University of Cebu – Main Campus

COLLEGE OF HOSPITALITY DEPARTMENT

Assignment in
TOTAL QUALITY MANAGEMENT
HM BMEC 2

Submitted by:
Chavez, Darah Bless T.
BSHM 4th Year
 THE QUARTERLY SALES REPORT

Ron Hagler, the vice president of sales for Selit Corp., had just received a report on the
past five years of quarterly sales data for the regions under his authority (see sales data shown in
the Excel worksheet C02-CaseData.xlsx on the Student Companion Site). Not happy with the
results, he got on the phone to his secretary. "Marsha, tell the regional managers I need to speak
with them this after- noon. Everyone must attend."
Marsha had been Hagler's secretary for almost a decade. She knew by the tone in his
voice that he meant business, so she contacted the regional managers about the impromptu
meeting at 2 P.M. At 1:55 P.M., the regional managers filed into the room. The only time they
were called into a meeting together was when Hagler was unhappy.
Hagler wasted no time. "I just received the quarterly sales report. Northeast sales were
fantastic. Steve, you not only improved 17.6 percent in the fourth quarter, but you also increased
sales a whopping 20.6 percent over the previous year. I don't know how you do it!" Steve smiled.
His philosophy to end the year with a bang by getting customers to stockpile units had paid off
again. Hagler had failed to notice that Steve's first quarter sales were always sluggish.
Hagler continued: "Terry, Southwest sales were also superb. You showed an 11.7 percent
increase in the fourth quarter and an 11.8 percent increase over the previous year." Terry also
smiled. She wasn't sure how she did so well, but she sure wasn't going to change anything. "Jan,
Northwest sales were up 17.2 percent in the fourth quarter, but down 8.2 percent from the
previous year," said Hagler. "You need to find out what you did previously to make your sales
go through the roof. Even so, your performance in the fourth quarter was good." Jan tried to hide
his puzzlement. Although he had received a big order in November, it was the first big order he
had received in a long time. Overall, sales for the Northwest were declining.
Hagler was now ready to deal with the "problem" regions. "Leslie, North Central sales
were down 5,5 per- cent in the fourth quarter, but up 4.7 percent from the previous year. I don't
understand how your sales vary so much. Do you need more incentive?" Leslie looked down.
She had been working very hard the past five years and had acquired numerous new accounts. In
fact, she received a bonus for acquiring the most new business in 2009.
"Kim, Mid-Atlantic sales were down 3.2 percent in the fourth quarter and down 2.6
percent from the previous year. I'm very disappointed in your performance. You were once my
best sales representative. I had high expectations for you. Now, I can only hope that your first
quarter results show some sign of life." Kim felt her face get red. She knew she had sold more
units in 2011 than in 2010. "What does Hagler know anyway," she thought to herself. "He's just
an empty suit."
Hagler turned to Dave, who felt a surge of adrenaline. "Dave, South Central sales were
the worst of all! Sales were down 19.7 percent in the fourth quarter and down 22.3 percent from
the previous year. How can you explain this? Do you value your job? I want to see a dramatic
improvement in this quarter's results or else!" Dave felt numb. It was a tough region, with a lot of
competition. Sure, accounts were lost over the years, but those lost were always replaced with
new ones. How could he be doing so badly?
How can Hagler improve his approach by applying principles of statistical thinking? Use
any analyses of the data that you feel are appropriate, such as construction of Excel charts or
computing summary statistics to fully explain your thinking and help him.

I. Problem
Facts of the case:

 Ron Hagler, the Vice President of sales for Selit Corp., had just received a report on the
past five years of quarterly sales data for the regions under his authority.

 Hagler had failed to notice that Steve’s first quarter sales were always sluggish.

 Overall, sales for the Northwest were declining.

 Mid-Atlantic sales were down in the fourth quarter and another down from the previous
year.

 South Central sales were the worst of all. Accounts were lost over the years.
II. Alternative solutions

1. Applying the Quality Management Principles

Tools and approaches that help the managers and workers make practices effective. They
are vital for achieving high quality and performances excellence. It helps an organization achieve
greater consistency in tasks and activities that are involved in the production of products and
services. When total quality management principles are employed in any organization,
profitability is increased while errors and waste are minimized.
2. Applying the statistical thinking
Statistical thinking is about understanding, controlling and reducing process variation.
Learn about problem-solving tools for defining and scoping your project, and understanding the
data you need to solve your problem. The foundation of statistical thinking is built upon having
statistical knowledge, context knowledge, and the information in data. Statistical thinking is the
synthesis of these elements that provides implications, insights, and conjectures to make your
process decisions.

III. Recommendation
I recommend that Ron Hagler, the vice president of sales for Selit Corp, apply the quality
improvement in an organization is in a close relation with improving the efficiency of
individuals, groups and the organization in whole. Ron Hagler must improve his leadership
skills, he should not rank or appraise people arbitrarily, and he must accept the responsibility for
continuous quality improvements and be dedicated to empowering others. The success of the
organization to achieve quality control depends on the ability and attitude of the top
management.

IV. Implementation
1. Improve leadership skills.
2. Evaluate employee performance progressively and acknowledge their past accomplishments.
3. Set realistic goals for employees and properly react to such variations.
4. Develop a reward system that would satisfy employee’s basic need which can be considered
fair and just.
5. Review and revise the sales target per region.