GLOBAL MULTI-PRODUCT CHILE

Presented By-Group VI

Dambaru Dhara Nahak

Brahma Prakash Paital
Prajna Jagdev
Ranjan Sarangi
Ranjeeta Patnaik
Satya Priya Behera
Trailokya Nayak
 Background of Multi-Product

• Multi-Product Inc. was founded in early 1900s to

manufacture abrasives.
• Become producer of 1st water proof sand paper in 1920s.
• Subsequently product no of other product as established
company as innovative , multi-product , manufacturing
company .
• By 1998 they were having 50,000 product base in the world.
• Target oriented for customer problems.
• In 1996 international sales total 14.2 Billion $ and increase
5.8 % from the previous year.
• International sales contribution was 53% of total sales .
• Company was having subsidiaries 60 countries outside USA
and sales products almost 200 countries.
 Company Vision
According the Bob Thompson (MD) the global driver for company
are
[Link]
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[Link] chain a customer focus.

Vision is to be the most innovative enterprise the preferred

supplier by

• Developing technologies and products that create a new basis of

competition.
• Earning their customer loyalty by helping them grow their business
• Expanding internationally where already generate more then half of their
sales
• Improving productivity and competitiveness world wide .
 Technology And Innovation

• In Year 1996 ,nearly 30 % of sales came from product

introduced in last 4 years .
• It was a competitive advantages on 30 no’s technology
platforms (i.e. adhesive , fluro chemistry , micro replication ,
electronic display etc .)
• They have around 30 programs underway , which offers high
potential to generate several Billion $ .
 Innovation in customer service

• Sales representative from one product group having strong

relation with customer that benefit to other product groups also.
• Introduced customer focused marketing (Related sales) instead
of company’s products groups.
• Customers rely on not for innovative and high quality product
also meet the solutions to customer needs.
• 100 % customer satisfaction (1st choice of customer)
• Integrated solution – “One voice , One face , One company “
means single sales employee can provide access to all products
and solutions .
 Multi-Product in Chile

• Company began operation in Chile in January 1976 with 2 m$.

• 1st Branch in conception during 1977 ,2nd in Valparaiso during
1979 and 3rd Antofagasta during 1982.
• In 1997 company’s total sales 60 m$ with more than 8000
Products.
• Year 1998 , Survey is conducted among 117 directors and GM’s
where Multi-product ranked 6th .
• Year 1998 company had 270 staffs out of 80 as sales reps , 9
no’ of tech support , 45 no’s of mfg and rest on management
,administration , maintenance etc.
 Chile : A Brief History

• Year 1970 a Marxist Govt was elected in Chile , Govt began a

economic reform .
• Banking , textiles ,insurance industries are nationalized .
• Chile currency reserve gone badly and business group
dissatisfied .which leads boycott against international credit .
• Year 1973 inflation reached 300 % .
• 1973 military took control of country .
• Gone for market oriented reform i.e. reducing govt , privatizing
industries and lowering import duties .
• 1990 Chile gone for elected democratic country and provided
economic success which leads 7% growth rate ,single digit
inflation , high personal saving 23 % and fully pension system.
 Chilean culture shared by Few
Managers .

• They are formal and closer to Argentina

• Most serious people .
• They are very professional .
• They are very polite and indirect (i.e. email writing .)
• Chilean are workaholic (work from 8 AM to 8 PM).
• Meeting generally started delay.
• They are very much isolated .
• People don't trust each other .
• Believe them selves.
• They more care about their family
 Bob Thompson

• Prior to going to Chile Bob Thompson was Executive with

Multi-Product Canada.
• Multi-Product Canada was very much successful with well
trained sales and good technical support , this was a classic
model for long term growth.
• Year 1991-92 in Canada company was stagnating and BT
thought of empower manager with in the organization.
• BT was very thought of very much creative , positive and
thought company in deeper way .
• He was spent the career out side the head office in keeping
Canadian subsidiary model (comfort in broadly shared
authority).
• He believe in encouraging positive risk taking and
empowerment.
 Bob Thompson

• Multi product Chile had been successful and growing about 17

% per year .
• It was been growing 2-4 time the then domestic products.
• Although there was no crisis in multi-product when BT arrived
in year 1996 but profitability declined but the good sign of
improvement .
• He sized up the organization , believe in profitability
objectives .
• He also made substantial changes to achieve the potential head
office in Chile.
 Structural Changes

• He added technical support positions to support technological

products.
• He created new position for integrated solution Manager will be
responsible for implementation of integrated solutions in Chile
and will reporting to mfg product business unit manager.
• Integrated solution manager has to coordinate the sales teams .
• He also created National account leader for key accounts will
directly report to Bob Thompson
 Organization structure

MD in the regions reported to vice president of Multi-Product and

Latin America ,Africa and Canada report to executive VP International operation.
 Key Account Concept

• This is applicable for customer those who is having large

potential to purchase product from Multi-Product.
• They sell the product differently to these customers with
respect to pricing and logistic support.
• This build strategic significant long term relationship with
customer.

Criteria for Selecting Key accounts as follows.

[Link] relationship with Multi-Product.
[Link] potential .
[Link] importance as an integrated solution account.
[Link] about environment and society having same value as
Global Multi-Product Chile.
 Sales Representative and Integrated
Solution
• Earlier in Multi-Product Chile individual product groups are
functioning independent of one another.
• With implement of Integrated solution , it was recognized that
sales team has to work as a team to sell products.
• 15 % Sales rep are with IS program ,60 % are with program but not
leading and rest 25 % are with individual product group.
• Sales rep has to adapt new sales technique to server current market
• When sales rep joined Multi-Product , they were given 6 months
period and with 100% fixed pay out. After grace period 40 %
would be fixed and rest 60 % are variable payout.
• Once become senior then variable pay out percent would be
reduced .
• To accommodate integrated solution , sales manager could include
sales of other product as target with in sales rep variable
compensation . Sales rep also get additional compensation once the
reach the target.
 Q.1What changes are they made ? Why were those changed made ?What
is our evaluation of these changes ?We need to think with respects to
company strategy .

Traditional distribution to retailer distribution ……

• Big American retailers are coming to Chile .

• In Chile superstores are capturing 90 % of the markets share.
• Superstore they made expectation in the market to get the product
from suppliers rather from distributors and they also expect lower
price.
• Customer also asking direct service at lower price and having
very much accessible to price of the product in Internet world
wide .
• Retailer demanding just price discount.
• Again demanding advertising support before the put the product
in shelve to support customer.
 Q.1What changes are they made ? Why were those changed made ?What
is our evaluation of these changes ?We need to think with respects to
company strategy . Continue……

• Multi-Product has complete line of products in the market , which

try to add more value to product .
• Multi-Product paid 5 million Pesos for photograph of office
product to be include in catalogue.
• Retailer wanted timely delivery of products to reduce inventory
and better communication with supplier around ordering , billing
and logistic.
• For industrial product MP loading a big truck and sending to
customer and for consumer product they use smaller trucks and
make more stops .
• Retailed wanted to reduce multi-product sales representative from
4-5 to 1 only.
• Which lead same person has to access product from the company
and might originate multiple product division.
 Q.1What changes are they made ? Why were those changed made ?What
is our evaluation of these changes ?We need to think with respects to
company strategy . Continue……

• Company reorganized the product responsibility (i.e Marketing

Manager for consumer goods looks for consumer products but also
has to coordinate with Home and office division which is called as
cross divisional selling )
• Many cases company continue to use distributors, because nearly 80
% of their product sales went to industrial users .
• Integrated solution was rolled out in Chile ,
• Part of this exercise Multi-Product discovered around 30 customer a having
very good relationship with customer where they have opportunity to sell
other products also.
• In 2nd stage company has to take an X-ray of these company to determine
which product they were already using ,then a group of product specialist
map the customer business and find out the opportunity for other product
which reduce cost to company.
• An individual sales rep was selected as a leader for specific client and act as
single point of contact for all product from multi-products.
 Q.1What changes are they made ? Why were those changed made ?What
is our evaluation of these changes ?We need to think with respects to
company strategy . Continue……

• Earlier in Multi-Product Chile individual product groups are

functioning independent of one another.
• With implement of Integrated solution , it was recognized that
sales team has to work as a team to sell products.
• To accommodate integrated solution , sales manager could
include sales of other product as target with in sales rep
variable compensation.
• Sales rep also get additional compensation once the reach the
target.
 Q.2 What these barriers to changes that
Bob Thomson faces ?

• Late 1996 , retreat was held between the senior mangers of

Chile , Bolivia and Peru to establish mission statement but it was
not gone well.
• They were not able to touch the border objective for the regions.
• It was held for 2-3 hours but gone beyond 2 days .
• Thompson was pretty disappointed , not only with groups
inability to reach a conclusion but also the quality discussion
held.
• This become gone poorly because they don’t trust each other
(Due to autonomous in what they do) .
• Manager are less aware of group process for team work.
• Manager are also very much isolated and defensive .
• They were also some unresolved conflict , where no such
methodology exist to resolve the conflicts .
 Q.2 What these barriers to changes that
Bob Thomson faces ? Continue…

• From the conducted survey they found around there were

some opinion differed on work condition , safety , pay and
empowerment etc.
• As changes are happening too quick and too aggressive but
employee are not able to understand why it is happening.
• Some people thought that they were measure by their sales ,
no need a change as company also doing good.
• There also been conflict and resistance on major changes
been happened in company for various movements.
 Q.3 Bob Thompson’s position at the end of the
case , what would you do and how would you do ?

• There has been resistance and conflict generated because of

the changes . it may has been too aggressive and too quick .
People need to understand regarding the changes.
• Thomson thought himself that may be he had introduced
enough changes to Multi-Product Chile and it was not
necessary to go further, after all business was good and things
were going well.
 Q.3 what would you do and how would you do ?

• We definitely support the initiation made by Bob Thompson

for the long term growth of the company.
• Going by technological and innovation products.
• Recruit better people out of the best (Support multiple
product line)
• Need to be more creative (To adapt technology and
innovation)
• Work on compensation system to make sales reps happy.
• Provide workshops for team building.
• Try to resolve conflict among employee.
• Make people feel part of company in deeper way.
• Adapt integrated solution and Key account Manger concept.