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Behaviour Modification and Learning Systems

at Chocó-Delight
Established in 2001 by Tony Douglas (Douglas) and Jack Dowell (Dowell), Chocó-Delight had
become a dominant player in the Australian chocolate industry. The company planned to start its
journey with a single brand, ‘Melting Delight’. Determined to make Melting Delight the most sought
after chocolate brand, Douglas and Dowell hired David Parker (Parker), to head their marketing and
branding team. Parker channelised his efforts towards launching and subsequently promoting Melting
Delight on a grand scale. The innovative marketing and promotional strategies employed by Parker
and his team translated into substantial profits for the company. Encouraged by this success, the
company launched three new brands in 2004. Determined to replicate the success of Melting Delight
with these new brands, Douglas and Dowell decided to hire new team members and brand managers.
Further, to build an efficient organisation, that would be known for its integrity, the duo adopted a
simple organisational structure. Nevertheless, the mounting work pressure on Parker’s team created
the need to hire new members. Realising his pressing commitments, Douglas and Dowell shouldered
the responsibility of recruiting new members. The month long process, resulted in the selection of
three new members, each of whom boasted of a brilliant professional history. Confident of their
hiring decisions, Douglas and Dowell expected to witness more success stories in future. However,
to Parker’s dismay, the entry of these new members was accompanied by a series of behavioural
discrepancies hampering his team’s work. These issues gradually started reflecting on the overall
performance of Parker’s team. What measures should Parker take to resolve these behavioural
discrepancies? Is punishment the right solution for stopping undesirable behaviour?

Chocó-Delight: The Australian Chocolate Giant

Founded by Douglas and Dowell in March 2001, Chocó-Delight had emerged as a dominant
player in the Australian chocolate industry. The company forayed into the chocolate manufacturing
business with a single brand, Melting Delight. During the first three years, Douglas and Dowell

This case study was written by Deepti Srikanth and Vara Vasanthi, under the guidence of Dr. Nagendra V. Chowdary, IBSCDC. It is
intended to be used as the basis for class discussion rather than to illustrate either effective or ineffective handling of a management
situation. This case was written from generalised experiences.

© 2009, IBSCDC.
No part of this publication may be copied, stored, transmitted, reproduced or distributed in any form or medium whatsoever
without the permission of the copyright owner.

Background Reading: Chapter 2, “Foundations of Individual Behavior”,

Organizational Behavior (Stephen P. Robbins, et al., 12th Edition)

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inteded to focus their efforts on making Melting Delight the most sought after chocolate brand in the
Australian chocolate industry
Guided by this aim, they hired Parker to handle the marketing and branding for the Melting
Delight brand, within a month of the company’s inception. With 12 years of experience in handling
various marketing positions (in confectionary and chocolate companies) Parker boasted of in-depth
industry knowledge. He also seemed to be the ideal fit for the role, as he had been working as the
regional brand manager, at a leading Australian chocolate company (Xam Xam) for the past 5 years.
Additionally, he had built the repute of a brilliant marketer in the Australian chocolate industry owing
to his focus on innovation and unique marketing style. Highlighting the same, Dowell said, “Parker
has an excellent track record. It was his single-handed efforts that made Xam Xam chocolates a craze
across all age groups in Australia. We are confident Parker will be able to recreate the same magic for
Melting Delight.”
While Douglas and Dowell focused on the operational (including all the production related issues)
and financial matters. Parker shouldered the responsibility of launching and marketing Melting Delight.
However, he needed an effective team to execute his plans. While recruiting his team members,
Parker focused on their skills and past work experience. After 3 months of rigorous selection process,
Parker shortlisted five members, all of whom had an excellent track record and relevant experience
in brand management in the chocolate and confectionery industry (Exhibit I).
Realising that they were pitted against some of the biggest manufacturers in the market, Parker
and his team worked relentlessly towards launching Melting Delight on a grand scale. Parker focused
on exploiting the diverse skills and industry experience of his team members. While Green and
Graham were responsible for advertising, Geller and Hayden were assigned the task of conducting
customer surveys and creating marketing strategies. Having built relationships with major confectionery
outlets across Australia, Parker entrusted Jane and Green to promote Melting Delight in these outlets.
Though Parker was known for his eye for detail, he ensured that all his team members were given
operational and creative liberty. Additionally, he spent adequate time with each member, understanding
their ideas, discussing their hurdles and making suggestions. This made each team member feel
appreciated and valued. Determined to make Melting Delight a success, Parker and his team
relentlessly worked towards achieving their aim.
A month before the launch, Parker and his team released teasers on televisions and radio, to
capture the imagination of the customers. This was also coupled with banners and hoardings across
all major departmental stores, hypermarkets and supermarkets. After 5 months of extensive market
survey and product research, Melting Delight was finally launched in December 2001. Melting Delight
was positioned as a chocolate for every mood and occasion and the advertisements presented it as a
chocolate to be relished by every member of the family, irrespective of age. Further, these
advertisements did not use celebrities to garner attention. Instead, Parker and his team had portrayed
ordinary people from different walks of life, enjoying the diverse moments of their lives with Melting
Delight chocolates so that the customers could easily relate to the endorsers. Asserting the same,
Parker said, “Our market survey revealed that customers preferred different brands of chocolates to
gratify their different moods. What was surprising was they wanted a single chocolate brand to suit
their every mood. That is exactly what we aim to achieve with our Melting Delight chocolates.”

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Exhibit I
Educational and Professional Qualifications of the New Hires
Name Educational Details Work Work Profile Professional Highlights Nationality
Experience in the Previous
(in years) Organisation
Mathew Diploma in 8 Was working as the marketing Was single-handedly responsible for the Australian
Geller Marketing and head for a reputed international launch and success of a popular
(Geller) Brand Management chocolate manufacturer. chocolate brand.
Simon MBA (Marketing 7 Was the regional head at a Had risen in ranks in his organisation American
Green and Advertising) well-known confectionery owing to his team building skills and
(Green) company. market knowledge.
Scott MBA (Finance) and 8 Was the brand manager of a He was awarded the Innovator of the Australian
Hayden Diploma in popular chocolate brand. Year award in 1999 and 2000 during the
(Hayden) Brand Management corporate achiever ceremony for his
innovative marketing strategies.
Sarah Diploma in 8 Was working as the marketing Despite starting her career as a European
Jane Advertising manager for a leading management trainee, she soon became
(Jane) confectionery manufacturer. the head of the marketing department
owing to her hard work, product
knowledge and people-management skills.
Monica MBA (Marketing 8 Was the advertising manager Over the years, she had built the American
Graham and Advertising) of a well-known international reputation of an advertiser, whose
(Graham) chocolate manufacturer. campaigns established an emotional
connect with the customers and drew
them towards the product.
Prepared by the author
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Parker’s team continually worked towards implementing innovative measures to retain the
company’s existing customers and lure new ones. For instance, Parker and his team targeted
schools across Australia and sponsored events like inter-school fests and school carnivals. The
winners of these events received Melting Delight gift hampers. Rachel Reeves, a student said, “I
am personally very fond of chocolates but had never tried Melting Delight. My friend won an
event and that’s how I got to taste these chocolates for the first time. Our entire group has now
become totally hooked to it.”
Their efforts reaped results with Melting Delight slowly but steadily climbing the popularity charts.
Within 3 months of its launch, the demand for Melting Delight chocolate was on a rise. Douglas and
Dowell were pleased to witness the enthusiastic response from the customers. This increase in demand
and popularity translated into better bottomline for the company. By the end of the 1st quarter in
2003, Chocó-Delight had registered a profit of $7 million, which nearly tripled by the end of the year
(Exhibit II).

Exhibit II
Quarter-wise Performance of Melting Delight Chocolates – 2003
Quarter Profit (in $ million)
January–March 7
April–June 10
July–September 15
October–December 20.9
Prepared by the author

The success of Melting Delight encouraged Douglas and Dowell to add new brands to their
product offering. By 2004, the company introduced three new brands – Milky Delight, Nutty Delight
and Fruity Delight. With the aim of replicating Melting Delight’s success, the duo hired new brand
managers and team members for each of these brands. To avoid communication gaps or inter-group
conflicts, Douglas and Dowell held weekly company-wide meetings, where all the brand managers
and team members interacted openly and voiced their concerns. They also conducted periodical
one-to-one meetings with all the teams to ensure an open communication. The duo also nurtured a
culture of mutual respect, loyalty and trust. Highlighting the same, Douglas said, “We aspire to build
an organisation where every individual is known for their professionalism and integrity and it’s our
conviction to have an inclusive and enriching culture.” Additionally, to promote a healthy competition
between all the teams, the company rewarded the best performing team and team member in annual
company meetings. To avoid reporting ambiguity, Douglas and Dowell maintained a simple organisation
structure (Exhibit III).

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Exhibit III
Organisation Structure at Chocó-Delight

CEO COO
Tony Douglas Jack Dowell

Stephen Coy
Brand Manager Brand Manager Brand Manager Brand Manager
Melting Delight Milky Delight Nutty Delight Fruity Delight
Parker

Team Members Team Members Team Members Team Members

Prepared by the author

Riding high on the success of Melting Delight, the company spent heavily on introducing and promoting
its new brands. Unlike the promotions of Melting Delight, celebrities were hired to endorse Nutty
Delight and Fruity Delight. The new managers formulated marketing strategies in consultation with their
team members. Further, they hired representatives at departmental stores and hypermarkets to promote
these new brands and lure customers to buy them. Highlighting these efforts, Stephen Coy (Coy), brand
manager of Milky Delight, said, “We are trying to leverage on the popularity of the Melting Delight
brand. Customers trust our company’s product and have developed an emotional connect with it. By
using these measures, we are trying to extend their loyalties towards our new brands.”
Additionally, in 2005, Chocó-Delight set up its exclusive chocolate stores in selected cities across
Australia. At these stores, customers could create customised chocolate gift baskets and place bulk
orders for birthday parties or other events. Douglas said, “This is a novel concept. We would like to
offer our customers the pleasure of finding all our chocolate brands under one roof. We have launched
our stores in select cities only. Based on the customer response, we shall set up new stores in other
areas as well.”
Despite the introduction of these new brands, Melting Delight continued to rule the roost. Though
its new brands had succeeded in drawing customers, Melting Delight had emerged as the preferred
brand across all age groups. Stephanie Zondors, a customer said, “Though my family has tried Nutty
and Fruity Delight, Melting Delight still continues to be our No. 1 choice. I think it’s not only because
it tastes great but also because of the manner in which it has been marketed over the years. It has built
a special emotional connection with my family.” According to a survey conducted by TasteBudz, a
popular food magazine in Australia, Melting Delight was rated as the most popular chocolate brand
across all age groups in 2005 and 2006. Nutty Delight and Milky Delight gradually started climbing
the popularity charts.

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In 2006, Chocó-Delight recorded a profit of $37 million. However, the three new brands contributed
to 40% of the company’s profits, while Melting Delight alone made up for 60%.
This initial success encouraged Douglas and Dowell to chalk further ambitious plans for their new
brands in general and for Melting Delight in particular. While the new teams were expected to focus
their efforts on garnering profitability and building their brand name in their current markets, Parker’s
team was expected to launch Melting Delight across Australia. Highlighting this ambitious quest,
Douglas said, “We have started witnessing a positive response for all our brands. However, realising
that Melting Delight has garnered immense popularity, most of the efforts in the coming years shall be
focussed towards cashing in on this popularity.”
However, the new marketing and promotional initiatives for Melting Delight added to the mounting
workload on Parker’s team, creating the need to hire new members. Realising his pressing
commitments, Douglas and Dowell decided to take on the responsibility of hiring new team members.
After a month long interview process, the duo hired three new members in 2007 (Exhibit IV).
Confident of their choice, Douglas and Dowell expected things to go from better to best on Parker’s
team.

Brewing Behavioural Issues: Threatening the Company’s Future

With many new marketing initiatives in the pipeline, Parker was relieved by the new additions in
his team. He was also impressed by the past experience and professional achievements of the new
hires. Further, Parker was convinced that the new members would fit in easily with his existing team
members. However, Parker’s ambitious quest came to an abrupt halt when he started countering
problems with his new team members, within a couple of months of their joining.
Owing to Turner’s impressive past record in devising marketing strategies, Parker entrusted him
with the responsibility of designing a marketing plan for promoting Melting Delight Pan Australia. As
Geller had managed a similar initiative in the past, he asked Turner to seek his guidance in case of
any doubts.
Within a span of 5 days, Parker received the marketing proposal from Turner. However, on
reading the same, Parker realised that it bore a striking similarity to the plan that Geller had discussed
with him a couple of weeks ago. Surprised by this finding, he decided to discuss the same with Geller
before taking any further action.
Following was the conversation between Parker and Geller:
Parker: Geller, I wanted to talk about your marketing proposal that we had discussed a couple of
weeks back. Did you discuss its details with anyone else?
Geller: Yes Parker. I had used it as an example to help Turner understand how to work out the
finer details while planning such an initiative.
Parker: Did you give him a copy of the report as well?

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Exhibit IV
Educational and Professional Summary of the New Hires
Name Educational Work Work Profile Professional Highlights Nationality
Details Experience in the Previous
(in years) Organisation
Stephen MBA (Marketing 6 Was the marketing manager Had risen from being a management trainee to Australian
Turner and Advertising) at a reputed chocolate the marketing lead within a span of 3 years of
(Turner) manufacturing firm. joining the company. Was known for developing
strategies that would surprise the company’s
competitors and was regarded as a
smart marketer.
Chang MBA (Marketing) 8 Was the brand manager of a Had received the award for executing the best Chinese
Lee(Lee) well known chocolate brand. product launch in 2003 and 2004. Had built the
reputation as a loyal and dedicated member
of the company.
Mark MBA (Marketing) 10 Was the regional head with In the 10-year long association with his previous American
Branson with a Diploma in a famous chocolate employer, he had repeatedly proved himself as
(Branson) Advertising manufacturer. an innovative marketer. He was also
single-handedly responsible for launching and
promoting one of the most popular chocolate
brands of the company.

Prepared by the author

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Geller: No, I did not. But I did give him access to my user name and password as he needed to
work on his new project while his system was undergoing formatting. Is there some
problem, Parker?
Parker: Well, not really. But I would suggest that you do change your user name and password
for confidentiality purpose.
Such an event had never been reported in the history of Chocó-Delight. For an organisation that
thrived on mutual trust and integrity, such an action would come across as a shock. Reporting the
same to either Douglas or Dowell could lead to serious implications for Turner, while also tarnishing
the reputation of his team in the organisation. Disturbed by these findings, Parker decided to have a
one-to-one discussion with Turner.
Turner: Hi, Parker. I hope you did find time to go through my proposal. I was awaiting your
feedback.
Parker: I would like to get direct with you on this matter. I was really surprised to find that your
report was almost a replica of a proposal that Geller had already worked on.
Turner: Well, Geller won’t need that report as he is working on other commitments. Moreover,
it appeared apt for my present assignment.
Parker: Turner, I did not expect it from someone with a commendable track record as yours. I
was expecting to see an original report. That didn’t leave a good taste.
Turner: Honestly, I do not understand my mistake. My action has not caused any harm to
anyone. Moreover, marketing is a competitive field and one should learn to get their
Ethical issues
Assumes that work done in a smart way.
everywhere things
are same and will Parker: But, I don’t think taking credit for someone else’s work qualifies as smart work!
go according what
he wants Turner: In my previous organisation, I was always appreciated for accessing competitor’s
strategies and using them for the company’s benefit. I was known to be a smart marketer,
who was adept in accessing and using information to gain an edge over others. Also,
my previous experience has taught me that achieving results is all that matters!
Parker: I cannot comment on your past organisation, but such form of behaviour is against the
culture of our organisation. We have always encouraged integrity and loyalty as an
integral element of our culture and the behaviour you consider as smartness is definitely
not acceptable here!
Turner’s behaviour was not the only problem that Parker encountered. To add to his woes, Lee
was having trouble adjusting in the new team. The company was planning to launch Crunchy Melting
Delight, wafer and chocolate combination of Melting Delight, by January 2008. Realising that Lee has
been recognised and rewarded for his product launching skills, Parker decided to assign this project to
him. Additionally, he also assigned Hayden and Green to work with Lee on this initiative.
Lee was reluctant to be a part of the brainstorming session with Hayden and Green. Though he
finally attended the session, he did not contribute to the discussion. Further, Lee also maintained a

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low profile in any launch related meeting with Hayden and Green. Lee also refused to reciprocate to
Hayden’s and Green’s attempts of building an informal relationship with him. Unable to understand
Lee’s problem, they informed Parker of this new behavioural issue.
Parker decided to discuss this matter with Lee in an informal manner over lunch. Following was
the conversation between Parker and Lee.
Parker: So how are you finding your new company? Have you been able to adjust with your
new team?
Lee: It’s a good company. However, I cannot say much about my team at this point.
Parker: Lee, I think it is important that you feel free to discuss any apprehensions with me. I
have been very impressed by your professional achievements. But somehow I feel you
are not very comfortable with your fellow members. If you do not let me know about
your reservations, it shall ultimately hamper the productivity of our team.
Lee: I do realise that. Honestly, I am not very happy being a part of this team. I do not intend
to sound biased, but I would have preferred to work with members from Asian countries.
Parker: But why would you set such working preferences? Have any of the team members
misbehaved with you in any manner?
Has set beliefs due to Lee: No they haven’t. But I have had many bitter experiences of working with European,
previous experiences
American and even Australian team members. In my opinion they are highly individualistic
and have no regard for other team members. There were many instances where I had
toiled hard to prepare critical reports, but my team members, most of them European
and Americans, would take all the credit. I can only associate bitter experiences with
team members belonging to any of these countries. On the contrary, each time I have
worked with team members from Asian countries, I have received a fair share of credit
and appreciation for my contribution. Additionally, in my experience, people from
European and American countries look down upon members from other nationalities
and undermine their potential.
Parker: Well, I am sorry to hear that you have had such unpleasant experiences. But I think you
should not generalise people on the basis of a couple of instances. It shall not be fair
towards your new team members and shall also hamper our performance.
Lee: I can understand your position, but my perception has been formed over the years and
not based on a couple of instances. I am planning to speak with Douglas and Dowell to
assign me projects that can be handled independently by me.
This unfruitful discussion with Lee further added to Parker’s dilemma.
Problems further intensified when Jane and Graham, owing to the constant disagreements and
arguments with Branson, refused to work with him on the new advertising campaign, which was to
be released in 2 weeks’ time. With 10 years of successful professional record, Branson regarded
himself more experienced in the field of advertising. Further, he undermined Jane and Graham’s

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Gender stereotyping
Bias against women
ability, as he considered women incapable of understanding the demands of a field like marketing.
He was also of the opinion that women were more emotional and found it difficult to cope up with
the pressures of the corporate world.
Realising that this attitude would hamper the morale of his two experienced team members,
Parker decided to conduct a meeting with Jane, Graham and Branson.
Following was the conversation between Parker, Jane, Graham and Branson:
Parker: I hope we all realise that this advertising campaign is due for release in just 2 weeks’
time. We need to cooperate with each other all the more at this juncture!
Jane: Parker, we all are aware of the pressing deadline. But it shall be extremely difficult to
work with a member who undermines your ability and refuses to listen to your
suggestions.
Graham: We have been a part of Melting Delight since its launch. We both have contributed to
making its advertising catchy and memorable over the years. Melting Delight enjoys
an emotional connect with our customers. But Branson feels that both of us are
incompetent of understanding the demands of the product!
Parker: Branson, would you like to respond?
Branson: Well, there is nothing to deny. Both of them have undoubtedly been with the company
for long, but that does not change the fact that women are not the right choice for
handling the demands of the competitive marketing world. It is essential to have a
practical approach towards advertising, but both of them fail to understand that. Given
my experience, I surely know more than both of them.
Parker: Branson, we all respect and value your experience. However, Graham and Jane are
also not new entrants in this field. Moreover, they have nurtured this brand since its
launch and our customers have always responded positively to their strategies. I think
it is unfair on your part to associate skills and competencies based on the gender of a
person!
Branson: Parker, it is not only my belief. Even Stephen Taylor (Taylor), my ex-CEO, whom I
continue to hold in high esteem, was an ardent believer of the same. After the disastrous
performance of the women managers in the sales and advertising team, Taylor entrusted
all critical marketing related functions to men! Despite an impressive educational
background, none of these women managers were able to understand the customer’s
expectations. It was I who brought in the much needed revival and gave the industry
one of the most popular chocolate brands. Even Taylor praised my advertising inputs
and ideas as compared to those proposed by the former women managers in many
company meetings!

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Parker: Branson, not everyone succeeds in every venture that they undertake in an organisation.
But that should not serve as a reason to undermine the efficiency of the opposite
gender. We shall not be able to work together as a team if you continue to nurture an
attitude like this.
Branson: Well, since you think I am at fault, it shall be better to either change my team or give
me projects where I do not have to work with women.
Faced with these problems, Parker was certain that his team shall not be able to live up to the
reputation that it had built over the years. He was unable to decide how to handle these cropping
behavioural issues. Should he set a code of conduct for his team? Would escalating the matter to
Douglas and Dowell serve as the apt solution? Should he punish the members who refuse to work in
tandem with the organisational expectations? Will terminating one of the new members prove fruitful?

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