Katetutor

The case study detailed below deals with a company called Ricoh USA. Ricoh is a leading manufacturer of office, engineering, and some electrical equipment. The division in question deals with the engineering side of the business. This equipment is designed to print schematics, designs, and blue prints for structures to be built. The company, in the U.S. has a direct sales and service organization that work together to achieve profitable and sustainable results.

The market that this division serves in the Architectural, Engineering, and Construction space. During 2007 through 2009 this space was crippled by the financial meltdown and funding for new or existing project dried up. Since 2009 this market has been on an extremely low rise but a rise none the less. These AEC firms rely on the engineering equipment to print critical documents for new and existing structures.

The sales and service teams are broken up into branches, twelve in total throughout the country. These sales people sell the equipment directly to the AEC firms and the service people do the break/fix work. The sales and service teams will have roughly seven people on each side with two leaders of the group that work cohesively together to manage the business. In order for the sales people to be successful, the service organization needs to keep the customers happy by making sure the equipment sold is in good shape and consistently running. The sales people need to continue to feed the account base with new customers because inevitably you cannot keep 100% of your client base.

In a market such as this where so many market elements can affect the results, every sale is crucial. The sales people treat every sale as their most important, not just because sales in a down market aren’t easy to come by but because if they make the sale they make money and if not they do not. This is where the particular case rises, a situation of conflict between the sales and service people.

One of Ricoh’s engineering customers that currently has over ten systems was having some struggles in the Maryland office with a piece of equipment. Without the knowledge of the sales person who is the face of the organization and the overall account manager, the customer was beginning to get very frustrated with the poor performance of the equipment. The customer failed to report their dissatisfaction to the sales person because they assumed the service person would have told them but never did. Some time went on with continued service related issues causing the customer to lose time and money. This spurred the customer to contact the sales person and threaten returning the equipment and not paying their bill any longer. Additionally, they would discontinue purchasing other equipment until this was resolved.

The sales person, who rightfully was very upset decided to email the service person and critically ask them why they have not performed their job function of fixing the problem and also failing to alert them to the issue. They went on to unprofessionally accuse them of sabotaging the account because they could care less about making them happy. Unfortunately this turned into the service person firing back in a similar fashion accusing the sales person that they neglected their account and part of the reason for failure was training that sales should have provided.

The situation ended up getting worse because the service person, for a period of time put this troubled customer on the back burner, letting the situation come to a boiling point. Both sales and service didn’t escalate the conflict to the two team leaders and the relationship between sales and the service person suffered, which impacted more than one customer. During this time period, the sales person would often send emails to the service person pointing out poor performance. This caused service to neglect their duties and perform even worse. The email tradeoffs continued without the team leader’s involvement.

Finally, the team leaders were notified of the situation by other sales and service people who had been hearing things through the grape vine. The situation was dealt with by the two team leaders but took several months to resolve and create a team atmosphere again. The conflict did leave quite a few customers very unhappy. This situation that spun out of control negatively impacted the branches results for the year.