Change Management Plan

Project Name

August 15

2011

The change management plan is concerened with a companys division, facing problem with declining sale of its product portfolio. The division undertook a structural and promotional change to cope up with this contingency

Project Maa (Maa- Mother in India), as the below case we will be discussing is about child nutrition product, where the buyer is primarily a mother

Change Management Plan

Index: Section A A.1. A.2. A.2.(i) A.2.(ii) A.3. A.4. A.5. A.6. A.6.(i) a. A.6.(ii) A.6. (iii) A.6.(iv) A.7. A.8. A.9. A.10. A.11. A.12. Executive Summary Background Business Background: Company structure Product Portfolio Glimpse for Nutrition Division Situation: Change Initiative stimulation Objective Action Change and Scope of change Structural Change Promotional Change Resources SWOT analysis of propsed change plan Stakeholder communication, resistance and change readiness Change Facilitators Training Risk Assessment and Mitigations Post Implementation Results Section B B.1. B.2. B.3. Approach chosen from many available Models and thinking about change drawn on in developing this plan Implementation problems foreseen 21 21 22 3 4 4 4 5 5 5 8 9 10 10 11 12-15 16-17 18 19 19-20 20

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Appendices and References Section A A.1. Executive Summary: Nutrition Division of Wockhardt limited faced a problem of declining sales of its paediatric brand portfolio in last 12 months. Sensing the urgency of situation a meeting was called upon of key members of the Team consisting of Vice president, marketing and top level sales team. The team was required to brainstorm and find a solution to not only arrest the declining sales but to gain market shares aggressively. This needed a 3600 approach. After mulling over the issue for two days the team was able to zero in on the Root problems The problem was multi fold

Limited number of sales force Even this limited sales force was not focussed on paediatric portfolio promotion Quality of the Sales force too was not uniform across the geographic regions Competition was too intense and it required almost weekly follow up to retain market shares Selling of paediatric portfolio was to intense on activities which needed substantial time Relationship building played important role in the decision making by the customers

So the team decided to remove these roadblocks and take steps to build a sustainable and scalable model to promote the brand On ground sale force was divided to promote set of brands, promotional change was brought about to deal with paediatric doctors, paediatric team gained a momentum as they had to promote brand to specific set of doctors which reduced their overall calls/ day, increased sales and business credit was fairly divided. This brought about more accountability amongst sales team and brand mangers. This change plan was submitted by VP- sales, VP- marketing to President domestic operations and Chairman. Meanwhile this change was on its pilot run, VP marketing resigned, this brought about a directed change from top management to integrate sales and marketing under one VP (earlier the sales VP). Here resistance from marketing members was dealt by group meeting participation of VP sales With initial hiccups the marketing team well integrated with the sales team. Being managed by one leader helped imbibe open discussions with sales and marketing. All this required managing many changes simultaneously

Managing the Change in the Mind Set of the team Managing the change in the Roles and responsibilities of the team members Managing the change in the perception of the customers Managing the change in call process Managing the change in processes like Training, Marketing inputs, Reporting and monitoring.
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A.2. Background A.2.(i) Business Background: Company structure:

Compa

Operating

Divisions within Pharma Business as per product portfolio

Brands within Nutrition Product Portfolio

A.2.(ii) Product Portfolio Glimpse for Nutrition Division: (All Brands were promoted to DoctorsEthical promotion) Nutrition Division has 2 base brands: Protinex and Farex Protinex: Protein Nutrition Brand, within Protinex Farex: Infant and baby Food Brand (Promoted there were sub category of brands for different to Paediatricians and general physicians with target segments as follows: paediatric practice) Flagship brand, promoted for Protinex over 50 years and market Original leader in Nutritional Segment Farex 1 Infant formula for 0-6months Flavour variant of Protinex Infant formula for 6-12 Protinex Vanilla Original Farex 2 months Protinex Protein Nutrition for Diabetic Cereals with flavour variants Diabetes people Farex Cereals for babies 6 months and above Protein Nutrition during Mama Protinex pregnancy and lactation Protein Nutrition for growing up children, (Promoted to Paediatricians and general physicians with paediatric Protinex Junior practice) A.3. Situation: Change Initiative stimulation
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Nutrition Division (ND) of Wockhardt Limited was facing problem with sales of all Brands promoted to paediatric segments (marked in red). Brand: Farex was a market leader but lost sales to competitors due to change of hands from Glaxo to Dumex to Wockhardt (2006), situation advantage was taken by competitors to grab market share. Sales force were facing difficulties in promoting and getting sales of Farex due to strong competitor foot hold on paediatricians. Also due to another strong brand (Market leader) in the portfolio sales team focused Protinex sales for achieving annual targets, thus gradually interest was lost in promoting Farex Protinex Junior (launched in 2008), the initial enthusiasm faded off in the first few months as the sales force was not concentrating much on paediatric promotion due to Farex and also Protinex junior had strong competition from media promoted kids nutrition brands (Horlicks, Bournvita, Complan) Internal conflict between sales and marketing: Marketing and Sales both were concentrating on Protinex sales for achieving annual targets, top management questioned about sales of Farex (which was supposed to attend flagship brand title as per earlier proposals made) Both marketing and sales efforts were more directed to Protinex, few marketing initiative taken for Farex were also not paying results due to lack of implementation by sales force. There was an internal conflict were sales blamed marketing for not undertaking effective promotional campaigns on Farex, marketing blamed sales for not implementing the initial promotional strategies and achieving minimum sales figures, this was quoted as a reason by marketing for not able to allocate more budget to Farex marketing campaigns A.4. Objective: Arrest declining sales of Brands in Paediatric segments and undertake measures to increase sales of paediatric portfolio collectively as a division A.5. Action: Change plan Meet: Sensing the urgency for declining sales and with constant pressure from chairman about sales of entire paediatric range; a meeting was called including high influencing teams (Kotter Approach Step1) Participants: (Kotter Approach Step2 and 3) Vice president- Sales Vice president- Marketing Entire Marketing team Regional Managers

(December2008) During the brain storming meet; team came up with a plan to have focused promotion for Farex and Protinex Junior; as both these brands were promoted to paediatrician, Team decided to have a separate paediatric team to promote these brand which will enhance paediatric portfolio.
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Accordingly the on ground Nutrition Advisors (Medical representatives) were to be divided into brand specific teams. A pilot project was carried out in 2 cities; Kolkata and Chennai (December2008) (February 2009) The outcome of this plan was positive and sales of Farex and Protinex Junior showed a positive change; which was 100% over the existing small base. Plan was to be implemented by 1st June 2009, across India Vision was to increase sales of Farex by 50% and Protinex Junior by 100% by Year 2010 A.5.(i) Planned change approach was undertaken; a clear road map was drawn: (Kerber and Buono, 2005)

A.5.(ii) Change forces identified: Driving forces Resisting Forces

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Strong

Weak

Strong

A.6. Change and Scope of change: Structural and Promotional A.6.(i) Structural: Existing Divisional Structure

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Medical Representativ

New: (marked in red are structural changes implemented)

A.6.(i) a. Structural: Structural component 1) One Divisional Head handling Sales and
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Purpose Minimise conflicts at top

Change done by -Marketing head resigned

Implications Dissatisfaction of GPM and

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Marketing

management level

2) Marketing team was divided to handle similar brand portfolio

3) NA team was divided to promote similar set of brands 1.Protinex Team (PNA): Promote entire Protinex portfolio with allocated set of doctor speciality 2.Paediatric Team (FNA): Promote Farex range and Protinex Junior to paediatricians

-Chairman and President decided to have 1 Divisional Head VP sales took over position of VP-Sales and Marketing. - Directed Change (Kerber and Buono, 2005) -Recruiting new and Clear focus on individual brand Aligning existing brand managers as per marketing Accountability of competencies Brand P and L responsibilities Team was -Realigning existing divided as per sales force skill sets, as -Recruiting new talent promotion of as per requirement Farex required (mostly in metros) intensive medical knowledge and promotion follows strict guidelines Doctor speciality was allocated to teams Minimised overlap of territory sales Increased accountability of territory brand sales

PM Had concerns regarding reporting to new head

PM- Farex and Protinex Junior, had concern on individual brand accountability Concerns regarding decrease in share of existing business (Protinex went out of promotional basket for FNA and Farex was out of promotional basket for PNA) FNA to promote difficult brands, hence concern on establishing business

A.6.(ii) Promotional: Team responsible 1) Marketing Team: Brand manager- Protinex Brand manager- Farex

Change component Focus on marketing campaigns by individual brand manger Focus on target customer and hence better understanding of market dynamics (Competitors, Brand, Customer,
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2) Ground sales force (Nutritional advisors)

A.6. (iii) Resources Resources required Manpower NA PM Budget Farex

promotional tactics) Reduced interference from other Brand promotion Better allocation of Brand Budget Allocation of Brand specific promotional campaign inputs Focus on doctor speciality Paediatric specific promotional tools- Implemented by paediatric team Protinex Junior was promoted by both the teams

Existing 120 1 3 Million 2 Million 20 2

Additional

2 Million 1 Million

Protinex Junior

A.6.(iv) SWOT analysis of propsed change plan:

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A.7. Stakeholder communication, resistance and change readiness: (Kotters Step 4) Communication Objectives Addressing concerns Known Concerns: Optimum Communication <suspected basis for Channel resistance (if any)> Plan Regarding recruiting presentation new workforce (Change and Implications)DCM Managing diverse group interests Degree of Change Readiness Reason for degree of change readiness Increased profitability of the division Establish Brand leaders Imperative to gain market shares Increase brand on brand building Increase brand on brand building Increase overall product portfolio sales Increase resources of manpower and hence increase

Stakeholder Group (No. Of people) Chairman (1) Approval President (1)

Increased business ++ Sales projection for ++ building brands Bargaining for decreased head count of a VP Counselling and retraining +++++

Vice president (1)

Set the guidelines Presentations and provide and Meetings on resources weekly basis One on one meeting with VP Marketing meeting

Group Product Brand allocation Manager (2) within PM Product manager (3) Brand allocation Brand P and L responsibility Implement change in respective region Facilitate and Implement change in respective States

+++

Handling of brand individually with declining sales Co-ordination between AMM and ASM; NA and SO Co-ordination between NA and SO Concern on promoting Farex and Protinex

30% marketing budget for year 2010 Priority support from GPM, VP, Sales team Weekly meetings and exchange of information Team building training to managers Pilot project example

++

Regional Manager (4)

National Meeting

+++

Area Medical manager (15)

Branch Meeting

++

Junior by FNA- people concern Area Sales Manager (15) Facilitate and Implement change in respective States Facilitate and Implement change in respective territory with doctors Facilitate and Implement change in respective Territory with retailers Changes in reporting, -Customer list -Calls/day, -CustomerBusiness mapping 1)Group meetings with AMM 2)Group meetings with AMM, ASM 3)Branch meetings 1)Group meetings with ASM 2)Group meetings with AMM, ASM 3)Branch meetings Meeting with Brand managers and VP Co-ordination between NA and SO +++

business Increase in business with focused promotions

NA (120)

1)FNA- decrease in business because of Farex and Protinex junior 2)PNA- slight decrease in sales 3)loss of core doctors Have to co-ordinate with 2 NA in a territory

Standard information exchange format, weekly meetings

SO (120)

Standard information + exchange format, weekly meetings

Increase in business

Online reporting department (4)

Building up multiple Set up standard monthly Brand team in system reporting format. under same manager Complexity in online reporting Complex Data extraction and analysis

---

Increased work on setting up field force according to brand and new customer lists

Administration Link sales and Staff (6) performance

Admin meetings At Branches

Neutral

HR (3)

Change in structure Increased employee productivity Increase production as per forecast Procure materials Regional warehouse allocation Customer segregation according to brand team, knowhow of the new sales person who will meet him monthly Expected increase in sales Improve product stocking

Production planning

Meeting with key members and offline and one to one meetings Meeting with VP and GPM

Single co-ordinating window for the team

Consolidated

+++

Clear demarcation of performance and hence appraisal Increase in sales and hence optimum use of production capacity for Farex and Protinex Junior Will be accepted over few visits as doctors have may medical representatives from different companies which keep changing Increase business of each brand

Obsolete material in slower sales and product mix changes

Fortnightly Sales and Operations meeting reviews

+++

Doctors (26000)

Existing NA who cover the territory to visit the doctor with the new NA

Not comfortable with the Area manager to bridge new NA the gap. If the doctor is an core customer New NA to visit him on weekly basis to develop the rapport

+++

Retailers (40000)

SO to 3 people to co-ordinate communicate from same company through one on division one conversation ASM to accompany SO where required

SO, FNA and PNA to co-ordinate their visits weekly

++++

A.8. Change Facilitators: (Kotter Step 5-empowering) Responsibilities and Progress Externall Internally Position y responsible To Sales VP force, Marketing and top managemen t To AMM, ASM, NA,SO RM Task 1.Approval from Chairman 2.Organisation Structure 3.Operating framework 4.Recruiting meet with HR 5.Production planning 6.Sales forecast for year 2009-2010 1.Communication to AMM and ASM 2.Branch Meeting announcements Brand wise Promotion plan Increase accountability of PM- Brand Resource allocation Regional managers GPM and PM took this project at priority Manpower approval Approval on product forecast Branch meetings, Time Structure and concern handling sessions with RM or VP wherever required Brand wise budget allocation, Increase in budget for Protinex Junior and Farex Regional Administration support Time line 1st Mar09 6th Mar09 6th Mar09 9th Mar09 15th Mar09 1st Apr09 10th Mar09 1st Apr09 Customer conversions Process adherence Monitoring mechanism Project milestone completion Monthly performance reviews

Sales Objectives Customer Conversions Process adherence

To PM

GPM

To Retailers and wholesale rs To Doctors

To SO

ASM

1.Standard information exchange format 2.Retailers and wholesalers meet 1.Team Allocation- PNA FNA

5th May09 Sales objectives met Customer conversions June09 Customer coverage Activities initiated 15th Apr09 Sales objectives met Customer conversions

To NA

AMM

Regional Administration support

2.Standard information exchange format 3.Scrutinize doctor lists To Doctors To Retailers To NA, SO, ASM, AMM, RM, PM NA 1.Prepare new doctor list Time

SO

1.Inform retailer 2.Increase retail stocking

Online 1.System structure change Reporting 2.Upload new doctor lists and 3.Upload training module Monitoring team

Time and new Structure Increase stock allocation to warehouse New Structure, Time Doctor list all India Training material from medical and PM

5th May09 Customer coverage Activities initiated 5th May09 1st May 25th Sales objectives met Apr09 Customer conversions Customer coverage Activities initiated June09 Fill rates Mid Stock outs June09 Rx bounces / refusals th 15 Customer conversions Mar09 Activities done th 25 Rx Matrix improvements May09 1st May09

A.9. Training: Position NA Type of Training required Medical Product training Field Training conducted by 1.Nutritionist; from Medicomarketing 2.Product manager Training Documents Medical and physiological Detailing Aids Team exercise Handouts Time line Training 1: 31st May09 Training 2: October09 Training 3: March10

SO AMM and ASM

implementation 3.External training faculty Team co-ordination Team co-ordination External training faculty Team Building External training faculty

Team exercise Handouts Team exercise Handouts

Training 1: 31st May09 Training 2: March10 Training 1: 15th May09 Training 2: September09

A.10. Risk Assessment and Mitigations: If the project failed i.e the FNA were not able to gain sales momentum, Risk/ concern What about Increased manpower recruited (NA) Again question of Promotion of Farex and Protinex Junior Nature of risk High High Action To delegate responsibility of growing and expanding into new markets Markets were identified Since the brand had good budget allocated Protinex Junior: To be promoted on Media Farex: Highly scientific promotion; through conferences, CMEs, Symposia

A.11. Post Implementation: A.11.(i) Monitoring: Position NA Monitoring component Territory Sales Monitored by AMM Doctor calls and Campaigns Training modules ASM Monitoring Mechanism Weekly retailer invoicing Online report Online module Weekly retailer invoicing Online report Bi-weekly brand invoicing Online reporting Bi-weekly brand invoicing Bi-weekly invoicing on ERP Online reporting ERP ERP Online reporting Brand meetings and Online reporting ERP

SO

Territory Sales Retail and Wholesale calls States Sales Doctor Campaigns States Sales Regional sales Customer details Inventory Total Brand Sales Customer details Progress of campaigns Brand wise sales Inventory

AMM ASM RM

RM RM VP

PM

GPM

GPM

VP

A.11.(i) Creating short term and long term gains: (Kotters step 6 and 7)

Motivation tools: Awards and recognition

Recognition for highest orders in a month from a retailer/ doctor- FNA, this motivated other NA to join FNA team Recognition for Best co-ordinated team for AMM, ASM, NA, SO; reduced conflicts Brand sales awards- for Brand managers Highest Brand sales award in a territory- NA and SO; this improved co-ordination Brand Building awards to marketing; included innovative campaigns, doctor coverage, brand business

Experience sharing:

Open forum during branch meetings to share experiences within different teams Difficulties faced by a particular team was discussed and addressed by other team members, RM, AMM, ASM Feedback were consolidated and posted by RM to VP and Marketing. This helped marketing to implement new and innovative campaigns or make changes in the current campaigns Feedback was helpful as it gave market insights, customer and sales force requirements Protinex portfolio sales increased as well

A.12. Results: (Kotters Step 8) Farex sales grew by 60% by July 2010, brand contribution increased to 40%, Protinex junior showed a exponential growth of 110% over the initial small launch base Brand Volume sales June 08-09 Farex Protinex Junior 72000 35000 Volume sales July 09-10 115250 74000 60% 110% Growth over last year

Well co-ordinated team was developed, open sessions and contributions from sales force were encouraged. Around 15 promotions were declared by July2010, thus nurturing future leadership Projected a good return on investment picture in DCM, the model was implemented by other divisions to promote their flagship brands

Section B

B.1. Approach chosen from many available: Change in leadership of the division was a directed approach from the president of domestic operations. This change was not planned and had to be incorporated in the structure. VP sales took over position of VP sales and Marketing. This approach was taken by top management considering the corporate cost cutting; also other divisions had single VP operating for managing both sales and marketing. This Change was initially not welcomed by marketing staff but over 3-4 weeks of group meetings and work and reporting planning. Marketing staff got accustomed to the change. Here group meetings and open house discussions were used to reduce resistance Change in All India sales force structure was a planned change. This approach was chose as it was very crucial to organise the entire structural change across India, which had to happen by involving highly influential leaders, a pilot project gave useful insights of its implementation. Here sales force responses to change were noted, this helped to manage change initiatives successfully (S.piderit, 2000) Directed approach would have been a disaster as the change involved people and their territory business, imposing change would have led to dissatisfaction and hence attrition. The change involved initialisation with participation of highly influential leaders within the division, as it is very important to involve middle managers. If middle managers are convinced it is easier for them to convince and manage people reporting to them Once the brain storming team came up with a possible solution on declining sales the implementation could have taken a evolution or a white print approach but considering the urgency of situation and time crunch to attain sales these approaches were discarded B.2. Models and thinking about change drawn on in developing this plan Kotters 8 step approach was considered for conducting the overall change plan. Each step co-related with the change plan steps in report. Kerber and Buono planned and guided change approach was considered for set objective implementation by involving stakeholders, the underlying key is to inspire organisational members so that they are drawn to and excited by possibility of change this in turn reduced resistance. Pilot project served as an example for possible changes sales force would encounter and also reduced resistance (Kerber and Buono, 2005) Management (Vice president and Regional managers) could have choose not to spend time and effort to educate employees on the rationale behind change initiatives through one on one and branch meetings. It can rely on formal authority to enforce decisions. However, the approach chose was to tap into moral authority of entire sales force to earn the trust and confidence for effective implementation and nurturing honest relationships to achieve better results (Covey, 2004)

ADKAR model for individual change was applied with respect to NA

(Hiatt,2006) B.3. Implementation problems foreseen. Include were resistance might be expected and how to deal with them VP sales taking over VP sales and marketing was initially not welcomed by marketing staff, this was foreseen. Resistance to this problem was decreased with VP sales presence and contribution in marketing planning meets, his ideas and view points were well accepted, VP sales got to know about Marketing teams way of thinking and acting on plans. Over 3-4 weeks of group meetings followed by work and reporting planning, marketing team was handed over to the common VP. Marketing staff got accustomed to the change. Here group meetings and open house discussions were used to reduce resistance. Increasing number of marketing staff was a concern from top management which was bargained for decrease in headcount for a VP. Dividing NA team to FNA and PNA faced resistance mainly from NAs as brand allocation decreased their share of business and also from president as this would mean increasing total head counts in a division. Here resistance by NA was dealt by:

Citing example of the pilot project conducted, Projection of focused approach in increasing sales with decreased doctors covered and effective used of inputs allocated

Resistance by President was dealt by:

Brand building exercise, sales projection with increased manpower Citing example of pilot project Clarity in brand budgets and promotions, minimising product business overlaps among PM and NA, increasing accountability

Appendix: VP: Vice President, Head of Division GPM: Group Product Manager PM: Product Manager, reporting to GPM

 RM: Regional Manager, there are 4 regional managers across India- East, West, North, South AMM: Area Medical Managers, report to regional managers and NAs report to them ASM: Area Sales managers, report to regional managers and SO report to them NA: NAs/ Medical representatives, make doctor calls FNA: NA promoting Farex and Protinex Junior PNA: NA promoting range of Protinex SO: SO, Make retail calls and make product available at outlets Regional Office meetings: Meetings at one of the 4 regional offices, include entire sales team reporting to that regional manager Quarter Meetings: Meetings between Marketing and sales force, one in each region conducted every 3 months i.e 4 meetings in a year. Marketing strategies, campaigns, inputs are communicated to the sales force DCM: Domestic Council Meetings, Monthly meeting of VP from different division with President and Chairman ERP: Enterprise resource planning tool CME: Continuous medical education Rx: Doctor prescription to a brand References:
K. kerber, A F. Buono (2005). Rethinking Organisational Change: Reframing the challenge of change management Organisational Development Journal Volume-23 Pg24-28 S. Piderit. Rethinking Resistance and recognizing Ambivalence: A multidimentional view of attitudes toward an organisational change, Academy of Management Review volume 25 Pg 791 Stephen R. Covey. The 8th Habit: From Effectiveness to Greatness. New York, NY: Free Press, 2004. J. M. Hiatt. A Model for change in business, government and our community. Prosci

Reasearch, 2006