THE SALES MANAGEMENT PROCESS: Economic Analysis example: if an
SALES PLAN FORMULATION, SALES independent agent would receive 5%
PLAN commission on sales and company
salespeople would receive 3% and
IMPLEMENTATION, and SALESFORCE
company salespeople, sales administration
EVALUATION
costs would have a fixed cost of $ 500,000
per year. At what sales level would
Sales plan formulation independent or company salespeople be
Setting objectives less costly?
Organizing the salesforce
Developing account management
policies.
Sales plan implementation
Salesforce recruitment and selection
Salesforce training
Salesforce motivation and
compensation If sales are below 25mm, hire an agency,
and If above, use a company salesforce.
If using their own salesforce, a company
Salesforce evaluation needs to also do a behavioral analysis -
Quantitative assessment should the company organize the salesforce
geographically, by customer type, or by
Behavioral evaluation
product or service?
The sales management process involves ___________________________________
sales plan formulation, sales plan ____
implementation, and salesforce evaluation.
SALES FORCE LEADERSHIP
Sales Plan - a statement describing the
Sales Force Ethics
what is to be achieved and where and how
the selling effort of salespeople is to be TO LOOK OR NOT TO LOOK
deployed.
Assume you are taking a make-up final
Involves setting objectives, organizing the exam in separate room and you need an A
salesforce, and developing account to pass the course, otherwise you might
management policies. o Setting Objectives - have to go to summer school and delay
the objectives must be set in terms of graduation for three months, You are 99%
volume of new customers, sales calls, certain that your professor will not check in
selling expenses, product knowledge, and on you while you are taking the test and you
customer service have textbook and notes in your book bag,
which is sitting next to you on the floor. You
Organizing the Salesforce -must decide if
are stumped on a few questions (enough so
they will use its own salesforce of an
that you probably won’t get your A). If you
independent agent - analysis is made based
looked in your notes and text, you would
on economic and behavioral factors.
answer them correctly.
Do You look? Greed
Reputation
TO LOOK OR NOT TO LOOK
Other?
Assume the same situation, but that if you Case – Defining Moment
got you’re a on the test you would receive $ You are the regional sales manager
5,000 (in addition to graduating). of a technology-based firm.
Stacy, one of your branch
Now would you look in your notes? managers, wants to fire Kathy, a
Metronic’s Ties to Spine Doctors Attract salesperson you hired last year, for
Scrutiny underperformance (lack of territory
development).
Congress Investigate Payments to While there are no formal quotas,
Consultants; the other salespeople have had
Queries Also Cover Complication Linked to double-digit revenue growth
Unapproved Procedures recently, while Kathy has
experienced 8% growth.
“Former employees have alleged the Kathy works 40 hour weeks,
company induced doctors to use Infuse and however, everyone else puts in
other spine products by sending them on about 50-60 hours per week.
lavish trips to resorts, paying them Kathy is devoted mother with full
undeserved royalties, and handing out custody of her 5-year-old daughter
lucrative consulting contracts that required and no child support or other
little work.” assistance from her ex-husband.
(David Armstrong, Wall Street, Journal, Oct You are the regional sales manager
3, 2008) of a technology-based firm.
Stacy, one of your branch
CVS Suppliers Pay for Face Time With managers, wants to fire Kathy, a
Company Execs salesperson you hired last year, for
underperformance (lack of territory
Greg Norman, left, talks with CVS President development).
Tom Ryan, second from right, as others While there are no formal quotas,
look on during the 6th Annual CVS Charity the other salespeople have had
Classic in 2004. double-digit revenue growth
recently, while Kathy has
The company’s ethics policy is supposed to experienced 8% growth.
keep vendors from using fancy gifts to win Kathy works 40 hour weeks,
favor with CVS execs. But the rules don’t however, everyone else puts in
apply to the company’s annual charity golf about 50-60 hours per week.
tournament, where vendors pay big bucks Kathy is devoted mother with full
for trips with key CVS executives, custody of her 5-year-old daughter
and no child support or other
Examples of Pressures Facing Sales assistance from her ex-husband.
Managers Do you allow Stacy to fire Kathy
because everyone else has been
Incentives to provide favorable
working longer hours, experienced
earnings reports
double-digit growth, and future
High rewards for short –term profits
at expense of long-term growth
competitive pressures on the
company would be intensifying?
Or do you say “no” because the
company executives believe in
creating a “family-friendly”
organization and you now have a
chance to do something tangible to
support this culture?
Influences in Ethical Decision Making
SELF
Workplace
Coworkers
Managers
Ethical Policies
Community
Ethical norms
Culture
Profession
Legal System
Law
Punishment
Religion
Family
Ethical Checklist
Recognize the Dilemma
Get the Facts
List the Options
Make Your Decision
Common Sales Ethics Issues
Hiring and Firing
House Accounts
Expense Accounts
Gifts for Buyers
Bribes
Entertainment
responsible for compliance
with federal regulations.
Fair Packaging and Labeling Act
– Standard package sizes and
disclosure of the
manufacturer’s or
distributor’s name.
Consumer Credit Protection Act
– Illegal for loan companies
and retailers to avoid
misleading consumers.
Eight Ways to Keep You Sales Force
Honest
1. Get support from top
management showing that they
expect you to follow the spirit and
letter of the law.
2. Develop and distribute a sales
ethics policy.
3. Establish the proper moral
climate. If the bosses follow the
rules, then the troops are apt to
do likewise.
4. Assign realistic sales goals.
People who try to meet an unfair
quota are more likely to
Consumer Protection Laws rationalize their way to a kickback
Clayton Antitrust Act scheme.
– Prohibits price discrimination, 5. Set up controls when needed.
certain exclusive dealing Watch people who live above their
arrangements, and mergers income.
which may substantially 6. Suggest that salespeople call for
reduce competition or create help when they face unethical
a monopoly. demands.
Magnuson-Moss Warranty Act 7. Get together with your
– Illegal for salespeople to competition if payoffs are an
coerce customers into industry problem.
purchasing replacement 8. Blow the whistle if necessary.
components at higher prices
than a third party could
provide by threatening the Honesty
buyer that such action would “The reputation of a thousand years
void the product’s warranty. is determined by the conduct of one
Federal Sentencing Commission for hour.”
Organizations Japanese Proverb
– Holds both the employee
and the employee’s company
“There is no pillow as soft
as a clear conscience.”
Blanchard and Peale
“When in doubt, tell the truth.
It will confound your enemies
and astound your friends.”
Mark Twain
