Exploring Web 3.0 Growth marketing: Navigating the Future of the Internet
Sales Ch 3-7.pptx
1. Chapter 3: Sales Planning
3.1. Nature and Methods of Forecasting
• Forecasting means “A statement made about the
future”. So, Sales forecasting is the estimation of
sales made for the future.
• A sales forecast is the prediction of sales volume
that a company can estimate to achieve in
specified period of time in future.
• It is the estimated birr or unit sales for a specific
future time period based on a proposed
marketing plan and an assumed market
environment.
2. …Cont’d
• According to American marketing Association,
“Sales forecast is an estimate of sales in dollars
(Birr in Ethiopia) or physical units for a specified
future period”.
• According to Matthew, Buzzles, Lovitt, Frank, ‘A
sales forecast is an estimate of sales of a
company’s product that are expected to be
achieved during a given future period, in a given
place’.
• Sales forecasting for a new business is more
problematical as there is no baseline of past sales.
3. 3.2. Periods of Forecasting
There are different periods when we need to predict
some results
• Short term forecasts – there are usually for periods up to
three months ahead and are really of use for tactical
matters such as production planning.
• Medium term forecasts – these have direct implication
for planners. They are of most importance in the area of
business budgeting, the starting point for which is sales
forecast. Thus if the sales is incorrect then the entire
budget is incorrect.
• Long term forecasts – these are usually for periods of
three years and upwards depending upon the type of
industry being considered.
4. 3.2 Methods of Sales Forecasting
There are two types of forecasting techniques:
1. Qualitative forecasting technique
2. Quantitative forecasting technique
1. Qualitative forecasting technique: qualitative forecasting techniques are
sometimes referred to as judgmental or subjective techniques because they
rely more upon opinion and less upon mathematics in their formulations.
• Qualitative forecasting techniques are used in the not predictable
environment and when we don’t have enough data.
• These techniques are usually used when managers forecast for launching a
new product line or new technologies.
• The absence of past sales means that you have to be more creative in coming
up with prediction in the future.
• Sales forecast for new products are often based on executive judgments,
sales force projection, surveys and user’s expectation.
5. 3.3. Qualitative Forecasting Techniques
• Jury of Executive Opinion Method: This is the oldest method of
sales forecasting. This method is also called Executive Judgment
Method.
• Under this method, a jury or committee is formed. The jury
consists of high ranking executives from different departments
such as marketing, finance, production etc.
• Here, the jury members sit together and each member of the jury
is asked to give the sales forecast for a given period of time based
on his/her experience and information.
• Like this each members gives his/her opinion and then the
opinions are collected, analyzed, and discussed. After that a
collective decision is made about the future.
6. 3.4. Delphi method
• is a structured type of jury of executive opinion technique. The main
difference is the members do not meet in committee. The basic
procedure involves selection of a panel of managers from the
company. Each member of the panel submits anonymous forecasts
for each account. These forecasts are summarized in to a report by
the project leader that is sent to each panel member.
• The report presents descriptive statistics concerning the submitted
forecasts with reasons for the lowest and highest forecasts. Panel
members review this information and then again submit individual
anonymous forecast.
• The same procedure is repeated until the forecast for individual
accounts converge into a consensus. Because this procedure
involves a written rather that verbal communication, such negatives
as domination, undue conservatism, and argument are eliminated,
while team members benefit from one another’s input.
7. Cont’d . . .
• Customer expectations use customer’s expectations of their needs and
requirements as the basis for the forecast. The data are typically gathered by a
survey of customers or by the sales force
• Sales force composite combines the individual forecasts of salespeople. This
technique involves salesperson making a product-by-product forecast for their
particular sales territory. Such a method is a bottom-up approach.
• Expert Opinion Method: Under this method, the organization collects the opinion
from outside experts who are engaged in the field of sales. The opinions given in the
newspapers, journals etc are also taken.
• The opinions are then collected, analyzed and evaluated and then the sales
forecasting is done.
8. 3.4. Quantitative Forecasting Techniques
• Managers apply quantitative forecasting techniques when the
environment is predictable and if they have data from past period
about sales.
• These techniques are good when we want to predict existing
products and technologies. They often used mathematics’
techniques for forecasting.
• Quantitative techniques are sometimes termed objective or
mathematical techniques as they rely more upon mathematics as
less upon judgment in their computation.
• These techniques are now very popular as a result of sophisticated
computer packages.
•
There are many quantitative techniques:
• Generally, quantitative methods of forecasting fall in to two
categories. They are:
• Time series analysis
• Causal methods
9. i. Time Series Analysis
• A time series is a set of some variable (demand) overtime (e.g.
hourly, daily, weekly, quarterly annually). Time series analyses
are based on time and do not take specific account of outside
or related factors.
• Forecasting techniques based on time series data are made on
the assumption that history follows a pattern that will
continue. Time series analysis is a time-ordered series of
values of some variables.
• The variables value in any specific time period is a function of
four factors
10. 3.4.1. Some of Time Series Methods are listed Hereunder:
a. Trend - Accounts for the gradual shifting of the time series over a long period of
time. long-term movement in data
b. Seasonality - Accounts for regular patterns of variability within certain time periods,
such as over a year( short-term regular variations in data)
c. Cyclical – Wavelike variations of more than one year’s duration. Any regular pattern
of sequences of values above and below the trend line is attributable to the.
d. Irregular variations - Series is caused by short-term, unanticipated and non-
recurring factors that affect the values of the time series. One cannot attempt to
predict its impact on the time series in advance since it is caused by unusual
circumstances.
11. 3.5. Types of time-Series Forecasting
1. Simple Moving Average : a simple moving average is obtained by summing and
averaging values from a given number of periods repetitively, each time deleting the oldest value
and adding the new value.
2. Weighted Moving average takes an average of a specified number of past observations to make
a forecast. As new observations become available, they are used in the forecast and the oldest
Observations are dropped.
3. Exponential smoothing makes an exponentially smoothed weighted average of past sales, trend
and seasonality to derive the forecast.
4. Decomposition breaks the sales data into seasonal, cyclical, trend and noise components and
projects each into the forecast
5. Straight-line projection is a visual extrapolation of the past data which is projected into the
future as the forecast
12. 1. Simple Moving Average
• A simple moving average is obtained by summing and averaging
values from a given number of periods repetitively, each time
deleting the oldest value and adding the new value.
• SMA = Ft =
Where;
SMA – simple moving average
Ft - Forecast for period t
At-i - Actual demand in period t-i
n - Number of periods (data points) in the moving average
13. Example
Required:
a. Compute a simple 5 month moving average to forecast
demand for month 9
b. Find a simple 5 month moving average to forecast the
demand for month 10 if the actual demand for month 9 is
123.
a) SMA9 = F9 = =120.6
Therefore, the forecasted demand for month 9 is 120.6.
Month 1 2 3 4 5 6 7 8
Actual demand 105 106 110 110 114 121 130 128
14. b) SMA10 = F10 = = 123.2
• Therefore, the 5 month moving average forecasted demand
for month 10 is 123.2.
• Note: In moving average, as each new actual value becomes
available, the forecast is updated by adding the newest value
and dropping the oldest value and computing the average.
• Consequently the ‘forecast’ moves by reflecting only the most
recent values.
15. 2. Weighted Moving Average
• In weighted moving average, forecasts are
calculated by
Ft = WMA = W1At-1+W2.At-2+… +Wn.At-n
Where;
Ft =forecast in time t
WMA = weighted moving average
W = weight
A = Actual demand value
16. Example
• Example: A department store may find that in a four month period the best forecast
is derived by using 40% of the actual demand for the most recent month, 30% two
months ago, 20% of three months ago and 10% of four months ago. The actual
demands were as follows.
Required:
a) Compute weighted 4-month MA for month 5
b) Suppose the demand for month 5 actually turned out to be 110. Compute forecast
for month 6.
Solution
F5= WMA = 95x0.4+105x0.3+90x0.2+100x0.10
F5= 97.5 units
F6 =WMA = 0.4x110+0.30x95+0.2x105+0.1x90
F6= 102.5 units
Month Month 1 Month 2 Month 3 Month 4
Demand 100 90 105 95
17. 2. Casual Methods of Forecasting
Regression and Correlation Methods
• Regression and correlation techniques are means of describing the association
between two or more variables. More specifically, regression and correlation
methods are related to the following issues:
- Bringing out the nature of relationship between any two variables, say X and
Y
- Measuring the rate of change in one (the dependent) variable associated
with a given change in the other (independent) variable.
• Evaluating the strength of the relationship and quantifying the closeness of
such relationship.
18. Regression
• It is concerned about the first two issues, i.e.
- Bringing out the nature of relationship between any two variables.
- Measuring the rate of change in one (the dependent) variable
associated with a given change in the other (independent) variable.
• Regression means ‘dependence’ and involves estimating the value of
a dependent variable, Y, from an independent variable X.
• There are two types of regression: simple regression and multiple
regression
19. 3.6. Sales Quota
• Also referred to as sales target
• It is a quantitative goal assigned to a sales unit for a
specific period of time
• It is the amount/volume sales that is aimed to be
achieved within specific period of time and territory
• It indicates the level of performance that is target to
achieve
• It could be done in two ways:-
a. imposed (sales managers allocate the quota without
discussing with the salespersons) or
b. co-operative (the sales manager and the
salespersons discuss about the sales quota)
20. 3.6.1. Uses of Sales Quota
• It is used as an input to plan, and control
selling activities
• Serve as a base for:-
- sales target
- incentive
- payment
• Sales quota can be assigned based on product
line, territory and/or sales volume/income
• Sales Performance indicator (SPI) Sales x 100
Sales quota
21. 3.7. Sales Budget
• Is part of sales plan that deals with financial plan for
profit of a given period of time
• Sales budget can be prepared using either of the
following two techniques
A. Percentage of sales method: the sales budget is
determined by sales volume and also some percentage
of the previous sales volume will be taken as base to set
the sales budget
B. Objective and Task Method: under this method,
objective of the firm will be defined and then, the tasks
to be performed to achieve the sales objectives will be
indentified. Finally, the budget to accomplish the tasks
in order to achieve the sales objective will be assigned.
22. 3.8. Sales Plan
• Is the road map/blue print that enables to
answer who, when, where, how and what of
the sales activity
• Is the process of setting sales goal
• It also a process of preparing tomorrow's sales
on today
23. 3.8.1 Contents of A sales Plan
• Cover page
• Preliminary pages (table of contents, list of tables, list of
figures…)
• Executive summary/Abstract
• Introduction
• Situation analysis/SWOT, market audit, competitors analysis,
sales performance analysis/
• Marketing Plan
• Marketing Objective /awareness creation, increase market
share, increasing profit and so on/
• Sales objective
• Sales forecast
• Sales target/Quota
• Sales Budget
• Timetable
24. Chapter 4: Planning for and Recruiting Successful Salespeople
• Manpower Planning: it deals with staffing aspect of sales
force management. It includes activities such as:
Determine replacement of lost salesperson
Determine the need for new salesperson
Determine the abilities/skills required for the efficient
performance
Preparing manpower inventory/manpower audit
Identifying man power gaps
Formulate manpower plans/Determine the number of sales
forces required
Conduct job analysis
Prepare job description
25. 4.1. Job Analysis and Job Description
• Job specifications and job descriptions are part of
manpower planning prepared to determine job
requirements and the quality of needed
personnel.
• Job specification is a formal statement of
minimum qualification required for the successful
performance of a job.
• Job description is an organized, written and factual
statement of job contents in the form of duties
and responsibilities of a particular job.
26. 4.2. The recruitment process
• It is the process of searching for prospective
employees and stimulating them to apply for jobs.
• Recruitment is the process of obtaining a good
number of sales forces with required capability
• The purpose of recruitment is to attract talented
employees with the needed knowledge, skill and
attitude in the proper quantity and quality for the
jobs available.
• It is generally viewed as a positive process.
27. 4.3. Sources of Recruitment
• There are many options a sales manager can go to find recruits.
• Sales managers should analyze each potential source to determine which
ones will produce the best recruits for the sales position.
• Some firms will use only one source; others will use several. Using various
options is recommended to get appropriate candidates.
• The most frequently used sources of recruitment are:-
1. Internal sources: transfer (shifting one sales person from one
territory to the other or from other profession to sales post ),
promotion (up grading an employee from lower position to the
higher)
2. External Sources: competitors, non competing firms, advertisements,
on campus/direct recruitment, unsolicited applications, referral,
employment agencies, placement broacher and the like
28. 4.4. Problems in Screening Applicants
• Corruption
• Nepotism
• Lack of clear yardstick
• Absence of teamwork during screening
• Lack of know how on sales profession
• Lack of standardization
29. 4.5. Selecting Applicants
• The selection process involves choosing the candidates who best meet the
qualifications and have the greatest aptitude for the job.
• It can be done through written exam, physical examination, quality of CV,
information from references, application form, interview of short listed
applicants, skill test, demonstration and so on
• Selection is described as a negative process.
• The proper selection of employees will go a long way towards building a
stable work force and eventually reducing labor costs.
• Putting the right sales staff on the right position increases efficiency, job
satisfaction, morale and productivity. Absenteeism and labor turnover
will be reduced highly.
30. 4.6. Some Major Activities After Selection
A. Placement
• Placement is the process which involves putting or posting the selected
candidates on appropriate jobs.
• It involves assigning specific jobs and work places to the selected candidates.
• In placement, employees are assigned to jobs that are most suitable to them.
• The purpose of placement is to match the employee and the job, or to place
right person on the right job. The advantages of correct placement are:
Placement improves job satisfaction and productivity
Placement reduces labor turnover
Placement reduces absenteeism
31. B. Induction
• Induction: is a socializing process by which the
organization seeks to make an individual its agent for
the achievement of its objectives
• The purpose of induction is to provide the new
employee with necessary information about the
company that may include:-
Company history
Company products/services
Organization structure
General company policies
The duties and benefits of employment
Location of departments and employee facilities
Personnel policies and practices
32. C. Orientation
• Orientation is a socializing process by which new employee is
provided with information about work environment.
• Specifically, orientation involves:
Rules, regulations and daily routines
Grievance procedures
Safety measures
Standing orders
Employee activities, benefits and services
33. 4.7. Qualities of a Good Sales Person
1. Physical Qualities (first impression)
• Brushed teeth
• Combed hair
• Appropriate dressing
• Optimum voice
34. 2. Mental Qualities
Planning skill
Problem solving skill
Decision making skill
Confidence
Resourcefulness
Alertness
Imagination
Memory
Eagerness to learn
Gathering up to date information
36. 4. Social Qualities
Eagerness to know new clients
Counting clients as family
Tact
Treating clients with equal eyes
Accommodating clients very warmly
Respecting the culture if the client
Applying the golden rule of selling
37. 4.8. Selling Styles
There are four distinct selling styles. Each style is characterized by certain behaviors and
tendencies. Keep in mind that successful salespeople can and do use all four styles, but
they primarily use a combination of the first three styles.
• Collaborative Sellers: tend to ask questions, listen actively, brainstorm with the
customer, strive for partnerships, and value long-term relationships. They genuinely
solicit input and suggestions from the customer. In a phrase, "We are together."
• Technical Sellers: view themselves as the expert, like to talk about features and
benefits, make recommendations and are perceived as rational and objective. In a
phrase, "Let me tell you about my product or service."
• Closers: are good at closing and generating results. They tend to make aggressive
offers, sometimes try to close too soon, and are satisfied to make an immediate sale
even at the expense of a long-term relationship. In a phrase, "What do I have to do to
get your business today?"
• Reluctant Sellers: are sensitive to signs of rejection or failure. If Closers are at
one extreme on the fight-or-flight continuum, reluctant Sellers are at the other extreme.
In a phrase, "Look this over and we'll talk again next time."
39. According to Mahatema Gandhi
“A customer is the most important visitor on our premises,
he/she is not dependent on us.
We are dependent on him/her. He/she is not an interruption in
our work. He/she is the purpose of it. He/she is not an outsider
in our business.
He/she is part of it. We are not doing him/her a favor by serving
him. He/she is doing us a favor by giving us an opportunity to do
so.”
40. Selling Philosophy of ‘Good’ Salespeople:
• Selling is problem solving
• Selling is a helping, caring activity
• A customer is a person to be served, not a
prospect to be sold
• Treat people as human beings, not $ signs
• Unique products, relationships, cultures are
important
• Be customer driven, not product driven
41. Cont’d . . .
• Focus on customer needs
• The customer is the reason a salesperson exists
• Long-term success depends on pleasing others
• Selling is a ‘win-win’ activity
• A commitment to self improvement and life-long
learning essential for long-term success
• Adherence to a strict code of ethics emphasizing,
among other things, mutual trust, respect, and
honesty is essential
42.
43. Why do buyers object?
• Tendency of natural aversion to new or
unfamiliar product
• Due to partially convinced salesmen
• To test the salesmen knowledge and patience
• Lack of understanding
• Pressure/unfair means of selling product from
the salesperson
• To postpone current purchase
• To secure more information
• To avoid disgraceful sellers
45. Knowledge- about what?
• Customer
• Company knowledge
• Product knowledge (selling point)
• Competition knowledge
• Selling Process
Also be aware of the following . . .
59. Thumb Rule to Handle Customer
• Rule 1: Customer is always right.
• Rule 2: If Customer is ever wrong,
• Rule 3: Reread Rule 1
60. Ways of Handling Clients
Showing smiling face
showing respect
Listening (golden rules for listening)
– Put yourself in customer’s shoes
– Stop chatting inside your head
– Concentrate on what is being said
– Show that you are listening
– Check details if you are in doubt
– Be aware of what is being missed by customer
– Write down the details..
61. Cont’d . . .
Being part of the
solution
Personal and office
hygiene
Having Badge
Politeness
On time delivery
Empathy
62. Cont’d . . .
Equity
Call clients by name
tolerance
hard work
loyalty
Honesty
Transparency
Give small gifts
63. Dealing with difficult customers..
• Don’t return anger to anger
• Take control- assert yourself
• Never promise what you can’t deliver
• Let them vent their anger
• Show concern and sympathy
• Apologize, even if it is not your fault
• Offer solution
64. Customer Service Slogans
• Customer Service - part of the solution
• Customer Service - we make a difference
• Customer Service - because we care
• Customer Service - simply the best
65. Why do customers quit ?
• 1% Die
• 3% Move away
• 5% Form other friendship
• 9% For competitive reasons
• 14% Due to product dissatisfaction
• 68% due to indifferent attitude by the staff
towards customers.
66. Benefits of Satisfied Clients
Spread of good word of mouth for 3-4
prospects
Source of satisfaction for
the provider
Excels its contenders
Minaye PLC secures
good image
67. Consequences of Dissatisfied Clients
Bad words of mouth
for 12-15 prospects
2/3 of existing clients
loss trust on us
Gives room for
competitors to beat us
Switch of current
clients
Losing Job
Shutdown of the
organization
68. When Does a customer satisfy?
• Service performance = Client's expectation, the client wil
be satisfied
• Service performance < Client's expectation= the client
will
be dissatisfied
• Service performance > Client's expectation=
the client will be delighted
69. Chapter 5: Organizing the Sales Force
• Organization is the back bone of management. It is the foundation upon
which the whole structure of management will build and also resources
assigned. Without organizing manager cannot function as a manager.
• Organization is concerned with the building, developing, and maintaining of
structure of working relationship in order to accomplish the objectives of the
enterprise.
• It is concerned with determination and assignment of duties to people and
also the establishment and the maintenance of authority relationship among
this grouped activities and people.
• The ideal sales organization has a built in adaptability allowing it to respond
appropriately to diverse marketing environments.
70. 5.1. Types of Sales Organizational Structures
• If sound practices are followed in setting up the sales
department, the resulting structure takes on features of one or
more of four basic types: line, line and staff, functional, and
committee.
• The first two types (line and line and staff) are the most
common.
• Functional and committee organization are rare.
• Most sales departments have hybrid organizational structures
71. … Cont’d
• The grouping of activities into positions and the charting of relationships
of positions causes the organization to take on structural form.
• No two companies have identical sales organizations, because no two
have identical needs.
• The customers the marketing channels, the company size, the product or
product line, the practices of competitors, and the personalities and
abilities of the personnel are a few of factors affecting the organizational
structure of the sales department
72. 5.2. Line Sales Organization
• In this type, each subordinate is responsible only to one person
on the next higher level.
• The line sales organization sees its greatest use in companies
where all sales personnel report directly to the sales executive
• The line organization is the oldest and simplest sales
organizational structure.
• It is widely used in smaller firms and in firms with small
numbers of selling personnel and in companies that cover a
limited geographic area or sell a narrow product line.
• The chain of command runs from the top sales executives
down through subordinates.
74. 5.3. Line and Staff Sales Organization
• The line and staff sales department is often found in large
and medium sized firms, employing substantial numbers of
sales personnel, and selling diversified product lines over
wide geographic areas.
• The line and staff organization provides the top sales
executive with a group of specialists in dealer and
distributors relations, sales analysis, sales organization, sales
personnel, sales planning, sale promotion, sales raining,
service, traffic and warehousing, and similar fields.
• This staff helps to conserve the top sales executives time
and frees them from excessively detailed work, they make it
possible for their chiefs to concentrate their efforts where
they have the most skill.
76. 5.4. Functional Sales Organization
• Some sales departments use functional
organization.
• This type, derived from the management
theory developed by Frederick W. Taylor, is
based upon the premise that each individual in
an organization, executive and employee,
should have as few distinct duties as possible.
• The principle of specialization is utilized to the
fullest extent. Duty assignments and delegation
of authority are made according to function.
77. Cont’d …
• In the functional sales department, salespeople receive
instructions from several executives but on different
aspects of their work.
• Provision for coordinating the functional executives is
made only at the top of the structure; executives at
lower levels do not have coordinating responsibilities.
In contrast to the line and staff organization, all
specialists in a functional organization have line
authority of a sort or, more properly, they have
function authority.
• Instructions and even polices can be put into effect
with or without prior approval of the top level
coordinating executive
79. 5.5. Committee Sales Organization
• The committee is never the sole basis for organizing a sales department. It is
a method of organizing the executive group for planning and policy
formulation while leaving actual operations including implementation of
plans and policies to individual executives.
• Thus, many firms have a sales training committee (comprised of the general
sales manager, his or her assistants, the sale training manager, and perhaps
representative divisional or regional sales managers) that meets periodically
to draft training plans and formulate sales training policies.
• Implementation of these plans and polices, however is the responsibility of
the sales training manger, if the company has one, or of the line and or staff
executives responsible for sales training in their own jurisdictions.
• Other committees found in sales organization include customer relations,
operation, personnel, merchandising, and new products.
• The use of committees in the sales department has advantages. Before
policies are made and action is taken, important problems are deliberated by
committee members and are measured against varied viewpoints.
80. 5.6. Schemes for Dividing Line Authority in the Sales Organization
1. Geographic Division of Line Authority
• The large firm with far-flung selling operations is likely to subdivide line
authority geographically.
• This is particularly applied if the characteristics of large numbers of
customers vary by geographic location and if certain products are more
strongly demanded on some regions than in others.
• But there is an even more compelling reason for dividing line authority
geographically as more customers are added and as a wider area is
cultivated, the size of the sales task increases enormously.
• Geographic division is usually made first in top regions or division.
• However, this system calls for multiple offices so administrative expenses
increases. Then, too, the top sales executive faces coordinating several
regional operations. Unless this coordination is effective, different regions
may develop conflicting policies.
82. 5.7. Product Division of Line Authority
• A second scheme for dividing line authority is
to split the sales task among subordinate line
executives, each of whom directs sales
operation for part of the product line.
• Some companies product lines are too and
others sell both highly technical and non
technical product, thus some salespeople need
specialized training and some do not.
84. 5.8. Customer or Marketing Channel Division of Line Authority
•This is appropriate when nearly identical products are marketed to several types of customers
and the problems of selling to each type are different.
•Some companies, especially in consumer-goods field pattern their sales organizations after the
marketing channels although ultimate consumers may be substantially alike, they frequently must
be reached in different ways.
85. Chapter 6: Training and development
• Very often the terms "training" and "development" are considered as
synonymous. Really speaking, there is a difference between the two.
• Training: It is the process of increasing the knowledge and skills of an
employee for doing a particular job.
• It implies imparting technical knowledge, manipulative skills, problem
solving ability and positive attitude.
• The purpose of training is to enable the employees to get acquainted with
their present/prospective jobs and also to increase their knowledge and
skills and to modify their attitude.
• Training is not a one-stop process, but continues throughout the career of an
individual. Training is job-oriented (job-centered).
• Development: It refers to the growth of an individual in all respects -
physically, intellectually, and socially. Development is career bound.
Development of individuals is the consequence of training. In other words,
training is the cause whereas development is the consequence.
86. 6.1. Importance of Sales Training
• To increase increases the efficiency and productivity of a
sales person
• To upgrade the knowledge and skill of sales forces
• To create high performing business organization
• To handle customer better
• To build and maintain organizational reputation
• To win market competition
• improves the organization’s ROI/Return on Investment
• Serve as tool of motivation
87. 6.2. Nature of Effective Sales Training
• It should be need based
• Reward specific achievement
• Limit the size of trainees (25-30)
• It should be practical
• It should be participatory
• Use technology and real life stories
• Better to retreat to some other place during the
training
• Don’t forget accommodation and other facilities to
capture trainees’ attention
• Hire/assign experienced trainer
88. 6.3. Types of training
Training may of several types. Some of them are:
• Orientation training: it seeks to adjust newly appointed salesperson
to the work environment
• Job training: it refers to the training provided with a view to increase
the knowledge and skills of an employee for improving performance
on the sales job.
• Safety training- it is intended to provide training to minimize
accidents and damages to machinery.
• Promotional training: it involves training of existing employees to
enable them to perform higher level jobs (positions)
• Refresher training - it involves training given to employees in the use
of new methods and techniques. This type of training is given when
existing techniques become obsolete due to development of better
techniques
• Remedial training- it is designed to correct the mistakes and
shortcomings in the behavior and performance of employees.
89. 6.4. Methods of training
1. On-the-job Training (OJT): under this method, the worker is trained by his immediate supervisor
or by an experienced employee in a real work situation. The trainee is told (explained) the
method of handling tools, operating the machines etc.
2. Apprenticeship Training: it refers to giving instruction, both on and off the job, in the practical
and theoretical aspects of the work required in a highly skilled occupation. Apprenticeship
program contains both on-the-job and classroom training. The theoretical aspect of the job is
learnt in the classroom, but its skills will be learnt on the job.
3. Vestibule Training: is a training in which the trainee learns the job in an environment that
simulates the real working environment as closely as possible.
4. off- the -Job Training: includes all over training other than apprenticeship, vestibule training,
and on-the job training. It can be done in organizational classrooms, vocational schools or
elsewhere.
90. 6.5. Compensating (Remunerating) Salespeople
• Compensation can be defined as all of the rewards
earned by employees in return for their good
performance.
• Reward for employment in the form of pay, salary,
or wage, including allowances, benefits (such as
company car, medical plan, pension plan), bonuses,
cash incentives, and monetary value of the noncash
incentives. It can be summarized in three ways:-
•
91. 6.6. The Purpose of Compensation in an Organization
• Attract & retain employees
• Motivate workforce
• Sustain high morale
• Motivate personal growth
• Brings about sense of belongingness
• Increases sales forces initiation
• Contributes to organizational growth
92. 6.7. Methods of Sales force Compensation
• Direct financial compensation: consist of a pay received in the form of
wages, salaries, bonuses, incentives and commissions provided at regular
and consistent intervals
• Indirect financial compensation: includes all financial rewards that are not
included in direct compensation and can be understood to form part of the
social contract between the employer and employee such as leaves,
retirement plans, education, and employee services
• Non-financial compensation: refers to topics such as career development
and advancement opportunities, opportunities for recognition, as well as
work environment and conditions
93. 6.8. Factors Affecting Compensation Plan
• Labor market
• Experience of sales persons
• Performance of sales persons
• Competition
• Company performance
• The management
• Country's economy
94. Chapter 7: Evaluation and Control of Salespeople
• Performance appraisal and Controlling are directly related to planning.
• The controlling process ensures that plans are being implemented
properly.
• Controlling is the final link in the functional chain of management
activities and brings the functions of management cycle full circle.
• Control is the process through which standards for performance of
people and processes are set, communicated, and applied. Effective
control systems use mechanisms to monitor activities and take
corrective action, if necessary.
• The supervisor observes what happens and compares that with what
was supposed to happen. He or she must correct below-standard
conditions and bring results up to expectations.
95. …Cont’d
• Controlling: is the process in which management appraises the performance of sales force
performance using predetermined standards and in light of the results makes a decision
regarding corrective action.
• Controlling: is the process of establishing and implementing mechanisms to ensure that
objectives are achieved.
• Controlling: is one of the basic managerial functions, which deals with evaluating how well an
organization is achieving its sales goals and taking action to maintain or improve
performances.
• Controlling: is a managerial function, which involves comparing actual performance with
standard, identifying and analyzing deviations, finding causes of deviations, if any, takes
corrective actions to meet the standards in subsequent periods.
96. 7.1. Performance Appraisal Processes and Procedures
• Establishing standards of performance
• Communicating the standard to the sales forces
• Measuring actual performance
• Comparing actual performance with the set
(established) standards
• Taking corrective action
97. 7.2. Types of Performance Appraisal Techniques
Types of
Performance
Appraisal
Techniques
Management
by
Objectives
Ranking
Graphic
Rating
Scales
Behaviorally
Anchored
Rating
Scales
99. B. Behaviorally Anchored Rating Scales
Salesperson will always cooperate in any way
with other sales force team members, even if
such effort is personally inconvenient or
requires self-sacrifice.
Salesperson is generally antagonistic toward
other team members and frequently undercuts
group efforts.
Salesperson seldom helps others and tends to
resent contributing to group effort.
Salesperson will occasionally help team members
with field sales problems
Salesperson is usually willing to help other team
members on field sales problems.
Salesperson can be expected to go out of his or
her way to help other team members with any
work-related problem.
9
8
7
6
5
4
3
2
1
10
0
Cooperation with sales team members
Categories of performance Observed behavior
Very high
indicates strong willingness to
cooperate with other members
of the sales team
Moderate
indicates an average amount of
cooperation with other team
members
Very low
indicates generally no team
effort, which often hurts group
performance
100. C. Management by Objectives
Step 1
Set sales objectives.
Step 4
Conduct annual
performance evaluation of
salespeople.
Planning phase
Control phase
Modify
and
adjust
MBO
cycle
Step 2
Develop sales plans and
implement them.
Step 3
Periodically monitor
performance and alter sales
tactics to stay on track.
101. D. Ranking Method
• In the ranking method, the supervisor ranks the
sales person according to relative performance
basis, rather than evaluating performance against
a set of performance criteria.
• This method provides a more consistent
approach to evaluate performance by judging
each individual on relative basis considering
his/her overall performance.
• Ranking also permits comparison by providing
ranks to all the sales persons in an organization.
103. 7.3 Some Basic Rules of Performance Appraisal
• Set clear criteria
• The employees should agree on the criteria
• Have formal performance evaluation periodically
• Give chance for employee to evaluate themselves against
their own goals
• Coach, and not dictate the employee to better
performance
• Evaluate the performance, not the individual
104. 7.4. Characteristics of Effective Performance Appraisal
• Accuracy- information that is received from control system should be
accurate or real. If the information is not correct, the resulting decisions are
likely to make things worse rather than solving problems.
• Timely- the information being feedback must be provided on time to allow
managers to obtain full benefits from the data.
• Economical- the cost of control system must be weighed against its
benefits. If the resources expended on the control don’t return equal or
greater value, the control is better left un implemented.
• Focus on critical points- a manager does not have time to control every
aspect of operations. As a result a control system should single out specific
and major areas that provide overall comprehensive control.
• Acceptability- employees must agree that controls are necessary and the
controls will not have negative impacts on individuals or their efforts to
achieve personal goal
