By Allen E. Hoover of Banner & Witcoff Ltd.
You are the CEO of a large, publicly traded company with sales of almost $2 billion. In recent years, demand for your company’s products has surged. In addition, some of your customers are placing larger, more complex orders that require extra effort to fulfill. For these reasons, customers are starting to wait longer for order fulfillment. Your company’s resources are becoming stretched a little thin, and you are becoming worried about this. The quality of your company’s products is generally very good, and in fact your company’s employees are regarded as being preeminent in the field. Nonetheless, a few concerns in this area have been raised, and you believe that these concerns are due to overtaxing of your company’s resources. What do you do? Here are two possibilities:
(A) Make an effort to increase capacity to meet the demand in a responsible and reasonable manner. Start hiring. Because attrition is inevitable, make plans for sustained growth. You may need to raise prices a little, especially for the more complicated product orders.
(B) There’s just too much demand for your product. Make it difficult and more complicated for customers to place orders. For the more sophisticated orders, make the cost prohibitively expensive. Your customers have purchasing agents. Think of ways to place the purchasing agents at personal risk when dealing with your company, so they are discouraged fro...