TO: Professor Susan Sampson

FROM: Madison Darrah, Abby Koss and Tenley Weinstein

DATE: 11 May 2016
RE: Conner Labs Case Analysis and Case Recommendations
Managerial Decision Issue Identification
Conner Labs lost one of their largest accounts, Joysco Technological Surgeries (JTS). This
account was lost due to a poor performance by one of Conners employees. The salesperson must analyze
their actions to determine where he/she went wrong. The main issue is there was inadequate training and
lack of product knowledge, as recorded throughout the case. First the Strategic Framework will be listed
to understand the forces impeding on the cataract market and the strengths and weaknesses of Conner
Labs. Following the Strategic Framework is the Case Analysis, the examination of the mistakes in the
case. Lastly, our team offers recommendations to Conner Labs that will help regain certain accounts and
ensure increasing revenues all the while explaining our assumptions and limitations.
Strategic Framework
The analytical tools that will be represented in this memo include the following: Porters Five
Forces, SWOT analysis and revenue and net income analysis. A Porters Five Forces will be helpful to
understand the external forces impeding on Conner Labs sector of the cataract surgery market. This will
allow for better analyzation of the loss of the account JTS. In addition to this, a SWOT analysis is helpful
to understand the internal forces impeding on Conner Labs that will better the recommendations for
Conner Labs. Lastly, analyzing the revenue and net income is pertinent in assimilating Conner Labs.
Case Analysis Background
A description of the market of which Connor Labs is in is listed to ensure complete understanding
of the framework of this case. The cataract surgery market is a growing market; the recent insurance
policies of Medicaid and Medicare cover nearly 40% of patients for cataract surgery (Cron & DeCarlo,
2009, p. 381). Additionally, developing cataracts has become more common; roughly 35% of the
population now develops cataracts in their lifetime (Cron & DeCarlo, 2009, p. 380). Because this market

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has grown over the last twenty years, the markets for selling cataract surgery equipment like diagnostic
units, surgical units and disposable instruments are highly competitive.
Conner Labs has had a 70% decrease in their market share of cataract surgery products from 1990
to 2004 (Cron & DeCarlo, 2009, p. 383). This is attributed to the cataract surgery market growing
tremendously (Cron & DeCarlo, 2009, p. 380) and salespeople are providing a higher quality of service.
This memo will move on to explain the importance of proper sales training and how to set proper sales
goals. The selling process for Conner Labs is extensive but necessary with such a competitive cataract
surgery market. The selling process involves speaking with hospital staff in order to identify their needs
but also to demonstrate the usage of their products. In addition to fostering relationships with potential
clients, the salespeople at Conner Labs are required to foster a long-term relationship with current
accounts. Next the industry and internal analysis will be analyzed then specific work of one salesperson
who was responsible for the large account, Joyco Technological Services (JTS) will be analyzed.
Industry and Internal Analysis
In order to best understand the forces impeding on Conner Labs, a Porters Five Forces analysis
was done. From the Porters Five Forces analysis it is clear that there are many external forces influencing
Conner Labs. Ways in which external forces are influencing Conner Labs is reflected in the companys
income statement for year ending 2004 (see Exhibit 1). As explained in Exhibit 2, Conner Labs supplier
power and buyer power are both high threats. This is due to suppliers requiring enabling patent licenses
that are costly. Conner Labs relies on single third-party vendors for diagnostic instrument platforms.
These platforms give the supplier power and the platforms allow buyers of Conner Labs products to have
control over the purchase. Their power comes from the high disparity with reimbursement. Furthermore,
it is a competitive market where many diagnostic tests perform similar functions on the market; this gives
the customers a lot to choose from. Similarly, competitive rivalry is high for Conner Labs despite the
patents on their products. This is due to patent protection not guaranteeing success. Furthermore,
competitors and their resources like technical, marketing, legal and sales of competitive companies may
take advantage of Conner Labs as their sales deplete. There is little threat to entry as there are high

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barriers to entry such as high start up costs. However, the high profitability of the cataract surgery
equipment market attracts new entrants. The threat of substitution remains medium as patent protection
and technical limitations make it so Conner Labs is preferred. These many external forces can all be
contributing factors to the loss of such a big account, JTS, but also make the selling process that much
more difficult. Now, it is important to recognize the internal forces tainting Conner Labs ability to
maintain its profitability.
In order to best understand the internal forces impeding on Conner Labs, a SWOT analysis was
done (see Exhibit 3). A SWOT is helpful because it describes the four forces affecting the company
internally and explains how Conner Labs conducts its relationships with their accounts. Conner Labs
strengths include the fact that they offer 100% warranty on all of their products. This is a point of
difference for Conner Labs as they are the only one in the market that offer this high level of service.
Additionally, Conner Labs leads in medical diagnostics and surgical products. As the leader in the market,
it is crucial for Conner Labs to excel in all areas so that their clients feel emotionally connected to the
leadership position of Conner Labs. The weaknesses of Conner Labs are the premium price point, lack of
competitive strength, decrease in market share, weak sales force and the inability for the sales force of
Conner Labs to abide by the company-wide policy of how to conduct a new account through the
National Account Planning Program (NAPP). The best explanation for the decrease in market share is
that sales force of Conner Labs lacks the proper training on how to manage large accounts which is also
displayed in their decrease in revenues from $558.5 million to $456.1 million (see Exhibit 1). The loss of
the large account with JTS and their lower price point competition requires Conner Labs to reevaluate
their sales program and the marketing department. And as current legislature exists, those who purchase
the equipment are instructed to purchase only the products at the lowest possible price. The opportunity
for Conner Labs is to continue using research and development to deliver the best products to make up for
their premium price. With the growing cataract surgery market, it is possible for Conner Labs to increase
their revenues and to regain their accounts.

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Salesperson Conduct Analysis
After reading the agenda of the salesperson, it became evident that there were many issues with
their sales techniques, especially this particular salespersons inability to abide by the National Account
Planning Program (NAPP) (see Exhibit 4). The salesperson failed to connect with the individuals
influential in the purchasing of Conner Lab products. In this case, the influential decision makers are
Sandy Adams, the Vice President of Purchasing, B.J. Avery, the JTS Director of Purchasing, and Dr.
Stenz, the lead Surgeon of JTS. The salesperson failed to create another meeting time with Dr. Stenz after
their salespersons first appointment. In correspondence to this mistake, the salesperson arrived at the
hospital, two days later with no one aware that [he] was coming (Cron & DeCarlo, 2009, p. 385).
Instead of meeting with Dr. Stenz this day, he met with the office manager, who was disconnected to the
Purchasing Department. A week following the meeting with the office manager, the salesperson called the
Purchasing Department. Although the salesperson called the correct department, which is influential to
the purchase, they should have conducted this call immediately after his first meeting with Dr. Stenz.
Although it was a nice gesture to take the Purchasing Department Vice Presidents Assistant out to lunch,
the salesperson failed at connecting with an individual important to the signing of the contract. The
salesperson called Dr. Stenz a month after his lunch with the Vice Presidents Assistant to schedule an
appointment for the following month. Dr. Stenz denied the appointment and instead directed them to the
Head of Safety, who was completely non-influential to the potential deal with JTS. After this call, the
salesperson concluded in not developing a friendly professional relationship with Dr. Stenz, leading to the
loss of the contract. Developing relationships with clients of Conner Labs needs to be the salespersons
top priority.
Developing relationships with clients implies the salesperson has an ample amount of knowledge
on their specific products, the companys competitors, and influential people in the buying process. The
salesperson at Conner Labs failed to have knowledge on competitive products, which hindered his ability
to handle objections that JTS had. An example of this is on May 15 the salesperson was trying to reach
Dr. Stenz to talk about JTSs objection of price but instead reached an associate whom they engaged in

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conversation with about price but the salesperson remained unknowledgeable about what they were
basing [their] opinion on price [on] (Cron & DeCarlo, 2009, p. 386). This lack of knowledge on
competing products hinders the salespersons ability to make a case on why JTS should purchase their
products over any other products on the market. In addition to this, the salesperson did not conduct any
research previously before meeting with potential influential people in the buying process at JTS. For
example, on March 16th the salesperson explains in his activity log that Dr. Stenz told him he must speak
with the Head of Safety, H.M. Jones. The salesperson mentioned that they did not know who the person
was and how they were connected to the buying process. The salesperson should have researched H.M
Jones and developed some reasoning as to why Dr. Stenz would ask for them to speak with him. This is a
flaw of the salesperson and it directly negates Conner Labs policy on how to conduct a new account,
outlined by the National Account Planning Program (NAPP) (see Exhibit 1). The NAPP was developed
in order for Conner Labs employees to abide by the same list of how to conduct a new account. This
new approach emphasizes the importance of relationship building, value-added selling, identification of
product line extension opportunities, an account tracking system and coordination with management. If
the salesperson follows this new program, they will develop a strong pitch, which will increase sales and
improve their overall performance.
The salesperson performed an inefficient attempt to look for their competition for the JTS
account. They failed to perform their own SWOT analysis to compare Conner Labs strengths and
weaknesses to their competitors. This failure appeared later when B.J. Avery, the JTS Director of
Purchasing, told the salesperson that their prices appeared to be quite high a month and a half prior to the
salesperson losing the account. The salesperson needed to know Conners competitors so that they can
directly compare their weaknesses to Conner Labs strengths. After analyzing this specific salesperson it
also is helpful to understand the companys industry and internal analysis.
While the salesperson made mistakes while conducting the account, their manager is at fault as
well. If the manager was completely engaged in the selling process of his employees, the loss of such a
large account may not have happened. On May 18th, the salesperson was making an appointment with

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Dr. Stenz and felt confident enough that this was the meeting they would get the sale. The Vice President
of Sales of Conner Labs reached out to the salesperson and suggested he attend the meeting as well (Cron
& DeCarlo, 2009, p. 386). After the suggestion of the Vice President of Sales, the salesperson declined
his offer and decided he was confident in the sale. While the salesperson may have felt confident in the
sale, there manager should have attended the meeting anyway. At the very least, the manager should have
required that his salesperson provide documentation of why he was so confident in the sale. Moreover, the
manager should not have brushed off such a meeting like the one with JTS where $10.5 million was on
the line.
Case Recommendations
From the alternatives above, our team has recommended an implementation of a training program
on the National Account Planning Program (NAPP). If Conner Labs implemented a better training
program for their sales force, it would prevent big account losses, like Joysco Technological Surgeries.
The salespeople of Conner Labs need to be trained on how to conduct the proper protocol of the NAPP.
Furthermore, they need to be trained on the basics of selling and how to conduct a relationship with an
account. The larger the account is, the more time and effort is needed to put into the account. The
manager also needs to check-in with his employees more often when conducting large accounts. To
prevent another loss of a large account the manager will need to be more involved with his employees.
This is so because the loss of large accounts like JTS has an incredible impact on a company like Conner
Labs. Conner Labs suffered the loss of over $10 million and will need to work hard in order to regain that
revenue. More than that, the manager of Conner Labs should reach out to Dr. Stenz and try to build that
relationship back to hopefully gain that sale back within a couple of years. While it will be important for
both the sales manager and sales employees alike to sell product and be properly trained, the marketing
department also holds responsibility in conducting accounts and making the sale. The marketing
department of Conner Labs acts as if the products of Conner Labs are in the introduction and growth stage
when in fact the products of Conner Labs are in the maturity stage. Instead the marketing department
should be focusing on defending their market share, maximizing the number of hospitals and clinics their

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products are in, and most importantly, the marketing department should stop stressing the product lines
point of difference and instead be reminding the market of their features. With proper training, the sales
force will be able to retain accounts and relationships within the accounts that continuously bring in
revenue for the company. With well-trained sales employees, Conner Labs will be able to start a longterm mentorship program that ensures that the sales force is performing at high-standards.
Limitations and Assumptions
While analyzing the case there were restrictions of some variables. In some areas of the case,
there were assumptions made about the individuals involved. For the purpose of this case, it was assumed
that Dr. Stenz did in fact have buying power in the purchasing decision for JTS and was in fact affiliated
with the decision of the Purchasing Department. Additionally, it was assumed that both Sandy Adams and
B.J Avery were the most important figures in the buying decision for JTS. Lastly, it was assumed that
Conner Labs held patents on all their technology. This was assumed because Conner Labs is the only
seller of surgical products that are able to conform to existing equipment in hospitals and doctors offices.
While there were assumptions made the team was able to offer Conner Labs the best recommendation on
how to improve their sales and regain the large account lost, Joysco Technological Surgeries.

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References
Cron, W. L., DeCarlo, T. E., & Dalrymple, D. J. (2009). Dalrymple's Sales Management. Hoboken, NJ:
John Wiley & Sons.

Exhibits

Exhibit 1:
Revenue and Net Profit Trend Analysis: Conner Labs

Numbers retrieved from: Dalrymples SALES MANAGEMENT 10th Edition

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Exhibit 2:
Porters Five Forces Analysis: Conner Labs

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Exhibit 3:
SWOT Analysis: Conner Labs

Strengths
100% Warranty on all products
Diagnostic units -- only unit on the
market that gives surgeons 100%
confidence in diagnosis

Opportunities
Growing cataract surgery market
Continuous use of R&D on surgical
and diagnostic units

Weaknesses
Premium price point -- priced a lot
higher than competitors
Lack of competitive strength
Decrease in market share
Weak sales force
Difficult time following correct New
Account Planning Program (NAPP)
strategies
Threats
Overcoming the loss of big account JTS
Lower price point competition
Lost 70% market share

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Exhibit 4:
Conner Labs: National Account Planning Program (NAPP)

Image retrieved from: Dalrymples SALES MANAGEMENT 10th Edition