---
title: "City Manager Chases KPIs, Distributor Chases Profit: How to Reconcile?"
description: "Amid China's economic slowdown, fragmented consumer demand, e-commerce impact, and squeeze competition, the traditional channel model in the FMCG industry is under pressure, with sales hitting bottlenecks. Against this backdrop, New Distribution, in collaboration with Professor Gao Song from East China University of Science and Technology Business School, launches the 'Gao Song: Channel Empowerment' column to explore new channel models, strategies, and methods for FMCG manufacturers and distributors in the new era. (This is the eighth in the series.) The essence of channel transformation for empowering marketing organizations in FMCG is downward delegation, fighting a war commanded by squad leaders."
author: "高松"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2020-01-14"
categories: "Dealer Operations, Management & Methods"
language: "en"
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original_source: "https://mp.weixin.qq.com/s/zkiXL4JBKOZVWp8Bnj0p5Q"
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citation: "高松. “City Manager Chases KPIs, Distributor Chases Profit: How to Reconcile?.” New Distribution, 2020-01-14. https://xinjignxiao.com/en/articles/city-manager-chases-kpis-distributor-chases-profit-how-to-reconcile-149eac68/"
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---

# City Manager Chases KPIs, Distributor Chases Profit: How to Reconcile?

> Amid China's economic slowdown, fragmented consumer demand, e-commerce impact, and squeeze competition, the traditional channel model in the FMCG industry is under pressure, with sales hitting bottlenecks. Against this backdrop, New Distribution, in collaboration with Professor Gao Song from East China University of Science and Technology Business School, launches the 'Gao Song: Channel Empowerment' column to explore new channel models, strategies, and methods for FMCG manufacturers and distributors in the new era. (This is the eighth in the series.) The essence of channel transformation for empowering marketing organizations in FMCG is downward delegation, fighting a war commanded by squad leaders.

Amid China's economic slowdown, fragmented consumer demand, e-commerce impact, and squeeze competition, the traditional channel model in the FMCG industry is under pressure, with sales generally hitting bottlenecks.
Against this backdrop, **New Distribution, in collaboration with Professor Gao Song from East China University of Science and Technology Business School, launches the 'Gao Song: Channel Empowerment' column to deeply explore new channel models, strategies, and methods for FMCG manufacturers and distributors in the new era.** (This is the eighth in the series.)
The essence of channel transformation for empowering marketing organizations in the FMCG industry is downward delegation, fighting a war commanded by squad leaders.
**This squad leader is the city manager, who needs to take on the command role at the marketing front.** Therefore, the job responsibilities of this role need to be redefined to respond agilely and efficiently to market demands and competitive changes.
Reviewing the entire process, Xiao Fang, the city manager responsible for the Jingzhou market, played a crucial role. Xiao Zhang and Lao Zhang are grateful to Xiao Fang.
However, recalling the past Xiao Fang, Lao Zhang's heart is filled with mixed emotions.
**-01-**
**The old Lao Zhang and Xiao Fang: a pair of adversaries**
Xiao Fang is the city manager for Brand X.
City manager is a common grassroots sales management position in the FMCG industry. Typically set at the prefecture-level market, it oversees sales work in both prefecture and county markets. The city manager leads a team of sales representatives and is the squad leader at the marketing grassroots.
**The job responsibilities of a city manager for Brand X typically fall into four areas:**
> **1. Achievement of sales targets and tasks**: Based on the company's sales targets and market plans, formulate the regional sales plan and market plan breakdown, responsible for developing new markets, recruiting distributors, achieving sales targets, and collecting payments.
> **2. Market control**: Responsible for managing distributors and terminal outlets within the jurisdiction, including: customer relationship maintenance, business negotiations, price management, market order maintenance, payment collection, after-sales service, and anti-counterfeiting.
> **3. Information hub**: Responsible for collecting market information, regularly collecting and organizing various reports, and submitting them to higher departments (finance, sales management, logistics, HR) on time. Responsible for implementing and executing company policies, systems, strategies, and promotional activities.
> **4. Team management**: Responsible for recruiting and training the sales team, boosting team morale, and ensuring team vitality.
**From the above description, the traditional city manager role is the manufacturer's control hub, helping the manufacturer implement market policies and strategies to achieve sales targets.** To achieve these goals, the city manager's main job is to control distributors and ensure the implementation of company tasks.
This creates conflict between the city manager's control role and distributors. The city manager works for company KPIs, while distributors work to make money.
Under KPI performance assessments, city managers, for their own bonuses and promotions, may pursue short-term interests and adopt abnormal means such as pressuring inventory, channel stuffing, and falsification, harming distributors' interests. This provokes distributor backlash and resistance.
In the past, City Manager Xiao Fang was no exception. Every time he visited Lao Zhang, it was either to collect payments, pressure tasks, or find faults. He never solved problems or provided practical help, nor did he care whether Lao Zhang made money.
Lao Zhang hid many things from Xiao Fang, treating him as a negotiating adversary he could neither afford to offend nor rely on.
**-02-**
**Three new roles for city managers: market planner, business consultant, team political commissar**
The 'Excellence in Business' project redefined the responsibilities of City Manager Xiao Fang.
In this project, Xiao Fang, Lao Zhang, and Xiao Zhang formed a business alliance. **This alliance aims to improve the quality of the distributor's business, with the authority to formulate market strategies and plans, execute them, and review and adjust.**
Accordingly, Brand X adjusted its performance assessment for Xiao Fang, making the achievement of the alliance's performance the core indicator for evaluating Xiao Fang.
Different management systems create different people. Under the new mechanism, Xiao Fang seemed like a changed person.
City Manager Xiao Fang is a post-90s generation, full of drive and eager to make a difference. However, under the old marketing organization management model, the city manager was just a passive cog, responsible for implementing top-down instructions.
Many times, Xiao Fang knew that the assigned tasks and market plans were not suitable for the Jingzhou market, but he had to passively accept them and pressure distributor Lao Zhang to complete them.
Xiao Fang could see the resentment and hostility in Lao Zhang's eyes. When market results were poor, Xiao Fang had to take the blame for insufficient execution. Xiao Fang felt wronged. As a post-90s who values self-perception, Xiao Fang began to consider leaving.
The 'Excellence in Business' project ignited the youthful vitality of City Manager Xiao Fang, who rolled up his sleeves ready to make a big move!
In the words of distributor Lao Zhang, this time Xiao Fang came to fight with a gun and bullets!
**During the six-month project period, City Manager Xiao Fang actually played three new roles: market planner, business consultant, and team political commissar.**
**1. Market planner**
**Under the empowering marketing organization channel model, the business alliance plays the role of the marketing front.** It is like the empowered small teams in the U.S. military described in the book 'Team of Teams,' granted battlefield decision-making authority, able to call for fire support, and flexibly and efficiently adjust based on battlefield conditions. The authority for frontline market decisions, traditionally held by company headquarters, is delegated to the business alliance.
In Brand X's 'Excellence in Business' project, to address the lack of market planning capabilities among frontline city managers and distributors, project designer Professor Li specifically designed a teaching module on market planning, covering market research methods, regional marketing strategy formulation, and specific strategies for product upgrades and competitive benchmarking.
After learning, City Manager Xiao Fang returned to the Jingzhou market and **the first step was market research.** Xiao Fang went deep into the frontline, not only visiting large supermarket terminals in the urban area but also following delivery vehicles to rural areas to visit small shops.
During the visits, Xiao Fang **focused on observing local consumer purchasing habits in Jingzhou, competitor performance, his own product performance, and the work status of Lao Zhang's team.**
After market research, City Manager Xiao Fang held discussions with distributor Lao Zhang and his son Xiao Zhang, raising the following issues:
> **1) Unreasonable product mix**: The product mix is aging, outdated products are not eliminated in time, and there is a lack of new products for consumption upgrades.
> **2) Lack of targeted competitive plans**: Brand Y is rising in the Jingzhou market, and there is a lack of targeted competitive strategies.
> **3) Insufficient control over large supermarket terminals**: There is a lack of effective control measures at key supermarket terminals.
> **4) Lack of consumer promotion and experience activities**: Consumer education and experience activities are lacking, leading to a decline in brand influence.
In response to the above, City Manager Xiao Fang, together with colleagues from the company's project department, discussed and developed a comprehensive marketing plan for the Jingzhou market.
**2. Business consultant**
After the marketing director of Brand X took office, he has always emphasized that city managers need to have a business mindset and cannot just be executors.
City Manager Xiao Fang initially did not fully understand this, but after attending the 'Excellence in Business' course, he gradually grasped it. Xiao Fang was deeply impressed by a statement from Professor Li.
**"The essence of business is altruism, achieving success by creating value for customers."**
Distributors are the manufacturer's customers. Only by enabling distributors to succeed and make money can the manufacturer achieve healthy growth in channels and sales. **The past practice of exploiting and squeezing distributors may yield short-term gains but undermines the foundation for long-term development.**
City managers need to have a business mindset, play the role of business consultants to distributors, and from the perspective of improving distributor business quality, help distributors conduct business reviews, diagnose business issues, and provide targeted improvement suggestions.
To help city managers build a business mindset, the course specifically taught a distributor business diagnosis model based on DuPont analysis, including 23 core business indicators, and a 'three-element, six-step method' for improving operations, enhancing business quality from market, operations, and organization aspects.
After City Manager Xiao Fang and distributors Lao Zhang and Xiao Zhang jointly learned this system, they found they had established a common management language. In the six months after training, they conducted monthly business reviews and analyses based on the diagnosis model and made targeted improvement plans.
Xiao Fang noticed that Lao Zhang's attitude toward him was getting better and better, and their hearts were together.
**3. Team political commissar**
**The role of political commissar originates from the military system of the Communist Party of China, referring to the person responsible for political and ideological work in the military.**
Ma Yun, during the construction of Alibaba's Iron Army, creatively introduced the political commissar role into sales teams. In a sales team, the commander handles business, while the political commissar handles people's growth. One manages things, the other inspires people.
City managers need to play the role of political commissar for the distributor's business team, assisting distributors in leading the team, stimulating vitality, and enhancing combat effectiveness.
The political commissar's duties specifically include team training and coaching, establishing team culture, organizing team-building activities, planning team competitions, and designing and implementing team meetings, mentorship systems, and review activities.
City Manager Xiao Fang realized through work that **the team fighting on the front line is the distributor's business team. Only by motivating and mobilizing this team to unleash its combat effectiveness can market performance be improved.**
**Under the guidance of the business alliance, manufacturers and distributors are actually in the same value creation chain and need to serve customers together.** Therefore, breaking organizational boundaries and organically integrating teams is necessary to improve channel efficiency and reduce channel costs.
After six months, Lao Zhang's business team's morale significantly improved, business efficiency per person rose sharply, and business income grew substantially. Everyone respectfully called Political Commissar Xiao Fang 'Brother Fang,' and Xiao Fang himself felt a great sense of achievement.
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## Citation metadata

- Publisher: New Distribution
- Author: 高松
- Published: 2020-01-14
- Canonical: https://xinjignxiao.com/en/articles/city-manager-chases-kpis-distributor-chases-profit-how-to-reconcile-149eac68/
- Original source: https://mp.weixin.qq.com/s/zkiXL4JBKOZVWp8Bnj0p5Q

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