The Way in Which Sales and Distribution of Products Are Carried Out by an Organization - Coursework Example

 Sales and distribution management Introduction For an organization to perform better in the market, it must consider its strategic plans for distributing their products to customers. The supply chain must be effective in order to ensure that the customers are satisfied with what they want (Anderson & Dekker 2009). There should be clear communication between different parties involved in the marketing or distribution process like the project manager who inspects the products being dispatched and the and the sales manager who places order and also draws the specification of the products to be delivered to the customers. In this regard, an organization can deliver required materials to customers and can be strength for the organization to gain competitive advantage by attracting many customers. This paper will be analyzed based on the structural steel industries specialized in supplying steel to other industries and construction companies. The paper will further discuss the main challenges facing the company in its supply of steel to Laredo Construction Company. Structural steel industries had the contract of supplying steel to Laredo Company but in the due course there was misunderstanding between the two companies. This paper will therefore try to analyze the case study and the problems encountered in the distribution. It will also discuss ways in which to prevent these problems and finally the parties which should be involved in project management. Problems encountered in sales and distribution management There are various problems which are encountered in the sales and distribution department which affect the smooth flow in the distribution department. The first problem encountered is lack of responsibility (Brenda 2009). In this case study, we see that there are many departments which are involved in the Laredo project. Because this was a federal government project, it was expected that the structural steel industries supply steel which are locally made as the law requires. However the company did not supply a hundred percent local steel instead included forty percent Mexican steel and supplied it. When the Laredo construction company found out that the steel was not a hundred percent locally manufactured, there was nobody in the supply company responsible for the mistake. Both the production, project and shipping managers assumed that the steel is a hundred percent local and they were not a ware that they were shipping 40% Mexican steel. This mistake happened because of lack of responsibility as all the team members did not execute their duties effectively. Another problem encountered in the sales and distribution management is lack of proper specifications. Lack of clear specifications can lead to supply or delivery of wrong materials because when there is no specification or the order is based on past experience, the supplier may supply materials based on the previous orders which may not be applicable (Marianna 2005). In this case study, structural steel industries sourced for steel from the manufacturer but they did not give the specifications. They assumed that the manufacturer will supply locally made steel but they included 40% steel from Mexican manufacturers. So this mistake happened because the company did not specify the products they wanted from the manufacturer. Nobody in the structural steel company bothered to know what kind of steel they were supplying to Laredo Company so the steel did not meet the specifications according to the contract requirements of using locally manufactured steel as it was a federal government project. In addition, there is also the issue of communication. When there is poor communication in the sales and distribution department, the functioning of the department will not be smooth (Daniel 2006). For example in this case study, there has been no good communication between different managers like the project manager, production, shipping and sales managers. They do not coordinate the functions well so that they can be sure of what they are supplying. After the contractor has noticed the mistake it is then they realize that there has been a mistake. All these managers are held responsible for the mistake happening in the supply of steel. The managers could have inspected the steel upon receiving it before shipping to Laredo Company. Nobody asked anyone if what they are shipping is the right steel according to the contract they have with Laredo. Therefore they all made a mistake and should be held responsible. Furthermore, there is the problem of organizational chart. For effective and smooth flow of operations in the department of sales and distribution department there has to be effective organizational chart. Through the organizational chart there will be good communication in the department or in the organization (Anthony et al 2008). There will be effective span of control because everyone will be answerable to his or her superior. In this structural steel industry there is no clear channels of communication in this company because all the managers are on the same level of management thus no one takes instructions from the other thus it is hard to give instructions. This led to the mistake of supplying Mexican steel because they did not take their responsibility personally. Therefore, the organizational chart should show hierarchy so that it will be easy to give instructions and also keep everyone responsible for any mistake committed. In this effect each manager in the sales and distribution department should be accountable for any mistake. There is also the problem of not developing an effective team which will conduct an inspection. When the ordered products or materials have arrived, there is a need to inspect to ensure that the delivered materials conform to the requirements of the order (Onder & Surendra 2012). If the company cannot do the inspection, the products delivered may not conform to the requirements of the products and could not serve the same purpose they were intended to do. In the case study of structural steel industry, the management should be held responsible for the mistake. This is because they did not take responsibility and inspect the steel instead they just assumed that the steel was locally manufactured. If the management of the company had developed an inspection team, this mistake could have not occurred because as they could have corrected the mistake before supplying the steel to Laredo Company. Another issue which affects the sales and distribution department is the lack of adequate trained personnel to conduct the operations. In some companies the employees are overworked because they want to save huge profits (Chanaka et al 2012). In this industry we see the production manager who is Manuel is complaining that they need one week to complete the task and now Mary the project manager wants the mistake of supplying the Mexican steel within one weekend. This shows that there are no adequate employees in the organization and that is why it will take longer before they supply the locally manufactured steel. To end this menace, there should be adequate personnel in the department who will be responsible for the actions. Importance of effective management of sales and distribution Management of sales and distribution is important in various ways. The following are the ways in which sales and distribution management is important in an organization. The first benefit is that sales and distribution enable organizations to create good relationship (Sushil & James 2012). When there is effective management of distribution of products or services the buyers will be satisfied with the delivered items hence will develop a positive attitude towards the supplier. For instance, the structural steel industry could have created good relations with the Laredo Company if it had managed the supply effectively. The company delivered steel which was manufactured in Mexico against the specifications thus the relationship between the two companies started deteriorating as we see Jack complaining bitterly. Another importance of managing sales and distribution effectively is that it enables an organization to effectively compete in the market. A company will gain competitive advantage if it is able to meet the customer expectations (Chanaka et al 2012). This can only be achieved if the company has a qualified team to manage the distribution of the products and this will attract many companies because they know that the company is competent in the supply of the materials or products. For instance, structural steel industry may not compete effectively in the market its sales and distribution team has proved to ignore their duties and that is why they supplied the Mexican steel instead of the local steel according to the laws of federal government projects. In this instance, companies like Laredo will withdraw their contracts and find competent suppliers thus the company will lose customers. It also improves the profitability of the company. The company will be able to attract many customers because of its good image and maintain them (Chanaka et al 2012). By attracting and maintaining many customers, the company will be able to raise more revenue thus high profitability. Recommendations for preventing sales and distribution issues There are many ways in which an organization could be able to manage and prevent issues involved in the management of the department. Through the effective management of these issues, the company will be able to improve customer satisfaction because it will deliver the products or services according to the specification. The following are the ways in which the company can manage the issues; The first way in which the management issues will be managed is through designing specifications. There should be clear specifications to that should be critically examined to ensure that the supply of the materials or products meet the specifications so that there is no misunderstanding between the supplier and the contractor. For instance in this case study, the managers of sales and distribution department did not take into consideration the specifications drafted and that led to supply of wrong steel. Another way in which issues affecting the management of sales and distribution department are through eliminating the assumptions. After agreeing to manufacture of supply the materials and after they have been delivered, the buyer should not assume that the supplied materials meet the required specifications. They should be inspected against the specifications to ensure they meet the required standards before they are dispatched to the contractor to avoid misunderstanding between the supplier and the contractor. There is also need to improve communication between the structural steel industries and the supplier so that there will be no misunderstanding between the two parties. For instance, the Laredo Company should draft a specification of the products and give it to the structural steel Industries Company to ensure that they get the right manufactured steel. The company should then inspect the steel and if they conform to stated standards they will supply it. This could avoid supplying wrong materials hence there will be no misunderstanding. Conclusion Sales and distribution management is the way in which all the sales and distribution of products is carried out by an organization. Structural Steel Company has been performing well in the supply but recently it supplied Mexican steel which was not specified by Laredo Company. This led to arguments by the management of the two companies. The issues affecting sales and distribution steel include lack of responsibility by the managers, inadequate trained personnel, communication problems, lack of effective specifications and poor organization structure which lead to lack of accountability. The importance of managing effectively the sales and distribution department is that it improves the corporate image of the company thus attract many customers, improves the competitiveness of the company and creates good relation ship between the buyer and the seller. Therefore it is important for any organization to maintain good management of sales and distribution so as to gain competitive advantage and satisfy the needs of the customers. References Anderson, S. W & Dekker, H 2009, Strategic cost management in supply chains, Part 1: Structural cost management. Accounting Horizons, Vol. 23, No. 2, pp. 201-220. Anthony, R. Wheeler, J. Halbesleben, M & Ronald, B 2008, Multi-level strategic HRM: Facilitating competitive advantage through social networks and supply chains, London, Macmillan Business. Brenda, S 2009, "Driving sales through shoppers' sense of sound, sight, smell and touch", International Journal of Retail & Distribution Management, Vol. 37, No. 3, pp. 286–298. Chanaka, E. Bogdan B & Xinjie, S 2012, Optimal Selection of Contracts for Supply Chain Coordination Under Decision Hierarchy, London, Prentice Hall. Daniel O’L 2006, Using “mirror worlds” to support supply network management, London, Macmillan Business Marianna, S 2005, Collaborative supply chain management in the airline sector: the role of global distribution systems (gds), London, Emerald publishing group. Onder, O & Surendra, M 2012, Optimal Management of Reverse Supply Chains with Sensor-Embedded End-of-Life Products, Sydney, McGraw‐Hill Book Organization. Sushil, V & James E 2012, Creating Socially Responsible Value Chains: Role of Companies, Governments and NGOs, London, Emerald publishing group. Read More