“Who Moved My Cheese?” Change Management & the Challenges of Implementing a New Trade Promotion System


"Today more than ever business environments are rapidly changing, requiring your company to continuously adapt. If environmental complexities including customer demands, regulatory requirements, and competition are not adequately addressed, businesses run a high risk of failure." Clarkston Consulting, www.clarkstonconsulting.com.

Change is natural and can be very positive. Staying competitive in these challenging economic times requires change. Managing change means managing people's fears which can be unpredictable. We all seem to be trying to figure out how to manage change and there are many bestselling books are out there on the topic to help. Implementing a new Trade Promotion Management (TPM) process and tracking tools can usher in some of the most difficult change management challenges imaginable. However, if properly approached change management can be successfully implemented, but there is a right way and a wrong way to approach such a daunting challenge as a new TPM process or a new planning tool.

"Who Moved My Cheese?," written by Spencer Johnson, M.D., is a #1 best selling story of four characters living in a maze. Each one faces unexpected change when they discover their cheese has disappeared. Each one adapts to change in the maze differently. One doesn't adapt at all. Metaphorically, the maze represents our organizations and communities and the cheese represents our careers, relationships, wealth, etc. This timeless allegory reveals profound truths to individuals and organizations dealing with change. Moral: Don't get upset by change. Adapt for long term success.

According to the Graziadio Business Report from Pepperdine University, there are some basic principles to remember when implementing change:

  1. Do no harm. Implementing change poorly is sometimes worse than not implementing change at all.
  2. All change involves personal choice. Any organizational change is preceded by personal change.
  3. The relationship between change and performance is not instantaneous. As far as humans are concerned, there is so such thing as an instantaneous transformation.
  4. Connect change to business strategy. Change should only be pursued in the context of a clear goal.
  5. Involvement breeds commitment. Managers who do not involve their workers in decisions run the risk of stalled change efforts.
  6. Any good change effort results in increased capacity to face change in the future. It's one thing to "install" change and another thing to "implement" change.


Managers and leaders sometimes forget these principals in their haste to adapt the "latest and greatest" ideas. Although managing change is difficult, remembering the basics can help ease the transition. One change some progressive companies are making is to implement a Trade Promotion Management (TPM) system to improve the efficiency of their forecasting and trade promotion spending. When change is connected with a clear business strategy, it is easier to obtain buy in throughout the organization. The process, however, is not without its unique set of challenges.

Challenge #1: Getting buy in throughout the organization.

How do you select and implement rather than "install" a system? The very first step is to collect the stake holders (sales, marketing, finance, logistics, etc.). This group should consist of cross-functional managers who are peers and will actually be using the new process or system. Remember, involvement breeds commitment. These cross-functional representatives, as well as all those who will be involved in the process, need their success tied to the success of the implementation. Establishing quantifiable group goals and measuring the successful accomplishment will help keep the team focus on obtaining results. The next step is to gather and carefully consider the input from the groups and address concerns as they relate to process. This takes more time and coordination, but will pay dividends with the support it garners. The entire process needs to be tied to some level of satisfaction within the organization and the question; "What's in it for me?," needs to be answered. The job can be done faster, easier, more accurately; the individual may be able to make more money, etc., because of this new process and software. Make them see the value as it affects them personally. The new system should be "sold" throughout the organization by showing people what they have to gain. Personal change precedes organizational change.


Challenge #2: Getting the right process.

In the case of a TPM process, a series of sales planning and trade spending decisions must be made and communicated throughout the organization. The question is how to best streamline the flow of information from the trade spending planning process, to the approval process, to the execution process, to the evaluation process.

The team must evaluate and perhaps re-write the TPM process. Perhaps there was no formal process and one must be invented. Perhaps the process evolved around systems that no longer exist and is no longer effective. Careful consideration should be given to avoid the "not invented here" syndrome and once again, input from all functional areas must be collected and considered. If the process is broken, a software tool wrapped around a wrong process will actually inhibit good change management. If the process is intuitively smooth, clean, and well thought out, then a software tool wrapped around that new process will actually enhance change management.

The implementation team should establish a timeline to implement the process with success milestones along the way. These success milestones should be communicated to everyone in the organization to keep each person focused on the achievement. This also serves to re-focus if the group gets off track. In a large organization, it's better to select a small test group and make sure the process flows, before extending the new process and system to the entire company. Incremental change is important when adopting a new process. Do one thing well first. Then move on to other, more complicated areas.



Challenge #3: Getting the right tools.

Finding a tool that is easy to implement, gets the job done, and is affordable is a huge accomplishment. Often CPG companies will spend more than they need to just to get to a viable trade planning tool. The bell curve in how people learn technology will impact project implementation. Some learn fast, some never learn, and some learn what they need to accomplish their jobs. The user interface must be simple, easy to learn and intuitive to the user. If not, it's an uphill battle.
Fox diagram.jpg

There are many companies selling software solutions for demand forecasting, supply chain management, retail and warehouse inventory control, and logistics planning, etc. One such integrated Sales & Operations Planning tool built for the consumer products industry comes complete with the added benefit of an integrated trade spending management component, is the Fox Collaborative Planning System.

This tool allows an account manager to build a forecast based on his individual accounts and product group promotions, using historical volume & base volume, promotional tactical lifts, and spending budgets. The system communicates volume, spending, and approval status throughout the organization. Forecasts are literally built from the ground up, one product group at a time, account by account based on factual lift calculations resulting in a one number forecast tool. Spending authority and budgets come down from management, get allocated, approved, presented to customers, approved again, and are officially "planned" and in the system.

Gaps between business objectives and forecasts are easily visualized and understood. Red flags are flown when inventory issues arise and spending goes above budget. One of the major strengths of this system is the ability to plan and evaluate and to use this information in future planning cycles.

Challenge #4: Getting used to new levels of accountability.

When you go from a forecasting and planning approach that uses a bit of mystery, smoke, and mirrors to a logical, fact based system, you will likely ruffle some feathers. The sense of threat, fear, and loss of control increases when you're under the microscope and all your numbers can be questioned, analyzed, and monitored. Some sales managers get defensive and are uncomfortable losing their proprietary knowledge set (their "job security"). They like keeping total control over their key accounts. This can be overcome with time, involvement, training, reassurance and consistent objectives, that is, their personal success tied to the success of the implementation.

Senior management must stay the course as the new trade planning process and tools are implemented. Volume at any cost, quarterly loads, and mortgaging volume must be replaced with fact based planning, event based forecast numbers and a "one number" system that is accepted across the organization.

Although there are challenges to implementing any type of change, you can be successful implementing a new trade promotion management system. Keep in mind the pitfalls, set goals, and establish accountability, take baby steps, and go.

Insight, information & Consulting Services, Inc. has the experience and the knowledge to help your company navigate the Trade Promotion Management water. We can help your company develop the right processes, select the best and most efficient tool; and put in place the right components to help minimize the impact of change management on your TPM project. Please call us to discuss your needs and ask for Rick Pensa at 770-425-4243 or on the web at www.insightinformation.net .

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