Makenzie Schmidt
Dr. Gerry Macintosh
Marketing 634
2/27/2018
Case Four: McGee Metals
McGee Metals is a is a diversified metal company specializing in three unrelated groups; aluminum, stainless steel and a specialty materials group, which is broken down further into composite, titanium and fiberglass divisions. Don Mann is the regional sales manager for the composite materials division. Mann’s path to management is typical to that of most management in the company where advancement often occurs either by promotion within the position, promotion into sales manager or a pass-through promotion.
McGee Metals selling strategy is divided into three unrelated groups; aluminum, stainless steel and a specialty materials group, which is broken down further into composite, titanium and fiberglass divisions. Specifically, composite materials have been growing at a rate of 25% a year and is expected to continue, although would be higher if the materials weren’t so expensive to fabricate. This makes sales people in the CMD (composite material division) even more important. McGee Metals compensation is based on Hay rankings of the salesperson and currently range from entry level (3) to account executive (14).
The problem for McGee Metals is that beyond higher compensation they have little incentive to motivate salespeople who wish to remain in sales but who do not have the right qualifications to become a sales manager. This is especially true when an employee has reached the highest payment level the company offers.
The first alternative is McGee metals to just restructure to allow for more compensation levels.
The second alternative would be for McGee Metals to restructure the entire company to allow for movement for all divisions and other benefits.
The third alternative would be for McGee Metals to stick to the status quo and see how things work out in the near future.
The first alternative is McGee metals to just restructure to allow for more compensation levels. We don’t have a lot of information on the other divisions, but we know this is important to the composite material division. We know that due to the expensive nature and difficulty to fabricate materials that well-trained salespeople are key to providing customers with knowledge for their application problems. Not only does this require extensive training, but additionally trust between the buyer and seller. Without advancement options McGee metals is losing their top salespeople- a large concern considering that currently four of the seven salespeople reporting to Mann are at grade level 12. We have to assume that management positions won’t be open for all four salespeople and losing over 50% of the strongest people in this division is not an option. Mann himself doesn’t like the idea of topping out his salary level.