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Video Case Study – Sales versus Corporate – Reflection – Bryce A. Smart

by on October 17, 2007

As we watched the video case study about the new CEO who had to settle a turf war between a construction supplier’s sales force and their corporate support staff, my mind was immediately drawn to the case in The Heart of Change entitled “The Blues versus the Greens”, wherein a new executive board had to settle partisan issues dividing their leadership. Given those similar situations, I was surprised at how such dramatically different approaches resolved these two sets of issues. In Blues versus Greens , the polite-speak was the key problem, whereas the construction supplier faced significant issues from a lack of politeness. Personally, I’d have thought that because the end goal of honest, open, professional communication was the same, that similar solutions would abet both groups. While similar solutions might work, I’m beginning to realize how important it is for behavior-changing solutions to be carefully crafted to the specific scenario.

Blues versus Greens
As I’ve thought about the Blues versus Greens case study, I realized that while the strategy taken by the discussion moderator worked in the end, other approaches may also have worked. In the case study, the moderator eventually became so frustrated by the executives’ lack of honest communication that strongly reprimanded both sets of executives, dismissed them for the day, and got them practically fighting the next day. That technique was extremely risky for all sets of stakeholders. The moderator could have lost his appointment, the moderator’s company may have lost reputation and contracts, the executives could have become even more divided, hurting their burgeoning corporation, shareholders in the newly-merged company could have suffered, potentially costing the company its vitality. What could a consultant, or new CEO, have done in that situation to end a turf war?

My recommendation is to host semi-formal debates over corporate issues—with a twist. For instance, if a director position is being discussed, the two executives who would be most likely to clash over that appointment would be asked to formally debate the appointment. Rather than campaign for their candidate, however, they would have to argue the case of a candidate from the other company. In this way, they would be forced to understand and internalize in the deepest way the value of their “internal competition”. This forced crossing of the line between Blues and Greens, coupled with individual discussions between the CEO and other executives where private feelings and motivations can better be expressed, would help to mix the segmented group into a solid team without incurring the radical amounts of risk associated with encouraging an all-out brawl.

Race Cars
The risk of a brawl is clearly displayed in the construction supply company, where the sales force was a war with the rest of the corporate infrastructure. They flaunted the knowledge of their higher pay and treated the support staff as though they were beneath their contempt. The support staff, in turn, regarded themselves as the brick and mortar foundation of the organization and considered the sales team to be arrogant, churlish prima donnas. The ill-will between the two teams threatened the continued existence of the company. The new CEO was appointed not only amid this trench war, but specifically to diffuse it. He began with the sales force, flattering them by comparing them to a powerful, sleek race car. Then, he pointed out how even the fastest, best built cars require a skilled pit crew in order to win the race, let alone make one more lap around the track. The analogy seemed to sink in. He then turned his attention to the support staff, telling them how they existed to keep the race cars on the track. He reassured them of just how important they were to the continued functioning of the sales force and gave them permission to hang up on a rude salesman. Month-by-month, he asked them to give him just a little more time to improve things even more. After a while, his short-term wins paid off with a new, unified organization.

I was a bit surprised that a solution this simple worked. However, I’m also impressed by the other suggestions from class, particularly Blaine’s suggestion that the sales team and support staff job shadow each other for a few days. This, coupled with the race car analogy could have an even more profound effect.

Building on the Race Track
As I tried to voice, but was not able to articulate with the clarity and depth I had hoped for, was another solution to support the race car concept—restructuring the sales teams. It is to this idea that I would like to devote much of the rest of this reflection.

Rather than leave the two groups in their existing state, with a line drawn in the sand between them, I would destroy that line utterly by reorganizing the organization into “customer teams”. These teams would be headed by a senior salesperson, who would have a pit crew assigned specifically to his car. The pit crew would include all the other customer-facing elements in the organization—customer care, accounts receivable/payable, logistics/delivery, etc. This personalized customer service, where the care representative, as well as the salesperson, knows the names of their clients, works wonderfully in other major companies. Hanjin Shipping, one of the largest freight carriers in the world, uses this method. Each sales office is directly supported by a team of logistics specialists, accounts receivable/payable specialists, import/export booking specialists, and legal/customs experts. All for a single sales force. When a customer calls in, the booking team knows them by name, can recognize their voice and has developed a personal relationship with the point-of-contact on the client’s side. This has worked so well for Hanjin that the company is able to charge shipping rates far more expensive than their larger competitors and still grow business. Applying the personalized service to the construction supply company would go a long ways toward building client relationships that departing sales personnel could not take with them.

This “racing team” structure is frequently used by major advertising agencies like Ogilvy & Mather and McCann Erickson. In these agencies, teams headed by a relationship/account manager handle specific clients brought in by that RM. These larger agencies that use the race-team structure have been successful, although it does add pressure to the teams to retain and expand their client base. These agencies have carried this concept to an extreme beyond what I would recommend for the construction supplier. When a team in an advertising agency loses a client, even to another team in the same company, they could potentially be disbanded completely, either reassigning everyone on the team to another force or firing them outright. That intense, cutthroat mentality would prove as destructive to this smaller company. Therefore, dire consequences would be replaced with incentives for those who finish that lap of the race in the best position.

Even with this new setup, the potential for a salesperson to consider him or her-self superior to their team still exists. To counteract this, the team’s support staff would still have the freedom to hang up on anyone who is treating them cruelly, and also to immediately transfer to another team where the support staff is treated better. In this way, an arrogant, unkind salesperson would lose power and effectiveness as they acted negatively. They would fall behind their fellow racers without their pit crew and would be humbled into a behavioral change. Those salespeople who treat the support staff well would, in turn, be rewarded for their positive actions by moving to the front of the race and contending for team-wide prizes (for instance a team getaway for an extended weekend—significant others included). The incentive pay would also be extended to support staff. This would incentivize the entire team to gain more clients and better service their existing ones. The additional business would pay for the incentives and more.

In all, I believe this restructuring, coupled with taking advantage of the racecar mentality, would create a more agile, empowering environment that allows the organization to better-service customers while actively adapting to an evolving market as individual teams see new opportunities to improve their own strategies, serving as a pilot for the rest of the company. The value of the CEO’s “race car” campaign is too compelling for me to ignore, and I believe it should be incorporated into any changes that occur within the organization. I guess that’s why he’s CEO and I’m not…

Resources
· Kevin C. Desouza. 2007. Class discussion. University of Washington, Information School. October 15, 2007. Seattle, Washington.
· Kotter, John P. and Cohen, Dan S. 2002. The Heart of Change: Real-Life Stories of How People Change Their Organizations. Harvard Business School Press. Boston, Massachusetts.
· Michelle Smart worked at Hanjin Shipping for three years as an export booking specialist. She saw the effect and was told on numerous occasions how the personal interactions at all levels of the organization was the main reason people shipped with Hanjin, even though their rates were far higher than most carriers.
· Kelly, Kevin. 2004. Class discussion. Brigham Young University, College of Fine Arts and Communications. November 18, 2004. Before teaching at BYU, Kevin Kelly had been creative director at Ogilvy & Mather for 18 years, he was intimately familiar with the “pod” structure.

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