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1

Introduction to Sales

Management

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2

1. Willingness to go to bat for the buyer within thesupplier rm

2. Thoroughness and follow through

3. Knowledge of the sales person’s product line

4. ar!et !nowledge and !eeping the buyer posted". #pplying his product and ser$ices to buyer’s

needs

%. Knowledge of the buyer’s product line

&. 'reparation for sales calls

(. )egularity of *ales calls

+. ,iplomacy in dealing with operatingdepartments

1-.Technical education

Personal selling strategies

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3

'ersuasion

onsultati$e

*elling

'artnership

*trategies/usiness

anagemen

t0egotiation

Evolution of personal selling

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4

Marketing concepts

1 'roduction concept

2 'roduct concept

3 *elling concept 4 ar!eting concept

" *ocietal concept

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© Oxford University Press 2005, Allrights reserved.

5

ustomer0eeds

*ales ustomers

mphasison *eller’s

0eeds

'roduction

'roduction

*ales

mphasison

ustomer0eeds

Societal marketing concept

*ales rientation

ar!eting rientation

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6

Nature and role of sales

management The determination of sales forceob5ecti$e and goals

*ales force organi6ation7 si6e7

territory7 and 8uota nali6ation *ales forecasting and budgeting

*ales force selection7 recruitment7and training

oti$ating and leading the sales force

,esigning compensation plan andcontrol systems

,esigning career growth plans and

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7

Types of personal selling

9ndustrial selling )etail selling

*er$ices selling

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!

Types of selling

rder ta!er sales people

rder creators

rder getters

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"

*elling:unctio

n

rder

Ta!ers

rder

;etters

rderreators

utside rderTa!ers

9nside rderTa!er

erchandisers

,eli$ery *ales'eople

issionary*ales 'eople

0ew/usiness

*ales'eoplergani6ation

al*ales 'eople

onsumer

*ales 'eople

Technical*upport sales

'eople

:ront

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10

:actory :actory

*elling andpromoting

'rotsthoughsales

$olume

*elling concept

ar!et concept

ar!et ustomerneeds

oordinatedmar!eti

ng

*tarting

point :ocus eans nds

'rots throughcustomersatisfaction

Difference between sales and marketing

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11

Marketing management process

#)KT #0T99'#T90

=change o>er of $alue

'roducer

ar!eteronsumer

ar!eting mi=

'roduct

'rice

'lace

'romotion

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12

:ormulation of a strategic sales programme

9mplementation of the sales programme

$aluation and control of sales force performance

Sales management process

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13

Technolo

gy

)elationshipselling

ustomerorientation

;lobal andethical9ssues

0ew sellingmethods

,i$ersity

mergingtrends in

salesmanagement

Emerging trends in sales management

Technology

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14

*elling *!ills and

*trategies

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15

*elling and buying styles

9

8

7

6

5

4

3

2

1 2 3 4 5 6 7 8 9

. o n c e r

n f o r t h e c u s t o m e r s

17+ 'eople riented9 am customer’s friend7

9 want to understand himand respond to hisfeelings and interests sothat he will li!e me. 9t is

the personal bond thatleads him to purchasefrom me."7" *ales techni8ueriented

9 ha$e tried an e>ecti$eroutine for getting acustomer to buy. 9t

moti$ates through ablended personality andproduct emphasis

171 Ta!e it or

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16

*elling situations

*ales tas! and function

aintenance selling

,e$elopmental selling

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17

*elling s!ills

*elling *!ills

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1!

ommunication process

0oise

hannel

:eedbac! 9ntended

essage

*ent essage

ncoding

'ercei$edessage

)ecei$edessage

,ecoding

*ender )ecei$er

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1"

ommunication processcontd.

anaging body language@

'ersonal #ppearance

'osture ;estures

:acial =pressions

ye ontact

*pace ,istancing

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20

Process of listening

#ttendance

9nterpretation

$aluatio

ns

)emembrance

)esponse#ction

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21

Levels of listening

:eedbac!

'araphrasing

mphatic

listening

larications

#cti$e

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22

on?ict managements!ills

odels of con?ict

omponents of con?ict

The con?ict resolution process@B lumping

B a$oidance

B coercion

B meditation

B conciliationB arbitration

B ad5udication

B negotiation

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23

*tage 9

'otentialoppositionor

9ncompatibility

*tage 99

ognition C'ersonali6at

ion

*tage 999

9ntentions

*tage 9D

/eha$iour

*tage D

utcomes

#ntecedentonditions

ommunication

'ersonalDariables

*tructure

'ercei$ed on?ict

:elton?ict

on?icthandling

9ntentions

ompeting

ollaboration

ompromising

#$oiding

#ccommodati

$erton?ict

'arty’sbeha$iour

thersreaction

9ncreasedgroupperforman

ce

,ecreasedgroup

performance

onflict management process

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24

0egotiation s!ills

*ituation and timing for negotiations:ormulation for a bargaining

strategy

The theory and strategy of principlenegotiations

# separate the people from the problem# focus on interests7 not on positions

# in$ent options for mutual gains# insist on ob5ecti$e criteria

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25

'roblem sol$ing s!ills

Eabit 9@ be proacti$e Eabit 2@ begin with an end in mind

Eabit 3@ put rst things rst

Eabit 4@ thin! winFwin Eabit "@ see! rst to understand7

then to be understood

Eabit %@ synergi6e Eabit &@ renewal

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26

,ene theproblem

;enerate alternati$e solutions

,ecide the solution

9mplement the solution

$aluate the solution

Problem solving process

'roblem denition

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27

'roblem,enitionTechni8ues

:ind out originof theproblem

=plore theproblem

'resentdesiredstate

analysis

$aluateproblemstatemen

t

*tatementand

)estatement

,un!er’s

diagram

'roblem denitiontechni8ues

1

2

3"

4

%

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2!

Dunker!s diagram

#chie$e the desired state

'ossible path to the desired state

'ath 1 'ath 2 'ath 3

lutions to implement C paths to desired solutions

*olution 1*olution 2 *olution 3

;eneral *olution

:unctional *olution

*pecic *olution

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2"

: u 6 6 y e s s

'ercei$ed problems

)e *tatement

)e *tatement

:inal problem *tatement

)ela=onstraints

a!e anpposite*tatement

;enerali6e

Statement restatement tec"ni#ue

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30

omponents of a decision on t"e

future course of action

*ituation analysis

'roblem analysis

'astWhat is the fault

,ecision analysis

'otential problem#nalysis

:utureEow to pre$ent future

faultsG

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,ecision on the best solution

#ppro$al

'lanning

arry through

:ollow up

$aluation

9'<

0T#

T90

Solution implementation process

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32

T"e Selling Process

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Stages in t"e selling process

'reBsalepreparati

on

*ales'resentat

ion

Eandlingustomerb5ection

s

losingthe *ale

:ollow upaction

#pproachto the

customer

'reBapproach

beforethe

inter$iew

'rospecting

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34

Prospecting

*uccessful prospecting

"- potential prospects

1" Hualied prospects

% 9nter$iews

1 sale

"- potential prospects

2" Hualied prospects

1& 9nter$iews

& sales

*uccessful prospecting

0o Ies

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Process of prospecting

9dentify and dene prospects

*earch for sources of potentialaccounts

Hualify the prospects from thesuspects

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© Oxford University Press 2005, Allrights reserved. 36

Met"ods of prospecting

old can$assing

ndless chain customer referral

'rospect pool

enters of in?uence 0on competing sales force bser$ation

:riends and ac8uaintances

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Selling process 're approach to selling

#pproach to the customer *ales presentation

B approach to sales presentationB attracting customer attentionB creating interest

B arousing desire and building con$iction ethods of sales presentation

B canned presentationB organi6ed presentationB tailored presentation

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© Oxford University Press 2005, Allrights reserved. 3!

$andling customer ob%ections

*tart with your highest e=pectations

#$oid conceding rst

/ sure the customer understands the $alue

of a concession

a!e concessions in small amounts

#dmit mista!es and ma!e corrections

willingly

/ prepared to withdraw a concession

,o not ad$ertise willingness to concede

*uggested by *9TE

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© Oxford University Press 2005, Allrights reserved. 3"

Met"ods of "andling customer

ob%ections

*uperior feature method IesJ/ut method )e$erse nglish method

9ndirect denial method 'ass out method omparison method ,irect denial method

#nother angle method 0arrati$e method Testimonial method Huestion or WEI method

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losing t"e sale

ethods of closingthe sale

:ollowBup action /2/ selling

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Sales Organization

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Sales organi&ation

an organi6ation of indi$iduals either wor!ing togetherfor the mar!eting of products and ser$ices manufactured

by an enterprise or for products that are procured by therm for the purpose of reselling

a sales organi6ation denes duties7 roles7 rights7 andresponsibilities of sales people engaged in sellingacti$ities meant for the e>ecti$e e=ecution of the sales

function

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Sales organi&ation

contd'

a structural body through which the functions ofsales management are carried out

sales organi6ation always ma!es e>orts to increase sales7thereby achie$ing the principle of prot ma=imi6ation7which contributes to the o$erall growth of enterprise

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(actors influencing structure

'roduct and ser$ice related factors

rgani6ation related actors

ar!eting mi= related factors

=ternal factors@#*ales rganisation design based on Team performance

# Trend towards elimination of sales force ba6ee.com# ar!et dri$en strategy customer segmentation strategy $s.

ustomer dri$en strategy partnership strategyB The speed of mar!et change higher decentralisationB )eduction in the number of $endors per buyerB loser customer relationships# hanges in regulations and international practices

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)rgani&ational principles *pan of control

entralisation $s. decentralisation

nity of command

Eierarchy of authority

*tability and continuity

oordination and integration arico C ' C; for rural

Eomogeneity

b5ecti$ity

*peciali6ation

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)rgani&ational design# $ormal and coordinated tas!

# #ssigning territories# stablishing ?ows of communication and responsibilities

of sales groups and indi$iduals to customers e>ecti$ely

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onsumermar!et

9nstitutionalmar!et

orporatemar!et

0ational,istribut

ors

,irectto

Eome

,irectmar!etin

g

,istributors

/undling

;ifting

onsumer)egional,istributors

)etailers

onsumers

Typical structure of a line organi&ation

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Design by territory

D' ar!eting

0ational *alesanager

,i$isionalanager

ast

,i$isionalanager0orth

,i$isionalanagerWest

)egional *alesanager

,istrict *alesanager

*ales *ta> ity wise



*ales *ta> ity wise



*ales *ta> ity wise

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Design by management function

r. ,ara singh7

D'ar!eting

rs. hitra

ohanty

#d$t L *ales

'romotion gr

*ta> :unction *ta> :unction

r. ,ibya

/ehera

*ales anager

r. handra ,e

anager

)

2- *ales 'eople

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Design by product

'resident7ar!eting

'roduct anager #

'roduct anager /

anager*ales

anagerTraining

anager'romotion

anager*ales

anagerTraining

anager'romotion

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Design by customer

'residentar!eting

*ales anagerWholesalers

*ales anager)etail *ales

*ales 'eople

*ales anager9ndustrial)elations

Dice 'residentar!eting

*ales 'eople *ales 'eople

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:unctional

eographic

ustomer

ombined

Sales )rg' Design

'resident

ar!etinganager

9nternational

;.

9nternational*ales

ar!etinganager

9ndia

Dice'resident

ar!eting

;.onsumer care

;.

9nternational*ales

Dice'resident

E),

Dice'resident

'roduction

,i$isionalanager

*oaps

,i$isionalanager

:ood

,i$isionalanager

'aper

astern *ales,i$ision

Western *ales,i$ision

0orthern *ales,i$ision

urope ,i$ision#merica,i$ision

;ulf ,i$ision

'roduct

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Key account sales

*ales process automation

B focus on )B customer protability and $alue analysisB the few accounts gi$e incremental returnsB national accounts

B ,9 F lectronic ,ata =change

Sales )rgani&ation

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Emerging organi&ational design

agency and distribution selling

shared sales force

telemar!eting

TH and teamBbased selling

ustomer

*ales ar!etingTechnical*upport

anufacturing

*upplier selling team

N b f l l

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Number of sales people

determined by@B territories $ary in their demand structure for prospectingB product mi= demands

B le$els and types of prospecting

B nature of the customer segments

#>ordability method based on sales budget

9ncremental method

Wor!load method0umber of sales people M

0umberof e=istingcustomers

0umber of

'otential

customers

9dealfre8uency of calls

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Management of Sales Territory

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Sales territory

# group of present and potential customers

assigned to

an indi$idual sales person7 a group of sales

persons7 a branch7 a dealer7 a distributor or

a mar!eting organi6ation at a gi$en period

of time.

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O%&e'tives of ()les *erritory

• *o for+l)te s)les -l)ns, -oli'ies, str)tegies )rond

'o+-)nys -rod'ts/servi'es, designed for ) territory.• An)lye territory s)les -otenti)l -l)n +)reting

-rogr)+s ey -otenti)l 'sto+ers for ) territory.

• An)lye strengths e)nesses of 'o+-etitors or

ot str)tegies to s%vert 'o+-etition for ) territory.• denti')tion 'l)ssi')tion of )''onts )''ording to

their -otenti)l 'h)l ot ')ll -l)ns for ) territory.

• Org)nie s)les for'e, )llo')te s)les eorts, i+-le+ents)les -l)ns +ore ee'tively for ) territory.

• evie -erfor+)n'e of s)les for'e )t regl)r interv)lsfor ) territory

• edesign s)les -l)ns, -oli'ies, str)tegies in ')se of'h)nges in +)ret trends/%siness environ+ent for )

territory. 5!

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5"

Sales territory *contd'+

#d$antages of designing a sales territo

9t ensures better mar!et co$erage

>ecti$e utili6ation of the sales force

Ocient distribution of wor!load among

sales people 9t is con$enient to e$aluate the

performance of sales people

To control o$er the direct and indirect

costs of the sales function ptimum utili6ation of sales time by sales

people

D i i l i i:actors

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60

Designing sales territories

*elect the basicgeographic controlunits,ecide on thecriteria for allocation

,ecide on thestarting pointombine controlunits ad5acent tostarting point

ompare territorieson allocation criteriaand conduct wor!loadanalysis#ssign sales forceto new territories

:actorsin?uencing themodicationsof a territory@

mergers mar!et

consolidation split indi$ision sales force

turno$er customer

relocations productlifecycle change product

line

odifyterritorialboundaries to

balancewor!loadandpotential

T it "

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Territory s"apes

circlewedge

lo$er leaf

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62

Strategic Planning Matri,

pportunity

*trategy

pportunity

*trategy

*trategy

*trategy#llocate a moderate le$el ofresources to maintain currentad$antage.

ither commit a minimal le$el

of resources to the account or

consider abandoning the

account altogether.

The account o>ers stableopportunity since the sale

organi6ation has di>erentialad$antages to ser$ing them.

pportunity

pportunity

The account o>ers little

opportunity. 9ts potential is small

and the sales organi6ation is at a

competiti$e disad$antage in

ser$ing it.

The account o>ers a goodopportunity. 9t has highpotential and the salesorgani6ation has adi>erential ad$antage inser$ing it.

ommit high le$els of sales

resources to ta!e ad$antage ofthe opportunity.

The account may represent agood opportunity. The salesorgani6ation needs to o$ercomeits competiti$e disad$antagesand strengthen its position tocapitali6e on the opportunity.

ither direct a high le$el of

sales resources to impro$e theposition and to ta!e ad$antage

of the opportunity or shift

resources to other accounts.

*trong Wea!

Eigh

<o

w

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63

0ew Territories..G

se of 9nformation Technology

9T enabled ser$ices

computer programmes simulation techni8ues

Sales territories

8e'ide 9)si' *erritories: ;)ret 9ild#U-

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-;ethod

64

;)n)ge+ent +st deter+ine:

8esir)%le ')ll -)ttern

*ot)l ')lls needed in e)'h 'ontrol nit

?orlo)d ')-)'ity

*ent)tively set territori)l %ond)ry lines 'o+%ining 'ontrol nitsntil, @tot)l ')lls needed tot)l ')lls -ossi%leB

;odify territories )s needed

?orlo)d )--ro)'h: Cx)+-le#.

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65

-- -

ustomer

allfre8uen

cyLannum

0o. ofcustom

ers

0o. ofcalls L

annum

0o. ofcustom

ers

0o. ofcalls L

annum

Totalno. of

calls Lannum

inbothunits

Dontrol Unit # 1 Dontrol nit # 2

;)&or ! 100 !00 150 1200

;oder)te

6 150 "00 250 1500

;inor 4 600 2400 700 2!00

4100 5500 "600?orlo)d Eo of oring d)ys x )v. no. of ')lls / d)y240 oring d)ys x 4 ')lls -er d)y "60e=ired no. of s)les -ersons "600 F "60 10

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66

ustomerType

Time L call alls Lannum

Eours Lannum

Total hours Lannum

;)&or

60 +in. /

')ll

40 40 hrs. 10,000

;oder)te

30 +in. /')ll

30 15 hrs. 7,500

;inor

20 +in. /

')ll

1! 6 hrs. 4,!00

hrs.> *ot)l 22,300 hrs.

Eo. of oring d)ys / )nn+ 273

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8e'ide 9)si' *erritories: ()les 9re) 8on;ethod

67

;)n)ge+ent +st deter+ine:

Do+-)ny ()les Potenti)l

()les -otenti)l in e)'h 'ontrol nit

()les vol+e ex-e'ted fro+ e)'h s)les -erson

*ent)tive territori)l %ond)ry lines %y 'o+%ining 'ontrol nits ntiltot)l s)les -otenti)l ex-e'ted s)les vol+e

*erritori)l +odi')tions )s needed

1 ompany *ales 'otential

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1. ompany *ales 'otential( EIPE Eo. of -ros-e'tive %yers of r+I Csti+)ted s)les nits J dire't selling 'ost .

0.20K K J 0.50 K J s.6,00,000.

K s.20,00,000 )v. vol+e of s)les, ) s)les-erson shold )'hieve in )territory.

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*ales 'otential ethod

Eo of s)les-ersons needed E

Ann)l ()les $ore')st for 'o+-)ny ( < s.40,000,000>Cst. -rod'tivity of )v. s)les-erson P Cst. -er'ent)ge of )nn)l s)les-erson trnover *

E (/P G * , or,E (/P

*herefore,

E 40,000,000 /20,00,000 22 s)les-eo-le ill %eneeded for the entire 'o+-)ny.

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anagement of *ales Hu

Sales #uota

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Sales #uota

A =ot) is )n ex-e'ted -erfor+)n'e

o%&e'tive

A =ot) is ) s)les )ssign+ents or go)l to

%e)'hieved in ) s-e'i' -eriod of ti+e

t is rotinely )ssigned to the s)les nits

()les nits -ro'eed to re)'h =ot)s intheir

res-e'tive do+)ins

“A sales quota is the sales goal set for a product line, company division, or salesrepresentative. It is primarily a managerialdevice for dening and stimulating the sales

eort.”. … Kotler

P i i l f t ttiPrinciples of #uota setting

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Principles of #uota settingPrinciples of #uota setting

(etting of s)les =ot)s is ) 'h)llenge tothe s)les

+)n)ger )nd shold %e h)ndled ith-re'ision

)nd )de=)te sill

t +st %e si+-le to nderst)nd%oth to the

+)n)ger )nd the s)les -eo-le

O%&e'tivity to %e o%served hile xing

=ot)s)nd shold %e %)sed on f)'ts )nd

gres dr)nfro+ the +)ret

Lot)s set )%ove the )'hiev)%le li+itoften

de+otiv)te )nd reslt in high trnover in

the

P i i lPrinciples

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:lexi%le to the -rev)iling )nd e+erging+)ret

'onditions There shold %e ) level of deniteness inthe =ot)

set for ) s)les-erson t shold %e xed either in ter+s ofgeogr)-hi'

territory, on +oney v)le, or on the %)sis of

nits of-rod't

# -)rti'i-)tory =ot) setting -ro'edrefolloed

&ointly %y the s)les +)n)ger )nd s)les -eo-letogether

serves )s ) tool of +otiv)tion )nd le)ds to the

Principles''Principles''contd'contd'

* # )

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T'9:9

#*

)#/

<

T

T#9

0#/

<

#<9

*T9

9

*'9:9

*/J

/ in the*ales

domainG

rgani6ation of the sales 5ob

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rgani6ation of the sales 5ob

,ening annual ob5ecti$es

'rocedure for setting sales 8uota

onferencing with each sales person 9 n d i $ i d u a l ; o a

l s e t t i n g

f o r m

utput

0ame Iear

Iour

territory)esultse=pected'essimistic )ealisticptimistic )esults1. Dolume per

month2. =penses permonth3. ;ross margin

Lmonth4. ar!etshareLmonth". Key accountco$erageL month

Types of sales #uota

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Types of sales #uota

sale $olume 8uota sales budget8uota

sale acti$ity8uota combination 8uota

f

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Met"ods of setting sales #uota

Huotas are based onJ sales forecasts and potentials

forecast

past sales and e=perience

e=ecuti$e 5udgement

sales people 5udgement

based on compensation

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Problems in setting sales #uota

1.There is a high le$el of indi$idual di>erencein e$eryorgani6ation

2. # perfect 8uota is a combination of

selling and nonB selling acti$ities

3. ften sales people do not gi$e proper

attention to thenonBselling acti$ities e.g. searching for

prospects7handling customer ob5ections7 and

creating mar!et for

-ersons -erfor+)n'e index. ?h)t 'on'lsions ')n yo dr) %)sed on yorresltsM

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*ales Huota #ctual *ales 'erformance 9nde=;r . A 150,000 160,000 107;r . 9 1"0,000 160,000 !4;r. D 160,000 110,000 6"

Perfor+)n'e index ')n %e ')l'l)ted %y dividing )'t)l s)les %y =ot) )ndthen the s)les +)n)ger ')n dr) inferen'es )%ot the )'tivity of e)'h s)les +)nin this ')se. ;r ND is nder -erfor+ing here )s ;r NA is doing ell. ;r N9 ')ni+-rove -on )s his -erfor+)n'e index is ithin )n )''e-t)%le li+it.

D)l'l)te the order to s)les ')ll r)tio )nd the )ver)ge sie of order for the ye)rfro+ the folloing t)%le. ?hy does the s)les-ersons -erfor+)n'e dierM

0ame 0o. of alls 0o. f rders #ctual *ales *alesLall*alesLrder;r . A 1300 350 s 500,000 s. 3!4.6 s.142!.6

;r. 9 1400 650 s 560,000 s. 400.0 s.!61.5;r. D 1600 5!0 s. "00,000 s. 562.5 s.1551.7 *ot)l 4300 15!0 s. 1",60,000 s.455.!s.1240.5 *he order to s)les ')ll r)tio ')n %e fond ot %y dividing the )'t)l s)les %y ')lls)nd )'t)l s)les %y orders. *he )ver)ge sie of the order ')n %e fond ot %y

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© Oxford University Press 2005, Allrights reserved. !0

-ecruitment and selection of

t"e sales force

T"e sales manager

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© Oxford University Press 2005, All

rights reserved. !1

'erforms sales management PE)

management A )ecruits7 selects7 trains7 moti$ates7leads7controls7 and compensates sales

teams *election and recruitment of eOcientsalespeople is always a process of building

competiti$ead$antage for an organi6ation

T"e sales manager

*trategic position

Turno$er Qob 8ualication

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rights reserved. !2

g panalysis

,ecide on thenumber of people

to hire9dentify best sources ofrecruitment@

internal and e=ternalsources

;enerate database

of candidates

$aluate candidates

*elect and inducecandidates to accept

positions*ociali6e

Turno$er

stablish hiring

ob5ecti$es

Qob 8ualication

Qob descriptionrgani6atio

nalcharacteristics7

companyimage and

climate7styles of

super$ision7

compensati

on7 andmoti$ation

of thecompany

*election

*ociali6ation

)ecruitme

nt

'lanning

The hiring process

"allenges in sales force

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rights reserved. !3

"allenges in sales forceselection

'ersonality types matching to

5ob proles

ne of the measures that theorgani6ation loo!s in an

employee is@

B the ability to perform by an

employee

M #bility = oti$ation

le$el of moti$ation

Planning for recruitment

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rights reserved. !4

Planning for recruitment 1. (tr)tegi' -osition )n)lysis J )y s)les

&o% to %e -erfor+ed )nd sills )%ilities needed to-erfor+ the &o%.

2. *rnover J st#in#ti+e hiring / (to' -iling

3. o% An)lysis)thering )nd org)ni)tion of infor+)tion

'on'erning the *)ss, 8ties )nd es-onsi%ilities of )s-e'i' &o%s.

4. *)s nventory An)lysis : o% *)ss vs. C+-loyeeDh)r)'teristi's

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rights reserved. !5

Sales force recruitment e'rit+ent is )n )'t of ind'ing =)lied )nd)--ro-ri)te -eo-le to get interested in )nd )--ly for )s)les-ersons -osition ithin ) s)les org)ni)tion.

9nternal sources

B existing e+-loyees# l)ter)l )nd -)rd +oves# interns )nd 'oo-er)tive stdents# e+-loyee referr)l -rogr)++es

=ternal sourcesB indstry sor'es

# ed')tion)l instittions )nd ')+-sre'rit+ents

# e+-loy+ent ex'h)nges# -l)'e+ent 'onslt)nts

# )l in intervies

=ternal sources

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rights reserved. !6

B netoring referr)ls# e% 'onslt)nts

# res-onses to dire't o-en )dvertise+ents

=ternal sources contd...

*election procedureB inviting )--li')tion for+s# -erson)l intervies

# referen'e 'he's# -hysi')l ex)+in)tions# -sy'hologi')l tests# intelligen'e# -erson)lity

# )-titde )nd sills# deter+in)tion of ter+s of servi'e# )--oint+ent# initi)l orient)tion

Sociali&ation process

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rights reserved. !7

Sociali&ation process

Pro'ess of orienting ) ne s)les-erson to the

s)les org)ni)tion, territory, or division in hi' he or she ill %e oring

Three stages

#nticipatory stagerealistic 5ob pre$iew

ncounter stage

*ettling stageemployee mentoring

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rights reserved. !!

Training the *ales :orce

h ll i l t i i

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rights reserved. !"

hallenges in sales training

Will the training programme be e>ecti$ein sol$ing a problemG

Will the in$estment in it be 5ustiedG

Will it produce the desired or intendedresultsG

) l f th t i

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)ole of the trainer

• The success of the training programme depends onthe ability7 s!ill7 and moti$ation of the sales trainer

T"e training process

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T"e training process

Training need assessment

,esign and conduct of a training programm

$aluation of a training programme

Training need assessment

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Training need assessmentphase

rgani6ational le$el analysis

Tas! le$el analysis

9ndi$idual le$el analysis

Training needs

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Training needs

9dentication of specic problems

#nticipating impending and futureproblems

anagement re8uests

9nter$iewing and obser$ing thepersonnel on the 5ob

'erformance appraisal

Huestionnaire sur$ey

hec!list#ttitude sur$ey

9nterpersonal s!ill test

,esigning and conduct

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rights reserved. "4

g gphase

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rights reserved. "5

Types of training

rossBfunctional training

Team training

reati$ity training

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rights reserved. "6

Training methods

,idactic method lecture methodB structure the lecture

B reinforce the essage

B aid concentration

B material used for the lectureB ma!e it memorable for the participants

B deli$er with dynamism

B use 8uestions

Disual support'articipati$e

onferences

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rights reserved. "7

Training methods contd..

*eminars,iscussions

)ole play

ase study

:ishbowl role re$ersal methodWor!shops participati$e

*ensiti$ity training interpersonalrelationships

Transaction analysis9nBtray e=ercises

Transcendental meditation

, idi l t i i

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,eciding a sales trainingprogramme#imontent

Knowledge

'rociencies

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'rocess of sociali6ation

• Anti'i-)tory so'i)li)tion

• A''o++od)tion st)ge

• Ot'o+e st)ge

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*ales :orce ompensation

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101

()les $or'e Do+-ens)tionPl)n

$)irness;)n)ge+ent J &dge+ent

;otiv)tion

Do+-etitiveness$lexi%le Dost

ee'tive

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102

ompensation n)n'i)l )%ility )> -rev)iling 'o+-ens)tion-oli'ies in indstry

%> Do+-ens)tion -oli'y %> Reg)l 'onditions

'> e'rit+ent sele'tion-oli'y

'> C'ono+i' 'onditions

d> Pro+otion -oli'y d> ;)ret 'o+-etition

e> o% des'ri-tion e> *r)de nion

f> o% ev)l)tion f> lo%)l 'onsider)tions

g> An e+-loyees -osition design)tion

h> An e+-loyees rel)tive'ontri%tion to the &o%

#ims of a good compensation plan)> *o in're)se enthsi)s+ +otiv)tion of s)les-eo-le

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103

%> *o instill ) sense of 'o++it+ent in s)les-eo-le to)rdstheir &o%

'> *o in&e't )n )t+os-here of te)+ s-irit +or)le ithin thes)les-eo-le

d> *o develo- ) st)%le s)les for'e red'e 'h)n'es of)ttrition of s)les for'e

e> *o ret)in eS'ient s)les for'e for ) long rn

f> *o 'oordin)te 'ontrol s)les for'e s''essflly

g> *o )ttr)'t eS'ient s)les-eo-le fro+ the 'o+-eting r+s

h> *o in're)se loy)lty of s)les for'e to the r+

i> *o in're)se =)lity of inter)'tion of s)les-eo-le ith

'sto+ers

&> *o i+-rove sense of 'onden'e of 'sto+ers on s)les for'e the r+

> *o 're)te ) dedi')ted s)les for'e ho le)ves no stonentrned to )'hieve r+s go)ls

(te-s in develo-ing Do+-ens)tion Pl)n

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104

evie &o%

des'ri-tion

Cst)%lish'o+-ens)ti

ono%&e'tives

Cst)%lish'o+-ens)ti

on level

Dhoose'o+-ens)ti

on +ethod

8e'ide on'o++issionor indire't

Do+-ens)tions el)te

re)rds to-erfor+)n'

e +e)sre+e

nt of

evie theentire -l)n for

short ter+/longter+

+-le+entthe -l)n

:actors in?uencing the design

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rights reserved. 105

:actors in?uencing the designof a compensation plan

• :inancial stability

• *i6e of the mar!et

• 0ature of the product

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;ethods of 'o+-ens)tion

• (tr)ight s)l)ry

• (tr)ight 'o++ission

• Do+%in)tion -l)ns

i. ()l)ry )nd 'o++ission

ii.()l)ry )nd %ons

iii.()l)ry G 'o++ission )nd %ons

106

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107

Do+%in)tion -l)ns i.()l)ry G 'o++ission

ii.()l)ry G %onsiii.()l)ry G 'o++ission G %ons

Types of compensation

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rights reserved.10!

plans

• :inancial compensation

• 0onBnancial compensation

:i i l ti

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rights reserved.10"

:inancial compensation

• *traight salary plan

• *traight commission plan

• /onus and incenti$e

• *alary plus incenti$e combination plan

• ,rawing account and commission plan

•

#llied methods

Do+-ens)tion s'he+es : non#n)n'i)l

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)--ro)'h

•

D)reer )dv)n'e+ent throgh -ro+otion J &o%enri'h+ent

• (elling ex-enses J x ex-ense =ot) to 'ontrolnde ex-enses %y s)les-ersons

•

$ringe %enets J +edi')l %enets, insr)n'e'over, R*D, retire+ent %enets, entert)in+ent)llo)n'e, +o% %ill )llo)n'e/rei+%rse+ents,d)t) ')rd

• Pers J 'o+-)ny ')r, fel 'h)rges, roo+

frnishing )llo)n'e et'.• ()les 'ontests J re)rds for )'hieving short ter+

go)ls

110

*traight *alary

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1 1 1

#d$antages ,isad$antages

)> Provides ) sense of

se'rity

)> t h)s no -rovision to -)y

in'entives to s)les-eo-le. *his +)y restr)in the+t)ing )ddition)l initi)tive drive in -erson)l selling

%> Cnsre st)%ility of in'o+e %> (elling ex-enses )re not

rel)ted to s)les vol+e.(elling ex-enses )re in'rredreg)rdless of s)les vol+e

'> Tel-s to develo- ) loy)ls)les for'e

'> t gives e=)l tre)t+ent to%oth high lo -erfor+ing

s)les-ersons

d> Prevents high trnover ofs)les-eo-le

d> *he s'he+e +)y not)ttr)'t high -erfor+ings)les-eo-le fro+ the'o+-eting r+s

f *afe to new salespeople f ay discouragesalespeople to o>erdditi l > t f l

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rights reserved.112

additional e>orts for slowmo$ing items

g> (i+-le to nderst)nd )nd ise'ono+i')l in )--li')tion g> T)rd oring s)les-eo-le+)y not nd this +ethod)ttr)'tive

h> ()les-eo-le feel +ore'o++itted to their &o%

i> ()les-eo-le -)y +ore)ttention ret)ining 'sto+ersth)n gener)ting ne ones

&> ()les-eo-le ')n 'on'entr)teon 'sto+er s)tisf)'tion to

ret)in 'sto+er loy)lty> ()les-eo-le ')n give +ore)ttention to non#selling)'tivities )s ell

l> ()les +)n)gers ')n exer'ise

*traight ommission


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rights reserved.113

g g

)> A'ts ) s ) gre)t +otiv)tor )> Ross of 'ontrol overs)les-ersons

%> 8ierenti)tes high -erfor+ings)les-eo-le fro+ rest

%> ()les-eo-le +)y not t)einterest in slo selling / less+)rgin -rod'ts of the 'o+-)ny

'> Unli+ited o--ortnity to e)rnfor eS'ient s)les-eo-le

'> ()les-ersons ill 'on'entr)teon e)sy selling or high +)rgin

-rod'tsd> ;)n)ge+ent h)s no -ressreto in'r selling 'osts

d> ()les-ersons ill try to -shex-ensive v)ri)nts of -rod'tdes-ite )v)il)%ility ofe'ono+i')l v)ri)nts servings)+e -r-ose to 'ons+ers

e> ()les-eo-le ')n or freely e> ()les-eo-le +)y indlge in)ggressive selling th)t +)y)e't i+)ge of 'o+-)ny

f> C)sy to nderst)nd )nde'ono+i')l to o-er)te

f> ()les-ersons ill l)' sense of%elonging to the 'o+-)ny

* l l t * l

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g *alespeople cannotcomplain for anyunderpayment B lin!ed to

performance

g *alespersons candi$ulge $aluableinformation of the

company to outsidesources

h> ()les-eo-le ill not resent)g)inst )ny -ressre selling

&o%s.

h> ()les-eo-le +)y not -)y)ttention to non#selling)'tivities

i> ()les-eo-le +)y not %einterested in %ilding longter+ rel)tionshi- ith'sto+ers

&> ()les-eo-le ill not %einterested in ) develo-ed+)ret

> (in'e e)rnings )ren'ert)in, s)les-ersons +)yle)ve in -eriods of %)d s)lesor for %etter &o% -ros-e'ts

ombination 'lan salaryPcommissionPbonus

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115

o b a o a sa a y co ss o bo us


)> (t)%le in'o+eG )ddition)l

n)n'i)l in'entives

)> Eot si+-le to nderst)nd

diS'lt to o-er)te

%> (ense of &o% se'rity Gn)n'i)l in'entives forgener)ting +ore s)les

%> (elling 'osts v)ry )'rossdierent selling sit)tions Ji+-le+enting 'o+-)ringthis nifor+ly )'ross selling

sit)tions is diS'lt'> n'o+e v)ries ith s)les-rod'tivity, )lso is ) exi%leo-tion

'> ()les +)n)gers nd itdiS'lt to 'ontrol s)leso-er)tions

d> Do+%in)tion -l)n t)'les

dieren'es in s)les -otenti)l indierent territories, %etterth)n single -l)n

d> Pl)n re=ire 'onst)nt

re'ording of s)les trnoverth)t +)y )--e)r to %e'+%erso+e to s)les+)n)gers

e> CS'ient s)les-eo-le )re%eneted

e> t de+)nds high)d+inistr)tive 'ost

f de)l for )+%itios self f $ixin 'o+ osition of l)n

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116

g This plan can be made

?e=ible by suggestingdi>erent combinations fordi>erent le$els ofsalespersons

g ombination plans lead

to une8ual income ofsalespeople in di>erentterritories. Eencecomparison of theirperformance on commonstandards is diOcult.

h> ()les-ersons +)ynderesti+)te the non#selling)'tivities

i> ?hen s)les t)rgets )rexed )t high levels for

s)les-ersons to )tt)in, this-l)n ill dis'or)ge the+ todo their %est

&> Rong ter+ deferred-)y+ent of in'entives +)yfrstr)te s)les-eo-le

#pplication of compensation methods *pecic'lan

Do+-)ny )nts to go in for extensive -ros-e'ting drive

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117

?hile l)n'hing ) ne -rod't in the +)ret

C)sy to ev)l)te -ro'ien'y )+ong s)les -eo-le

Do+-)ny h)s ell est)%lished %r)nd n)+es in the +)ret

$or s)les tr)inees or nely )--ointed s)les-eo-le

?hen n)n'i)l strength of 'o+-)ny is e)

$or te'hni')lly 'o+-lex -rod'ts / -rod'ts of high =)lity

?hen non#selling )'tivities )re not i+-ort)nt?hen 'o+-)ny -rod'ts h)ve re)'hed ) +)trity / de'liningst)ge

Do+-)ny )nts to get into ) ne geogr)-hi')l territory

Do+-)ny )nts to rel)te selling ex-enses to s)les vol+e

Do+-)ny introd'es ) ne -rod't / -rod't line

Do+-)ny )nts to do overse)s selling

?hen -rod'ts )re sold throgh de)lers +er'h)ndising dis-l)y )re i+-ort)nt

?hen 'o+-)ny )--oints -)rt ti+e s)les -eo-le

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()les $or'e Dontrol

ntrod'tion

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• A good s)les +)n)ge+ent -rogr)+ needssyste+)ti' 'ontrol +e'h)nis+ to +onitor thes)les for'e -erfor+)n'e )nd ee- the 'ostsnder 'ontrol

•

Eo s)les -l)n is ee'tive in the )%sen'e of )s)les 'ontrol +e'h)nis+.

• ()les for'e 'ontrol +e'h)nis+ ee-s 'ostsithin %dgeted li+its %t )lso %rings dis'i-lineto org)ni)tion)l -ro'esses of i+-le+ent)tion.

• ()les for'e 'ontrol hel-s in %dget+odi')tions )nd )ddition)l re'rit+ent if sore=ired to )'hieve s)les o%&e'tives

Dir'l)tory E)tre of ()les; t $ ti

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;)n)ge+ent $n'tion

()les;)n)ge+ent Pro'ess

Pl)nning Org)niing

Doordin)tingDontrolling

Dontrolling ()les for'e Perfor+)n'e#n-t Ot-t 9)sed A--ro)'h

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n-t#Ot-t 9)sed A--ro)'h

An)lye +)ret sit)tion, 'o+-etition to set -erfor+)n'eev)l)tion )nd 'ontrol -oli'y

8e'ide the 'riteri) for s)les-eo-les -erfor+)n'e ev)l)tion

(et -erfor+)n'e st)nd)rds

Do+-)re )nd 'ontr)st )'t)l -erfor+)n'e ith set st)nd)rds

evie )nd 'o++ni')te -erfor+)n'e ev)l)tion

8e'ide s)les +)n)ge+ent )'tion

Dontrolling ()les for'e Perfor+)n'e#n-t Ot-t 9)sed A--ro)'h Dont

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n-t#Ot-t 9)sed A--ro)'h Dont.

• An)lysis of +)ret sit)tion )nd'o+-etition to set -erfor+)n'eev)l)tion )nd 'ontrol -oli'y –

?ho ill ev)l)te s)les -eo-leM – To fre=ently s)les -eo-le ill %e

ev)l)ted

– ?h)t sor'es of infor+)tion shold %e sed

for ev)l)tion – ?h)t shold %e the degree of ev)l)tion


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• Driteri) for ()les Perfor+)n'eCv)l)tion

– Ot-t %)sed 'riteri) – 9eh)vior)l 'riteri)

– Do+%in)tion of %oth


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• (etting U- Perfor+)n'e (t)nd)rds – ()les =ot)

– D)ll fre=en'y r)tio

– D)lls -er d)y – Order ')ll r)tio

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• Do+-)re )nd 'ontr)st )'t)l-erfor+)n'e ith set st)nd)rds – 8ene the infor+)tion need

– 8eter+ine the sor'e of infor+)tion – Dolle't the desired infor+)tion

• D)ll re-orts – D)ll -rogress re-ort

– Cx-ense re-orts

– ()les or -l)n


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• evie )nd Do++ni')te Perfor+)n'eCv)l)tion e-orts ith s)les -eo-le – O-en syste+ of -erfor+)n'e ev)l)tion

–

$or+)l syste+ of -erfor+)n'e ev)l)tion – nfor+)l syste+ of -erfor+)n'e ev)l)tion

– Do++ni')te throgh• Ier%)l 'h)nnels

• $or+)l 'h)nnels

• T+)n resor'e 'h)nnel


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• 8e'ide ()les ;)n)ge+ent A'tion – Positive )'tions

• n'entives• Pro+otion

• Tigher &o% res-onsi%ility• o% enri'h+ent

– Eeg)tive A'tions• 8e+otion

• ?ithdr))l• *r)nsfer• *er+in)tion

()les $or'e Dontrol()les Adit < investig)tion of the i+-)'t of intern)l/extern)l f)'tors on

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12!

< g -s)les -erfor+)n'e>i.?h)t de'isions ere t)en )t -l)nning i+-le+ent)tion st)gesM

ii.To these )e't the s)les o-er)tionsMiii.?h)t 'h)nges )re to %e %roght in, to i+-rove the sit)tionM

;)n)ge+ent nfor+)tion (yste+ i.ntern)l re-orting syste+ii.;)reting intelligen'e syste+

iii.;)reting rese)r'hiv.An)lyti')l syste+s

;)n)ge+ent %y ex'e-tions?henever signi')nt devi)tions )re noti'ed, 'orre'tive )'tions )re t)en,ithot del)y.

()les Adit

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• t 'o+-rised ) syste+)ti' -ro'ess of)--r)ising s)les o%&e'tives )nd -oli'ies %y)ggreg)ting individ)l in-ts intoorg)ni)tion)l -erfor+)n'e

• Tel-s in ev)l)ting over)ll -erfor+)n'e of theorg)ni)tion )g)inst s)les go)ls, o%&e'tives,+ethods, -ro'edres )nd s)les st)+otiv)tion

• t hel-s in fo'sing on over)ll s)les str)tegyr)ther th)n on individ)l 'o+-onents ofev)l)tion )nd sggests 'orre'tive )'tions.

• t hel-s in ne)rthing o--ortnities fori+-rove+ent in s)les for'e -erfor+)n'e

;)reting Adit

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• *his is ) syste+)ti' )nd o%&e'tive +ethod of stdyingthe tot)l +)reting eS'ien'y of )n org)ni)tion.

• t ev)l)tes the +)reting -oli'ies )nd )'tivities ofthe r+ )nd +e)sres the dire'tions )nd levels of

groth• t ev)l)tes long ter+ %siness groth in ter+s of

str)tegy, str'tre )nd -oli'ies folloed %y the r+

• t is ')lled N'ontrol of 'ontrols )s it 'overs %oth%siness )nd +)ret )s-e'ts of the org)ni)tion.

• t hel-s in revieing )ss+-tions sed in develo-ingstr)tegy. t serves )s )n indi')tor for ftre dire'tionth)t r+ -l)ns to t)e.

()les $or'e Cx-ense An)lysis

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• *his is the +ost rdi+ent)ry for+ of s)les for'e'ontrol.

• Do+-)nies do this )n)lysis %y looing into s)lesex-enses rei+%rse+ent -oli'y of theorg)ni)tion

• t shold %e seen )s ) f)ir )nd e=it)%le &sti'edone to )ll the -eo-le )'ross the territories

• ?hile de'iding on ) 'o+-ens)tion -oli'y for s)les-eo-le, ex-ense -l)nning 'onstittes ) +)&or

de'ision )nd it shold t)e into )''ont the sieof the territory, s)les =ot) )nd eorts ex-ended%y s)les -erson to )'hieve s)les go)ls.

;e)sre+ent of ()les Org)ni)tionCe'tiveness

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• ()les An)lysis – A'ross Org)ni)tions

• At n)tion)l level• At region)l level• At division level• At st)te level• At distri't level• At %r)n'h level

– 9y *y-es of s)les•

D)sh• Dredit• (hi-+ent• Order sie• Prod't ')tegory• ;)ret• *y-e of distri%tion 'h)nnel• (ie of 'sto+er order

– 9y ty-es of An)lysis

• Do+-)ring ith ()les =ot)• Do+-)ring ith Previos *i+e Period• Do+-)ring ith indstry )ver)ge• Do+-)ring ith (tr)tegi' Do+-etitors• Do+-)ring ith ()les $ore')st

;e)sre+ent of ()les Org)ni)tionCe'tiveness Dont.

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;)reting Dost An)lysis

Dl)ssify ;)retingCx-enses

*r)nsfor+ )''ontingex-enses d)t) to )'tivity

ex-ense gro-s

8evelo- 9)ses for)llo')ting Do++on

Cx-enses

D)l'l)te Dontri%tion;)rgin

$in)lie the Dorre'tiveA'tions e=ired for *he

(it)tion


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• Dredit Dontrol – Do+-)nies s)le %oth in ter+s of ')sh )nd 'redit

– D)sh s)les )re vit)l to org)ni)tions li=idity – Dredit 'ontrol is i+-ort)nt )s it restri'ts o of

')sh %)' to the syste+ – To +'h )nd ho often 'redits )re given to

'sto+ers shold %e 'riteri) – Dredit s'oring is done to nd ot the 'sto+er

ho )re ')sh/'redit de)l oriented )nd so )lso for

the s)les -eo-le ho sell on ')sh/ 'redit )s )-er'ent)ge to their tot)l s)les


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•

;)ret (h)re An)lysis – ;)ret sh)re is f)r+ s)les divided %y indstry s)les – t tests ho the org)ni)tion is doing in rel)tion to the rest

• 9dget)ry Dontrol – t involves s)les -l)nning, s)les fore')sting, s)les %dgeting )nd -rot -l)nning

• )tio An)lysis – ()les to D)-it)l C+-loyed r)tio

–

nventory *rnover )tio – ross Prot to ()les r)tio

– Eet Prot to ()les )tio

– etrn on ;)reting nvest+ents

– etrn of Assets

– etrn on D)-it)l C+-loyed

– ?oring D)-it)l *rnover )tio

– 8istri%tion Dost *rnover )tio

• ;)n)ge+ent %y O%&e'tives – 8eter+ine the o%&e'tives in e)'h signi')nt )re) of %siness

– ;e)sring -erfor+)n'e )g)inst -redeter+ined o%&e'tives

– ;)n)ging the %siness ith %ond)ry of set of o%&e'tives

Don'lsion

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• A good s)les +)n)ge+ent -rogr)+ de+)ndssyste+)ti' 'ontrol +e'h)nis+s to +onitor shes)les for'e -erfor+)n'e )nd ee- 'ost nder'ontrol

•

?ith in're)sed 'o+-etition )nd fr)g+ented+)ret sh)re it is i+-er)tive to 'ontrol 'osts)nd +)n)ge -erfor+)n'e in ti+e %ond+)nner

• ;)n)ge+ent )nd 'ontrol +e'h)nis+s shold

%e integr)ted ith -l)nning -ro'ess fori+-roving over)ll org)ni)tion -erfor+)n'e.

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137

Evaluation of t"e Sales (orce

Performance

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13!

Cv)l)tion st)nds on toi+-ort)nt f)'tors:

1.(etting -redeter+ined st)nd)rds2.Do+-)ring )'t)l -erfor+)n'eith the set st)nd)rds

Driteri) for Perfor+)n'e Cv)l)tion

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13"

(yste+)ti' Periodi'eslt Oriented $lexi%le

Provide dire'tions Cn'or)ging

Underst)nd)%le (tr)tegi' $itness

e)listi' $)ir

Iision fori+-rove+ent Ai+ for +)x.)''r)'y

(te-s in ()les $or'e Cv)l)tionPro'ess

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140

(et s)les go)ls o%&e'tives

8esign i+-le+ent)tion +e'h)nis+s

Cst)%lish -erfor+)n'e st)nd)rds

;e)sre )'t)l reslts

Do+-)re reslts )g)inst st)nd)rds

*)e 'ontrolling +e)sres

(etting s)les go)ls o%&e'tives

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• Att)in)%le• e)listi'

• L)nti)%le / ;e)sr)%le

• Do+-)r)%le / )n)lys)%le

141

8esigning i+-le+ent)tion+e'h)nis+s

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+e'h)nis+s

To s)les-ersons )'hieve t)rgetsM

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(t)nd)rds

• L)ntit)tive Perfor+)n'e(t)nd)rds

• L)lit)tive Perfor+)n'e(t)nd)rds

143

1. ;e)sre )'t)l reslts

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144

()les An)lysis

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()les Iol+e

i. 9y Prod'tsii.9y Dsto+er ro-s

iii.9y *erritories

Prots

i> ross or net -rot +)rgins re=ired• 9y Prod'ts• 9y Dsto+er ro-s•

9y *erritoriesii> ross ;)rgin )tio J gross +)rgin to tot)ls)les

iii> Eet Prot )tio J net -rot to tot)l s)les145

L)ntit)tive Perfor+)n'e (t)nd)rds ()les Orders

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iii.Order I)le

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i. (elling ex-enses : *ot)l ()les

ii.$ield selling ex-enses : tot)l selling ex-ensesiii.Aver)ge selling ex-enses / ')ll

Eo. of ')lls / d)y

Dost / ')ll D)ll fre=en'y r)tio

;)ret sh)re )n)lysis

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14!

aKnowledge on@

i. Prod'ts/servi'es de)lt ithii. Do+-)ny -oli'iesiii. Do+-etitioniv. 8istri%tion 'h)nnelsv. Dsto+er %eh)viors

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14"

'erformance #ppraisal ethods

Traditional ethods odern ethods

)> )ning +ethod )> ;)n)ge+ent %y o%&e'tives

%> P)ired Do+-)rison

+ethod

%> 9eh)vior)lly )n'hored r)ting s')le

J &o% )n)lysis

'> r)-hi' )ting s')le ' > 360 degree )--r)is)l

V ;9O J long ter+ go)l setting / &oint

short ter+ go)l setting / -re-)r)tion of)'tion -l)ns / -eriodi' -erfor+)n'erevie / for+)l )--r)is)l.

d> Dhe'list +ethod

e> Driti')l n'idents +ethod

f> $or'ed 8istri%tion +ethod

*r)dition)l ;ethods

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)ning ;ethod:

• )ned on the level of their -erfor+)n'e,reg)rdless of the ty-e of or they -erfor+.

• )ning )rr)nges s)les-eo-le in ter+s of

%est -erfor+)n'e, next %est -erfor+)n'etill the le)st -erfor+ing s)ler-erson isre)'hed.

• A't)l degree of dieren'e in the

-erfor+)n'e of the s)les-ersons ')nnot %e)s'ert)ined.

150

*r)dition)l ;ethods

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P)ired 'o+-)rison +ethod:

• *o s)les-ersons )re 'o+-)red )t )ti+e 'o+-)red on ) 'o++on 'riteri).

• f there )re 10 -ersons, the no of -)ired

'o+-)risons ill %e 45 : n /2• *hs hile it is %etter th)n r)ning

+ethod %t the -ro'edre is very

tedios, ti+e 'ons+ing s%&e't toh+)n error hi'h ill +lti-ly ith+ore sets of -erfor+)n'e 'riteri).

151

*r)dition)l ;ethods

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r)-hi' )ting (')le

1. Dontinos s')le: f)'tors )reev)l)ted 'ontinosly, +)ringso+ehere in the 'ontin+, on )

s-e'i' f)'tor.

152

1Iery high

3Tigh

5;oder)te

7Ro

"IeryRo

(%&e'tive &dg+ent J %i)s ')nnot %e rled ot

*r)dition)l ;ethods

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8is'reet (')le:

153

Iery ood ood Aver)ge 9)d Iery 9)d

5 4 3 21

%)sed on s%&e'tive &dg+ent J ')n le)d to %i)s

*r)dition)l ;ethods

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?eighted Dhe'list ;ethod :

154

#ttributes

)elati$e

weight

=cellent "

;ood

4

:air3

/ad2

Dery/ad 1

*core

Prod't

noledge

0.3 W 1.2

Do.noledge

0.2 W 0.!

(elling(ill 0.1 W 0.3

D;(ills

0.1 W 0.2

;otiv)tion

0.1 W 0.2

*r)dition)l ;ethods

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Driti')l n'ident ;ethod .

*he essen'e# to )s'ert)in 'riti')l events th)t +)ethe dieren'e %eteen -erfor+)n'e no-erfor+)n'e.

).9right in -ros-e'ting

%.Eot s+)rt in 'sto+er h)ndling

'.?rites ')ll re-orts ell

d.8e+o sill is ex'e-tion)l, et'.155

*r)dition)l ;ethods

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$or'ed 8istri%tion ;ethod:

156

bser$ations of the rater 'erformance *tandards

Do++ni')tion sill 25H Dery ;ood M R %-S;ood M 4- F %-S#$erage M 2- B 4-S

/ad M 2-SDery bad M 1-S

t is si+-le to i+-le+ent

)nd ')n )void %i)s to )l)rge extent.

(elling sill 40H

Pers)sive sill 50H

Person)lity 30H

C+otion)l +)trity 30H

Over)ll r)ting 35H Aver)ge.

*r)dition)l ;ethods

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$ield evie ;ethod: *he r)ter intervies eld s)les +)n)gers)nd s-ervisors to no hos)les-ersons -erfor+ in the eld on %oth=)ntit)tive )s ell )s =)lit)tive-)r)+eters.

Toever v)lidity reli)%ility ofinfor+)tion so 'olle'ted fro+ the eldshold %e 'he'ed.

157

;odern ;ethods;)n)ge+ent %y O%&e'tives :

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;)n)ge+ent %y O%&e'tives :

•

Org)nis)tion)l go)ls )s gidelines J long ter+ go)ls• oint go)l setting J ()les +)n)gers s)les-eo-le

est)%lish short#ter+ -erfor+)n'e t)rgets ho+)n)gers ')n hel- the+ )'hieving s'h t)rgets.

•

Pre-)r)tion of )'tion -l)ns J resor'e re=ire+ents +ethods of selling )re develo-ed. o%res-onsi%ilities )re 'le)rly dened/+odied.

• Perfor+)n'e revie J tr)'ing -rogress of s)les-erfor+)n'e on ) -eriodi' %)sis.

• $or+)l )--r)is)l J -erfor+)n'e reslts 'o+-)redith t)rgets 'orre'tive )'tions t)en/ go)lsredened.

15!

;odern ;ethods

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y g < >

)>An)lyse 'h)r)'teristi's %eh)vior)l )re)s of the &o%.

%>dentify 'riti')l %eh)vior)l )re)s ')tegorie the+)s +ost#ee'tive to le)st#ee'tive f)'tors.

'>*hese 'riti')l in'ident )re)s )re revieed rened to) s+)ll gro- of -erfor+)n'e di+ensions e)'h isgiven right denition.

d>Another gro- of s)les-eo-le/s-ervisors ithex-erien'e )re )sed to revie r)te on 1 s')le.e>$in)lly, fe -erfor+)n'e di+ensions ith individ)l

r)ting s')les dene the 9A(.

15"

;odern ;ethods

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360 degree )--r)is)l

160

8istri%tors

()les-eo-le

Peers

()les;)n)gers

*he+selves

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161

,istribution channel

management B anintroduction

)ole of distribution channels To ad5ust the discrepancy of assortment through the

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162

5 p y g

performance of the accumulation7 allocation

smaller lots C assorting process.

To minimi6e the distribution costs through

routini6ing and standardi6ing transactions to ma!e

e=change more eOcient and e>ecti$e.

To facilitate the searching process of both buyers

and sellers by structuring the information essential

to both the parties.

To pro$ide a place for both parties to meet each

other at a place con$enient to the customer and

reducing uncertainty

hannels facilitate afterBsalesBser$ice.

,iscrepancies in theprocess of e=change

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163

p g•

*patial discrepancy physical distance

• Temporal discrepancy di>erencebetween time of manufacturing $s. timeof consumption

• 0eed to brea! the bul! consumed insmaller 8uantities

• 0eed to pro$ide assortmentheterogeneous mi=.

The cost and control aspects ofintermediation

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164

intermediation

Direct ,istribution Indirect distribution

ontrol

osteOciency

,istribution channelstrategy

(etting distri%tion o%&e'tives in ter+s of the

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165

(etting distri%tion o%&e'tives in ter+s of the

'sto+er re=ire+ents

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166

8istri%tion 'h)nnel +)n)ge+ent

en'o+-)sses )ll )'tivities de)ling ith thedistri%tion fn'tion of the r+

*he distri%tion str)tegy -rovides gidelinesfor de'ision +)ing.

*he distri%tion +)n)ge+ent fn'tion ')n %e

vieed )s h)--ening in to -h)ses:

).8istri%tion -ro'ess +)--ing est)%lish+ent

%.8)y#to#d)y +)n)ge+ent of 'h)nnels.

,istribution channelmanagement contd.

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167

*he e ante -h)se involves )ll the )'tivitiesth)t )re )sso'i)ted ith the design )nd

est)%lish+ent of the distri%tion 'h)nnel.

*hese )'tivities )'t)lly t)e -l)'e %efore the

distri%tion 'h)nnel )'t)lly st)rts fn'tioning.

*he e poste -h)se involves +)n)ging the d)y

to d)y )'tivities of the 'h)nnel herein the

%eh)vior of the individ)l 'h)nnel +e+%ers)re 'oordin)ted

hannel anagementtas!s

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16!

,istribution hannel*trategy

•hannelb5ecti$e

•#cti$ity :inali6ation•rgani6ing theacti$ities•,e$eloping 'olicy;uidelines

,esign of thechannelstructure

stablishingthe channel

oti$atinghannelembers

)esol$ingon?ictsamongchannelmembers

= ante

'hase

='oste'hase

;)nf)'trer

hannels of drug distribution

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16"

D$ /8e-ot /(-er (to'ist

(to'ist / ?holes)ler

et)iler/ Dhe+ist

P)tient

nstittion Tos-it)l

r)l 8istri%tion Dh)nnels J ;)&orsses

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sses• C'ono+i' sses

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171

,esigning customerBoriented

mar!eting channels

Dh)nnel 8esign Pro'ess

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• Do++er'i)l Eetor :

J )gents / holes)lers / ret)ilers.

• Rogisti')l Eetor:

J tr)ns-orters / inst)ll)tion

+)inten)n'e st) .


172

"annel Design*he 'h)nnel design is nor+)lly +e)nt to

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173

*he 'h)nnel design is nor+)lly +e)nt to

give ) 'le)r ide) )%ot:1> *he n+%er of 'h)nnel entities in the

'h)nnel netor .

2> *he )y in hi'h they )re lined.

3> *he roles )nd res-onsi%ilities of the entitiesin the netor 'le)r 't gidelines for the+)&or )'tivities to %e -erfor+ed dring the

nor+)l fn'tioning of the 'h)nnel.4> *he re)rds for -)rti'i-)ting in the

)'tivities.

What are the ser$iceoutputs

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174

• Donvenien'e

• (-)ti)l 'onvenien'e < 'h)nnelintensity vs. 'ost>

• ?)iting ti+e

• Assort+ent

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175

3. A'tivities to %e -erfor+ed to fll servi'e ot-t o%&e'tives

4. D)l'l)te 'ost in'rred for -erfor+ing these )'tivities, )t e)'h level

5. 8esign ide)l 'h)nnel str'tre, netor of +e+%ers, -erfor+ing

'ert)in fn'tions )t ) +ini++ 'ost

6. Do+-)re ide)l 'h)nnel str'tre ith the str'tre existing in re)lityJ for )ny +odi')tion

7. Assess ide)l 'h)nnel design J ee'tiveness, e=ity, s')l)%ility,exi%ility

!. 8evelo- the 'h)nnel est)%lish+ent / +odi')tion -l)n

=ample of a ser$ice outputdeli$ered template

Sl No Service dimension Service output delivered

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176

Sl.No. Service dimension Service output delivered

1. Bulk-Breakin !nits are delivered in ones

2. Spatial convenience "#ere is at least one outlet $or almost ever%3 km radius e&cludin o$ course t#inl%populated areas

3. 'aitin time Not more t#an 2 da%s $or an% model

4. (ssortment )t#er consumer oods items includin t#ato$ ot#er competitors are availa*le at all t#eoutlets +#ere t#e products are ot#er+ise(vaila*le

5. ,nstallation support (vaila*le

6. ($ter sales support ree $or $irst t+o %ears *ut availa*le onpa%ment a$ter+ards. (lso availa*le at ever%cit% $rom +#ere t#e product +as *ou#t.

7. /onsumer $inancin (vaila*le

Dh)nnel $los

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:low 0ame =planation

'hysical'ossession

*r)ns-ort)tion (tor)ge

wnership *)ing title to the -rod't

'romotion Pro+oting -rod't in v)rios )ys

0egotiation *er+s of tr)de ith -stre)+/donstre)+

:inancing D)sh o / oring ')-it)l re=ire+ents of'h)nnel -)rtners

)is! ta!ing Underriting riss hile -ossessing/oning,

)rr)nties et'.rdering Pro'essing of orders -)ssing on to -stre)+

'ayment $lo of -)y+ents )t e)'h 'h)nnel level© Oxford University Press 2005, All

rights reserved.177

hannel design e>ort decisions Fconsumer durables

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17!

consumer durables

• *he servi'e ot-t levels

• *he os or )'tivities th)t )re)sso'i)ted ith the )'hieve+ent ofthe servi'e ot-t levels

• *he ty-e of entity ho old %eentrsted ith the -erfor+)n'e ofe)'h of these os

'arameters for comparingchannel designs

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17"

channel designs

• CS'ien'y

• Ce'tiveness

• C=ity

• (')l)%ility

The channel establishment plancontd.

• *he +)in -r-ose of the 'h)nnel to %e set#-.

• *he -role of the 'sto+ers ho )re the t)rget +)ret

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1!0

• *he -role of the 'sto+ers ho )re the t)rget +)ret

for the 'h)nnel .• *he needs )nd re=ire+ents of the t)rget +)ret ith

reg)rd to the identied servi'e ot-ts -rovided %y

the -ro-osed/ existing 'h)nnel.

• An)lysis of the o-er)tions of the existing 'h)nnels th)tde)l in si+il)r -rod't/servi'e lines J ide)s for

dierenti)tion.

• 8et)iled )'tivity 'h)rt for )'hieving the servi'e ot-t

o%&e'tives # lining servi'e o%&e'tives to s-e'i'

)'tivities.

'lanJ.. ontd.• 8et)ils )%ot the v)rios 'h)nnel 'onstitents

ho ill %e -erfor+ing these t)ss

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1!1

• *he 'ost of -erfor+ing the )'tivities

• *he design)ted roles )nd res-onsi%ilities of the'h)nnel 'onstitents

• *he -ro-osed re+ner)tion for -erfor+ing theseroles )nd res-onsi%ilities

• (t)nd)rds for +e)sring the -erfor+)n'e

• Driteri) for )--ointing the 'h)nnel +e+%ers

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1!2

Managing "annel Member

.e"aviour

hannel relationships

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1!3

Per'e-tions of org)ni)tion)l -oer 8e-enden'e

Dontrol

*rst

Do++it+ent

Do#o-er)tion

,iscrete relational e=changecontinuum

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1!4

#rm’s length relationship

)elational e=change relationship

hannel control

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1!5

'ayF> 'ayF>

:unction:unction

ToleranceTolerance

:unction:unction

lostlost

opportunitieopportunitie

ss

*upplier*upplier

authorityauthority

protprot

earned byearned by

channelchannel

membermember

Uone ofUone of

acceptanceacceptance

A

)ole of persuasion7 authority7 andcoercion in channel control

hannelhannel ToleranceTolerance

f tif ti

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1!6

#uthority#uthoritypersuasionpersuasion

oercion

'ay Fo>'ay Fo>

functionfunction

//

/

members protmembers prot functionfunction

controlcontrol

Dh)nnel Poer

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•

e)rd Poer

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1!!

$in)n'i)l retrnsHuality

products

Do+-etitive -ri'e)eliable deli$ery

0ational

reputation

'romotionalsupportTraining

ar!etresearch

ompanypolicies

Technicalassistanc

e

)esponsi$eness systems

incenti$es

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,istributor rmincenti$es

2. apabilit/uilding'rograms

1.hannelore

3.9ncenti$e'rogram

,n$luenceStrate%

roup

"%pes o$ ,n$luenceStrate%

0&planation

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1!"

hannel anager’s9n?uence strategy types

,ndirectin$luence

strateies

•

,n$ormation e&c#ane• ,n$ormation control

• odellin

'#ere in$ormation on eneral *usinessissues and t#e c#annel proram is

merel% e&c#aned +it# c#annelmem*er personnel.

irect !nmediated

Strateies

• ecommendation

• 'arnin

• ositive normative• Neative normative.

,n t#is t%pe o$ strate% t#econseuences o$ t#e acceptance or

reection o$ t#e c#annel proramme orits implementation are stressed *utt#ese conseuences are *ased on aresponse $rom t#e market

environmentnot on t#e mediation o$ t#e c#annel

rincipal.

e+ard and

unis#ment

Strateies

• 0conomic re+ard

• Non-economic re+ard

• 0conomic punis#ment

• Non-economic punis#ment

,n t#is t%pe o$ strate% re+ardsand punis#ments are directl%iven to c#annel mem*ers

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1"0

contd. 9n?uence strategytypes

irect

un+ei#ted

strate%

• irect reuest "#is strate% involves makin a

direct reuest to t#e c#annelmem*er +#ere t#e rincipalmainl% communicates desires or+is#es concernin t#e c#annelmem*ers acceptance o$ t#ec#annel proram.

irect

ediated

strateies

• ersonal plea

• romise

• "#reat and

• ealistic re$erence.

,n t#is t%pe o$ strate% speci$icaction is reuestedconseuences o$ acceptance orreection are stressed and are*ased on t#e mediation o$ t#ec#annel principal.

9n?uence situations in channelrelationship

/ttitude towards t"e c"annel program/ttitude towards t"e c"annel program

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1"1

ein$orcementprocess

Be#aviouralein$orcement

:non-economicre+ard;

oderaterationali

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1"2

of con?ictof con?ict

*tructural*tructural

sources of sources of con?ictcon?ict

on?icton?ict

resolutionresolution

:elt:elt

con?ictcon?ict

con?ictcon?ict outcomesoutcomes

#** : 0:

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1"3

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#ccommodati$#ccommodati$

eeollaborati$eLprobleollaborati$eLproble

m sol$ingm sol$ing

ompromiseompromiseonceroncern forn for

thethe

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Documents

Class PPTs (16.10.14)