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A Problem Shared Is a Company Aligned

Geplaatst op dec 5, 2013 in News

It’s seldom easy to achieve alignment around challenges in any business.  Even agreeing what the challenges are can be far from straightforward. Companies are complicated places; the different stakeholders all have different agendas and are motivated by different norms and incentives.  Sometimes a strong leader can through force of will create alignment among these warring factions, but in my experience a more consultative approach that respects the legitimacy of everyone’s position achieves better results.

A number of years ago, my family company won the Greek franchise of a leading US confectionary manufacturer.  The American company was very dynamic and provided us with a steady stream of new confectionary products to distribute.  It all looked very promising at first.  But we quickly became aware that our salespeople were reluctant to sell the company’s products.  The steady stream of new products, they complained, was too much for their retail clients to absorb.

The problem, I realized, was that the US company’s strategy of constant new product development was not aligned with what motivated our salespeople.  We needed, therefore, to bridge the gap between the interests of our US supplier and the interests of our salespeople and their retail clients.  I doubted that there was a feasible way to force such an alignment and even if there had been I would probably not have taken it.  Instead, I decided to work on getting our salespeople to understand what the US company needed and to bring them in the discussion on how to help the Americans achieve their goals, and thus be able to keep their distributorship.

I started by educating them about our supplier.  Getting the sales team together in one room, I played a video describing the company, its basic principles and policies, its competitive advantages, its sales volume, how it had already successfully penetrated a number of non-US markets, and its vision for the future.  A key takeaway from the video was that the company’s products were not only good to eat, but that from composition to packing materials they were also the most environmentally sensitive sweets in the market.  The video managed to make our salesmen feel proud that they belonged to an “international family” selling the best-tasting and most environmentally friendly confectionary products in the world.

After the video I explained the tangible and intangible gains our company would derive were we to be able to keep this franchise as well as our loss of prestige in the market were we to lose it to one of our competitors.  In view of this, I said, and given that we recognized the difficulty of placing so many new products with our clients, my firm was prepared to double their commissions on the American company’s new products, and to finance a visit to its headquarters in the US of our most successful salesman.

I then opened the floor for discussion, asking people one by one to speak up and freely express their views so that we could together work out a plan to address the challenge of meeting the requirement of our supplier while keeping our retail clients satisfied. Many expressed their concern that if they insisted beyond a certain limit we might well lose important clients altogether.  So I focused the discussion on how best to establish this “limit”.

It quickly became clear that we also needed to offer our retail clients special incentives to compensate for the risks of taking on the new products.  In the meeting we reached an agreement on what the incentives could be and specified the ways in which we would track, monitor, and learn from our sales progress with the new products.

Of course, it took more than a single meeting to achieve genuine alignment.  We followed up with weekly review meetings to discuss progress, analyze problems, and hammer out solutions.  With time, perseverance, and mutual respect between managers and sales staff, sales of the new product started to grow, slowly at first but before long at rates that made everyone very happy.

Looking back on the experience, I believe that what made the difference was the fact that we made a transparent effort to bring all the parties into the discussion. This wasn’t about forcing changes in behavior through bonuses and coercion, but rather about taking our people’s comments and suggestions seriously and frankly sharing our problem.  In this context, we created a positive atmosphere in which to conduct an open and fruitful exchange of views and experiences, reach feasible decisions, and win commitment from our sales force to implement them.

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