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CASE : KOMAL FOOD PRODUCTS COMPANY LTD.
Kornai Food Products Company which was founded in 1935 to manufacture grocery and other food products had in the course of years grown into a vast enterprise having offices and branches in almost all the important cities of the country. Its annual sales amounted to about Rs. 50 to 60 lakhs a year.
The company`s Head Office and factory were situated at Calcutta. Its products were distributed through five zonal sales offices which directed 25 district sales offices throughout the country.
The administrative responsibility of each zonal office was borne by a manager whose duty it was to promote sales in his zone. He was advised and instructed by the Head Office from time to time.
Under the control of each onal Manager there were four functional heads, viz., Personnel Manager, Accounts Manager, Sales Manager and Office Manager. These executives advised and assisted the Zonal Manager on various functions relating to the zonal administration. Each functional head enjoyed sufficient freedom and independence in respect of his work.
On matters relating to sales the Zonal Manager received advice from the sales Manager. The latter often formulated policies, plans and schedules for sales operations ; and submitted his views on all the matters concerning sales to the Zonal Manager. Many a times he also issued orders and instructions to the District Sales Managers but all these were routed through the Zonal Manager. Ordinarily all his views and advice were accepted and approved by the Zonal Manager.
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Questions :
(i). What is the problem in the case ?
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(ii). Analyse the cause which led to the problem.
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(iii). As a member of the management team, what would you do to solve the problem immediately ?
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(iv). Suggest a suitable organisation structure for this company so that such problems do not occur in future.
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