal Manager

Accounts Manager

Office Manager

SELLING SITUATION AND ORGANISATIONAL STRUCTURE

Organisational Structure

Environmental Characteristics

Task Performance Performance Objective

Specialization High Environmental Uncertainty

Non Routine Adaptiveness

Centralization Low Environmental Uncertainty

Repetitive Effectiveness

Komal Foods should go for Centralized Organisational Structure

Sim

ple

P

rod

uct

Off

eri

ng

Sim

ple

P

rod

uct

Off

eri

ng

Com

ple

x

Ran

ge o

f P

rod

ucts

Com

ple

x

Ran

ge o

f P

rod

ucts

Customer Needs DifferentCustomer Needs Different

Customer Needs SimilarCustomer Needs Similar

Market-Driven

Specialization

Product/Market-Driven

Specialization

Geography-Driven

Specialization

Product-Driven

Specialization

CUSTOMER AND PRODUCT DETERMINANTSOF SALES FORCE SPECIALIZATION

COMPARISON OF SALES ORGANIZATION STRUCTURESOrganizatio

nalStructure

Advantages Disadvantages

Geographic • Low Cost• No geographic duplication• No customer duplication• Fewer management levels

• Limited specialization• Lack of management control over product or customer emphasis

Product • Salespeople become experts in product attr. & applications• Management control over selling effort

•High cost• Geographic duplication• Customer duplication

Market • Salespeople develop better understanding of unique customer needs• Management control over selling allocated to different markets

• High cost• Geographic duplication

Functional • Efficiency in performing selling activities

• Geographic duplication• Customer duplication• Need for coordination

GEOGRAPHIC DIVISION OF LINE AUTHORITY

HO

ZM ZM ZM ZM ZM

DSM DSM DSM DSM DSM

PROPOSED CHANGE IN RESPONSIBILITIES OF PRODUCT MANAGERS

• Identify profitable opportunities in the market

• Managing the entire product life cycle and Customer Relationship Management

• Look into strategic and tactical planning related to their specific product line

• Specifying market requirements for current and future products by conducting market research supported by on-going visits to customers and non-customers.

• Develop market based product strategies and communicate the same to the entire zone.

• Developing and implementing a Zone-wide go-to-market plan and work with all departments to ensure smooth execution.

• Create the following documents on a monthly basis and pass it on to the Zonal sales manager

• Business Requirement Document (BRD) – identifies business problems and solutions

• Market Requirement Document (MRD) – functional and non-functional requirements

• Product Requirement Document (PRD) – feature details, specifications

Thank You