Shell Lubricants North America announced a reorganization yesterday that will take effect the first of the year. Based on exit polls of the meeting taken by JobbersWorld, Shell marketers are cautiously optimistic that the changes made to the organization are for the better.
As shown below, Shell's North American Lubricants business is currently headed by Lisa Davis, President of North American Lubricants. Andrew Hepher, VP of sales reports directly to Davis and oversees the activities of both direct and distributor sales. Distributor sales include four District Managers (West, Central, East, and South East) reporting to Hepher. In addition, there is another branch in the organization engaged in direct Business-to-Business sales. Whereas the B2B part of the organization communicates and coordinates with the District Managers in distributor sales, they report directly to Hepher. Marketers have been told roughly 25% of Shell's B2B's activity should be allocated on working with the distributor side of the business.
Now for the changes.
According to the Shell marketers JobbersWorld spoke with, the first major change in the organization is Andrew Hepher's exit from the North America lubricants business. Although Hepher's next assignment with Shell was not disclosed, marketers say they suspect he may be returning to Shell across the pond.
The second major change is the consolidation of four districts into three. As shown below, the south east district in the current organization will go away. It's understood that most of the business activity in this region will be handled by the General Manager in the East.
According to marketers, equally significant is that the B2B business activity will be managed by the General Manager in each of the three regions. This means the regional GMs will have oversight and bottom line responsibility for both distributor and direct business. It was also noted that, although Shell did not announced who the GMs will be (those announcements are expected in mid-October), each regional GMs will have an area of expertise that Shell NA Lubes will turn to for guidance in that area. As an example, one may have the expertise with national accounts and provide Shell with guidance across all districts on certain national account related issues.
So why do most of the marketers JobbersWorld spoke with about the reorg feel the new organization may be a move in the right direction?
Whereas marketers are always, and rightfully so, guardedly optimistic when changes occur, those whom JobbersWorld spoke with say these changes tighten the organization and this should make it more intimate and responsive to marketer and customer needs. Further, having both distributor and B2B sales managed by, and accountable to, the regional GMs will help to improve cooperation and collaboration between these often times competing efforts, and help assure 25% of B2B/Direct's time is allocated to working with marketers to help grow the marketer's business.
In addition, a number of marketers JobbersWorld spoke with say this reorganization will likely lean out some of Shell's overhead.
Let us know what you think. Is this just another example of musical chairs in the world of major oil companies, or is there substance to it?
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