Ledals Redistributor: Enacting Policies that Frustrate Salespeople and Customers
(5 pages of text)
Case (Gen Exp)
Ledals, one of the premier redistribution firms in the United States, had determined that whenever backorders occurred, the additional trips being made by delivery trucks were killing margins. Therefore, management imposed a new policy, whereby backordered items would be held until the next customer order was received and prepared for shipping.
This arrangement led to repercussions, with both customers and Ledals’ salespeople frustrated with the new policy. Muted at first, but growing in volume, many members of the sales force were clearly disgruntled. What remained was figuring out how much damage was actually being done. Was it simply a predictable resistance to change that would resolve itself in the coming months? If it was a genuine problem, Ledals’ management needed to consider what, if any, actions should be taken. Ledals also had to determine whether the problem was with the policy itself or its implementation. Regardless of the cause, management had to make a decision as soon as possible about how to move forward.
- Discussions of the value provided by participants in supply chains and the tight margins that compel firms to seek cost-cutting opportunities in their value delivery systems.
- The effects of policy changes on personnel. Whereas salespeople are the focus of this case, it is appropriate to ask students about other functional areas of the firm affected by the policy changes.
- How profit motives of a firm can, at times, blindside executives to the effects of policies on customers. In this regard, instructors have opportunities to discuss safeguards that can be put in place to assure that customer-centricity stays front-and-center.
- How salespeople often face difficult and potentially awkward situations in which they must support company policy while trying to win the hearts and minds of customers.
United States, 2013
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