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Indian Institute of Management Indore

ODC Case Analysis

Jess Westerly at Kauflauf GmbH Case

Group – 5
Section - 'B'

Sambit Halder (2018PGP321)


Rahul Kisku (2018PGP288)
Adya Prabha (2015IPM006)
Ujjwal Kumar (2018PGP410)
Savio Sharand Royan (2018PGP335)
Hari Vignesh M (2018PGP288)
Keerthana S V (2018PGP475)
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Table of Contents

Executive Summary……………………………………………………………………………...3

Problem Statement……………………………………………………………………………….4

Alternate Solutions……………………………………………………………………………….4

Criteria for Evaluation……………………………………………………………………………4

Evaluation of Options……………………………………………………………………………4

Recommendations……………………………………………………………………………….5

Action Plan………………………………………………………………………………………...5
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Executive Summary

Kauflauf GmbH is a software enterprise in Heidelberg, Germany. It is the first European


organization to offer software as a service and had grown rapidly by targeting mid-sized and top tier
smaller firms that could benefit from cloud based subscription software.
The key success factor of Kauflauf are choice of target market, differentiated approach to
sales in which consultant-like service is offered by highly qualified field representatives and work
culture. Mid-sized market, especially in Germany had the largest market for CRM and ERP
products and hence Kauflauf had utilized this opportunity at the right time. The sales force used
client education, hand holdings and customization to win customer accounts and loyalty while the
field consultants had the liberty to plan their own activity. Field representatives also have great
pride in the service they provide and their relationship with their customers.
The organization had a youth oriented, anti-hierarchical, friendly culture which created an
atmosphere which proved important for their professional image and experience. Informal networks
were considered as a key resource which helped them getting things done across division. Kauflauf
also developed an open platform which allowed the existing customers and new adapters to
develop their own application along company’s release. The solution oriented and relationship
driven organization emphasized on collaboration, technical excellence and mutual respect.
Jess Westerly was the assistant product owner of CMR applications which represents more
than two-thirds of the overall revenue of the organization. She conducted a simulation and also
analyzed the sales figure against the field consultants’ time allocation report and found that only
35% of the consultants’ time were spent on customers who produced 85% of the revenue and the
remaining time was spent on small, less profitable accounts. Her analysis suggests that the overall
revenue would increase by 30% if the consultants increases their spending time by 20% to these
large revenue generating customers. Her research also suggest that the profitability would increase
if the firm focuses more on large, established customers instead of the usual target segment.
After approval from Roeder, she emailed a memo to all the field consultants and Regional
Sales Directors describing the reasons behind the sales call pattern change. She also shared the
result of her simulation and also detailed about the action plan. But her proposal received severe
criticism and disappointment. The field consultants and Regional Sales Directors conveyed their
disappointment and disapproval to her proposal. However, Jess Westerly was still confident about
her proposal as after considering various scenarios, her further research too confirmed her findings.
She explained her proposal to Heinz Van Hoorn,
Director of Marketing, who was impressed by Westerly’s preparation and logic of proposal and gave
her a second chance to try her proposal.
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Problem Statement

What should Westerly do to effectively communicate and implement her new proposal
despite the rejection and disapproval from the field consultants and Regional Sales Directors?

Alternate Solutions

1. As Westerly has the support of her boss Tim Roeder, Heinz van Hoorn and Director of
Sales Klaus Kirstoff she must continue designing the execution plan based on her analysis
without consulting RSDs and best field consultants.
2. She must involve RSDs and field consultants to know their requirements in implementing
call pattern change and designing its proper execution plan. She must tell them the
advantages of her proposal and its effectiveness to get their approval.
3. She must give incentives to the field consultants to invest more time to large potential
customers.
4. She must hire new field consultants who will be dedicated to look after the large customers.

Criteria for Evaluation

● Feasibility of the options


● Time limit
● Resources required for implementation
● Cost incurred for the plan
● Different risks associated with the plan

Evaluation of Options

1. Continue designing the execution plan based on her analysis without consulting
RSDs and best field consultants:

This option is not viable at all because it will make the sales force and RSDs angry. They
will be forced to work for large clients for more time. Their reluctance may decrease the
service quality. Therefore, the company may lose few big clients and profitability will not
increase. Employees are required to be trained to handle large clients and call pattern
change, which require significant amount of investment. But lack of interest may lead to
employee turnover.

2. Involve RSDs and field consultants in making necessary changes and convey them the
advantages of her proposal:

This approach seems to be very feasible because the execution plan will take care of the
problems faced by field consultants. However, this execution will be little time consuming
but the sales force will be motivated to work towards acquiring big customers. A well
designed training program and sales manual are required but the motivated sales force
will eventually give a greater revenue. Risk is minimum because there will be low
resistance from work force.
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3. She must give incentives to the field consultants to invest more time to large potential
customers:

The main motivating factors are converting customers and solving their problems.
Personal benefit is not the driving force behind the success of field consultants. It requires
company to give some margin to sales force but they will be reluctant to switch to large
customers, which are difficult and time consuming to convert. If they are forced then the
relationship with current customers will deteriorate. Sales approach will also be changed
which all may not accept.

4. She must hire new field consultants who will be dedicated to look after the large
customers:

Hiring new recruits requires a lot of effort, time and cost. Sometimes hiring proper talent is
also a big challenge. The training program will consume a lot of money. Besides, the old
employees will not accept them properly because new recruits will be exclusively working
on big companies. This will create cultural disparity inside the organization. There will be
lack of coo-operation between old and new employees. This can be detrimental to
organization’s development as a whole.

Recommendations

We would like to recommend second option i.e. Jess Westerly must involve RSDs and field
consultants in making necessary changes to her execution plan and convey them the advantages
of her proposal in order to convince them.

Action Plan

 Westerly must call the RSDs and best consultants to discuss about the matter.
Previously she sent the memo without consulting with anyone. This made the field
consultants and RSDs dissatisfied. This time she needs to be more inclusive as they are
the persons who interact with the customers, understand their requirements, sale the
products and build effective relationship.

 She must communicate the advantages of her proposal. He must convince them how it
will benefit the company and the customer.

 She must target a few potential big clients and implement her plan only to those areas
rather executing it everywhere.

 Implementation will be gradual based on the success of previous phases and she must
take feedback of the RSDs, consultants and developers.