343 Lecture 17 Notes1

Management of Sales Force (17)

LEADERSHIP* The process of inspiring, influencing, and guiding employees to participate in a common effort* Involves a series of skills that can be acquired through study and practice* People who rise to the position of sales manager must understand the difference betweenleadership and management

Effective leaders demonstrate the following traits:* Structure* Consideration* Situational leadership* Test of character* Coaching for peak performance

Leadership styles:

Structure: Evidence includes:* Regular planning* Expectations clearly communicated* Prompt, firm decisions* Regular performance appraisals

Consideration: Evidence includes:* Regular and effective communication* Each salesperson treated as individual* Reward good performance often

343 Lecture 17 Notes2

Situational leadership:* Develop strong ethics and character* Leader’s style should match situation

Aspects of situational leadership:Supporting, coaching, directing, delegating

Peak performance coaching:* Help salespeople recognize need to improve* Help develop their commitment to improve* Document problems and explore solutions

Recruiting and selection:* Determine job requirements* Search for applicant* Select best-qualified applicant

Determine job requirements:* New or established territory* New or well-established product* Work independently or closely with manager* Likelihood of travel, transfer, promotion

343 Lecture 17 Notes3

Searching for applicants:* Within company* Colleges and universities* Trade and consumer advertising* Employment agencies/listings* Internet services/searches

Selecting applicants:Selection criteria:* Interest, enthusiasm, high motivation* Integrity* Knowledge of business, market, consumers* Customer orientation/relationships* Psychological tests (used in conjunction)

Interview application:What would you tell an interviewer about . . .* Yourself?* Your knowledge of the sales process?* Greatest strengths and weaknesses?* Most boring job/how you handled it?* What was your biggest contribution at your last job?* Why should he/she hire you?

Orientation and training:* Provide thorough orientation before person begins work* Initiate training program to help person achieve success . . .tasks, execution, role* Size of firm should not dictate scope of training

Dimensions of a formal training program:* Knowledge of product line, territory, business trends, firm’s marketing strategy* Attitudes toward the company, products, customers* Skills: applying selling principles and practices

Sales force motivation:* Internal motivation* Intrinsic rewards: achievement, challenge, advancement, growth, enjoyment of work* Often have long-term positive impacts

External motivation* Actions taken by firm to reward sales performance* Sales contests, incentive plans, cash bonuses

Effective external rewards:* Design programs that focus on several important aspects of the salesperson’s job* Evaluate incentive programs often* Avoid unrealistic goals

343 Lecture 17 Notes4

Compensation plans:* Compensation practices vary* Usually combination of:

- Direct compensation: salary and commissions- Indirect compensation: pension, insurance plans, vacations

5 Typical compensation plans:* Straight commission* Commission plan with guaranteed salary or draw provision* Commissions with draw or salary plus bonus* Fixed salary plus bonus* Straight salary

Award and incentive plans:* Specific product movement* Percentage sales increase* New accounts established* Increased activity

Compensation plan guidelines:* Define marketing objectives—plan complements objectives* Field test compensation plan* Explain plan to sales staff* Change plan as conditions warrant

How to assess productivity? Quantitative criteria --* Sales volume in dollars* Sales compared with last year* Volume by product or line* Number of new accounts* Amount of new account sales* Net profit on each account* Number of customer calls made

How to assess productivity? Qualitative criteria --* Attitude* Product knowledge* Communication skills* Personal experience* Customer goodwill generated* Selling skills* Initiative* Team collaboration