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8/6/2019 Module Handouts
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Evaluating the PerformanceEvaluating the Performance
of Salespeopleof Salespeople
Module TenModule Ten
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Purposes of SalespersonPurposes of Salesperson
Performance EvaluationsPerformance Evaluations
Ensure that compensation is consistent with actualEnsure that compensation is consistent with actualsalesperson performancesalesperson performance
Identify salespeople that might be promotedIdentify salespeople that might be promoted
Identify salespeople who should be terminated and to supplyIdentify salespeople who should be terminated and to supply
documentationdocumentation
Determine training and counseling needsDetermine training and counseling needs
Human resource planningHuman resource planning
Identify criteria for recruitingIdentify criteria for recruiting
and selecting salespeopleand selecting salespeople
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Purposes of SalespersonPurposes of Salesperson
Performance EvaluationsPerformance Evaluations
Advise salespeople of work expectationsAdvise salespeople of work expectations Motivate salespeopleMotivate salespeople
Help salespeople set career goalsHelp salespeople set career goals
Relate salesperson performance to salesRelate salesperson performance to salesorganization goalsorganization goals
Enhance communications betweenEnhance communications between
salesperson and sales managersalesperson and sales manager
Improve salesperson performanceImprove salesperson performance
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Salesperson PerformanceSalesperson Performance
Evaluation ApproachesEvaluation Approaches
General conclusions (continued):
Multiple sources of informationMultiple sources of information
Conducted by the field sales manager whoConducted by the field sales manager who
supervises the salespersonsupervises the salesperson Provide a written copy of the review andProvide a written copy of the review and
conduct a personal discussionconduct a personal discussion
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SalespersonSalesperson
360-Degree Feedback System360-Degree Feedback System
Evaluated by multipleEvaluated by multiple
ratersraters
Salespersons value toSalespersons value to
the organization andthe organization and
customerscustomers ConsiderationsConsiderations
Quality dataQuality data
ConfidentialityConfidentiality UsefulUseful
Not used exclusivelyNot used exclusivelyInte
rnal
Inte
rnal
C
usto
mers
C
usto
mers
Evaluation
Evaluation
Evaluation
Ev
aluationExternal
External
Custom
ers
Custom
ers
Eva
luatio
n
Eva
luatio
n
Eva
luatio
n
Eva
luati
on
Oneself
Oneself
Evaluation
Evaluation
Evaluation
Evaluation
SalesSalesManagerManager
Ev
alu
ation
Ev
alu
ation
Ev
alu
a
tion
Ev
alu
a
tion
Team
Team
Mem
bers
Mem
bers
Evalu
ation
Evalu
ation
Evalu
ation
Evalu
ation
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Perspectives on SalespersonPerspectives on Salesperson
Performance EvaluationPerformance Evaluation
Outcome-BasedOutcome-Based
Little monitoring ofLittle monitoring of
peoplepeople
Little managerialLittle managerialdirection ofdirection of
salespeoplesalespeople
StraightforwardStraightforward
objectives measuresobjectives measuresof resultsof results
Behavior-BasedBehavior-Based ConsiderableConsiderable
monitoring ofmonitoring ofsalespeoplesalespeople
High levels ofHigh levels ofmanagerial directionmanagerial directionof salespeopleof salespeople
Subjective measuresSubjective measuresof salespersonof salespersoncharacteristics,characteristics,activities, andactivities, andstrategiesstrategies
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Dimensions of SalespersonDimensions of Salesperson
Performance EvaluationPerformance Evaluation
BehavioralBehavioralBehavioralBehavioral
ProfessionalProfessional
DevelopmentDevelopment
ProfessionalProfessional
DevelopmentDevelopment
ResultsResultsResultsResults
ProfitabilityProfitabilityProfitabilityProfitability
SalespersonSalesperson
PerformancePerformance
SalespersonSalesperson
PerformancePerformance
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Criteria for Performance EvaluationCriteria for Performance Evaluation
Behavior:Behavior: Activities performedActivities performed
Activities to promote long-term customerActivities to promote long-term customer
satisfactionsatisfaction
Sales callsSales calls
Customer complaintsCustomer complaints
Required reports submittedRequired reports submitted
Training meetingsTraining meetings
Letters and calls to prospectsLetters and calls to prospects
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Criteria for Performance EvaluationCriteria for Performance Evaluation
Professional Development:Professional Development:
Assess improvements in certainAssess improvements in certain
characteristics: traits, skills, knowledgecharacteristics: traits, skills, knowledge
AttitudeAttitude
Product knowledgeProduct knowledge
Initiative and assertivenessInitiative and assertiveness
Communication skillsCommunication skills
Ethical behaviorEthical behavior
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Criteria for Performance EvaluationCriteria for Performance Evaluation
Results:Results:
Measured objectively: sales, market shareMeasured objectively: sales, market share
Possible negative effectsPossible negative effects
Sales quotasSales quotas
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Elements Important inElements Important in
Assigning Sales QuotasAssigning Sales Quotas
Concentration of businessesConcentration of businesses
Geographic size of the territoryGeographic size of the territory
Growth of businesses within the territoryGrowth of businesses within the territory
Commitment by the sales manager to assistCommitment by the sales manager to assist Complexity of products soldComplexity of products sold
Past sales performancePast sales performance
Extent of product lineExtent of product line
Financial supportFinancial support
Amount of clerical supportAmount of clerical support
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Criteria for Performance EvaluationCriteria for Performance Evaluation
Profitability:Profitability: Specific products soldSpecific products sold
Prices negotiatedPrices negotiated
Expenses incurredExpenses incurred
CriteriaCriteria
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Performance Evaluation Methods:Performance Evaluation Methods:Characteristics any method should includeCharacteristics any method should include
Job RelatednessJob Relatedness
ReliabilityReliability
ValidityValidity
StandardizationStandardization
PracticalityPracticality
ComparabilityComparability
DiscriminabilityDiscriminability
UsefulnessUsefulness
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Performance Evaluation MethodsPerformance Evaluation Methods
Graphic Rating/Checklist MethodsGraphic Rating/Checklist Methods
Performance evaluation formPerformance evaluation form
Especially useful in evaluating behavioral andEspecially useful in evaluating behavioral and
professional development criteriaprofessional development criteria
Good on most characteristics, especially jobGood on most characteristics, especially jobrelatedness, standardization, practicality, andrelatedness, standardization, practicality, and
comparabilitycomparability
Disadvantage is providing evaluations thatDisadvantage is providing evaluations thatdiscriminate sufficientlydiscriminate sufficiently
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Performance Evaluation Methods:Performance Evaluation Methods:Ranking MethodsRanking Methods
Rank all salespeople according to relativeRank all salespeople according to relative
performance on each performance criterionperformance on each performance criterion
These methods force discrimination as to theThese methods force discrimination as to the
performance of individual salespeopleperformance of individual salespeople May be complexMay be complex
Rankings only reveal relative performanceRankings only reveal relative performance
evaluationevaluation
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Performance Evaluation Methods:Performance Evaluation Methods:Objective-Setting MethodsObjective-Setting Methods
Management By Objectives (MBO)Management By Objectives (MBO)
Mutual setting of well-defined and measurableMutual setting of well-defined and measurable
goals within a specified time period.goals within a specified time period.
Managing activities within the specified timeManaging activities within the specified timeperiod toward the accomplishment of the statedperiod toward the accomplishment of the stated
objectives.objectives.
Appraisal of performance against objectives.Appraisal of performance against objectives.
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Performance Evaluation MethodsPerformance Evaluation MethodsBehaviorally Anchored Rating Scales (BARS)Behaviorally Anchored Rating Scales (BARS)
Links behaviors to specific resultsLinks behaviors to specific results
Salespeople are used to develop performanceSalespeople are used to develop performance
results and critical behaviorsresults and critical behaviors
Positive feedback about behaviors may bePositive feedback about behaviors may bemore effective than positive output feedbackmore effective than positive output feedback
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BARS Scale:BARS Scale: Cooperative Relations with Other Sales TeamCooperative Relations with Other Sales TeamMembersMembers BehavioralBehavioral
Anchor StatementsAnchor StatementsCould be expectedCould be expected
to cooperate when aid is requested by other team members.to cooperate when aid is requested by other team members.
to go out of her/his way to help the team achieve its goals.to go out of her/his way to help the team achieve its goals.
to lend a helping hand and can be expected to try hard to help the team.to lend a helping hand and can be expected to try hard to help the team.
to occasionally support the team on problems encountered in the fieldto occasionally support the team on problems encountered in the field
to contribute half-heartedly to the team effort to accomplish goalsto contribute half-heartedly to the team effort to accomplish goals
not to care much about the team and its membersnot to care much about the team and its members
to antagonize members of the team and pull against the team goalsto antagonize members of the team and pull against the team goals
10
9
8
7
6
5
4
32
1
0
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Performance Evaluation BiasPerformance Evaluation Bias
Occurs when a managers evaluation of aOccurs when a managers evaluation of a
salesperson is affected by considerationssalesperson is affected by considerationsother than the specified criteriaother than the specified criteria
Common sources of bias:Common sources of bias:
Personal relationshipsPersonal relationships
Perceived difficulty of territoryPerceived difficulty of territory
Impression managementImpression management
Halo effectHalo effect
Outcomes biasOutcomes bias
F k f U i
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Framework for UsingFramework for Using
Performance InformationPerformance Information
Evaluate Salespeople against RelevantEvaluate Salespeople against RelevantPerformance CriteriaPerformance Criteria
Identify ProblemsIdentify Problems
Isolate CausesIsolate Causes
Determine SolutionsDetermine Solutions
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Salesperson Job SatisfactionSalesperson Job Satisfaction
Job satisfaction related to turnover, absenteeism,Job satisfaction related to turnover, absenteeism,
motivation, and organizational commitmentmotivation, and organizational commitment Job satisfaction may be related to performanceJob satisfaction may be related to performance
(direction of relationship is unknown)(direction of relationship is unknown)
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Salesperson Job SatisfactionSalesperson Job Satisfaction
INDSALESINDSALES measures satisfaction with:measures satisfaction with:
JobJob Fellow workersFellow workers
SupervisionSupervision
Company policy and supportCompany policy and support PayPay
Promotion and advancementPromotion and advancement
CustomersCustomers
Results may identify areas where manager mayResults may identify areas where manager mayintervene to improve job satisfactionintervene to improve job satisfaction