Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall 17-1 CHAPTER 17 Management of the Sales Force

Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall 17-1

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17Management of the Sales Force


Learning ObjectivesLearning ObjectivesLearning ObjectivesLearning Objectives

• Describe how leadership skills can be applied to sales management

• List and discuss the qualities of an effective sales manager

• Discuss recruitment and selection of salespeople

• Describe effective orientation and training practices


Learning ObjectivesLearning ObjectivesLearning ObjectivesLearning Objectives

• Explain effective sales force motivation practices

• Develop an understanding of selected compensation plans

• List and discuss criteria for evaluating sales performance


LeadershipLeadershipLeadershipLeadership

• 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 between leadership and management


Sales ManagementSales ManagementSales ManagementSales Management

• The process of planning, implementing, and controlling the personal selling function

• The sales manager plans, recruits, trains, budgets, develops compensation plans, and assesses sales force productivity

• Successful supervisory management personnel have certain behaviors in common


Effective LeadersEffective LeadersEffective LeadersEffective Leaders

• Demonstrate the following:

• Structure

• Consideration

• Situational leadership

• Test of character

• Coaching for peakperformance

Samuel Palmisano, CEO of IBM


Basic Leadership StylesBasic Leadership StylesBasic Leadership StylesBasic Leadership Styles

FIGURE 17.2


StructureStructureStructureStructure

Evidence includes:

• Regular planning

• Expectations clearly communicated

• Prompt, firm decisions

• Regular performance appraisals


ConsiderationConsiderationConsiderationConsideration

Evidence includes:

• Regular and effective communication

• Each salesperson treated as individual

• Reward good performance often


Situational LeadershipSituational LeadershipSituational LeadershipSituational Leadership

• Leader’s style should match situation

• Develop strong ethics and character

Jaime Barauh, District Sales

Manager, McKesson

Pharmaceutical


Peak Performance CoachingPeak Performance CoachingPeak Performance CoachingPeak Performance Coaching

• Help salespeople recognize need to improve

• Help develop their commitment to improve

• Document problems and explore solutions

Brian Tracy’s sales training program has trained more than 1,000,000

salespeople. Completion of the program results in a designation of

“Certified Sales Professional.”

See theWebsite

http://www.briantracy.com/

http://www.briantracy.com/


Recruitment and SelectionRecruitment and SelectionRecruitment and SelectionRecruitment and Selection

• Determine job requirements

• Search for applicants

• Select best-qualifiedapplicant


Determine Job RequirementsDetermine Job RequirementsDetermine Job RequirementsDetermine Job Requirements

• New or established territory

• New or well-established product

• Work independently or closely with manager

• Likelihood of travel, transfer, promotion


Searching for ApplicantsSearching for ApplicantsSearching for ApplicantsSearching for Applicants

• Within company

• Colleges and universities

• Trade and newspaper advertising

• Employment agencies/listings

• Internet services/searches


The Value of the Best SalespeopleThe Value of the Best SalespeopleThe Value of the Best SalespeopleThe Value of the Best Salespeople

Co-CEOs Jana Machin and Julia Chavez say, “Having the best salespeople is important.” In the past year, 75 of these “best of class” have blazed their way into chains like Target, Toys R Us, Wal-Mart and others.


Selecting ApplicantsSelecting ApplicantsSelecting ApplicantsSelecting Applicants

Selection criteria:

• Interest, enthusiasm, high motivation

• Integrity

• Knowledge of business, market, consumers

• Customer orientation/relationships

• Psychological tests (used in conjunction)


Orientation and TrainingOrientation and TrainingOrientation and TrainingOrientation and Training

• Provide thorough orientation before person begins work

• Initiate training program to help person achieve success... tasks, execution, role

• Size of firm shouldnot dictate scopeof training


A Framework for Training A Framework for Training SalespeopleSalespeople

A Framework for Training A Framework for Training SalespeopleSalespeople

FIGURE 17.3Source: H.F. (Herf) MacKenzie, Sales Management in Canada. (Toronto: Prentice Hall, 2008), p. 229


Selling PowerSelling PowerSelling PowerSelling Power

Selling Power magazine has some of the best hiring and training products available to assist sales managers.

See theWebsite

http://www.sellingpower.com/

http://www.sellingpower.com/


Sales Training ProgramSales Training ProgramSales Training ProgramSales 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 MotivationSales Force MotivationSales Force MotivationSales Force Motivation

• Internal motivation

• Intrinsic rewards: achievement, challenge, advancement, growth, enjoyment of work

• Often have long-term positive impacts


Sales Force MotivationSales Force MotivationSales Force MotivationSales Force Motivation

• External motivation

• Actions taken by firm to reward sales performance

• Sales contests,incentive plans,cash bonuses


Effective External RewardsEffective External RewardsEffective External RewardsEffective External Rewards

• Design programs that focus on several important aspects of the salesperson’s job

• Evaluate incentiveprograms often

• Avoid unrealistic goals


Compensation PlansCompensation PlansCompensation PlansCompensation Plans

• Compensation practices vary

• Usually combination of:

• Direct compensation: salary and commissions

• Indirect compensation: pension, insurance plans, vacations


Icelandic’s IncentiveIcelandic’s IncentiveIcelandic’s IncentiveIcelandic’s Incentive

Icelandic® offers a very attractive incentive program to its distribution representatives.

See theWebsite

http://www.icelandic.com/

http://www.icelandic.com/


Five Compensation PlansFive Compensation PlansFive Compensation PlansFive 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


Strategic Compensation Strategic Compensation PlanningPlanning

Strategic Compensation Strategic Compensation PlanningPlanning

• Specific product movement

• Percentage sales increase

• Establish new accounts

• Increase sales activity


Compensation Plan GuidelinesCompensation Plan GuidelinesCompensation Plan GuidelinesCompensation Plan Guidelines

• Define marketing objectives—plan complements objectives

• Field test compensation plan

• Explain plan to sales staff

• Change plan as conditions warrant


Assessing Productivity: Assessing Productivity: Quantitative CriteriaQuantitative Criteria

Assessing Productivity: Assessing Productivity: Quantitative CriteriaQuantitative 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


Assessing Productivity: Assessing Productivity: Qualitative CriteriaQualitative Criteria

Assessing Productivity: Assessing Productivity: Qualitative CriteriaQualitative Criteria

• Attitude

• Product knowledge

• Communication skills

• Personal experience

• Customer goodwill generated

• Selling skills

• Initiative

• Team collaboration


Promoting SalespeoplePromoting SalespeoplePromoting SalespeoplePromoting Salespeople

Chally’s research suggests the decision to promote salespeople into sales management should not be taken lightly.

See theWebsite

http://www.chally.com/

http://www.chally.com/


Key ConceptKey ConceptDiscussion QuestionsDiscussion Questions


• Describe how leadership skills can be applied to sales management

• List and discuss the qualities of an effective sales manager

• Discuss recruitment and selection of salespeople

• Describe effective orientation and training practices




• Explain effective sales force motivation practices

• Develop an understanding of selected compensation plans

• List and discuss criteria for evaluating sales performance

Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall 17-3417-34

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Copyright © 2010 Pearson Education, Inc. Copyright © 2010 Pearson Education, Inc. Publishing as Prentice HallPublishing as Prentice Hall

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Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall 17-1 CHAPTER 17 Management of the Sales Force