Sales Organization

An Organization is simply an arrangement , working structure of activities involving group of people. The goal is to arrange these activities so that the people involved can act better together than they can individually Sales organizations are structural entities, which execute a combined sales plan and are designed to carry out mutually agreed business goals with clear structures, roles and responsibilities for each person, group and department

What does it do?

Defines duties, roles, rights and responsibilities of people engaged in selling activities. Managerial functions like recruitment, selection, training, motivation and manpower planning. Helps flow of upward and downward communication Inter departmental co-ordination Helps avoid duplication of work Efficiency and effectiveness

Types of organisation structure

Design By territory Design By function Design By product Design By customer Combined design

Factors influencing the structure.

Product and service related factors Organization related ( size, financial resources) Market factors: ( national, global) External factors ( competitors, etc)

Design By territory
VP Marketing National Manager Sales Divisional Manager (S) Regional sales Manager

Divisional Manager (East) Regional sales Manager

Divisional Manager (N) Regional sales Manager

District sales Manager

Sales staff ( city wise )

District sales Manager

Sales staff ( city wise )

District sales Manager

Sales staff ( city wise )

Features

On the basis of geographic territory Several areas are combined together to form a territory People are assigned to territories Advantages:

Closer to customer Quick service Market specific info to better launch programmes
Entire line should be sold by one person Resource allocation conflicts

Disadvantages:

Design By function
VP ( Sales And Marketing) Manager ( Sales promotion and Advertising) Manager ( Sales) Manager (Marketing research and IT)

(twenty Sales people )

Features

On the basis of staff and line function Staff authority aids to the line function Advantages:

Decision making is faster Expert advice Expensive Conflicts when staff heads communicate directly with field sales people

Disadvantages:

Design By product
VP ( Sales And Marketing) product manager (A)

manager (sales)

manager (Training)

manager (Promotion)

product manager (B)

manager (sales)

manager (Training)

manager (promotion)

Features

Basic assumption that one cannot sell complex equipment and locks Hi-tech companies use such structures Responsibility for the performance of their own products Advantages:

Products get more focus Quick response and high customer satisfaction Market information more accurate Expensive Duplication of efforts

Disadvantages:

Design By customer
VP ( Sales And Marketing) Manager (industrial customer) Manager ( government) Manager (Retail customers)

(Sales people )

(Sales people )

(Sales people )

Features

On the basis of customer profiles Different service delivery mix Nature and types of customer vary Advantages:

High customer retention Planning based on customer requirement

Expensive Controlling is difficult

Disadvantages:

Combined design

Large organizations selling wide range of products use such design The combination can be any of the above

Principles of organization design

Should be built around activities not people Should reflect marketing orientation Responsibility and authority should be related properly Span of control should be reasonable Should be stable but flexible Unity of command

Consider this

Cesars Palace is a prime property on Las Vegas strip attracting people from around the world and is a brand which has stood time. Currently they seem to face lack of team work which has led to poor co-ordination and lost high rollers for different casinos. There is a general manager who handles property and seven direct reports, the marketing department is divided into three divisions Far East marketing ( taking care of million dollar players from south pacific regions), National marketing (taking care of high rollers from US) and Casino marketing ( traditional promotional activities and advertising), hotel VP is responsible for front desk, housekeeping maintenance food and beverage service and so on operations VP is responsible for all gambling operations.

GM Property and seven direct reports

Far east marketing

National marketing

Casino marketing

Hotel VP

Operation VP

VP human resources

Chief financial officer