Sales Force Management

Case Study WAC

Mediquip S.A

Course Instructor: Prof. F. Fareedy

Submitted By: Group 3

Abdul Moeed Babar

15P00002

Asad Ahmed Subhani 15P00033

Mian Hashim Ayaz

15P00031

Saim Haseeb

15P00027

Date: 17th November, 2016

Lahore School of Economics

Case Summary:
Based in Germany, Mediquip is a subsidiary of the French Company, Technologic
Universelle. The company specializes in CT scanners, X-ray machines, ultrasound and
nuclear diagnostic machines. The company was renowned for their technological solutions
and aftersales services. In Europe, the companys sales force was spread across 8 countries.
Its major competitors include, Sigma, FNC, Electora, Magma and Piper. Mediquips major
customers include healthcare agencies and philanthropic institutions, as well as private
hospitals and private radiologists. Medical equipment was purchased by healthcare agencies
who had their budgets allocated a year in advance. The purchase decision was a bit complex
and involved radiologists, physicists, administration and people from funding and supporting
agencies. Everyone involved in the process plays a specific role.
Mr. Kurt Thaldorf, a sales engineer at Mediquip, lost a sale of a CT scanner in Lehmann
University Hospital worth DM 2.37 million, to a competitor (Sigma).

Qualitative Facts:

Thaldorf was convinced that Mediquips scanner was technologically superior to

competitors.
Wanted to learn the lessons from this experience to apply in future decisions.
Mediquip was the subsidiary of a company that specialized in technology.
The company had a worldwide reputation for their technology and after sales services.
CT (Computer Tomography) scanners were a technology and product in the field of
diagnostic imaging.
It was more advanced than the X-Ray machines.
CT Scan allowed doctors to see images of sections of the body that were never seen
on the screen before. eg. The pancreas.
Early diagnosis of pancreatic cancer was possible
They had well established sales in the European region.
CT scanners were sold at the upper end of the price range.
Industrial leaders in CT Scanners.
Several satisfied customers across Europe
Most of the sales were targeted to key accounts (public sector heath care
organizations)
Mediquip had a formal procedure, sales analysis/strategy formulation form to help the
sales engineers in sales.

Quantitative Facts:

The per-unit price ranged from DM 1.5 million to 3.0 million.

The European market for CT scanners was around 200 units per unit per year.
Mediquips first offered price to LUH was DM 2.85 million. It was lowered to DM
2.61 million and finally it was lowered to DM 2.37 million.

Sigmas CT Scan was offered to LUH at a price of DM 2.1 million

Company Structure:

Managing
Director

Regional
Sales
manager

Sales
Engineer

Regional
Sales
manager

Product
Specialist

Sales
Engineer

6 other
Regional
Sales
Managers

Product
Specialist

The Buying Centre:

Carl
Hartmann
(General
Director)

Prof.
Steinborn
(Radiologist)

Decider

Initiator

Buyer

User

Influencer

Dr. Rufer
(Physicist)

Influencer

Secretary

Gatekeeper

Minor Problems:

Mediquips equipment was expensive as compared to competitors

Sales engineer was not technically sound or confident about the product specifications,
thus couldnt explain the added benefits of their scanner and the value proposition.
Sales engineer couldnt convince the physicist regarding the technical specification nor
the director with the price, indicating lack of sales skills and incompetence.
Sales engineer failed to follow the company policy and maintain the sales analysis and
strategy formulation form, thus failed to identify the key decision maker.
He did not have the authority to formally quote or negotiate the price with the customers,
thus it took Mediquip four months to quote a competitive price.
There was a communication gap between the levels of hierarchy in Mediquip.
Continuous decrease in bid price giving a negative impression about the product and the
company to the customer.
Lack to team selling to handle key accounts.
Failed to handle clients efficiently and effectively.

Major Problem:
Failed to comply with companys sales policy and use the form for sales analysis and strategy
formulation, in addition to lack to team selling to handle technical key accounts which lead to
lost sale.

Solutions:

Sales engineer should have followed the companys procedure and maintained the sales
analysis and strategy formulation form in order to identify the key decision maker (Mr.
Hartmann) and invest more time convincing him rather than spending time with the
radiologist.
If he would have followed and maintained the form earlier he could have devised a sales
strategy and discussed it with his seniors.
To ensure consistency sales engineer should be trained technically i.e. he should have the
technical specification of the products at his fingertips, and be able to present and
communicate them effectively.
He should also be given sales trainings in order to ensure he as the required skills to lock
the sales deals.
The need-selling technique should have been used, since the clients seemed to prefer
personal selling.
Sales engineer should have been given some authority to at least quote the price.
Or else Mediquip should have focused on team selling, as this is more preferable in case
of technical sales especially to key accounts. Also this could have saved companys and
the clients time by reducing revisits and price negotiations at an earlier stage.
Instead of providing tedious technical literature presentations could have been effective.
They should not have dropped their price to meet their competitors just to win the bid.

Recommendations:

RSM should be fired as he failed to anticipate and implement the requirement of team
selling for this key account, as a result of which they lost the sale and a key account.
Sales engineer should also be fired as he failed to comply and follow the procedures /
SOP which led to lost sale and a key account.