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« The Evolution of Beer Wholesaling... continued | Main | The Illusion of Friday Sales for Monday Delivery Problems »

Random thoughts on management, the majesty of the common worker, and some nuts-and-bolts operating suggestions

I have just finished a major, top-to-bottom re-organization and as usual I am awed by the majesty of the common person.  For those of you who just can’t seem to find quality, dedicated employees, I recommend you first look in the mirror.  I will be the first to admit there are PLENTY of poor employees available, but my attitude is let the other guy have them, I want the best.  But in many, many situations, you already have these employees right now, filling almost every position in your company.

In my 20+ years of doing top-to-bottom re-organizations for beverage distributors, in every single case, I have found my client’s organizations to be filled with hard working, dedicated, loyal employees.  Sadly, in far too many situations the ownership and/or senior management simply did not have the skill (or is it desire?) to harness the power right there in front of them.  People long to be part of a team.  People will willingly give themselves and their hearts to a clear vision in which their contributions are noted and are important.  They WANT to do this.  Harness this and take your company to the next level.  Don’t let petty management actions destroy this emotional commitment.  This doesn’t mean you have to become some weak manager who looks for the easy way. Far from it.  Most successful leaders are VERY demanding.

In my 30+ years of starting, running, and consulting to businesses I have seen many times over that businesses don’t run on cash flow - although it is important.  They don’t run on technology.  At their most basic they don’t run on any of their tangible assets.  Instead companies run on personal energy… the spark, the intangible potential that each and every employee brings to the table.  That’s why I like smaller businesses.  In a small business you can actually see the results of your efforts.  You bust your butt and you can actually see honest to goodness results.  Motivating an individual in a large 10,000+ employee company is much more difficult because from the individual employee’s perspective, bust your ass or coast and do as little as possible… the visible corporate impact of your efforts is too often pretty much the same… zero.  Unless this drive is already in you – or racing up the corporate ladder is your ultimate goal – in large companies, driving employees to give their all is a difficult task.  Smaller organizations need to recognize this and use it to their advantage.

Because people have to willing give this energy.  You cannot force it out of them.  A paycheck does not command it.  Pleading or threatening doesn’t get you any closer to the goal.  An analogy is a kiss – see, I told you I was letting my warm and fuzzy side out for a walk ;-)  You could force your lips upon someone else’s and call this a kiss, but it is not.  A true kiss can only be given, not taken.  Anyone who has experienced a true kiss knows this to be true.  In business you have to create this willing environment through every action you take… leading to a situation where employees freely give their personal energy… their commitment… their passion.  And the great thing is this has a multiplier effect.  Passion over here leads to more passion over there.  It creates a virtuous circle where good things lead to more good things which leads to even more good things, etc. etc.

In discussing armies, Napoleon warned that the morale is to the physical as three is to one.  Think about that.  Three is to one!  The same is true with your business. 

Never forget that ultimately people have to willingly do their job.  You cannot watch over them every second.  Look in the mirror.  Look at your senior management team (in fact look at all of your managers and supervisors).  Would you follow yourself?  Would you follow your managers?  Great managers are great leaders.  You might be surprised at how many leaders you have in your organization.  One at the top generally won’t do it… ideally you want to have them everywhere. Be that leader.  This recent re-org has a unique character who is the owner.  Rather surprisingly (at least to me), he is a very strong leader who has a strong bond to his employees.  It shows in their market share.  Ensure your managers are leaders.  And free the leaders that exist throughout your company.  I can guarantee you will be amazed at the results. 

·                    Sales and Delivery management – one team or two?  Many wholesalers have over the years gone to sales/delivery “teams” where the team leaders and supervisors attempt to manage sales, delivery, and merchandising for their account base.  Often this structure was chosen due to problems with communications between sales and delivery… often going all the way back to the days of conversion from driver-sell to pre-sell.  The thought being that combining this under one team would solve these communication problems and increase execution for both.  The opposite structure separates the sales and delivery functions, with different management teams for both.  Although both structures can and do work, I generally lean towards separating the management of sales and delivery.  I hear from far too many team leaders that their management efforts in the sales arena are constantly hampered by delivery management issues.  Far too often, the supervisors of these teams are in effect just relief delivery drivers… they spend the bulk of their time working delivery routes.  And the sales effort suffers.  In addition, this structure actually increases the frustration from the delivery driver’s perspective, thus leading to increased driver turn-over.  The drivers might start their day at 4:00 am.  Is their “boss” there to help them start their day?  Of course not.  Instead they deal with warehouse staffs that have their own problems to deal with.  And the drivers might end their day anywhere from 1:00 pm to 10:00 pm.  Again, is their “boss” there to help them end their day?  To help with check-in and answer any problems they might have encountered?  In short, is any “boss” there to help them do their job?   Generally not.  Once again they are left to deal with warehouse or office staff that may or may not give a damn about their problems.  So this structure hurts the sales effort and hurts the delivery effort… all as a response to our problems with communication?  How about just communicating better?!

I think separating the management of sales and delivery makes more sense in dealing with the realities of our businesses today.  Have your entire sales team focus on one thing; selling.  Have your entire delivery team focus on one thing; delivery… you sell it and we’ll get it delivered.  Have at least an AM and PM delivery supervisor so that a delivery management person is ALWAYS available throughout the very long delivery day.  These supervisors can rotate or the shifts can be permanent, either works.  Merchandising can be under either (or some for both).  This is a far superior organizational design and can increase sales AND delivery execution and impact, and greatly reduce driver turn-over.  And all it requires is better communication.  Ensure this sales-delivery communication is done at the management/supervisor level and you will also find that you can actually SOLVE problems, rather than just constantly dealing with the same old problems over and over again.  If you are running sales/delivery teams, I strongly suggest you investigate this further.  I KNOW if you talk to your team leaders they will agree.  They are living the pain of this ineffective organizational structure every single day.

·                    4 day per week delivery service.  Not to beat a dead horse but this is still a bad idea.  Holding your weekly stop count the same, operating delivery on only a 4 day per week schedule increases your delivery costs by AT LEAST 20%.  By freely “giving up” a day, over 20% of your capacity now has to be included in the remaining 4 days.  In very broad stoke analysis; you could cut your delivery force by at least 20%.  As an example, if you presently have 50 delivery routes, you could delete 10 routes by returning to 5 days per week balanced service.  The same is probably true with your sales force (other than perhaps the chain team).  This can generate substantial savings.  I would fight quite hard to generate a balanced work week for these types of savings.  You probably would not want to try to put all of these savings in your pocket; some would have to be shared with your drivers and sales reps.  But it gives you the opportunity to increase the skill level of your sales and delivery teams (more pay generally should equal more qualified individuals) and allows you to drive at least 50% of these savings to your bottom-line.  During this same re-organization, an astute VP of Sales commented, who by the way has worked his way up from being a driver-sales rep, back when we were driver-sell we never had any problems with Mondays being light, or for that matter with balancing work-loads throughout the week.  Why?  Because the driver-sales reps MANAGED their accounts since they were the ones physically doing the job.  It can be done and it has been done. 

·                    Never forget compensation systems don’t manage your employees.  In many distributorships there are far too many paid incentives in front of the sales force on a regular basis.  This leads to two problems.  The first is simply the illusion that the incentives actually direct your sales force – it is not possible to focus on that many incentives all at the same time.  It simply can’t be done.  The second is this then requires the organization to spend far too much manpower checking, surveying, etc to ensure the incentives are actually met.  We should consider an organization much like an elegant organic entity – every action we take should be focused on selling product or supporting the sale of product (warehousing, office, etc).  All actions we take should be reviewed under this microscope – we should question all activities we do that don’t directly support this elegant mission.  Sending people into accounts whose mission is not to sell or not to merchandise but to “survey” is in my opinion a waste of precious resources.

Compensation systems do not take the place of management – they should only provide guidance.  Employees should get distribution, sell displays, and attempt to achieve all goals we give them as a condition of employment, period.  It is a bad habit to instill in your employees that they only do things if they are paid “extra” for the activity.  If an employee consistency misses goals (and after all remedial management steps have been taken), they should be terminated and replaced with someone who can achieve the goals, not simple miss out on making additional money from unachieved objectives.

Over my years in consulting and observing what works and what doesn’t, I have become more and more an adherent of the KISS principle (keep it simple, stupid).  I believe putting more than 3 – 5 monthly incentives (as part of their normal compensation package) in front of your sales force leads to diminishing returns, the illusion the people are actually being directed by these incentives, and instills bad habits.  There of course might be trips, etc. from suppliers, but as part of the sales rep’s normal compensation package, no more than 5 incentives per month.  They can have many goals, we simply don’t pay them for each one.  I’d let suppliers fight for being included on these incentives (of course not being politically foolish), and as much as is possible, let them provide the $$. 

·                    Stove pipe thinking – This is a term used to describe rigid, departmental (and even sub-departmental) thinking – where instead of viewing assets (people, vehicles, etc.) as company-wide resources, the assets are instead blindly categorized and often protected.  This same is true for communication.  You will want to ensure this type of thinking/management does not take root at your company. 

·                    Management – One of the more difficult transformations an individual will ever attempt is trying to become a manager.  Some have called it a “redefinition of self”, and I would have to agree.  Anyone who has much work experience has already experienced the impact of a poor manager… and I would have to guess the poor ones far outnumber the good ones.  Working through others, accomplishing your goals through others is a difficult task.  It is always much easier to do it yourself.   You managers (especially the new ones) should spend a considerable amount of time consciously working on this transformation.  There really isn’t one mold for the great manager, they come in all types, and the prospective manager needs to find the managerial style that works for them.  In many cases this requires trial-and-error.  Should you tone up the authoritative aspect or tone it down?  Be a buddy or a “boss”?  Try each and see what happens.  Do you like the results?  Are they moving in the right direction?  Are you comfortable with it?  There are many, many books on management.  Pick a couple that seem interesting and read them.  I’m certain you will find some value in them regardless.  Classic management thinking has the “management cycle” as an iterative cycle consisting of:

o       Planning

o       Organizing

o       Staffing

o       Directing

o       Follow-up

When in doubt, ensuring these steps are adequately taken will solve many nuts-and-bolts management issues.  But of course in most situations, it is not managing a process that is so difficult; it is managing those pesky people who are required to complete all the processes.  And since each person is different – and the only person on the planet who you can truly control is yourself – a superior manager must be somewhat of a chameleon, changing their personal/management style to meet the needs of the specific individual they are at that moment addressing.  Most people aren’t very good at this, and instead attempt to demand that others change to fit their style.  If you have enough organizational power you can force this illusion, but these individuals are seldom truly effective managers and even less seldom effective leaders.  And all great managers are great leaders… it is the nature of the beast. Check out this article, http://johnconlin.typepad.com/conlin_beverage/2006/06/how_to_build_be.html - please read about Conlin’s Chump School of Management – don’t join. 

·                    Time management – Time management is an important aspect of everyone’s personal and professional success.  Everyone gets the same number of minutes in a day, but look at the differences in what various people can accomplish.  Find a time management system that works for you and stick with it – remember that your personal space reflects your mental space, so choose a time management system that is in harmony with how your brain is hard-wired.  Go here, http://johnconlin.typepad.com/conlin_beverage/2006/03/time_bandits_ma_2.html for more of my wisdom on this subject ;-).


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