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IMD-7-1580

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v. 05.06.2024

MEISTERCLEAN:

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TURNING SUPPLY CHAIN
INTO A COMPETITIVE ADVANTAGE

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Professor Ralf W. Seifert prepared this case exercise as a basis for class discussion
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rather than to illustrate either effective or ineffective handling of a business situation.

Copyright © 2014 by IMD – International Institute for Management Development, Lausanne, Switzerland
(www.imd.org). No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form
or by any means without the prior written permission of IMD.

This document is authorized for educator review use only by SUDHANSHU JOSHI, Doon University until Aug 2025. Copying or posting is an infringement of copyright.
[email protected] or 617.783.7860
 IMD-7-1580

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MEISTERCLEAN

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You have just joined a company called “MeisterClean” as Director of Supply Chain. The
company, while having substantially grown its topline over recent years, has been plagued
by spotty product availability, low-capacity utilization and increasing distribution costs. Total
inventory has been rising steadily in both volume and cost and lead times have increased.
The CEO is asking you to outline a call for action to overcome these operational problems

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and to turn Supply Chain into a competitive advantage for MeisterClean.

MeisterClean has grown significantly over the years. A recognized technology leader in its
industry, it is renowned for its broad product offering, featuring a catalog of 80,000 different
items. Of these 80,000 individual Stock Keeping Units (SKUs), roughly 10,000 correspond to
various configurations of cleaning appliances/machines, while roughly 70,000 are either
spare parts or consumables (i.e. are “consumed” while using the machines for cleaning). In

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recent years, the company solidified its market share through several acquisitions, adding
various regional brand names to its product portfolio. MeisterClean is generally considered
a market leader and is widely distributed across different sales channels. While MeisterClean
sells some consumer appliances, 75% of its revenue stems from serving the Business to
Business (B2B) space of providing solutions to clean larger spaces ranging from office
corridors to airports or industrial plants. Having invested heavily in R&D, the company has
added more and more product variants to its portfolio and won several recent design awards.
MeisterClean prides itself on its high customer service whereas the competition mainly
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competes on price. The company’s sales force is performing well and benefits from a strong
incentive plan based on total sales volume. MeisterClean’s Chief Technology Officer (CTO)
and its Chief Sales & Marketing Officer (CSO) are both very happy with their past
performance but keep complaining about MeisterClean’s supply chain.

Operationally speaking, things indeed look less bright. Although MeisterClean’s assembly
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plants are located close to its target market, the company has been plagued by the spotty
availability of its product, low-capacity utilization and increasing distribution cost. The total
inventory cost has been rising steadily both in volume and cost and lead times have
increased. The CEO finally got fed up with the warehouse and distribution manager, calling
him “incompetent,” and the position became vacant. In light of the company’s diminishing
operational performance, he has brought you in as Director of Supply Chain in charge of all
warehouse and distribution activities. The CEO is asking you to turn Supply Chain into a
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competitive advantage for MeisterClean. He is even considering letting you invest in a new
and extended warehouse facility. You have been offered standard market pay and an
individual performance bonus based on your ability to reduce the working capital currently
tied up in inventory. Your key objectives are: Improve MeisterClean’s customer service and
reduce its operational cost. But you are wondering what it will take to truly succeed with the
mandate of turning Supply Chain into a competitive advantage considering both current and
emerging pressure points to stay competitive. Negotiating the necessary buy-in from
management will depend on the comprehensiveness and clarity of your arguments, a holistic
approach, and taking an integrated end-to-end supply chain view. Hence, you start
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wondering what else should be considered in analyzing MeisterClean’s challenges?

How do we compare to MeisterClean in terms of integration and SC maturity?

© 2014 by IMD 2
This document is authorized for educator review use only by SUDHANSHU JOSHI, Doon University until Aug 2025. Copying or posting is an infringement of copyright.
[email protected] or 617.783.7860