INSEAD Library

Includes bibliographical references

Digitized

Working at Cross-Purposes How Distributors and Manufacturers Can Manage Conflict Successfully Contents Foreword............................................................................................ vii Preface................................................................................................ ix DREF Board of Directors and Officers............................................ xiv Introduction.......................................................................................... 1 Getting Some Answers................................................................... 1 Learning from the Survey Results.................................................. 4 How the Book Is Structured........................................................... 6 Part I: The Foundation--What Happened to Distribution? 1. In the Beginning............................................................................. 11 A Few Basics................................................................................ 11 A Closer Look at the Distributor's Role....................................... 12 Summary....................................................................................... 17 2. What Changed?............................................................... 19 Stages in the Modern History of Wholesale Distribution............ 19 Distributors Respond.................................................................... 23 Summary....................................................................................... 25 Part II: Relationship Economics--It Is All about the Money 3. Where Is the Money?..................................................................... 29 Focusing on Suppliers...................................................................30 Focusing on Distributors.............................................................. 36 Leveraging Channel Power..........................................................42 Summary...................................................................................... 44 4. The Law of Legitimate Cross-Purposes......................................47 What Happened to Shared Prosperity?........................................ 48 Win-Win: A Failed Experiment...................................................49 Some Insights from the DREF Survey Interviews.......................50 The Transition to Legitimate Cross-Purposes............................. 53 The Case of Mixed Blessings.......................................................55 The Case of Market Purity...........................................................56 How to Operate in a World of Legitimate Cross-Purposes......... 57 Loyalty Is an Economic Term......................................................62 Summary...................................................................................... 63 5. The Law of Perpetual Change...................................................... 65 The Early Signs............................................................................ 67 The Case of Death by a Thousand Cuts.......................................68 Ignoring the Signs........................................................................ 69 The Four Common Mistakes........................................................70 The Case of the Unacceptable Business Plan.............................. 72 The Danger of Unintended Consequences...................................73 Summary...................................................................................... 74 Part Ill: Getting It Right--Diagnostics and Action Planning 6. Is the Relationship Dysfunctional?............................................. 81 The Dysfunction Model............................................................... 82 Something Is in the Air................................................................ 83 The Case of Missed Messages..................................................... 88 A Tool for Assessing Relationship Health...................................89 How Close Is Too Close?.............................................................91 Moving from Zone to Zone..........................................................91 The Case of Being Burned Before...............................................95 Summary...................................................................................... 96 7. Assessing the Risks of Change....................................................99 The Internal Economic Discussion............................................. 100 The Case of Better Lucky than Smart........................................ 102 Scenario Planning....................................................................... 103 The Legal Situation.................................................................... 105 The Distributor Contract.............................................................107 Valued Contract Practices.......................................................... 109 The Case of Channel Power over Market Reality...................... 111 Summary..................................................................................... 113 8. The Action Plan............................................................................ 115 Getting Back to Green: Where to Start...................................... 115 The Case of the Second-Class Citizen....................................... 121 Wisdom from Experience........................................................... 122 The Case of Who Is Next?.......................................................... 123 Waking the Sleeping Dog........................................................... 125 Summary..................................................................................... 128 A Call to Action.......................................................................... 128 A Final Message to the Reader................................................... 128 Appendix: DREF Executive Survey................................................ 131 References........................................................................................ 139 About the Authors............................................................................ 141