CURTIN UNIVERSITYSchool of Marketing

SALES MANAGEMENT MAR22 - OUATake home EXAM

Study Period 2, 2011

DUE DATE: Week 14 – by 4PM (WST) Thursday 25 August 2011

Answer any FOUR of the following five questions. All questions carry equal marks.

1. List and discuss common problems that Sales Managers may encounter in dealing with unmotivated salespeople. Suggest possible course/s of action to deal with such salespeople.

Unmotivated staff

- Bad sales trainin,

2. Discuss the importance of sales training for both new and experienced sales people. What training methods would you employ for the two categories of salespeople.

3. List the importance of recruitment and selection of salespeople and discuss possible problems that you may encounter in selecting the wrong person for the job.

4. Explain why building customer relationships through the Internet is important?

Page 1 of 3 pages

5. Discuss the advantages and disadvantages of sales force automation (SFA).

INSTRUCTIONS:

1. Your answers must be typed, double-spaced, printed on one side of A4 paper with 2.5 cm margins on all sides.

2. Begin each question on a separate page and answer each question in no more than 500 words.

3. References from scholarly sources (peer reviewed academic journal articles) must be properly cited and included in the References list at the end of your exam paper (not after each answer) following the Chicago Referencing Style Guidelines (available at http://library.curtin.edu.au/. A minimum of 10 peer reviewed journal references in total are required.

4. Attach completed and signed Cover sheet and Assessment sheet.5. Send your completed exam paper by the due date and time to: OpenCurtin@curtin.edu.au

End of Exam Questions.

Page 2 of 3 pages

Sales Management MAR22 – OUAStudy Period 2, 2011

TAKE HOME EXAM COVER SHEET

Name: ____________________________________________

Student ID: ______________________________

Unit Coordinator’s Name: Dr. Tekle Shanka

Date submitted: ______________________________

If the given name by which your Unit Coordinator knows you differs from your name on University records, you should indicate BOTH names above.

Your take home exam should meet the following requirements.

Please confirm this (by ticking boxes) before submitting your assignment.

Exam is word processed and double spaced

Pages have been consecutively numbered and identified

A copy of the exam has been retained by me

Spelling and grammar checks have been conducted and corrections made

Word Count _____________

Declaration below is complete

All forms of plagiarism, cheating and unauthorized collusion are regarded seriously by the University and could result in penalties including failure in the course and possible exclusion from the University. If you are in doubt, please contact your Unit Coordinator or your Course Coordinator.

Declaration

Except where I have indicated, the work I am submitting in this assignment is my own work and has not been submitted for assessment in another Unit or course. I warrant that any diskettes and/or computer files submitted as part of this assignment have been checked for viruses and reported clean.

________________________________________

[Signature of student]

Page 3 of 3 pages

SALES MANAGEMENT MAR22 - OUAStudy Period 2, 2011

Take Home Exam Assessment Sheet

_______

CONTENT Below Acceptable

Excellent

1. Demonstrates an ability to research and discuss the theory associated with the topic.

1 2 3 4 5 6 7 8 9 10

2. Introduces appropriate concepts related to the topic.

1 2 3 4 5 6 7 8 9 10

3. Uses good examples to illustrate key points.

1 2 3 4 5 6 7 8 9 10

4. Relevance of discussion (answers the question)

1 2 3 4 5 6 7 8 9 10

5. Demonstrated a clear understanding of and insight about the topic.

1 2 3 4 5 6 7 8 9 10

CLARITY

6. Includes a concise introduction that emphasizes key points made.

1 2 3 4 5 6 7 8 9 10

7. Presentation of assignment clear and neat (including structure of writing)

1 2 3 4 5 6 7 8 9 10

8. Includes a concise conclusion that emphasizes key points made.

1 2 3 4 5 6 7 8 9 10

9. Chicago referencing style used 1 2 3 4 5 6 7 8 9 10

10. Use of in-text references 1 2 3 4 5

11. Minimum of 10 peer reviewed journal references

1 2 3 4 5

Mark /100

1. _________________________________________________________________________

2. _________________________________________________________________________

3. _________________________________________________________________________

Page 4 of 3 pages

1. List and discuss common problems that Sales Managers may encounter in dealing with unmotivated salespeople. Suggest possible course/s of action to deal with such salespeople.

Problems:1. Ineffective sales training, bad leadership technique.http://www.guardian.co.uk/public-sector-training/line-manager-support2. Career plateauing > no career growthCoping With a Career Plateau: An Empirical Examination of What Works and What Doesn't1Rotondo, Demise M. Perrewe, Pamela L.Journal of Applied Social Psychology, 2000, Vol.30(12), p.2622-2646 [Peer Reviewed Journal]3. Unproductive workers > lack of incentives and rewards, impossible targets

4. Sales manager not respected as authority > Bad leadership style5. Lack of communication

Solutions:1. Leadership style improve > 1 and 42. Improved training methods (interesting)3. Improve incentives and rewards, make targets achievable4. Provide career growth opportunities

Coping With a Career Plateau: An Empirical Examination of What Works and What Doesn't1Rotondo, Demise M. Perrewe, Pamela L.

Journal of Applied Social Psychology, 2000, Vol.30(12), p.2622-2646 [Peer Reviewed Journal]

1. Improve communication and feedbackImprove employee feedback.(Addressing management issues)

Motivation is defined as a set of dynamic interpersonal processes that cause the initiation, direction, intensity, and persistence of work-related behaviors of subordinate salespeople toward the attainment of organizational goals and objectives. As unmotivated sales people can major impacts on the profits and productivity of a company, it is necessary the sales managers implement strategies to correct such occurances.

Unmotivated staff can exist in all areas of an employee’s career, including the start, middle and end. At the start of an employees career they may be unmotivated due to ineffective training. This could be the result an enthusiastic trainer or lack of structure to the planning regime . According to a study by KnowledgePool shows that a quarter of all training is ineffective, emphasizing the need to ensure training promotes motivation to the staff to maintain interest. Dr Phyllis Tharenou states that participation in training dramatically increases when positive reinforcement is promoted to staff. Using dual factor, sales managers could

Page 5 of 3 pages

show that this is due to new employee seeing quality training as a hygiene factor and with its absence has caused dissatisfaction.

During a sales persons career they may encumber sales managers with ineffective leadership styles. Bad leadership can cause employees to rebel against sales managers and be uninspired to work productivity or exceed sales targets. This is often the scenario if the sales manager is a new employee or recently promoted. Maslow hierarchy of these employees may be experiencing a lack of motivation because the present sales managers hasn’t gave them the job safety desired to pursue higher on the hierarchy.

This is also the case if the salespeople are receiving a straight salary compensation with no rewards. The result of this will be salespeople who are not willing to meet targets due to the lack of incentive. This could be evidence of the dual factor theory whereby employees are dissatisfied with their jobs due to the Hygeine factors such as compensation and fringe benefits not been suffiently satisfied.

For those unmotivated salespeople who are at a career plateau often have a negative response towards management and younger salespeople. These employees generally have lost motivation to expand careers due to the lack of opportunities in the company for them. Needs theory helps sales managers understand employees experiencing a career plateau due to older employees have a need for power and achievement. Also the employee may be experiencing a lack of motivator due to no opportunities for growth and advancement (Dual Factor Theory).

To combat unmotivating training programs, sales managers should move training to specilist training institutions, such as ….. In addition the sales manager should adopt a autocratic leadership style to pull employees into line and promote a particpative management style through the use of intrinsic rewards.

Apart from changes with training and management styles, the two main motivational strategies with built in sales incentives, are sales contests and sales meetings. Sales contests are competitions among sales people to build enthusiasm in order to improve productivity. The winner of the competition will receive extrinsic reward, fringe benefits and promotional opportunities. A sales meeting is a strategy to enhance motivation through sales meetings either national, regional or local. It provides opportunity for sales managers to recognize individual’s efforts and create a stronger company culture.

Both of these strategies are particularly effective for employees who are unmotivated due to career plateau or compensation. It is important for sales managers to locate unmotivated employees and take corrective strategies to promote growth, opportunity and rewards.

managers take an autocratic style of leadership to pull employees ‘in line’. In addition to this it is crutial participative management is practiced by sales managers to give salespeople a sense of ownership and responsibility therefore increase motivation and peformance in the sales force. Strong open communication aswell as mentoring new employees will also assist in fixing motivation issues as sales managers to listen

Page 6 of 3 pages

to any problems sales people may have and provide them with positive reassurance and encouragement.

Secondly salespeople who are at a career plateau often have a negative response characterized by psychological and performance withdrawals. This may be a result of due to lack of opportunities for further growth within the company. Therefore sales managers can implement a change in roles, to the staff experiencing the career plateau such as mentoring younger employees, becoming a sales expert or being provided training to become a sales manager. These activities should foster continued psychological growth on the job and improve motivation towards work.

Thirdly if salespeople are receiving a straight salary compensation, a inequality of effort may exist. The straight salary doesn’t promote staff to increase performance, therefore staff may become unmotivated. On the otherhand a straight commissionplan may unmotivate staff and increase turnover level if targets set by sales manager are too high or impossible to reach. Therefore a combination compensation plan will increase productivity and motivation because it gives salespeople a security and allows them sales manager to immediately reinforce desired sales behavior thus staff will always be stimulated and motivated. Also the use of incentives and rewards such as will also increase motivation of staff ().

Lastly ineffective leadership strategies will promote an uninspiring and unmotivated workplace (). Bad leadership styles. Staff often are unmotivated towards this leadership style as they have no respect the leader due to sales manager is a new employee or newly promoted (). Therefore to address this problem it is ideal managers take an autocratic style of leadership to pull employees ‘in line’. In addition to this it is crutial participative management is practiced by sales managers to give salespeople a sense of ownership and responsibility therefore increase motivation and peformance in the sales force. Strong open communication aswell as mentoring new employees will also assist in fixing motivation issues as sales managers to listen to any problems sales people may have and provide them with positive reassurance and encouragement.

Therefore it is essential that managers improve leadership style, training, compensation and communication methods. This will increase motivation of unmotivated salespeople and encourage teamwork to work towards company objectives.

// unenthusiastic trainer and lack of planning > outside training specilists

the cutting or absence of incentives and rewards will provide the employees Use positive reinforcement 2. Use active training formats and variety 3. Encourage social interaction 4.Facilitate expertise sharing 5. Include realistic examples and situations 6. Establish a safe environment for learningCopyright © Houghton Mifflin Company. All rights reserved.7. Encourage self-evaluation 8. Recognize early success 9.

Include sufficient practice 10. Encourage goal setting

6. List the importance of recruitment and selection of salespeople and discuss possible problems that you may encounter in selecting the wrong person for the job.

Importance:

Page 7 of 3 pages

Recruiting and Selection is important in guaranteeing the right person is hired for the job. Recruiting is the sourcing of applicants for a job and getting applications. Selection follows recruiting which is the selection of a candidate for employment. It is critical that human resources apply good quality assurance to both recruitment and selection. Failure to do so can be timely, and costly for a company as they can lose potential sales and customers. In addition breaches of discrimination and employment conditions legislation can add unnecessary costs for a convicted company.

Signs of employing the ‘wrong’ person for the job is evident through ineffective selection processes such as testing procedures, absenteeism and turner due to new employee not being happy at organization, and ‘grumblings’ which are colleagues that identify issues with a particular employee().

Inexperienced employees can potentially cause a loss in productivity and sales for a company. A company will then need to spend more funds on training the new candidate, which can also be very timely. Therefore it is essential the recruitment and selection process uses short screening, background checks and appropriate testing to ensure the candidate finally selected is familiar with the role and only little spending is necessary to get the new employee up to company expectations.

The confidence of current employees may be deteriated by the human resources selection of an incorrect candidate and increase turnover. This is due to the productivity lost from hiring the wrong person will have to be made up by another human resource, therefore increasing stress and changing lifestyle of current employees ().

As sales personnel are required to have strong relations with clients it is essential the new employee has excellent interpersonal skills. If the employee lacks interpersonal skills, they may jepodise the relationship with a client and the client may seek another supplier (case study).

Intellectual property represents the property of your mind or intellect. Background checks for both criminal and employment activities should be thorough to ensure, alter motives don’t exist. The absence of these checks poses a threat to the intellectual property of company processes and products to be leaked to the public or competitors. This occurrence would be very costly to a company and in many cases the leaked source publisher is never found().

Lastly the time delay of training or dismissing the incorrectly employed employee will be expensive as it will cause a delay of productivity. There it is

Page 8 of 3 pages

critical that human resources utilizes all methods of recruiting and selecting to ensure they place the right candidate in the right job.

Therefore human resources needs to ensure they have a Recruitment Selection and Placement process such as… which ensures they find the right person for the job. This will prevent the negative impacts as mentioned above and improve the operations of the salesforce.

SeminarsSeminar

Best process! (3 sentences)Possible problems:

1. Productivity and sales decreasehttp://www.kennacompany.com/articles/HiretheBestCandidate.htm2. Damage to client relationships

3. Confidence of current employees lost/ high turnoverhttp://www.bir.net.au/articleDetailBIR.php?Hiring-the-wrong-person-65

4. Expensive5. Potential threat to intellectual property6. Time delay (hiring another staff member)

7. Discuss the importance of sales training for both new and experienced sales people. What training methods would you employ for the two categories of salespeople.

Importance:

Sales training is a continuous process that facilitates growth and productivity for the employees. Due to the difference in experience and training between new and experienced salespeople it is necessary to train the two groups independently.

The importance of sales force training is to achieve the long-term objectives. Training improves skills of employees and increases opportunities for growth, therefore improves retention of employees. Sales training assists in improving customer relations by teaching effective ways to plan, sell, serve customers and implement company procedures. The result of training is vital for retaining and acquiring customers. Training is important for new and existing employees, as the external environment is always changing. As entering new markets, selling new products, changing company culture, implementing sales force automation and improving efficiency are all critical in a company gaining a competitive

Page 9 of 3 pages

advantage. Overall sales training will assist sales and thus increase profit in the long term

An initial sales training program is the method for training new employees. The beginning elements of the program should ideally be contained within a centralized group training structure involving lectures, literature, and conferencing/e-learning. This should take place in a organized training school, convention or seminar centers. The initial sales training program, like an induction, will inform new recruits everything internal, including policies, benefits and protocols and also external information regarding the industry, competitors and the external environment as a whole. The last elements of ISTP actively demonstrate to trainees the importance of strategic relations with customers and selling techniques to assist with meeting sales targets. Absorption of relevant information may be assisted if the trainer uses role-playing and simulation games to demonstrate trainee’s knowledge. On-the-job training will aid the integration of trainees into the workforce including the use of technologies, inter alia, sales force automation tools.

This is not the case for experienced employees who require continuous refresher training, retraining or managerial training. Refresher training methodically helps sales people improve productivity arising from changes in technology, products, markets and company objectives. The training focuses on improving skills in research, listening, interpersonal, team selling, motivation, positive thinking, self-esteem, technology and learning.

Retraining is necessary when job requirements change because the company has added new products or services, revised sales territories or upgraded the sales force automation or customer relationship management technologies. Retraining must focus on significant and difficult changes in the requirements of employment. Continuous managerial training should cover all aspects of the sales managers job. The purpose is to introduce new approaches to organize, plan, compensate, supervise, evaluate and control the areas the sales manager is responsible for.

Training is essential in an ever-changing internal and external environment. This highlights that training is important for existing and new employees. Despite differing methods, the methods of training share the same goal and subsequently act to improve customer relations, reduce sales force turnover, increase sales and in turn increase profits in the long term.

/

Refresher training The purpose of refresher training is to help salespeople do their jobs better by keeping them abreast of changes in technology, products, markets, and company objectives.Refresher training topics can include: • Basic skillsRefresher training Retraining Managerial trainingCopyright © Houghton Mifflin Company. All rights reserved.

Chapter 9: TRAINING THE SALES FORCE 191192Chapter 9: TRAINING THE SALES FORCE• Research • Listening skills • Interpersonal skills • Team selling • Motivation •

Positive thinking • Self-esteem •Alternate disciplines • Technology Table 9.13. Refresher Training Topics2. Retraining When a salesperson’s job requirements change because the company has added new products or services, revised sales territories, or upgraded SFA or CRM technology, retraining is needed.

Page 10 of 3 pages

Designing retraining programs includes the following steps:a) b) c)Determine which aspects of the new job are the most important. Determine which aspects of the new job are the most difficult. Determine which aspects of the new job are the most prevalent.3. Managerial training Managerial training should cover all aspects of the sales manager’s job, not just the training function.The purpose of the programs is to introduce new approaches to organization, planning, motivation, compensation, supervision, evaluation, and control over the areas the sales manager is responsible for.

• Company knowledge • Product knowledge • Knowledge of competitors and the overall industry• Customer and market knowledge• Selling skills knowledge• Technology-based skills

New recruits training can the responsibility line executives, staff trainers or outside training specialists. The use of outside training specilists can be ideal at motivating, leading, compensating and forecasting salepeople. This is a great way to improve the effectiveness of training however is expensive and requires the goals for the training to be understood by the specialist training institution. Internally however must be done by line managers such as sales managers, senior sales representatives, field supervisors, and division managers, or staff trainers who are specially hired to condust sales training programs.

The training of new recruits Internally however must be done by line managers such as sales managers, senior sales representatives, field supervisors, and division managers, or staff trainers who are specially hired to condust

sales training programs. Training must take place at a centralized or decentralized location. The benefit of centralized training program is that training is done at a school designed for training therefore training can be controlled however may lack the ‘on-the-job’ training that decentralized offers. Therefore for new recruits a mix between centralized and decentralized is ideal to maximize learning and make sure the new employee is ready for the workforce. At the decentralized training group instructional methods such as role-playing, lectures, simulation games and demonstrations are useful to get all staff to an even level. Then the centralized training can be used to train the individual through methods such as on-the-job training, E-learning and personal conferences.

A type of sales training program provided to new recruits to teach them the basic selling concepts, as well as knowledge about the company and its products, competitors and the industry, and customers and the market.

NewInitial sales training programCentralized/decentralizedGroup or individual training6 basic elements

Page 11 of 3 pages

Outside firm method

OldContinuing sales training programEmerging training methods (conferencing, internet and intranet) Refresher trainingRetraining Managerial training

BothFeedbackUnbiased

1. Discuss the advantages and disadvantages of sales force automation (SFA).

Sales force automation (SFA) is an integrated system of computer software and hardware that performs routine sales functions. Within Customer Relationship Management, Sales force Automation (SFA) is used to automate functions of sales and sales force management (). SFA is an integrated system of computer software and hardware that performs sales functions. The use of SFA has many advantages for both sales managers and can give the company a competitive advantage over its competitors. However, SFA is not advantageous for all companies.

The most primary function of SFA is that it ties together sales functions such as expense reports, sales call scheduling, territory management, team selling material, sales tracking, and so forth (). This can be useful to sales managers in planning by setting targets and objectives for individual sales people.

The information provided by SFA can also be used to generate an understanding of the external environment including competitor analysis and potential opportunities. The marketing department of an organisation can use this information to identifying target markets and planning marketing activities, using the marketing mix.

As for the company, Sales Force Automation has the ability to increase productivity using the program to reduce costs, increase sales revenues and increase market share. This can be achieved through both the sales force and sales manager becoming more efficient and maximising effectiveness

Page 12 of 3 pages

Marketing managers can utilise SFA to understand the industry through external environment analysis’ through creating a SWOT [Strengths Weaknesses Opportunities and Threats] and competitor analysis. The information also assists in market research in order to identify target markets and control, monitor and adjust plans for the future. Another benefit of SFA for Marketing managers is that it assists in matching customer expectations, therefore increase customer satisfaction. This will increase loyalty, retainment and profit margins for the company all while decreasing cost of acquiring customers.

Despite improving productivity in most companies, SFA is expensive program to implement, as it requires on going maintenance and training. The use of SFA technology requires training in order to be proven as productive. The sales force needs to be competent with the SFA technology otherwise can cause problems with efficiency. In addition industries with a disabled employees such as the vision impaired may struggle to operate the system such as …

Due to the increase in productivity created by the SFA program, salespersons may feel less secure about the future of their job. This could potentially lower motivation and impact productivity of the system.

For firms that customers wont realise the added value of SFA, this would make SFA unnecessary due to it is based on building customer relationships. For example …

Therefore firms need to do an analysis of costs and potential profit of implementing Sales Force Automation. SFA is not suitable for every firm as mentioned above and sufficient training needs to be done to ensure firms make the maximum benefit from the program.

Training >ergonomic

Therefore despite being an effective and efficient way of improving productivity and profit margins, Sales Force Automation is not ideal for every company. Apart from the SFA being ergonomic for the workforce, substantial training should be done to ensure productivity is increased. In order to address the disadvantage sales managers need to show the sales people the benefits of CRM and how it will assist in achieving their individual sales targets as the technology enhances activities done.

TDISADVANTAGES•Salespersons may feel less job security.

Page 13 of 3 pages

–Sales managers can overcome this problem by convincing salespersons the benefits of CRM—help them sell more and earn higher bonuses and/or commissions. •Assure sales force that neither CRM nor the SFA components replace selling processes.•These high-tech components merely enhance the activities of sales managers and salespeople.

•Despite CRM’s popularity, its adoption is no guarantee of success.•CRM is not for firms using a transactional approach.•CRM is also not for firms whose customers won’t realize added value from the benefits provided by the CRM process.

•Some factors contributing to success or failure of CRM implementation include the following:–whether top management gives its support–whether sales managers and sales force buy in to CRM–confidence in CRM vendor–training–a well-defined sales process–expectations

Page 14 of 3 pages