DEL MONTE REVAMPS OPERATING STRATEGY

PAT NATSCHKE LENIUS

CHICAGO -- Del Monte Foods, San Francisco, improved its ability to perform account-specific promotions by revamping its operating strategy and its organizational structure at the beginning of this year, said Bob Jordan, manager of trade promotions.

"We changed our organizational structure because we changed our operating strategy," said Jordan, speaking at a conference here entitled, "Trade Marketing in Transition" held by the Marketing Advisory Council, New York.

The scope of the changes at Del Monte extend to the creation of a trade marketing function, a compensation system that rewards profitable sales behavior and new operating systems that support cross-functional activities.

Taking a page out of the business re-engineering texts, Jordan observed that Del Monte, like most manufacturing organizations, was set up in a "silo" management system, which isolates various departments from each other along functional lines, such as marketing, sales development, field sales, product supply, manufacturing and customer service.

"At Del Monte we were structured that way until last December," he said. Upon examination, the company found its market strategies were not well defined across all those functions.

As Del Monte realized it is a trade-driven company, it created a trade marketing department. "We took our old marketing department and sales planning and put it together as trade promotion," Jordan said.

As a result of the restructuring, Del Monte is able to take a category or product plan and align it with an individual retailer's business objectives, he said.

In the drive to upgrade its sales personnel from sales managers to business managers, Del Monte changed its reward system, since field sales had focused only on volume. It also designated field-based trade marketing managers.