NORTHFIELD, Ill. -- Under the business consolidation it announced earlier this month, the company that used to be known as Kraft General Foods will create a dedicated account team in the field for virtually every major customer.
Now called Kraft Foods, the company here will establish approximately 300 customer business teams as it implements the plan during the next 12 months, said John D. Bowlin, who was named president and chief operating officer of Kraft on Dec. 16, 1994.
"We are doing this to have the most effective sales force in North America," he said in an interview in which he outlined three key elements of the plan: "streamline management, deploy dedicated customer teams and increase retail execution across all businesses."
Initiated with the New Year, Kraft's new structure dissolves the former Kraft USA and General Foods USA operating groups, consolidates manufacturing and distribution systems, and unifies approximately 3,500 sales people into a single force. Importantly, the plan includes "no headcount reduction targets" for the sales force, said Bowlin, labeling as "ludicrous" media reports that asserted there would be a significant loss of jobs. "I expect that one year from now when this process is completed you will see a minimal difference year-to-year."
He added, "There will however be lots of retraining and redeploying. Many peoples' jobs will change. Our job is to expand the business. Our marching orders are to grow."
Kraft Foods combined sales are currently "between $11 billion and $12 billion per year,"
he said.
Bowlin said the team structure will be phased in during the course of the year, beginning with a lead market. "We are developing the program now. Two to three lead regions will begin in a couple of months. As we get the systems worked out, we will expand further."
The sales force unification erases a structural legacy that has persisted since Kraft General Foods was assembled by Philip Morris Cos. from two acquisitions -- General Foods in 1985 and Kraft Foods in 1988. It operated four distinct and parallel sales forces, each with its own people, policies and paperwork until last year, when the company took several interim steps to consolidate its sales force.
During 1994 it merged its Kraft Cheese and Oscar Meyer sales forces, and later integrated its General Foods grocery sales and Maxwell House organizations, leaving two sales forces that called separately on the same retailers.
"What we are doing now is part of a natural evolution, going from two sales organizations to one. We are choosing as primary model for the one sales force, the Kraft-Oscar organization," Bowlin said.
That model calls for headquarters selling and retail execution for each account to come under the supervision of one team manager, said Richard Lenny, senior vice president of sales and customer service.
Each team leader is supported by as many as five category managers, depending on account size, who participate in headquarters sales. The team is supported by a retail sales force to execute at store level. "Now one sales rep will visit each store, which eliminates a lot of non-value-added redundancies, like drive time, etc.," Lenny said.
He added, "This team structure is for all of our customers, clubs, mass merchandisers, convenience stores, independents and other formats not mentioned here. If they sell our brands, this is for them."
In support of the account teams, the new Kraft Foods field organization will be organized into approximately 20 geographic regions. "Those will have decentralized, cross-functional resources to support the account teams," he added.
Lenny stressed that the company has resolved to design the field force from the CBTs inward. "Our approach is to build the systems around the teams, not the other way around," he said.
While the structure of the sales force will be changed to be more customer-oriented, the structure of the company's brand groups has been altered to better reflect consumer attitudes, said Bowlin. Kraft has established cross-functional teams at its offices in Chicago and White Plains, N.Y., which focus on collections of brands that are linked by consumer usage.
Newly created are the Dinners division, which includes Kraft dinners and side dishes, and the DiGiorno, Minute Rice and Stove Top businesses; and the Enhancers division, which includes pourable salad dressings, barbecue sauces, margarines, and the Good Seasons, Log Cabin and Shake 'n Bake brands.
Said Lenny, "In the corporate headquarters we are organized around consumer categories. In the field, we are organized around accounts, but with linkage to category teams through the regions."
He added, "Our teams will be deployed not just on the size of the customer but on how each executes marketing strategy."
Kraft Foods' new sales structure specifically excludes several food businesses that for various reasons are not direct warehouse distributed, said Bowlin. Specifically, the company's bakery products (Entenmann's) and its frozen pizza businesses (Jack's and Tombstone) are store-door delivered and will stay that way.
He added that Kraft Foods is about 90% direct sales in terms of business volume. However, he said, "When smoke clears, our powdered soft drink and Cool Whip businesses will remain under our broker sales management organization. We have long ago determined these products were best brokered. Our brokers have been informed that there will be no implicit or explicit changes to broker involvement under this change."
