Sales ManagementSales ManagementLeadership and SupervisionLeadership and Supervision

Module SevenModule Seven

The Importance of LeadershipThe Importance of LeadershipAn Expert’s Viewpoint:An Expert’s Viewpoint:

Regan Lancaster, vice president of global sales at i2 Regan Lancaster, vice president of global sales at i2 Technologies uses conventional and unconventional Technologies uses conventional and unconventional tactics to lead his salespeople. He offers substantial tactics to lead his salespeople. He offers substantial incentive-based pay and promotion opportunities. In incentive-based pay and promotion opportunities. In addition, he has dressed as a superhero and staged a addition, he has dressed as a superhero and staged a mock battle against competitors, motorcycled through a mock battle against competitors, motorcycled through a brick wall, and repelled down a four story building to brick wall, and repelled down a four story building to inspire his salespeople.inspire his salespeople.

ActionAction

The Importance of LeadershipThe Importance of LeadershipAn Expert’s Viewpoint:An Expert’s Viewpoint:

Lancaster’s leadership is paying dividends. During his Lancaster’s leadership is paying dividends. During his first seven years at i2, revenues have increased more first seven years at i2, revenues have increased more than 750 percent. In 2000, i2 had a record-breaking than 750 percent. In 2000, i2 had a record-breaking year for e-business with revenues of $1.1 billion.year for e-business with revenues of $1.1 billion.

ResultResult

What is the Difference Between What is the Difference Between Leadership and Supervision?Leadership and Supervision?

Leadership:Leadership:The use of influence with other people through The use of influence with other people through communications processes to attain specific goals communications processes to attain specific goals and objectivesand objectives

Supervision:Supervision:The day-to-day control of the salesforce under The day-to-day control of the salesforce under routine operating conditionsroutine operating conditions

Sales Force Socialization (Revisited)Sales Force Socialization (Revisited)

Task-Specific Self-Esteem:Task-Specific Self-Esteem:The extent to which an individual believes s/he can The extent to which an individual believes s/he can perform a task competentlyperform a task competently

Organizational Commitment:Organizational Commitment:The extent to which an individual feels a bond to the The extent to which an individual feels a bond to the organizationorganization

Formalization:Formalization:The extent to which work activity is directed by rules, The extent to which work activity is directed by rules, regulations, and commitmentregulations, and commitment

Sales Force Socialization (Revisited)Sales Force Socialization (Revisited)

Work Alienation:Work Alienation:An individual's psychological separation from the An individual's psychological separation from the activities of the jobactivities of the job

Job Involvement:Job Involvement:– An individual's psychological attachment to the An individual's psychological attachment to the

job itselfjob itself

Contemporary Views ofContemporary Views ofSales LeadershipSales Leadership

• Leader-Member Exchange (LMX) ModelLeader-Member Exchange (LMX) Model• Transformational LeadershipTransformational Leadership• Behavioral Self-Management (BSM)Behavioral Self-Management (BSM)

Leadership Model for Sales ManagementLeadership Model for Sales Management

SituationTime ConstraintsNature of TasksHistory and Norms

NeedsSalespeopleOther People

LeadershipSkillsAnticipationDiagnosticSelectionCommunication- Influence Strategy- Communications Mechanisms

PowerSalespeopleOther People

PowerSales Manager

Goals &ObjectivesIndividualOrganizational

SalesManager’sLeadership

Effectiveness

Power and Leadership Power and Leadership

Five types of power which may be present Five types of power which may be present in interpersonal relationships:in interpersonal relationships:

Referent PowerReferent Power

Legitimate PowerLegitimate Power

Reward PowerReward Power

Coercive PowerCoercive Power

Expert PowerExpert Power

• Trait ApproachTrait Approach• Behavior ApproachBehavior Approach• Contingency ApproachContingency Approach

Situational FactorsSituational Factors

• Important when Important when coercive powercoercive power is not being is not being utilizedutilized

• Realize all needs and wants cannot be metRealize all needs and wants cannot be met• Not all leadership directives need to be based Not all leadership directives need to be based

on needs and wantson needs and wants• Consider each salesperson as a unique Consider each salesperson as a unique

individualindividual

Needs and Wants of SalespeopleNeeds and Wants of Salespeople

• Leadership is easier when personal goals and Leadership is easier when personal goals and objectives of the salespeople are consistent objectives of the salespeople are consistent with those of the organizationwith those of the organization

• Sales managers strive to seek balance and Sales managers strive to seek balance and consistency between organizational goals and consistency between organizational goals and their salespeople’s goals.their salespeople’s goals.

Goals and ObjectivesGoals and Objectives

• The ability to anticipate problemsThe ability to anticipate problems

• The ability to seeking and obtain substantive The ability to seeking and obtain substantive feedbackfeedback

• The ability to diagnose problems and The ability to diagnose problems and opportunitiesopportunities

Leadership SkillsLeadership Skills

• The ability to select an appropriate The ability to select an appropriate leadership behavior and match it to the leadership behavior and match it to the situationsituation

• The ability to communicate effectivelyThe ability to communicate effectively

Leadership SkillsLeadership Skills

Communication Skills:Communication Skills:Influence StrategiesInfluence Strategies

• Threats Threats (coercive power)(coercive power)• Promises Promises (reward power)(reward power)• Persuasion Persuasion (expert or referent power)(expert or referent power)• Relationships Relationships (referent or legitimate power)(referent or legitimate power)

• ManipulationManipulation

• Take a we approachTake a we approach• Address only one or two problems at a timeAddress only one or two problems at a time• Don’t focus on criticizing poor performance, reinforce good performanceDon’t focus on criticizing poor performance, reinforce good performance• Foster involvementFoster involvement• Recognize differences in salespeople and coach accordinglyRecognize differences in salespeople and coach accordingly• Coordinate coaching with more formal sales trainingCoordinate coaching with more formal sales training• Encourage continual growth and improvementEncourage continual growth and improvement• Insist salespeople evaluate themselvesInsist salespeople evaluate themselves• Obtain agreement with respect to punishments and rewardsObtain agreement with respect to punishments and rewards• Keep good recordsKeep good records

CoachingCoachingThe continuous development of salespeople through The continuous development of salespeople through supervisory feedback and role modeling. Suggestions for supervisory feedback and role modeling. Suggestions for affective coaching include:affective coaching include:

Planning and ConductingPlanning and ConductingIntegrative MeetingsIntegrative Meetings

• Keep technical presentations Keep technical presentations succinctsuccinct

• Use visual aids and breakout Use visual aids and breakout discussion groupsdiscussion groups

• Keep salespeople informed of Keep salespeople informed of corporate strategy and their role in itcorporate strategy and their role in it

• Minimize operations reviewMinimize operations review

Planning and ConductingPlanning and ConductingIntegrative MeetingsIntegrative Meetings

• Set a humane schedule . . . allow Set a humane schedule . . . allow time for sharing and adequate time for sharing and adequate breaksbreaks

• Set and communicate the agendaSet and communicate the agenda• Ask for input from the salespeopleAsk for input from the salespeople• Generate excitement with contests Generate excitement with contests

and other rewardsand other rewards

Approaches to Management EthicsApproaches to Management Ethics

Immoral ManagementImmoral Management– Intentional and consistent management activity Intentional and consistent management activity

conflicting with what is moral (ethical).conflicting with what is moral (ethical).– Exploits opportunities for corporate gain. Cut corners Exploits opportunities for corporate gain. Cut corners

when it appears useful.when it appears useful.– Seeks profitability and organizational success at any Seeks profitability and organizational success at any

price.price.– Selfish. Management cares only about its or the Selfish. Management cares only about its or the

company’s gain.company’s gain.

Approaches to Management EthicsApproaches to Management Ethics

Amoral ManagementAmoral Management– Management activity that is neither consistently moral or Management activity that is neither consistently moral or

immoral . . . Decisions lie outside the sphere to which immoral . . . Decisions lie outside the sphere to which moral judgments apply.moral judgments apply.

– Give managers free rein. Personal ethics may apply but Give managers free rein. Personal ethics may apply but only if managers choose. Respond to legal mandates if only if managers choose. Respond to legal mandates if caught and required to do so.caught and required to do so.

– Seeks profitability. Other goals are not considered.Seeks profitability. Other goals are not considered.– Well-Intentioned but selfish in the sense that impact on Well-Intentioned but selfish in the sense that impact on

others is not considered.others is not considered.

Approaches to Management EthicsApproaches to Management Ethics

Moral ManagementMoral Management– Management activity conforms to a standard of ethical Management activity conforms to a standard of ethical

or moral behavior.or moral behavior.– Live by sound ethical standards. Assume leadership Live by sound ethical standards. Assume leadership

position when ethical dilemmas arise. Enlightened self-position when ethical dilemmas arise. Enlightened self-interest.interest.

– Seeks profitability within the confines of legal obedience Seeks profitability within the confines of legal obedience and ethical standardsand ethical standards

– Management wants to succeed but only within the Management wants to succeed but only within the confines of sound ethical precepts.confines of sound ethical precepts.

Meeting Ethical andMeeting Ethical andMoral ResponsibilitiesMoral Responsibilities

Sales managers should be aware of three particularly relevant types of unethical acts:

1.Nonrole

2.Role Failure

3.Role Distortion.

Meeting Ethical andMeeting Ethical andMoral ResponsibilitiesMoral Responsibilities

Nonrole Against the firm • Expense account cheating• Embezzlement• Stealing supplies

Type Direct Effect Examples

RoleFailure

Against the firm • Superficial performance appraisal

• Not confronting expense account cheating

• Palming off a poor performer with inflated praise

Meeting Ethical andMeeting Ethical andMoral ResponsibilitiesMoral Responsibilities

Type Direct Effect Examples

Role Distortion

For the firm • Bribery• Price fixing• Manipulation of suppliers

Problems in LeadershipProblems in Leadership

• Conflicts of InterestConflicts of Interest• Chemical Abuse and DependencyChemical Abuse and Dependency• Problem Salespeople: A Disruptive InfluenceProblem Salespeople: A Disruptive Influence

– Lone Wolf Lone Wolf – Corporate CitizensCorporate Citizens– Institutional StarsInstitutional Stars– ApatheticsApathetics

• Termination of EmploymentTermination of Employment• Sexual HarassmentSexual Harassment