Kramer Case
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Transcript of Kramer Case
KRAMER PHARMACEUTICALS, INC.
Group 6:
Ankit Goyal 073005
Anshul Prakash073007
Bhavik Vyas 073011
Ankit Nagrath221027
Ankit Sharma 221028
ApoorvaGupta221033
QUESTION 1
Please analyze Marsh's background, needs and aspirations to assess the probable reasons for the situation which arose.
Marsh’s background
Good academic record
Completed graduation from a top-flight pharmacy school in 1960.
Successful drugstore experience.
Experienced U.S. Naval pilot with a fine officer service record.
Grown up in a Toledo suburb
Personal Life: Married with two kids
Born: 1934
Needs & Aspirations• Career growth, in terms of promotion and salary.
• First territorial preference was Toledo.
• Travelled many European countries, so he was looking for international assignments as well.
• Stability of having a senior manager for longer duration instead of the frequent transfers.
• Pharmacy retail industry was unexciting and non-challenging for him, decided to become sales representative in Kramer.
• Joined Kramer at a lower salary which shows his passion for learning. He believed that his earnings potential with Kramer would be considerably greater in the long run.
• Positive feedback from managers.
• Building customer affiliations instead of selling new products regularly to them.
Probable reasons for the situation that arose:
• Lack of managerial stability,
• He could never meet the CPI standards at appraisal time at any time of his 12 years career at Kramer,
• Promotion of younger managers compared to Marsh,
• No Career growth, only salary hikes,
• Lack of territorial transfers, and
• Appraisals stressed more on negatives than his positives.
• Lost enthusiasm and excitement for the job after continuously being critically evaluated.
Question 2
• Please review Marsh's career at Kramer in terms of evaluation, compensation and attitude
JOHN MEREDITH BILL COUCH JIM RATHBUN
Evaluation
Improved from BELOW STANDARD to COMPLETELY SATISFIED+Hard worker & anxious to do well+Well received by physicians+Appreciates instructions-Should overcome tendency to prejudge -More responsive to management directives & attention to planning
Gratifying improvement from SATISFACTORY with an exception of planning and record keeping to WELL ABOVE AVERAGE+Outstanding reception in offices+Improvement in sales+Good Acceptance+Excellent attitude and company loyalty
-Dissatisfaction with establishment of new products and penetration with dentists +Identified excellent rapport with everyone.+Pointed out more opportunities for increased sales.-Specific suggestions on organized record and filing system-Poor attitude, careless organization and inattention to planning and follow upSATISFACTORY performance
CompensationStarted at $14000 on June 1966 to$20,000 on January 1971
Increased to $24000 in 1974From no salary increase in 1974 to $25000 in 1975
Attitude
Quick Grasping powerLoyal and DedicatedAbility to influence physiciansLack of attention to organizationPrejudged customer & company’s promotional logics
Added responsibility of overseeing a distributor but found it time consuming
Failure to communicate and hence misunderstood90 days probation lead to newly organized detail bag and automobileMaking efforts for improvements
VINCE REED TOM WILKENS TOM FRANKLIN
Evaluation
Generally SATISFACTORY to COMPLETELY UNSATISFACTORY+Improvements in planning, organization and commendable attainment of sales goals-Unsatisfactory sales-Slow acceptance of new products-Probation and instructed to submit written outline
After 2 days of interaction, no changes in records whereas confirmed previous recordsEnded probation
-Improve sincerity ,company loyalty, job interest, enthusiasm, cooperation, deference to supervision and work habits-Weekly review and required to complete questionnaires
CompensationRecommended Salary Increase of $1000 in 1977 to but not received
No salary increase in 1978 Separated from the company
Attitude
Laidback attitudeSamples and Promotional Literature still disordered
Agreed to step by step program, hence cooperativeBad start with late phone calls and written reportsMoody, unfriendly and lethargicProfessed fondness for the company and jobDesire to be better
Sales Organisation
Vice President
Zonal Manager 1
District Manager 1
Detailer 1 Detailer 2
District Manager
Detailer 6 Detailer 7
Zonal Manager 6
District Manager
34
Detailer 499
District Manager
35
Detailer 500
Cost of Sales• Year: 1978
• Salary ranged from $20,000 to $36,000 assuming average as $28,000
• Extra : • Corporate bonus : $4,200
• Fringe benefits ( 6%) : $ 1,960
• Cost for one detailer : $34,160
• Total detailers : 500
• Cost of sales : $ 17,080,000
Question 4
Please review other elements of sales management at Kramer in terms of recruitment, training, field supervision, compensation and termination policies.
Recruitment• Job description : Each detailer is responsible for 200
Physicians and Hospitals accounts in his territory. And expected to make 6-9 doctor/hospital calls per day.
• Education : Pharmacy school graduates with few years experience a registered pharmacists were preferred.
• Turnover: It was only bout 8% well below the industry average and hence a lesser number was required to be recruited.
• Candidates are evaluated on various factors like sincerity , aggressiveness , attitude, learning ability , judgment, enthusiasm, character , appearance and personal references
Training & field supervisionProduct Knowledge , Sales Techniques &
Competition
• 1 month Training in product Characteristics and selling skills at Headquarters
Customer Knowledge , Time and Territory Management
• Regular training at Headquarters
field supervision :
• 10-15 days on field training by district manager
• Relationship with customers , following rules laid down by company and so on were assessed and feedback will be given for better improvement
Compensation policies
• Salary and Annual bonus were based on corporate performance(15% of Total earning)
• Automobile, Generous fringe benefits and reimbursement for all normal business expenses were provided
• Total earnings ranged from $20,000 to $36,000 of which about 15% was corporate bonus.
Termination Policies
• Candidate would be given ample opportunities and facts were are well documented
• Candidate case will be observed closely by district manger, zone manger and corporate Headquarter
• Decision will be taken by higher authority and district manger will take care the proceedings.
Question 5
• Please decide whether it was management failure or Marsh's fault.
Appraisal criteria was only on the observation of supervisor whereas client’s feedback was not considered.
Company was overlooking his strengths and overcritical about his weakness.
Bob was good with customers and his sales turnover was impressive so there was no point to dismiss him.
Frequent changes in the supervisors over the 12 year period led to decreased efficiency of Bob since all had different expectations.
Loaded him with extra burden of assignments and questionnaire which did more harm than good.
According to us, it was a management failure.
Management’s Failure
Did not consider relocation of Bob to a new territory to break the monotony.
Annual increment tool was used as a tool of punishment but not as a effective tool as motivator.
Competitors might take advantage by recruiting Bob and use his close contact and credentials.
Company believes in rules are rules and that’s the way it’s going to be.
Management’s Failure
QUESTION 6
• What action will you take within the framework of the basic question - Who owns the customer - company or sales representative?
Who owns the customer - Company or Sales Representative?
Sales representative owns the customer as
• Sales rep visits customer regularly and communicate with the customer on the regular basis.
• It is the sales rep who develops and extends relations with the customers.
• He knows the customer personally and professionally.
• For customers he is the face of the company.
• His skills and abilities play a very important role in making the customers place their trust in the company.
Recommendation
• Considering Bob Marsh’s previous performance and his personal selling skills, Kramer's Pharmaceuticals should reconsider their decision of removing Bob Marsh.
• Give training to improve his record keeping and documentation skills and his level of understanding of promoting new products.
• Rather than dismissing Bob, he could become a role model or a mentor for other sales reps at entry level considering the amount of experience Bob has in sales field.
• He could give training on simple selling skills to entry level sales reps.
Thank You