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Chapter 17 Management of the Sales Force © 2010 Education Canada Inc. 17- * Describe how leadership skills can be applied to sales management List and discuss the qualities of an effective sales manager Discuss recruitment and selection of salespeople Describe effective orientation and training practices Learning Objectives © 2010 Education Canada Inc. 17- * Explain effective sales force motivation practices Develop an understanding of selected compensation plans Learning Objectives (continued) © 2010 Education Canada Inc. 17- * Leadership – is the process of inspiring, influencing, and guiding employees to participate in a common effort Sales Management – is the process of planning, implementing, and controlling the personal selling function Typically performed by Sales Manager Applying Leadership Skills to Sales Management © 2010 Education Canada Inc. 17- * Applying Leadership Skills to Sales Management (continued) © 2010 Education Canada Inc. 17- * Applying Leadership Skills to Sales Management (continued) © 2010 Education Canada Inc. 17- * Most Popular Topics Covered in Training Programs for Sales Managers © 2010 Education Canada Inc. 17 - * © 2010 Education Canada Inc. 17- * Applying Leadership Skills to Sales Management (continued) Sales managers have a dramatic influence on the salespeople they supervise Two of the most important dimensions of leadership are: Structure Consideration © 2010 Education Canada Inc. 17- * Applying Leadership Skills to Sales Management (continued) Structure – a leadership characteristic displayed by sales managers who clearly define their own duties and those of the sales staff, and who assume an active role in directing their subordinates Set of written and unspoken policies Structure © 2010 Education Canada Inc. 17- * Behavioural evidence of structure: Planning takes place on a regular basis Expectations are clearly communicated Decisions are made promptly and firmly Performance of salespeople is appraised regularly Too much structure can sometimes create problems © 2010 Education Canada Inc. 17- * Structure (continued) Consideration – a leadership dimension displayed by sales managers who have relationships with salespeople that are characterized by mutual trust, respect for the salesperson’s ideas, and consideration for their feelings Consideration © 2010 Education Canada Inc. 17- * Behavioural evidence of consideration: Regular and effective communication receives a high priority Each salesperson is treated as an individual Good performance is rewarded often Consideration (continued) © 2010 Education Canada Inc. 17- * Mastery of structure and consideration is an important first step towards achieving success in sales management Situational Leadership – matching your leadership style to the particular situation that you face with individual members of your sales force Situational Leadership © 2010 Education Canada Inc. 17- * The final test is that of character Character – is composed of personal standards of behaviour, including your honesty and integrity If exists then trust and respect will build Trust is a slow process that can be irreparably destroyed by a single lie or deceoption The Character Test © 2010 Education Canada Inc. 17- * Ability to be a good coach – to improve the attitudes and skills of others – is both rare and important Coaching – is an interpersonal process between a sales manager and a salesperson in which the manager helps the salesperson to improve performance in a specific area Coaching for Peak Performance © 2010 Education Canada Inc. 17- * Major goal is to improve performance while maintaining a relationship of mutual respect and trust Two primary areas of focus: Helping the salesperson recognize the need to improve his or her performance Developing the salesperson’s commitment to improve performance Coaching for Peak Performance (continued) © 2010 Education Canada Inc. 17- * Four-step Coaching Strategy: Documentation of performance problems Get the salesperson to recognize and agree that there is a need to improve performance in a specific area Explore solutions with the salesperson Get commitment from the salesperson to take action © 2010 Education Canada Inc. 17- * Coaching for Peak Performance (continued) One of the most significant tasks of a sales manager About half of the people working in sales should be doing something else About 20 to 25% of salespeople employed are selling products not suited to their personality Recruitment and Selection of Salespeople © 2010 Education Canada Inc. 17- * More of a science than an art Should follow some basic steps: Determine actual job requirements Search out applicants from several sources Select the best-qualified applicant Recruitment and Selection of Salespeople (continued) © 2010 Education Canada Inc. 17- * A job description should be prepared by answering a few basic questions: New or established territories? New or established product/service? Close supervision or independent? Amount of travel? transfer? promotion? Determine Actual Job Requirements © 2010 Education Canada Inc. 17- * Determine Actual Job Requirements (continued) © 2010 Education Canada Inc. 17- * Candidates within the company and employee referrals College and university students Trade and newspaper advertisements Employment agencies and listings Internet Search Out Applicants From Several Sources © 2010 Education Canada Inc. 17- * Some things to look for are: High level of interest and enthusiasm for the job High degree of self-motivation Integrity Evidence of business acumen and “closing” skills with interviewer Select the Best-Qualified Applicant © 2010 Education Canada Inc. 17- * Personality and Skills Testing Psychological testing to asses: Self-confidence Personal diplomacy Competitiveness © 2010 Education Canada Inc. 17- * Once the best-qualified salesperson is hired, two things should be done, with sales manager involvement, to ensure success: Thorough orientation of business operations Training program of the job More positive view of their job, greater commitment, and improved performance Orientation and Training © 2010 Education Canada Inc. 17- * Online training areas: Knowledge of the product line, company marketing strategies, territory information, and business trends Attitude toward the company, its products and services, and its customers Skill in applying personal selling principles and practices – the basics Orientation and Training (continued) © 2010 Education Canada Inc. 17- * Internal Motivation – is the intrinsic reward that occurs when a duty or task is performed Achievement, challenge Responsibility Advancement, growth Enjoyment of the work itself Involvement Sales Force Motivation © 2010 Education Canada Inc. 17- * External Motivation – is the action taken by others that involves rewards or reinforcement that cause the worker to behave in ways to ensure receipt of the reward Contests, prizes, bonuses Appreciation for a job well done Organizations should provide a mix of internal and external motivators Sales Force Motivation (continued) © 2010 Education Canada Inc. 17- * Focus on several important aspects of the salesperson’s job Evaluate program often to determine what has most impact Avoid setting unrealistic goals Develop a plan that rewards sales collaboration and the achievement of specific sales goals (individual, team, or both) Effective Use of External Rewards © 2010 Education Canada Inc. 17- * Compensation Plan – combination of direct and indirect (vacation, pension, insurance) monetary pay Straight Commission Commission with a draw or guarantee Commission with a draw or guarantee plus bonus Fixed Salary plus Bonus Straight Salary Compensation Plans © 2010 Education Canada Inc. 17- * Compensation plans can be designed to achieve a variety of sales objectives: Specific product movement Percentage sales increase Establish new accounts Increase sales activity Strategic Compensation Planning © 2010 Education Canada Inc. 17- * Important guidelines: Sales objectives are well defined Plans should be field tested Compensation plans should be carefully explained Plans should be flexible and change with conditions © 2010 Education Canada Inc. 17- * Strategic Compensation Planning (continued) Quantitative Criteria Sales volume in dollars or units Year-over-year sales volume Sales by product or product line Number of new accounts opened Amount of new account sales Net profit dollars Number of customer calls Assessing Sales Force Productivity © 2010 Education Canada Inc. 17- * Qualitative Criteria Attitude Product knowledge Communication skills Personal appearance Customer goodwill generated Selling skills Initiative Assessing Sales Force Productivity (continued) © 2010 Education Canada Inc. 17- * Applying Leadership Skills to Sales Management (continued) © 2010 Education Canada Inc. 17- * Applying Leadership Skills to Sales Management (continued) © 2010 Education Canada Inc. 17- * The final test is that of character Character – is composed of personal standards of behaviour, including your honesty and integrity If exists then trust and respect will build Trust is a slow process that can be irreparably destroyed by a single lie or deception The Character Test © 2010 Education Canada Inc. 17- * Determine Actual Job Requirements (continued) © 2010 Education Canada Inc. 17- * Explain effective sales force motivation practices Develop an understanding of selected compensation plans List and discuss criteria for evaluating sales performance Learning Objectives (continued) © 2010 Education Canada Inc. 17- *