s 5 org and rec

Organising and Staffing

the Sales Force

Eagles don’t flock. You

have to find them one at

a time.

Yogi Berra

5

1

Session Objectives

Concepts of the sales organisation

Basic types of sales organisations

Alternative organizational approaches

To determine the size of the sales force by using various

methods

Sales force staffing processPlanning

Recruiting

Selecting

Hiring

2

7-3

Areas Impacted by a Firm’s Sales

Force Structure

Concepts of Sales Organisation

The basic concepts of the sales organisation are:

• Degree of centralisation

• Degree of specialisation

• Span of control

• Line or staff positions

• Market orientation

• Effective co-ordination

4

Sales Force Specialization Continuum

Specialists

Certain selling

activities for certain

products for certain

customers

Generalists

All selling activities

and all products to

all customers

Some specialization

of selling activities,

products, and/or

customers

5

Tall Sales Organization

National Sales

Manager

Span of Control

Managem

ent L

evels

Branch

Sales

Manager

Branch

Sales

Manager

Branch

Sales

Manager

Branch

Sales

Manager

Branch

Sales

Manager

Branch

Sales

Manager

Regional Sales

Manager

Regional Sales

Manager

Span of Control vs. Management Levels

6

7-7

Span of Control

Span of control: number of individuals that report directly to a

sales manager

Customized customer solutions result in narrower spans of

control

Routine trade sales and telemarketing activities allow broader

span of control

Span of Control Ratios (Rep:Manager)

National Sales Manager

Regional Sales Managers

Branch Sales Managers

Product Manager

Sales Training Managers

District Sales Managers

Staff Position

Line Position

Line vs. Staff Positions

8

Customer and Product Determinants

of Sales Force Specialization

Simple

Product

Offering

Complex

Range of

Products

Customer Needs Different

Customer Needs Similar

Market-

Driven

Specialization

Product/Market-

Driven

Specialization

Geography-

Driven

Specialization

Product-

Driven

Specialization

Selling Situation Contingencies

9

Geographic Sales Organization


Branch Sales Managers (4) Branch Sales Managers (4)

District Sales Managers (20)

Salespeople (100) Salespeople (100)


Eastern Region Sales Manager Western Region Sales Manager

Sales Training Manager

10

Product Sales Organization


Office Equipment Sales Manager Office Supplies Sales Manager


Salespeople (100) Salespeople (100)


11

Market Sales Organization


Zone Sales Managers (4)


Salespeople (150)


Commercial Accounts

Sales Manager

Government Accounts

Sales Manager

Sales Training

Manager

Salespeople (50)

12

Functional Sales Organization


Field Sales Manager Telemarketing Sales Manager

Regional Sales Managers (4)

Salespeople (160)

Salespeople (40)



13

Comparison of Sales Organization Structures

Organizational

Structure Advantages Disadvantages

Geographic

• Low Cost

• No geographic duplication

• No customer duplication

• Fewer management levels

• Limited specialization

• Lack of management

control over product or

customer emphasis

Product

• Salespeople become experts

in product attr. & applications

• Management control over

selling effort

• High cost

• Geographic duplication

• Customer duplication

14

Comparison of Sales Organization Structures

Market

• Salespeople develop

better understanding of

unique customer needs

• Management control over

selling allocated to different

markets

• High cost


Functional• Efficiency in performing

selling activities


• Customer duplication

• Need for coordination

Organizational

Structure Advantages Disadvantages

15

Hybrid Sales Organization Structure


Major Accounts

Sales Manager

Regular Accounts

Sales Manager

Office Equipment

Sales Manager

Office Supplies

Sales Manager

Field Sales

Manager

Telemarketing

Sales Manager

Commercial Accounts

Sales Manager

Government Accounts

Sales Manager

Western

Sales Manager

Eastern

Sales Manager

16

Telemarketing

Customer contacts using telecommunication without

face to face contact.

Very cost-effective especially for smaller customers.

Cost per sales call around 6 to 8% of face to face

sales call.

Scope of telemarketing:

Prospecting and Lead Qualification.

Customer Service.

Smaller accounts.

Promotion Support

17

Telemarketing

Advantages

• Low cost per sales call

• Profitably serve small to medium customers

• Speed/time saving of telephone ordering

Challenges

• Acceptance by field salespeople

• Hiring the right person for the job

• Motivation and retention due to number of calls and lower salaries

• Do Not Disturb clause

Independent Sales Agents

Business entity contracted to perform the business of

selling in a given geographic area.

Do not take physical possession or ownership of the

products and are on commission basis.

Normally handle five to eight non-competing but

related products.

Major factors for decision are:Economic Consequences since there are no fixed costs

Management Control over agent’s time and process

Market Conditions – most suitable for new products or new

markets

19

Market Factors favouring DSAs

Fragmented Market

Decentralised Buying

Few Products

New Markets

For smaller lesser known companies

Short selling cycles and small value orders

No need for strong management control on sales process

No need for customer data base

20

8-21

5 Steps of a Comprehensive Recruiting

and Selection Process

Determine the number of salespeople needed1

Identify unique skills, knowledge, and attitudes salesperson needs2

Attract sufficient number of applicants3

Conduct interview process that accurately assesses qualifications4

Offer position to one or more applicants5

22

Recruitment and Selection Process

• Establish responsibility

for recruitment

• Determine number of

people wanted

• Company Culture

• Job Analysis

• Job Qualifications

• Job Description

• Recruitment &

Selection Objectives

• Recruitment &

Selection Strategy

• Internal Sources

• External Sources

• Screening Resumes

and Applications

• Initial Interview

• Intensive Interview

• Testing

• Assessment Centers

• Background

Investigation

• Physical Exam

• Selection Decision

and Job Offer

Planning for

Recruitment & Selection

Step 1

Recruitment: Locating

Prospective Candidates

Step 2

Selection:

Evaluation and Hiring

Step 3

23

Planning for Recruitment and Selection

Job Analysis:

Entails an investigation of the tasks, duties, and

responsibilities of the job.

Develop a statement of job qualifications

describing the personal traits and abilities to

perform in the job

Who should do the job analysis?

Current occupants of job

Sales Mangers

HR department through

observation

Planning for Recruitment and Selection

Job Description

A written summary of

the job containing the

job title, duties,

administrative

relationships, types of

products sold, customer

types, and other

significant requirements

like hiring qualifications.

Job Qualifications

Refers to the aptitude,

skills, knowledge,

personal traits, and

willingness to accept

occupational conditions

necessary to perform

the job.

24

25

DESIRABLE CHARACTERISTICS

Mental capacities (Problem solving, planning)

Physical characteristics (appearance, neatness)

Experience (Sales and other business experience)

Education (Degrees, Specializations)

Personality traits (Persuasiveness, adaptive)

Skills (Communication, inter-personal)

Socio-environmental factors (Interests, Activities,

Memberships)

26

Ten traits and abilities of top salespeople

Trait Related Ability

Ego strength To handle rejection

Sense of urgency To complete the sale

Ego drive To persuade people

Assertiveness To be firm in negotiations

Willingness to take risks To be innovative

Sociability To build relationships

Abstract reasoning To sell ideas

Sense of skepticism To question, to be alert

Creativity To sell complex products and ideas

Empathy To understand customer needs

Source: Erika Rasmusson, “The 10 Traits of Top Salespeople, “ Sales & Marketing Management, August 1999, pp. 34-

37.

27

Sources of Sales Force Recruits

Current

company

employees

Employment

Agencies

The

Internet

Educational

Institutes

Referrals

Recruiting

SourcesPart Time

Workers

Advertisements

Other

Companies

Also from job fairs

28

Recruiting Sources of Sales Reps

Source Comment

Referrals Advantage of known person. This is also rewarded

Current EmployeesThey are known and know the company and the

products

Other CompaniesEspecially competitors, suppliers and customers

know your company and products

The InternetWeb page recruiting; Internet recruiting sites;

Resume search services

Educational Institute Cost effective; building relationships

Advertisements Maximum response and cost; quality questionable

Employment Agencies Advantage of initial screening

Part time workers Specialist companies like MAFOI

Voluntary applicants Unsolicited applications

29

Recruiting Evaluation Matrix

Evaluation Criteria

Consistent

with

strategic

planning?Number

recruits

Number

hired

Percent

retained

after 3

yearsCost Frequency

of use

Rep’s per-

formance

after 2 yrs.

Recruiting

sources

Within company:

Sales force

Other departments

Competitors

Customers

Noncompetitors

Educational institutions

Advertisements

Employment agencies

Voluntary applicants

Computerized databases

Other companies:

8-30

Model for Selecting New Salespeople

Application Forms

Personal Data Forms help companies get

information on candidates in a structured manner.

31

Personal Experience Physical Environmental

NameWork

Ability to

perform job

related

physical

activities

Membership in

social and

service

organisations

Address and Phone

Reason for seeking

particular job

EducationPersonal Goals Hobbies and

InterestsReferences

32

Interviews

Types of interviewsInitial Interviews

Intensive Interviews

Stress Interviews

LocationsCampus

Recruiter’s Location (i.e. Plant Trip)

Neutral Site

Telephone

33

Personal Interviews

Most preferred for hiring of sales personsAnswers the following questions:

Is this person capable of excelling at the job?Is he really interested in this job?Will the job help in his goal realisation?Will he work to his full ability?

As much a tool for testing candidate’s past and working out his future plans as selling the position and company to the recruit

34

Personal InterviewsStructured interview

applicants are asked the same predetermined questionspotential weakness is that interviewer may fail to identify or probe a candidate’s unique qualities or limitations

Unstructured interview induces free discussion on wide ranging topics may yield unexpected insight requires experienced interviewers with interpretative skills

8-35

Other Interviews

Stress interview: places the applicant in

unstructured situation to see how well he/she

performs

Group interview: group of applicants placed in a

group or open forum and encouraged to ask

questions

Panel interview: placing a single applicant before a

panel of company representatives

Field observation: applicant travels with rep making

calls on current and potential clients

36

Suggestions for Improving Interviewing

Effectiveness

Have specific job specifications and qualifications

clearly in mind

Establish specific interviewing objectives

Provide some degree of structure

Allow adequate time

Be very familiar with application or resume information

Use standardized rating sheets after each interview

Use multiple interviews

Provide training and practice for the interviewers

Use the interview as an opportunity to learn more about

the candidate as well as to sell your company

37

An Excerpt from Xerox Campus Interview-

Evaluation Report

EVALUATION

(Circle Level)

(Does Not Meet

Xerox Standards)

(Meets Xerox

Standards)

(Exceeds Xerox

Standards)

Aggressiveness and

Enthusiasm1 2 3 4 5

Communication Skills 1 2 3 4 5

Record of Success 1 2 3 4 5

Rational Thought Process 1 2 3 4 5

Maturity 1 2 3 4 5

Overall Evaluation 1 2 3 4 5

Summary of Applicant’s Qualifications

Apparent Strengths:

Apparent Weaknesses:

Areas Requiring Clarification:

38

Testing: Value and Types

ValueMay be used to assist with initial screening

May indicate compatibility with job

responsibilities

May indicate compatibility with

organization’s culture and personnel

TypesPersonality

Intelligence

Psychological

Ethical Framework

39

Testing: Guidelines for Using

Use tests that have been based on a job

analysis for the particular job in questionDo not base the hiring decision solely on test resultsSome creative and talented people may deviate from expected normsIntelligent and “test-wise” individuals may be able to manipulate resultsSome tests may discriminate against people of different races, genders, et al – thus becoming illegal

40

Background Check

Be wary of first-party

references

Radial search referrals

might be used

Use an interview

background check

Use the critical incident

technique

Pick out problem areas

Obtain a numerical scale

reference rating

Identify an individual’s

best job

Check for idiosyncrasies

Check financial and

personal habits

Get customer opinion

41

Selection Decision and Job Offer

Evaluate qualifications in order of importance

Look for offsetting strengths and weaknesses

Rank candidates

If none meet qualifications, may extend

search

May have to offer market bonus (signing

bonus) to highly qualified candidates

42

Physical Examinations

Sales jobs require sound basic health, stamina and the physical ability to withstand stressCaution should be exercised in requiring medical examinations and other specific tests for such things as drug use or the HIV virusA physical exam can be performed only after extending a job offerManagers deem using a standard physical examination for all positions ill-advised

8-43

Making the Job Offer

Contact via phone

Follow up with first-class letter containing formal offer

of employment

IncludeDeadline for accepting the position

Info about responsibilities

Starting salary

Allowable moving expenses

Formal training dates

Time before first performance review

When rep will first be eligible for a raise

Number of vacation days

What Do Sales Candidates Want

to Know?

Sales candidates ask themselves

How financially healthy is the recruiting firm?

What is the firm’s track record?

What are their opportunities?

What will it take to succeed?

What is a realistic first-year income?

Is the product something customers want to buy?

Does the selling firm support sales efforts?

Is there a commitment to employee development?

8-44

Based on: Jeremy Cohen, “Natural Select-ion,” Sales & Marketing Management, September/October 2008, 26-27.

8-45

Avoiding Common Hiring Mistakes

Don’t Rush to Hire

Wrong rep hired

Backgrounds not diverse

Conduct Proper

Job Analysis

Identify essential skills, knowledge, and activities that new hire should possess to succeed

Generate Enough

Applicants

Have a large enough group of qualified individuals from which to select best applicants to interview and hire

Plan the Interview

Don’t interview “off the cuff”

Coordinate multiple interviewers

Conduct Thorough

Interview

Too often, sales mgrs ask a few questions and think their experience as a rep allows them to make accurate hiring decisions on the spot

Complete

Background Check

Up to 20% fabricate facts and accomplishments

Failing to check increases likelihood of hiring someone with dubious character

Next Session

AJAX CaseDeliverables

Single Sheeter by all students

Presentations by each group

Reading

Chapter 8

46

s 5 org and rec

Documents

sales forceeagles dont

control ratios rep

telemarketing activities

management levels67

certain products

geographic duplication

expertsin product attr

broader span of controlspan