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SALES AND DISTRIBUTIONSALES AND DISTRIBUTION

MANAGEMENTMANAGEMENT

BY: MUKESH MISHRABY: MUKESH MISHRA

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Recruitment and Selection ofRecruitment and Selection of

sales Forcesales Force Sales manager perform the sales force

management function.

They execute the entire human resource

management function in an organization

They recruit , select, train, motivate, lead,

control, and compensate the sales staff forachieving the desired goals of the

organization.

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sales Forcesales Force An effective sales force needs the attention and

guidance of a sales manager so that it is motivatedto remain attached to the organization for

considerably longer period. This is necessary because a sales job is very

stressful by nature and attrition rate in the salesprofessional is the highest.

A mismatch between the ability and aptitude of asalesperson and the nature of the sales job usuallymakes a salesperson quit and look for betteropportunity.

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sales Forcesales Force The vertical growth of salespeople is slow in many

organizations, which results in their migrating toother organization, including those of competitors.

A sales job has the highest probability of socialrejection. E.g while prospecting takes thesalesperson to many people only a few of these

prospects ultimately qualify as customers.

Social rejection from the industry sometimesdemotivates the sales force and results in a changein career to another functional area functional areaof operation.

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sales Forcesales ForceOnly people with the right aptitude and

mindset for building a career in sales should

be selected, so that there is balance betweenthe job description and the manpower

selected.

The selection and recruitment of efficientsalespeople is always a competitive

advantage for an organization.

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Challenges in sales forceChallenges in sales force

selectionselection The most important challenges are

1.Determination of characteristics that differentiate

candidate who perform better.

2. Measuring these characteristics,

3. Evaluation of the motivation level of the candidatesfor the job and organization, followed by a decisionon who will make the ultimate selection decision

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selectionselection Many organizations look at the personality types

suitable for the job, though there is no standardevaluation of which kind of personality has the

highest impact of job performance. Organization culture is also an important factor.

Different people in organization seek differentcharacteristics in that employees .

E.g. Top management may expect a salesperson toposses more managerial capabilities, the field salesforce may expect to have more of selling skills sothat the desired level of sales output can be achived.

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selectionselection In the hiring process, the attempt of an

employer organization is to measure the

ability of a candidate rather than his levelof motivation.

Motivation measures are also important

because performance is defined as a sumtotal of the ability to perform a job and the

motivation to do so.

Performance= Ability X Motivation

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Strategic position

analysis

Decide on the number of

people to hire

Identify best sources of

recruitment:

internal and external sources

Generate database of

candidates

Evaluate candidates

Select and induce

candidates to acceptpositions

Socialize

Turnover

Establish

hiringobjectives

Job qualification

Job description

Organizational

characteristics,

company image

and climate,

styles of

supervision,

compensation,

and motivation

of the company

Selection

Socialization

Recruitment

Planning

The hiring process

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Strategic Position AnalysisStrategic Position Analysis

It is a systematic procedure that describes the way asales job is to be performed. It consists of six steps

1.Determination of performance measures

2. The identification of the critical success factor.

3. The performance dimension of the position

4. The determination of performance measure

dimension5. The operationalization and the establishment of

performance.

6. The standards and the design of the assessment

tools

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The performance measure for a salesposition can be consistently maintained at a

profitability level of 105 by achieving salesquota over a period.

The next step is to perform a key activityanalysis of the job within a stipulated timerequired to conduct each activity

E.g. a salesperson may have to divide thetime appropriately between prospecting and

making sales calls for closure in 60:40 ratio.

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After determining the performanc measures, asales manager determines the performancedimensions required to perform job activities.

This include the knowledge and the variousskills like leadership and motivation skills, andthe occupational knowledge required to performjob in a better ways.

After identifying the skills required forperforming the job, sales manager evaluates thesales staff history and divides the sales staff intothree categories-ineffective, effective, and over-

performing.

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The sales manager then identifies the criticalincidents in the organization and sees howindividuals in each category have performed in

the past and have demonstrated one or more ofthe activities of the performed dimensions.

The activities of the individuals, theirperformance level, and the results of the

performance are analyzed for the purpose ofcomparison and classification.

The performance standards so created becomethe basis for the designing the assessment tools

in the process of hiring new salespeople.

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The sales manager next job is to find out

no. of sales people required. The formula to

calculate the expected number of salesperson needed for the future requirement

N= S/P (1+T)

where N= numbers, S= sales forecast, P=present average sales, T= attrition rate of

salespeople

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Job AnalysisJob Analysis

Job analysis identify job duties and responsibilitiesas well as critical activities to be performed for the

job success. A job analysis consists of following

steps

1.Analyse the environment in which the sales personis to work. This includes nature of customers,competitors, and knowledge and skills required for

the job.2. Determine the duties and responsibilities that are

expected from the salesperson. This information canbe obtained from the sales manager, salespeople,

customers, ad and promotion manager.

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Job AnalysisJob Analysis

3. The person conducting job analysis may be

a person from the sales team, or human

resource department, or an outsideconsultant. This person should also spend

time making customers calls with some

salespeople, observing and recording thevarious tasks or activities performed

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Job DescriptionJob Description

Companies use job analysis to develop jobdescription. Job descriptions are formals, writtenstatements describing detailed account of the job.

Most well- prepared job descriptions generallycover the following points

1.Title of job- A complete description so that there isno vagueness. this is particularly important in anorganization having many type of sales job. Some ofthe title are sales executive, marketing executive,sales engineer, BDO.

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Job DescriptionJob Description

2. Reporting Relationship- To whom salesperson will report.

3 type of product

4.Type of customers called on

5.Duty and Responsibilities- e.g. visit planning, selling,customer service, information cllection and communication,report preparation and payment collection from customer.

6. Job Demand- Mental nad physical demand of the job, such as

travelling, achievement of sales and other targets.7.Technical requirements: the degree to which the salesperson

needs to understand the technical aspects of the products andservice that are sold.

8. Location and geographical area to be covered

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Developing jobDeveloping job

Qualifications/SpecificationsQualifications/Specifications Duties and responsibilities in job descriptions

should be converted into job qualifications, orjob specifications. A sales recruit should have these traits in order

to perform well on the job. Determining the job qualifications or

specifications is probably the most difficult partof the entire staffing process as there is noaccepted traits and abilities of salespeople forsuccess across various selling position.

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Developing jobDeveloping job

Qualifications/SpecificationsQualifications/Specifications Many studies have attempted to determine which

qualifications are most important for a sales positionas below

Super achiever show following traits: risk taking,powerful sense of mission, problem solving bent,care for customer, and careful call Planning.

Effective salesperson has two basic qualitiesempathy(ability to feel as the customer does) andego drive( a strong personal need to make the sale)

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Recruiting the Sales ForceRecruiting the Sales Force

This stage includes

a) Finding or identifying the sources of

recruits.

b) Evaluating and selecting the recruiting

sources.

c) Contacting candidate through the selected

source

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a)Identifying the source of sales recruits For identifying or locating prospecting

candidates, companies use internal and externalsources

Internal Recruitment sources

1. Lateral and upward move

Sales people can move to higher positions in anorganization after completion of desired yearsof service or through lateral movements fromone territory to others

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Most sales manager are hired from the

internal sources through the elevation and

transfer of existing sales force. The advantage of such movement is that

incumbents posses the knowledge of

market, the product, and the level ofcompetition based on previous experiences

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2.Interns Students

Interns who work on a part-time basis in an

organization while pursuing their studies.

It includes all those employees who are

either paid part-time or are non paid and

who take up jobs in order to get workexperience while studying

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3. Employee referral programmes Many organizations value the referral given by the

employees.

Employee referral programmes are incentive programmesdesigned to reward an employee currently working in theorganization for identifying and recommending candidateswho are subsequently hired by the organization

Currently employed salespeople understand the needs of

organization and job and are often in a position to makereferrals of people who can contribute to the organization`sgoals.

As salespeople are in the market, they possess information ofemployees who work for other organizations and can

recommend hiring them in their own organization.

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4.Advertising Classified advertising and recruitment advertising

draws a large no. of potential applicants. Thismethod helps to get the bright applicants whowould not have applied otherwise.

The problem with this method is that it brings inlarge no. of applications that donot qualify to bethe applicants otherwise, and the processing ofthese unqualified applicants involves wastage ofmoney and financial resources of the salesorganization

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5.Employment agencies It constitute the traditional method of recruitment in the

India Market. The govt. has established employment

exchange all across the country and many unemployedyouth register their names in these exchanges. Sales organization collect their names as per the job

description and invite prospective candidate for recruitment. There are many private employment agencies in India.

Some of popular agencies include ABC Consultants, MafoiConsulting.

The benefit of using employment agencies is that they havea captive database of the employees and sales organizationscan substantially reduce the time in inviting applications and

scrutinizing them for identifying qualified applicants

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5.Walk-ins Many organizations find it convenient to use the

method of walk-ins for recruitment.

An observation of the recruitment practices in IndianMarkets indicates that there are emerging trends whereorganizations prefer the walk-in methods of recruitmentrather than the formal recruitment ad.

Walk-in include unsolicited applications given byapplicants. Going to the organization for selection with a

readymade profile and getting selected through walk-ins is one of the most convenient methods for job

seekers in metros

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6. Networking

Many aspiring candidates build up network amongfamily members, friends, and acquaintances so that theycan get call for recruitment.

Sending a resume to the personnel department may notget the desired response but if the resume goes throughthe network, then the chances of getting a call forselection improve.

In this context organization also take advantage of thesenetworks for collecting information about potentialcandidates, particularly when the organization is

looking for recruit at entry level.

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Selection of Sales ForceSelection of Sales Force

Selection is the process of hire or no hire decisionregarding each applicant for a job.

A sales manager obtains the database of candidatesto selected from recruitment stage.

Selection is the mechanism that determines overallquality of the human resources in an organization.

It is the process that determines whether or not anapplicant meets the qualifications for the specificjob and selects the applicants who is most likely toperform well in a job.

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Selection Process ofSelection Process of

SalespeopleSalespeople1. Screening Resumes

2. Application Blank

3. Psychological tests4. Aptitude and skill test

5. Personal interview

6. References checks

7. Determination of terms of service8. Appointment

9. Initial orientation

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SalespeopleSalespeople1.Screening Resumes To reduce the no. of applicants, initial screening of

resumes is done by the sales managers, based oncomparison with job specifications that was developed

earlier in planning stage.2.Application Forms The objective of the application is to collect and evaluate

information about the applicants physical characteristics,educational qualification, and employment history.

This also helps managers to prepare for interviews with thejob candidates. It is easy to find out job hoppers from theapplication forms by looking at history of their jobs in therecent years and one can use them during interviews tofind out the reasons behind such behavior.

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SalespeopleSalespeople3.Psychological tests, aptitude and skill test These set of tests are used by many sales

organization aimed at measuring the mentalability and personality characteristics of asalesperson.

A variety of tests measure different abilities

including verbal, qualitative and cognitive skills. A cognitive ability test measures the applicants

potential in certain area such as quantitativemathematics and is a good predictor of job

performance.

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SalespeopleSalespeople A higher level of cognitive abilities indicates that theperson can learn faster and quickly adapt toorganizational settings. People with a higher value arefound to be top performers in organization.

Aptitude tests are conducted to detect if there is anyproblem in persons sensory processes and intellectualcapabilities.

The sales manager focus on a particular talent like

learning skills and the level of reasoning. This method measures the person`s current level of

skills at certain tasks with an assumption that some setof skills and abilities can be taught and developedthrough training and development programmes.

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SalespeopleSalespeople Personality tests aim at measuring non-intellectualcharacteristics of the salespeople that include modificationinterests, ability to adapt and adjust, desire for level ofinterpersonal relationships.

Modern days sales recruitment and selection method usenewer method such as achievement tests or proficiencytests.

These tests are useful in situations when an experiencedperson is to be appointed as a salesperson.

Temperament tests help to evaluate various factor oftemperament, such as likes and dislikes, habit andpreferences.

Attitude tests are conducted to see the attitude of applicanttowards business conditions, organization, nature andcondition of employment.

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SalespeopleSalespeople4.Personal Interview

Sales manager conduct personal interviews to an

insight into an applicant`s mental abilities andpersonality

It also helps a sales manager to assess the

applicants personality, the level of appearance

and intelligence, communication skills, the degree

of sociability among peers, aggression level,

ambition and other personality elements

necessary to smoothly conduct the sales job

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SalespeopleSalespeopleInterview techniquesa) Unstructured Interview In this method interviewer begins by asking a few open

ended questions like tell me about yourself. the interviewergets the applicant talking on subjects such as school andcollege activities, achievements in life, work ex and so on.

The basic concept is that applicant`s traits orcharacteristics are discovered, if the applicant isencouraged o speak freely.

It takes a highly skilled interviewer to use non directedtype of interview effectively. Research has clearly shownthat unstructured interview type is not accurate inpredicting the job performance of salespeople

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SalespeopleSalespeopleb) Structured interview

It is based on the through job analysis where

the sales manager applies a series of jobrelated question with predetermined answer

consistently across all interviews for a

particular sales job. There are three type ofquestions asked during a structured

interviewed

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SalespeopleSalespeopleSituationalYou have planned a holiday and suddenly you remember

that you were supposed to meet a client at the same time.This has somehow slipped from your mind last night when

you made a day plan. What should you do in this case?Job Knowledge

what is correct procedure of closing a sales for a serviceand how different do you think it closing a sale ofFMCG?

Salesperson Requirement

some period of year are really hell due to the seasonality ofdemand and a salesperson has to work overtime on the job,what do you think about working overtime?

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SalespeopleSalespeople A situational question tries to elicit from applicanthow they would respond to a particular work situation.

These question can be developed fro critical incident

technique of job analysis. The sales manager rewritesituational question from critical incident behavior andthen generate and evaluate possible answers.

The applicants response are evaluated on the basis of

comparison to the already developed questions andresponse.

Job knowledge question assess whether on notapplicants have the basic knowledge to perform the

job

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SalespeopleSalespeople From the modality of conducting interview, someinterviews are categorized as stress interviews.

In stress interview, sales manager and the interviewertake a hostile role towards applicant.

he deliberately put him on the defensive by trying toannoy, embarrass, or frustrate him.

Many organizations also conduct group interviews anddiscussion as a method of weeding out the worst and

identifying best among the invited applicant Here group of applicants are interview

simultaneously. those who take a lead in thediscussion, influence others, and speak effectively are

selected.

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SalespeopleSalespeople The in basket exercise is most common method ofselection. This include problems , messages, andreports that might be a part of the basket of

performance for the salespeople on the job. The applicant are asked to deal with these issue as

they see fit and then are assessed on how well theyhave prioritized the issues, how creative andresponsive they are in dealing with each one, the

quality of their decisions, and other factor related tothe job. An interviewer should stay focused and should not

move into asking peripheral questions and shouldconcentrate on the objective of hiring to perform job

at hand.

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SalespeopleSalespeople7. Determination of terms of service. After the candidate has successfully cleared

all the above tests, the term of service arefixed for the selected candidates.

The term of service are related tocompensation patterns and types, including

salary, commission structure, allowancesincluding travel and medical, which aredetermined before the appointment letter isissued to the selected candidates.

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SalespeopleSalespeople8. Appointment The appointment letter is issued to the selected people

at the end of selection exercise. It contains the termsand conditions of service with regards tocompensation and allowances, probationary period,the last date to join duty.

9. Initial Orientation It is a process aimed at providing the job related and

organization related information to the newsalesperson. This includes the origin and growth ofthe firm, the policies, procedures and regulationsgoverning the job in the organization, informationabout sales department and its structure, current

structure and market standing of the sales force etc.

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SalespeopleSalespeopleSocialization It is defined as the process of orienting a new

salespeople to the sales organization or theterritory or division in which he will be

working.

It is a process by which new employees areintroduced to their work environment,

territory, and to the job.

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SalespeopleSalespeopleProcess of Socialization

a) Anticipatory stage

b) Encounter stage

c) Settling in

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SalespeopleSalespeoplea) Anticipatory Stage it is the first stage where new employees have

different kinds of expectations about organization

and job based on the information available withthem The best method to create appropriate

expectation is through a method called Realistic

Job Preview(RJP).In this method, a sales managerprovide a realistic picture of job demand, theorganization expectation of salesperson and thework environment in the organization.

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SalespeopleSalespeoplec) Settling In In this stage new sales people start feeling that

they are the part of organization. If this stage issuccessful, the worker will feel comfortable with

the job and his role in the sales territory.

A programme called `employee mentoring`

performed under the supervision of an

experienced employee of the organization helps a

new employees to settle down with the job and in

the organization with success.

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Training the sales forceTraining the sales force

New sales recruit need proper training andguidance to perform their jobs efficiently.

A sales manager plays an important role inevaluating the training needs of the sales forceand deciding on the kind of training a salesperson require to achieve organizational goals. A sales manager should exploit the talent of the

new recruits and utilize their service witheffective training for increasing theirproductivity and efficiency level.

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Managing The Sales TrainingManaging The Sales Training

ProcessProcess

1. Assess Sales Training Needs

2. Design and Execute Sales Training

Programme

3. Evaluation and Reinforcement of Sales

Training programme

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ProcessProcess

1. Assess Sales Training Needs

A)Training need assessment phase

a) Organizational level analysis

A sales manager evaluates the macro issues

like organizational structure, mission ,

business climate, and long and short term

goals

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ProcessProcessb) Task Level Analysis

This analysis examines the sales job to be performedat different levels . It focuses on all the functions

and jobs in sales and determine which one of themneeds the attention of training program.

The KSA`s are identified and information fromthese are used to determined the type of training

required by sales departmentc) Personal level Analysis

It helps to determine all those sales people who needto undergo the training programme. This is done byassessing performance of the sales staff.

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ProcessProcessMethods used for assessing training needsa)Sales Manager Observation Asm spend a lot of time in the field working with the

sales people. So he observes the need of particular sales

training based on the specific short comings of the salesperson.

b)Sales force Survey To identify the training needs of the sales people it is

important to conduct sales force survey as anindependent activity or combined with other salesactivities like sales report.

How ever if field sales manger and their sales peopledisagree on the training needs, it is better to discover thisdisagreement and find a solution before designing thesales training programm

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ProcessProcessc) Customer Survey The customer survey helps to understand

customer expectations, the company`s sales

people s competencies, as compared to that ofother salespeople in the same industry.

d) Performance Testing Some companies test knowledge and skills of

sales people by coducting performance testingof sales people on regular basis. Sales trainer evaluate the performance of sales

person on presentation skills, product

knowledge, CRM etc.

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ProcessProcesse) Job Description It mentions clearly the duties , responsibilities, and

the key tasks or KRAs of the sales people. It is ,

therefore, a logical tool to be used in assessing thetraining need.

f)Sales force Audit

As a Part of marketing audit or sales audit, some

companies use sales force audit for assessingtraining needs of sales people.

Generally conducted in one year, the sales forceaudit asks question on the training programmes

about its adequacy, contribution, and revision.

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ProcessProcessPopular Sales Training needa) Product Knowledge it includesadvantages,benefits,applications, and

limitations. If the product or service istechnically complex, more time is spent ingiving detailed knowledge.

b) Customer Knowledge

The sales training may include relevantinformation about the company`s customers,such as type of customer, knowledge ofcustomer business, customet need, buying

motives.

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ProcessProcessc) Competitive Knowledge Knowledge of competitors products or

services, in the term of strengths, weaknesses,

strategies and tactics as well as prices,discounts, payment terms is very important forsales people to plan sales strategy.

Competitor`s knowledge would help a salespeople during a sales presentation, overcomingcustomer objections, negotiations, and finallyclosing the sale

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ProcessProcessd) Sales Technique or Selling Skills Many sales people are not competent

enough in sales technique and hence theyneed training on `how to sell`.

There are many common shortcomings

like ineffective questioning and listningskills, giving benefits befor understanding

customer need which can be removed by a

good training program.

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ProcessProcesse) Company Knowledge new sales trainee should be told about the

company`s vision, mission values, objectives,organizational structure.. Leave policy etc.

Training is required about company sellingpractice, sales call per days, how to handle returnsfrom customers, expense account , sales report andso on.

Channel of communication, and key people inorganization structure are important for new salespeople. It is also required for the trainee tounderstand the history and any other relevant

background information that helps to develop a

sense of pride about the company.

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ProcessProcess2.Designing and Executing Sales TrainingProgramme

a) Aim (Why?)b)Content(What?)

c) Methods(How?)

d) Execution(Who , When, Where What)e) Evaluation

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ProcessProcessa)Aims/Objectives of sales training Increase sales productivity

Lower sales force attrition rate

Improve customer relation

Introduce new products, markets andpromotional programmes.

Create positive attitudes and improve salesforce morale.

Prepare new sales people for assignment to

a sales territory

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ProcessProcessb) Content of training programme The content of initial training for new sales

trainees will be broader and different from thecontent of refresher or continuing training for

experienced salespersons. Usually the content of the training program of

new sales people for initial training will includecompany knowledge, product knowledge,customer knowledge, competitor knowledge andselling skills or sales technique.

The content of continuing training programm forexisting and experienced sales persons will bemore specific , depending on the training needs

and objective.

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ProcessProcessc) Sales training Methods

Sales training methodOn the Job RotationMentoringJob rotationAbsorption Training/ Self study

Audio Cassettes

Manuals, BooksCD ROM

Online Training

EPSS(electronic programSupport system)Interactive Multimedia

TrainingDistance Learning

Behavioral

LearningRole playingCase studySimulation games

Class room LecturesDemoGroup discussion

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ProcessProcessd) Organizational Decision for sales training

1. Who will be the trainees?

2. Who will conduct the training?

3. When should the training take place?

4. Where should the training be done?

5. What will be the budgeted expenditure for

the training?

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ProcessProcesse) Evaluation of Sales Training Programme It is difficult to evaluate ( or fid value of)a sales

training programme. This dificulty arises because it

is hard to decide which sales performance variationsare due to sales training.. In spite of these difficulty most companies measure

the effectiveness of sales training to evaluatewhether present expenditure on the sales training is

worthwhile, and to imrove the design andimplementation of future sales training

programmes.

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ProcessProcess In evaluation, the company must decide whatoutcomes will be measured?, how the item will bemeasured, and when to measure these outcomes

These outcomes fall into following four categorya) Reaction These outcomes point the participants perceptions

or reaction.

Whether the sales training achieved the objectivesand whether the training was worthwhile. Reactions of sales trainees, can be measured by

interviewing or asking them to complete a fewquestionnaire.

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ProcessProcessb) Learning

The outcome measures how much

knowledge, skills, or attitude were learnt orabsorbed by the sales trainee.

The information collection methods used

are test and interview method. There may be `before` and `after` tests or

interview taken after test.

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ProcessProcessc) Behavior

The outcome here measure whether there was a

change in the trainee`s behavior. The assessment of the trainee`s change of

behavior is conducted by immediatesupervisor, who can observe the trainee after the

sales training, over the period of one year. The measurement may also include self-

assessment by the trainee or observation fromcustomers.

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ProcessProcessd)Results It point out whether the outcome of training has

improved performance results , and whether the benefitsof training were more than the costs.

The measures used to assess the final results are: sales,profits, customer satisfaction, no. of new customers, andmarket penetration.

The methods used to collect the relevant data or

information on results are: company data( on sales,profits, no. of new customer) market survey(forcustomer satisfaction) and immediate boss judgment.

These result can be measured every quarter for oneyear, after the training

Evaluation of SalesEvaluation of Sales TrainingTraining ProgrammeProgramme

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It is done to improve training design and implementation, and to find if expenditure was

worthwhile

Framework for sales training evaluation:

Outcomes to measure What to measure How to measure When to measure

Reactions /Perceptions ofparticipants

Training objective

Was trainingworthwhile?

Questionnaires

interviews

After the training

Learning knowledge,

skills, attitudes learnt

Knowledge, skills,

attitudes

Tests

Interviews

After training

Before & after training

Behavioural change Trainees change ofbehaviour

Self-assessment bytrainees

Observation bysupervisors / customers

After training, over aperiod of one year

Results Performance; Benefitsmore than cost?

Sales, Profits

Customer satisfaction

Company data

Managementjudgement

Market survey

After training,Quarterly, Yearly

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Sales Force MotivationSales Force Motivation

In many organization s, people don't

perform their job well. This is not because

they dont have the skill, but because theydon`t have commitment to the job due to

the lack of motivation.

Individual on organizational matters restrictthem from applying themselves to

performing a sales job up to the potential.

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This affects the overall productivity of the salesorganization. Problems of motivation inorganization arise due to the lack of effort on the

part of the sales people in performing the job. This results in frequent tardiness and absentism and

leads to a high level of unwillingness to finish thejob in time and achieve the sales goal set for theperiod in the territory.

One of the biggest challenges for the sales manageris to keep his sales team constantly motivated andmeet their commitments.

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Motivation is that element of the sales person

that stimulate him to increase the efficiency of

his work and thus achieve higher goal. It implies any emotion or desire that energizes,

activates, moves, direct,or channel behavior

towards goal

Performance(P) = Ability(A) X Motivation(M)

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Importance of Motivation

1 . Sales people get demotivated due to frequentrejection

Sales people have to put in a large effort to realizesales in the market. They get demotivated due tofrequent rejections by customers, lower esteem to

the sales job, and customer complains about thenon-compliance of the product and service.

The sales person perform the job as a soleindividual has no formal and fixed office hours and

faces stiff competition from the market.

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2 The nature of sales job Sales people have to the job of prospecting,

presentation, and demonstration repeatedly, which

make the job monotonous. Sales people often find a sales job to be boring not

stimulating in long run. A sales manager has to find the source of motivation

and designs systems and procedures to motivate theemployees to remain committed by identifying thesources of demotivation and developing a rewardsystem

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3. Frequent Travelling and socialization

Due to frequent travelling, the sales people

has to face domestic problems an may notbe able to have a normal family life.

This can hamper their efficiency and, toovercome this, the sales manager should

develop special leave and financial rewardprogrammes for motivating sales people.

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Sales people work in field, are not under directsupervision of their superiors, and have less contactwith their peers and co-workers.

They remain busy with their job at different places,which hamper the normal process of socialization. Sales manager should organize conferences,

seminars, and workshops to provide an opportunityto the sales people to develop a sense of

belongingness and to provide an opportunity to thesales people to develop a sense of belongingnessand participate in the process of socialization.

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4. To be remain in their job Efficient sales people posses good knowledge

about their job can sell goods and services .

It is observed that the majority of the salespeople would like to maintain an average levelof sales so that they can remain in the job.

A sales manager has to put substantial efforts

into the motivational programme, so that theycan discover and utilize their hidden talents anddo their job better.

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5.Conflicting company objectives Sales people are required to achieve the company

objectives and goals , such as sales volume, profits andcustomer satisfaction. Sometimes these objectiveconflicts.

For instance , a customer is satisfied if the sales personconfirms matching the competitors price with thecompany price. However the company management isunable to do so, because by bringing down thecompany`s price to level of competitors price, thecompany can not achieve the profit objective.

The sales person is frustrated that after putting a greatamount of efforts, the order from the customer is lost toa competitors.

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Motivational Drives

1 . Security

Every motivational programm should aim atproviding a sense of security to the sales person sothat the apprehensions about future will come downand he will be able to contribute without looking at

issue related to his basic survival and satisfaction ofphysiological needs.

E.g. performing beyond the quota level achievementtakes them to receive bonds and equity share of the

company as a part of incentive programe.

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2. Achievement

The sales person must know in advance the

achievement that he will have from themotivational programme. If there is no

sense of achievement in a motivational

programm, it can not stimulate the salesperson to achieve the higher goal.

E.g. crorepati agent scheme from LIC.

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3.Approval

Sales people also look for social approval

and they expect that the good work by themshould be praised, approved, and rewarded

by the sales manager.

An appreciation among peers does wondercompared to a financial reward system.

E.g. cruise to Caribbean with the CEO.

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4. Loyalty

If the interpersonal relationship is good betweenmanager and salespeople and there is a highsense of social respect for each other, the salesperson tends to develop loyalty towards theorganization and respect towards the seniors

and managers. On completion of the no. of years in the

company, sales person are felicitated andfunctions are held to appreciate and recognize

the loyalty of employees.

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5. Advancement

6. Leadership

Motivational Tools in a Motivational MixMotivational Tools in a Motivational Mix

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Motivational Tools in a Motivational MixMotivational Tools in a Motivational Mix

Financial compensation is the most widely used tool of motivation,

as salespeople give highest value to it

Financial Non Financial

Financial compensation plan Salary

Commission/Incentive

Bonus

Fringe benefits

Combination

Sales contests

Promotion Sense of accomplishment

Personal growth opportunities

Recognition

Job security

Sales meetings

Sales training programmes

Job enrichment

Supervision

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Evaluation of the sales forceEvaluation of the sales force

By evaluating the performance of the sales force, asales manager can test the effectiveness of the sales

programme and the quality of implementation of

the sales programme by the sales people. Performance appraisal is the process of evaluating

the performance and qualifications of the sales forcein terms of the requirements of the job to ensure

effective administration, including the selectiionfor promotion, rewards, and other recognitions inthe organization.

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A sales manager needs to identify and determine thespecific areas of work to be examined while appraisingperformance.

The appraisal system should be planned based on jobanalysis. It should focus on the performance of thesalespeople and have an effect on the organizationsfuture.

It should be based on the past achievements of thesales force and have a futuristic proposition so that thesales manger can find strategies to tap the potential ofthe sales people for the benefits of the organization

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Performance Appraisal Process

a) Deciding on the criteria for measuringperformance.

b) Deciding on the conduct of the performanceappraisal

c) Deciding on evaluation of individuals and teams

d) Comparison of actual performance with standards

e) Deciding on the frequency of the performanceappraisal

f) The external Variables and their influences

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a)Deciding on the criteria for measuringperformance

1. Relative and Absolute Judgment In the relative Judgment method, the sales

manager is asked to compare the salesperson performance with that of other

salespeople on the job.A rank order for sales people from the best

to the worst performer is developed in such

mthod

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This method does not provide any absoluteinformation and leads to an indecisive attitudeamong sales managers. This may lead conflict

within the sales force over the ranking given tosales person. In absolute judgment method sales manager is

asked to make judgment about salesperson

performance based on sales volume, marketshare or revenue realization. Here, the comparison among sales people in

different territories facing different selling

situation becomes irreleant

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2. Trait-based

The sales force can be evaluated based on somecriteria related to traits, outcome, and the behaviour

of the sales force. Traits based instruments are used by sales manager

to make judgement about the sales person traits andselling characteristics that tend to be consistent and

enduring. Most commonly used traits for this purpose are

decisiveness, reliability, energy, and loyalty.

Demerit of this method is it is based on personal

traits rather than the sales performance

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3.Outcome-based It is performance criteria based on outcomes instruments that

allow mangers to assess the results achieved by the salesforce are the amount of sales, no. of products sold in units orvolume, profitability as a net margins, and sales expenses as aratio of costs to sales.

The most common approaches used in this method are MBOand Natural Outcome.

MBO is a goal- directed approach to performance appraisal inwhich sales people and manager together set goals for theupcoming evaluation period.

In natural method , the performance measure is not muchdiscussed and is assumed to be acceptable by the sales people

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4. Behavior Based This method focuses on the behavior of the sales

people and does not focus on traits or performance

outcomes. The behavior measure is related to selling activitiesand for this the sales manager records howfrequently behaviors listed in a checklist of rating haveoccurred.

This rating assesses the value of the behavioralmeasures rather than their frequency of occurrence andit includes product knowledge, presentation quality,closing ability, service performed, the number ofactive accounts, and relationships with customers

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Method of Sales Force Evaluation

1.Essays In this method sales manger describes the

performance of the sales person in few paragraph. He maintains details like individual potential,

strengths, weakness and other relevant matters. The basic of using this method is assumption that a

written or word of mouth statement is as reliable asany other formal evaluation method. Demerits of this method is different managers use

different approaches to writing their evaluation and adifferent way of interpreting and rating characteristics

required for a particular job.

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2. Rating Scales In this method of performance evaluation, the sales

manager identifies certain specific criteria for a particulartype of job.

The criteria may be based on personality traits andbehavioral factors, or they may be performance related.

The sales personnel are evaluated based on the extent towhich they meet the desired performance criteria

The advantage of this method is that it helps identify areaswhere the sales person has to improve or maintain thedesired levels of performance.

Disadvantage is that most recent behavior of the salesforce is considered without looking at the sales person

behavior for a period of time.

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3.Behavior Observation Scale(BOS)

This method consider those behaviors and

activities of sales personnel that significantlyinfluence individual performance.

All the behaviors that are similar in the job

context are grouped together under singledimension. E.g certain behavior can be

grouped under dimension `customer

relationship`.

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Around ten such dimension are generally rated tomeasure the performance of sales person.

After the dimension of particular job type are

established, they are given in a random order to agroup of specialists to rate the dimensions again. if therating is similar to the rating given previously, thedimension rating of that particular job type is fixed.

A five point likert scale is used for each of the tendimensions. This evaluation form is given to arespective sales managers to rate each crucial behaviorfor all the dimensions based on their observation.

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4. Forced Choice Method It is method of rating that helps in comparing sales personnel by

creating standard for measuring sales force performance.

In this method , the sales manager is asked to go through groupsof statements and select those that best explain the individuals. Usually within a group, both or all statements are either positive

or negative. The rater is forced to choose what describes thesales person best from a group of all positive or all negativestatements.

Each statement is given a weight that the evaluator is not awareof. The form is evaluated by personnel dpt. and the sales personwith the maximum score is rated the highest

The advantage of this method is that it helps remove rater bias

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5. Ranking

This method of performance evaluation is useful

when the sales personnel in the entire sales forceworking in different areas have to be compared.

Ranking is pereferd when sales personnel from

different operating areas have to be evaluated for

promotion or for increase in compensation.

Alternation ranking and paired comparision

ranking are most commonly used ranking

methods

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In alternation ranking, sales person are listedrandomly on the left-hand side of theevaluation sheet. The name are selected basedon the criteria chosen for ranking.

E.g. the sales manager chooses the best salesperson from the list(if the ranking is done to

increase the compensation) and write thename on the top right hand corner.the nameof the least valued sales person is placed onthe bottom right hand corner.

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6. Family of measures(FOM) This method is useful to measure individuals as

well as group performance.

FOM does not compare the results obtained withthose for others sales force; it compares the resultwith the previous result over a time period.

The method is continuous evaluation process and

the results are not linked to the sales force pay. Itis flexible in approach because it allows salespersonnel to assign weights to each area based onthe difficulty of work and the experience of the

salesperson.

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7.Call Reports Call reports are periodic accounts and customer

statements prepared by sales persons of how they are

dividing their working time between various aspectsof job like prospecting, demonstration, and follow up.

8. Silent call Monitoring Scores It consists of sales managers rating of the sales

persons performance during actual calls to the

customer. The rating can cover a wide range of issue like

greeting, ascertaining customer needs and demands,courtesy, and the level of communication and listening

skills.

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9. Activity Reports

It explain the unusual events and incidents

that occur in the field as reported by a salesmanager and sales people, including peers.

This includes event like the launch of major

price war by the competitor, increase in thedealer push money of the competitors and

entry of competitors.

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Conduct of performance Appraisal

Biases

Problem with sales person evaluation are known asbiases in evaluation. Abias occurs when sales anagerinflate or deflate the subordinates performance rating.

A bias is either conscious or unconscious. A consciousbias can be either positive or negative.

The positive conscious bias includes sales managerwish to help experienced sales person cope with the

problem outside job

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The negative bias ia an attitude of getting rid

of problematic sales people to avoid

confrontation with an underperforming salesperson.

Such inflated or deflated ratings can also

happen as a result of unconscious orjudgmental biases. Some of unconscious bias

are

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a) Base Rate Information

It is the actual distribution of the outcome beingassessed. E.g. customer satisfaction indexcomprising the satisfaction levels of all thecustomers.

Under weighting of base rate information occurs

when a sales manager either overlooks theaverage base rate of customer satisfaction andconcentrate on a particular set of customers orincidences that are not representing base

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When a sales manager makes field visits with asales person and finds that calls are productive,he remembers this at the time of appraisal and

despite customer customer cpmplaints tend tounderplay the base score. The sales manager ignores the base rate

information and allows his limited personal

experience to the basic for making an evaluation. For overcoming such bias, sales manager shouldevaluate the sales people more frequently.

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c) Anchoring

Anchoring occurs when sales manager rate sales

people using a scale. If there is a five-pointLikert scale where the value of 3 stands as

average, the sales manager tends to evaluate

every sales person from a score of 3 and the rates

the sales person to reflect his activity observedduring the time period of study.

The bias happens when the sales managers

adjust rating in an unjustified way

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A sales person who received a high rating I oneperiod is likely to be rated higher in subsequentperiods due to the halo effects, even when hisperformance is not of that order. Same situation

happens in fixing sales quota.d) Hindsight Bias A hindsight bias occurs when a sales manager

discounts information received from a sales person

because they believe that it would have happenedanyway. In hind sight bias the salesperson bringsinformation about market condition, competitorsmoves, and relevant customer behavior data for salesmanager.

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e) Regression effects

It show the tendency of unusual observation

to be followed by observations that are moretypical of the company norm.

When a sales person joins a new

organization he uses all his connections inthe joining year to realize sales but in the

second year his sales come down because by

then he has exploited all his resources.

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SDM3

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