CALIFORNIA CREDIT LIFE INSURANCE GROUP

(Case Study)

Submitted to: Prof. Fareed Fareedy

Submitted by: Fahad Amjad Ghazanfar Latif M.Junaid Qurat ul Ain

Qualitative facts In 1961, California Credit Life Insurance Group was incorporated in Los Angeles. CCLIs initial product included all types of life insurance CLI has expanded its product line to include all types of insurance such as health, automobile, professional liability, pension and retirement programs, commercial packages, and related financial services. The sales reps work independently and do not need day-to-day supervision or contact with their area sales managers. Area sales managers have hiring authority and can set base salaries with approval from CCLI. Area sales managers can recognize excellent performance by increasing the base salary and modifying a sales reps territory to cover better accounts. 1994, CCLI decided to open an office in the southeastern area of the United States as soon as all staffing and physical details could be resolved. The southeastern region became reality in 1998, with James Bradford selected to be area sales manager. Bradford had been sales rep in the Dallas region and had been selected for southeastern region the new position based on his excellent sales performance and his strong interpersonal skills. Promotional opportunities are limited and turnover among area sales manager has been very low. Renoldi wants to change territory for greater sales opportunities but Bradford denied it because he felt that she was unable to satisfy especially male clients and there is still sale potential in this territory. Renoldi claimed Bradfords territory assignment is discriminatory. HBRS conducted qualitative research including focus groups with women and men sales rep and findings revealed some of the problem faced by women sales rep. Flangen came to know about many problems including performance evaluation and promotion policies.

Quantitative Facts CCLI has 15 regional offices and 230 sales representatives Area sales mangers typically supervise 15 people, a large number but manageable given the nature of the selling job. During the course of a year, each employee receives two performance evaluations. The performance is also based on meeting their quotas, which are set by the area sales manager based on guidelines, handed down from Vice President of Sales, and negotiations between the area sales manager and each sales rep. Sales reps receive a 3% commission on sales in addition to base salaries. Bradfords bonus allocation did not reflect sales volume and seem to be determined by taking the total bonus award and dividing it by 15. This process added an average of $1750 to each sales rep income. Renoldi join CCLI on 1998 and she made quota each year except for last 2 years. One third of Bradford sales force should be female to promote equal employment opportunity. Quota achievement of Renoldi is decreasing in last years from 99.6 in 2003 to 98.5 in 2004. Job satisfaction of female in Southeastern region is 45.13 whereas companys overall female satisfaction figure is 50.19 (Exhibit 5)

Core Problem: The core problem is that there is gender discrimination by the supervisor because he is not providing equal opportunities to female sales rep.

Other problems:

The behavior of supervisor is not satisfactory with women as in Exhibit 5 figure shows that women satisfaction is almost 7% less in Southeastern region as compared to the total company figure.

The bonuses are not allocated with respect to sales volume instead average is taken by dividing total bonus award with 15. There is a problem with performance evaluation system as in Exhibit 1 shows that Renoldis achievement of quota declines in last two years but Exhibit 3 shows her performance evaluation is Y.

Also performance evaluation is not timely.

Recommendations: The supervisor should promote equal employment opportunities because female in the Southeastern region have comparatively low satisfaction level from supervisor as compared to the total companys average. Bonus allocation method should be changed. And bonus should be allocated on the basis of individuals sales volume. Performance evaluation system should be made more effective with the involvement of HR. Also performance evaluation should be done more often like quarterly or monthly instead of semi annually. Conclusion: As there is the problem of gender discrimination so the senior management should take action to promote equal opportunities. Also the supervisor should change its behavior towards female sales rep so that they can work better and help the company in achieving the sales targets.