Achieving Target at Unilever

Sulman, a Regional sales manager in Unilever Islamabad town, pored over the performance evaluation data packet for his two area sales manager, Toor & Nasiri. He is mingling with two to decide who is to be promoted. Especially, the Toor who has the most negative remarks he had ever read. Sulman knew that Unilever wanted team players, but he felt that he had a responsibility to build a business and that Toor was critical to that effort. Toor was eligible to be promoted to BOM this year. But, with performance evaluations like these from his colleagues, it would be difficult, if not impossible, for the firm to promote Toor

Unilever

Unilever Pakistan is the largest FMCG Company in Pakistan, as well as one of the largest multinationals operating in the country. The company had a turnover of Rs. 18.2 bn  (Euro 329 mn) in 2004, and enjoys a leading position in most of its core Home and Personal Care and Foods categories,

Unilever’s’s corporate mission is to succeed with "the highest standards of corporate behaviour towards everyone we work with, the communities we touch, and the environment on which we have an impact."1 …and they believe “The Unilever community is shaped and led by its people, who operate creatively within a framework of shared values and business goals.”

The company operates through 4 regional offices, as well as 4 wholly owned and 6 third party manufacturing sites across Pakistan.2

Sales DepartmentThe sales department, headed by the General sales manager, Ali us Sajjad, is divided into regional offices. Each region is then further subdivided into different areas e.g. Islamabad region consists of Rawalpindi Area (managed by Toor) and Islamabad area (managed by Nasiri). Each area is further subdivided into territories (see Exhibit 1). Policies:

Each area is managed by area manager No manager can interfere in other’s area Transshipment Policy: Manager can sell only in its own area. Trans-area-

shipment is considered to be interference in someone else’s turf and highly prohibited.

Managers compete with each others based on their sales targets

1 www.unileverpakistan.com.pk/ourvalues/purposeandprinciples/default.asp 2 www.unileverpakistan.com.pk/ourcompany/unileverpakistan/UP_ataglance.asp

DilemmaTwo area Managers, AM, toor and Nasiri are confronting with each other. Toor with his vision to increase the sales of the company some times violates the company policy of transshipment. But this time Nasiri is at fire because he caught the delivery van with Rawalpindi’s TSO selling at Islamabad Saabzi Mandi. Nasiri knew Toor always fight only for the sake of his own commission and sales target; But always at the expense of someone else target and commission. Nasiri understand the dirty politics of Toor who is inefficient in his own home(Rawalpindi) and could not complete his target properly so toor always hunt for other’s home to meet its target.

Nairi is an efficient manager and has an established a reputation of people manager in the company. He established a strong third party distribution network in Islamabad. Prior to him the Islamabad area is very upset with no strong distribution network. Competitors are taking the advantage of this situation and Tapal & Tetley has already managed to enter into Lipton home. Habib Oil has also damaged the Dalda and Planta’s sales. In such a critical situation, Nasiri is like a blessing to a company whose good client skills and strong negotiation capabilities helped the company to regain their lost market position. But in last couple of months he could not achieve its sales target; even he is putting his best efforts. He could not figure out why this is happening. Meanwhile he found the sales of Rawalpindi area has grown in last couple of months and they are achieving more than their target. Furthermore, Nasiri is loosing some big clients in wholesale market. When he visited to those clients to explore their complaints he found they are getting supply from Rawalpindi area. He gets fierce on this situation and complaint this to Toor.

Nasiri: Your TSO is interfering in my territory.

Toor: I know this! He discussed this with me before delivery. But he is dealing with Nankari Bazar’s client. That client (Yousf & Sons) wants the delivery at Islamabad Mandi.

Nasiri: But you are not supposed to deliver or do any commitment regarding my territory. Moreover you are also giving them at cut price.

Toor: Yes! According to books I should not but I also have to achieve the target.Nasiri: Your target is for your area and you should complete it in your own area. If you

could not complete in your area then you are giving space to your competitor and damaging the company overall market share.

Toor: It is none of your business.

Shabaz ToorThroughout his four years of experience Toor has built strong relationships with the important players in the market. Toor knows how to pitch sales and how to achieve targets. But in few last months demand has increased rapidly because the Abpara and Mandi’s retailers are approaching at the Nanankari Bazar. They are complaining

Islamabad’s TSOs & DSR (see exhibit 3) are very uncooperative and could not fulfill their needs. Toor is generous to the Rawalpindi wholesaler to fulfill their client’s need even some time at cut price. But Toor do this to increase the overall sales of the company so that the widening gap should not be filled by company’s competitor.

End of Year Performance reviewThe most important performance measure in the Sales department is target. The manager who has brought new business to the firm and managed to achieve its targets is the best manager in company’s books. Sulman, RM, knew the conflict between the Nasiri and Toor but do not want to lose any anyone because both brings unique skills to the company and are beneficial for the longer success of company. So he let them fight against each other and to decide on their own. But now the situation gets worse because if he promotes Toor on the basis of performance metric (i.e. sales targets) then Nasiri will not work under him and if he promotes Nasiri he has no objective reason to support. But he knows it is a time to decide…

Exhibits 1: Sales Department

Exhibit 2: Area’s served by distributors

Distributor Name Area DescriptionCiti Distributor Islamabad H, I ,F,G sector excluding G-6 & G7Sana Distributor Islamabad Appara, Barahakho, G-6, G-7 Punjab Sarhad Distributor Rawalpindi Satelite Town, Kahyban-e-Sir syed, Pirwadhi,

PindoraNovelty Distributor Rawalpindi City & municipalityNational Consumer Distributors

Rawalpindi Rawapindi Cantt & sadder

Raja Distributors Islamabad MurreeHazara Distributors Islamabad Abbotabad

GSM

RM ISB

BOM

AM

RM Lahore

TSO

RM Karachi RM Quetta

Exhibit 3: Positions & Responsibilities

DSR– Distributor Sales Representative: Theses People are on pay roll of the third party distributor and partially paid by company. These are the potential interface between the retailers and company’s products.Delivery Man: He is DSR and delivers the goods and is responsible for account receivable and payments.OB–Order booker: He is DSR and books order by pitching the sales to various accountsTSO– Territory Sales Office: He is a liaison between distributor & company; and responsible to look after the company’s interest in collaboration with distributor’s sales force.AM– Area Manager: He is responsible to look after three to four TSOs & distributor and the market in general.