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UNIT FOUR

MANAGEMENT OF SALES FORCE AND


CONTROL

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3.1 Sales manager job Responsibility, strategy and
tactics-Sales and marketing planning
Introduction
• Sales management is one of the most complex and
challenging job in an organization.
• Sales volume, revenue and profit are the life blood of an
organization.
• Sales manger has been aptly called “the person with
three hats” like
• Responsibility for achieving reasonable profit on sales
through marketing and sales management expertise.
• Responsible to the sales force for representing their
interests to the management
• Responsible to the customers, for maintaining best
possible customer relation. 2
Areas of Responsibilities sales manager
Managing the sales functions
• This involves sales planning, policies, control of
sales operations, design proper distribution
network and channels, and conduct market
analysis.
Managing the sales force
• These involve sales force planning, recruitment,
selection, training, motivation, compensation,
coordination and control.
3.2 Sales force planning-Recruitment, selection
A. Sales force planning- Job analysis
• Planning is bridging the gap between the present and the
future.It is the primary function of any management
activity, and begins with the determination of the
objectives of the organization, i.e. deciding the future
course of action.
• Planning is all pervasive. It is essential at all levels of
management, and includes objectives, strategies, policies,
procedures and programmes.
• Planning basically involves foreseeing and decision
making.
• Job analysis is the process of collecting the relevant job
information and determining the component elements of a
job by observation and study.
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• It is the process of determining the pertinent
information related to a specific job, and the record of
such a process.
• Job analysis is the fundamental method through which
proper manpower management can be done.
• Job analysis is study of the activities of an employee
on a job to determine different operations which may
help in job description and job specification.
• It helps in the preparation of specifications for
recruitment, placement, selection, training and guidance
of employees.
• Job analysis as a report can help in time and motion
study also.

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• The job description ( means describing duties and
responsibilities of a particular job).
• It includes the job title, job number, function of the job
and the responsibilities involved.
It covers the following in regards to each job.
• Job objectivities.
• Relationship with other jobs.
• Duties and responsibilities
• Job performance criteria.
• Job specification means for selecting the best persons
for the best performance.
• Job evaluation means each job are identified measured
so that the determination of the remuneration.
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• As for example, job description of a sales job consists of
the following aspects
Sales
• Make regular calls
• Sell demonstrate
• Handle questions and objections.
• Check stock etc.
Service
• Install product or display.
• Report product weakness etc.
Territory Management
• Arrange route for best coverage
• Maintain
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sales portfolios, sample etc. 7
Sales promotion
• Develop new prospects and accounts
• Distribute pamphlets, posters etc.
Execution
• Each night make plan for next day’s work
• Organize visit plan with minimum travel time and maximum
calls.
• Attend sales meetings.
Good will
• Counsel customers on their problems
• Maintain loyalty for company
• Attend customers meet etc
Job Specification:- is the statement stipulating the minimum
desired qualification and experience a person must posses
to suit the job description.
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• Certain products need in depth knowledge so that
sales men could answer “questions and objections
raised by the prospects”. In such case, Salesman must
have required technical qualification in the appropriate
discipline of the product like engineering,
Pharmaceutical or agriculture as the case may be.
B. Recruitment
• Recruitment is the process of identifying the sources for
potential candidates and to motivate them to apply for
jobs.
• Proper steps should be taken to have the right type of
people in the right number and at the right time.

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The following steps to develop the sales force
recruitment
• Recruitment is necessary for taking care of vacancies
arising out of the following.
• Expansion programme
• Compensate attrition due to retirement, sickness and
death
• To take care of personnel turnover in the departments.
• If Turnover rate of sales department is very high. This is
due to unique working conditions due to unsettled nature
of work involving extensive travel and attend
psychological stress.
• Scope of job opportunity high with better pay and perks
offered by other firms desperately looking for
experienced hands in sales.
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Sources of Recruitment
1.Sources within the company
A. Recommendations from company sales personnel
B. Recommendations from other company employees
C. Through transfer from other departments/divisions /
units of the firm.
advantage
• The person who apply to the firm are generally
familiar with the firm, its products and policies
either directly or through the contact of company
employees who recommend their names.

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2. Sources outside the company
A. Direct unsolicited applications
These are volunteers, who applied for positions
without advertisement.
B. Employment Agencies and consultants.
C. Trade association and clubs
D. Educational Institutions etc..
E. Retired persons etc.
• Now, the advanced countries like USA, Japan,
Germany etc are following this system.
• The reason is those who are more efficient and
retired persons especially handled in the productive
and sales oriented and sales force like marketing
executives/ managers etc. 12
Recruitment Methods
Internal source Search
1. Bulletins/ posters of internal circulation
2. Memos circulated among the supervisors
3. Word of mouth
4. Review of personal data bank like jobs.com
External Sources of search
1. Direct method
• Scouting, campus recruitments etc
2. Indirect method (advertisements like news papers,
TV and Radio etc.
3. Third Party methods
• Employment Exchanges, Personal calls. Consultants
etc. 13
C. Selection process
1.Objectives and polices
• This includes identification of department or section
which is entrusted with this task and corresponding
authority delegation and responsibility allocations.
2.Selection Criteria
• This involves laying down performance criteria of job
like job analysis (job description and job specification)

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3. Selection process
• This involves discrete or comprehensive step is
needed, such as receipt of formal application,
interview, tests etc.
4. Decision making
This involves the decision of selecting the
right candidate and rejecting the wrong
candidate.
4. Communication
Results will be communicated to the those
who are selected in various methods.
3.3 Sales force Process-ACMEE
• This approach is profunded by the R. Kipling.
• Aim: It must have some purpose or objective.
• Aims vary with the nature and type of training needs, required for
a given organization and employees.
• Sales related marketing polices, job analysis. Individual sales
personnel back ground and experience.
C-Contents
• Content of training programme derived out of specific aim or
objective which obtained by analyzing the training needs of
sales persons.
• Since nature of product and type of business vary from
organization to organization, the contents to training also vary
from firm to firm.
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M-Method
There are numbers of training methods.
1. Lecture method and demonstration inside and
out side the organization.
2. Conferences and seminars
3. Case study and discussions
E- Execution
• Execution of training answers the following
four questions
• Who are the trainees?
• Who are the trainers
• When will the training take place.
• Where does the training get imparted
E- Evaluation.
• This step assists to detect the deficiencies.
• Feed back assist the control mechanism to correct the
deficiencies to that laid down objectives are achieved
in full.
• If necessary changes or modifications are introduced in
the organizations as per their convenient.
3.4 Sales force-Motivation and compensation.

• Motivation means is “ an energizer of human


behavior”.
• Motivation is the willingness to exert high level of
effort towards organizational goals, conditioned by
the effort and ability to satisfy some individual’s
need”.
• Motivation is general term applying to the entire
class of drives, desires, needs, wishes, and similar
forces.”

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3.5 Prospects of motivating sales personal
1. Interdependency and motivation
• In conventional concepts of power authority
relationship, superior has authority and power to
gives order and subordinates have obey “Concept”.
• In the case of sales persons power-authority-
relationship under goes changes.
• Whether or not the orders are accepted and
implemented by sales persons depend on the
“Interdependent relationship” between the
superior and subordinate.
2. Leadership style: Effective sales manager/executive
is “leader” not at “ boss” to his team of salesman. 20
 They motivate the subordinates by meeting their
individual aspirations and satisfying their ego though
their work.
 There are three leadership styles, out of these styles, the
participative leadership is always suitable to motivate the
subordinates.
 This style creates self-confidence among workers and
helps the leader to win the confidence.
 Loyalty and cooperation of all the subordinates.
3. Communication
• Effective communication assist motivation and
direction.
• Communication solves problems-both organizational
and personal.
• Two way communications assist other managerial
functions like co-ordination and control.
4. Industrial Relations and unionism
• Unionism is not popular with sales persons.
• This is because of their dispersed locations and nature of
work which is more individualistic rather than a
group activity.
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• Good industrial relations improve the motivations level
of employees.
• In Ethiopia labor proclamation 377/2003 is there, the
labor law to protect the employees in all the ways.
3.6 Sales compensation plan, features, principles and
objectives
• Sales incentives are for improving motivation levels
of sales person.
• Generally all the sales persons are motivated in these
methods like financial incentives,non-financial
incentives or both.
• Money is a powerful motivator. Compensation of
sales is based on the incentives.
Principles
1. Provide a living wage
2. Compatible with other motivational plans existing/
proposed.
3. Equity and fairness.
4. Easy to understand and implement.
5. Rewards are directly related to performance.
6. Meets the overall objectives of the organization .
3.7 Classification of sales compensation plans and types
• Sales compensation plan is a financial incentive scheme for
sales persons.
A. Pure salary
• This is the simplest form of method.
• These persons are paid monthly salaries.
• This system was popular and oldest method.
• However, some firms, even now use this system especially
those engaged in sales promotion and training activities
such as demonstration and such other non selling jobs.
• The main advantage - the stability of income and freedom
from financial risks and uncertainties to the sales men.
• One drawback - no incentive to improve sales.
• no encouragement of efficiency employees
B. Pure commission: is paid commission amount depends on
sales volume.
• This is an incentive scheme which is directly linked to the
productivity and sales efforts of individual sales persons
Various methods of commission systems are there.
• Like straight commission, differential commission,
commission which include sales expenses and excluding
sales expenses etc.
• The main advantage is merit is fully consideration.
Depend on efficiency and effectiveness.
• One drawback is no guarantee of minimum wage.

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C. Combination of salary cum commission plan
• This system is minimizes the pure salary and
commission based plan.
• Security of stable income
• Merit is recognized and rewarded greatly.
• Increases mutual trust and goodwill.
• limitation is the fixation of salary or commission not
uniform nature.
• Some organizations are following the ratio salary and
commission is 20:80 where as some of the organizations
are following 40:60.
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D. Fringe Benefits
• Those benefits are supplied by an employer to or for the
benefits of an employee, and which are not in the form of
wages, salaries, and time rated payments”.
• Hence fringe benefits are very essential prerequisite to
maintain high morale of sales persons.
There is no standard list of fringe benefits
• To create and improve sound industrial relation.
• To boost up employee morale.
• To provide quality work environment and work life.
• To provide health measures to the employees against
accidents.
Examples
• General: Company cars, specified parking lots,
furnishing housing etc.
• In addition to that paid holidays
• Leave travel concessions.
• Sick leave
• Maternity leave for women workers
• Life insurance
• Medical reimbursement and pension scheme after
retirement, profit sharing etc.
3.8 Reimbursement of sales expenses policy,
principles and methods
Reimbursement policy
A. Sales persons to pay their own expenses: sales
persons do better control their own expenses, most
economical, simple with least maintenance.
B. Company to pay part of their expenses
• This policy is very popular with most of the firms.
• When expenses are reimbursable, management must
make necessary control mechanism.
• Generally, the management is concentration these
aspects like mode travel, managerial ability,
nature of the business etc.
C. Company pays the entire expenses of sales
persons-Here the management paid fully amount
according to the employee’s requirement.
Reimbursement methods
1.Flat expense account
• The management is paying flat amount irrespective of
expenditure.
• This is standard system.
• Every month the management this amount credited to the
concerned employees account.
2.Flexible expenses account:
• management will reimburse according to the employees
requirement.
• What they are submitted to the management by way
of bills or vouchers, the management will reimburse to
the particular employee. 31
3.Honor system
• Here sales expenses are fully reimbursed.
• sales persons need not have to submit detailed documents.
• management must have full confidence or trust on sales persons.
One draw back- no control about this expenditure because not
audit of their documents.
4.Expenses Quota
• Management having studies the territory and type of prospects
and customers, fix an upper ceiling of expenses for a given
period.
• Having fixed the ceiling, the salesman is now free to incur
expenses at variable levels during the interval.
• As for example having fixed a monthly quota, he is now free to
spend at different rates in each week, as long as monthly ceiling
does not exceed.
• Here expenses are fully reimbursed.