Question

B&D is a designer and manufacturer of some of the highest, most sought-after men’s and women’s fashions in the world. B&D was founded in 1921 as a family-run workshop. In a Manhattan loft, six designers hand-made a collection of women’s dresses using skills handed down from generation to generation. Discerning consumers soon began to seek out the quality and unique nature of B&D craftsmanship. Now greatly expanded, B&D continues to maintain the highest standards for materials and workmanship. B&D’s exceptional workforce remains committed to carefully upholding the principles of quality and integrity that define the company. They attribute the prominence of the B&D brand to the unique combination of their original American attitude and design, their heritage of fine designer clothing and custom fabrics, their superior product quality and durability, and their commitment to customer service. B&D’s distribution strategy is multichannel. There are currently over 400 B&D stores in the United States and Canada, with more expected to open in the current calendar year. In addition, B&D has built a strong presence in the United States through B&D boutiques located within select department stores and specialty retailer locations. The catalog is an important advertising and sales vehicle for B&D, both domestically and abroad. In 1999, B&D launched its online store. While B&D continues to be one of the best-recognized brands in the United States, its long-term strategic plan is to increase international distribution and target international consumers, with an emphasis on the Japanese consumer. Through B&D Japan, Inc., now wholly owned by B&D, the company is leveraging a significant growth opportunity in this important market. Intent on maintaining a consistent brand strategy domestically and abroad, this ownership structure provides B&D with complete control of its distribution in Japan. With a global vision in place, B&D is available at over 900 department store locations in the United States, 182 international department stores, retail store and duty-free shop locations in over 20 countries, 161 department store shop-in-shops and retail and factory store locations operated by B&D Japan, Inc. B&D’s corporate headquarters remain in mid-town Manhattan, in the location of its former factory lofts. Sharon Reeves is the current Vice President of Sales and has held that role during all of the company’s international and Internet growth in the last couple decades. While she loves her career, she has one huge challenge that she cannot seem to overcome. She has a large staff of sales managers working under her, managing the different product lines and market segments. The current average tenure of these sales managers is somewhere between 24 and 32 months. Even more disturbing is that this average has been gradually getting shorter and shorter. The tenure of the last Internet Sales Manager was 19 months – barely more than six quarters. In Sharon’s mind, that’s three-quarters trying to ramp up, two more of waiting until things get better, and one last quarter for executing the exit strategy. Sharon has tried to think about what she is doing wrong. She realizes that probably her biggest fault is ineffective hiring (or promotion). This has been exacerbated by the fact that a large group of her senior managers fitted into the baby boomer category and have retired. Thus, her hiring practices have become quite haphazard as she rapidly sought to replace retirees. Sharon has cut down her hiring processes and has had candidates interview with far fewer C-suite executives. She has also relied more on her “gut feel” and less on her use of strategies, processes, and psychological and other testing procedures. Given that her managers need such a broad base of analytical skills, she knows that dropping some of her testing procedures is dangerous, but in this time of both mass retirements and downsizing, she has simply had to make do with what she has the ability to do. However, the biggest mistake that Sharon has made is to have promoted her top sales reps into sales management positions. She feels that these reps have worked hard, are very entrepreneurial, and not only deserve the promotion but also should do well in the job, owing to their hard-working nature. However, the reps who have been promoted to managers have the lowest tenure of all, around 20 months on average. Whatever the cause, Sharon knows that she has to stop the mass departures. In each of her divisions, she sees almost a perfect negative correlation between length of time in job and performance of reps, customer satisfaction, growth of new market segments, and contribution margins.

4. What different qualifications should Sharon look for in comparison to retiring baby boomers when replacing them with new managers? Are there differences in management needs based upon generation? What about sales reps’ and customers’ needs: how are they different from generation to generation?

Answer 1

4.

Sharon should look for two aspects of the qualification when replacing the baby boomers with the new managers. The first qualification is the technical knowledge. This means she needs to make sure that the candidates have the requisite skills to be a good sale rep. The second qualification that she need to look for is the stability of the employee. Now, this is more of a soft skill and psychographic parameter of the candidates. Nonetheless, she needs to look for these two skills.

Management needs may vary based on generation as the company evolves. The companies that exist today may want to achieve a completely different goals tomorrow. In such case management needs will vary. However, in case of an apparel brand like B&D, it is very unlikely that management needs will change this soon.

Sales rep are the employees and their needs will be different. The baby boomers of course had different needs and the new generation sales rep will have different needs. For example, it is possible that the baby boomers’ primary need was job security. On the other hand the new generation may look for growth.

The customer needs will vary too based on generation. A baby boomer customer may have been satisfied with a basic piece of apparel but the new generation may want something with a political statement. This is just an example, but the basic understanding that the needs of the customers will be influenced by their generation.