The Evaluation of the Effectiveness of Salespeople of Ace Distributors - Assignment Example

Rough Draft, I am winding up shortly LETTER IZATION LETTER OF TRANSMITTAL TABLE OF CONTENTS EXECUTIVE SUMMARY THE REPORT INTRODUCTIONOrigin of the report Purpose The purpose of this report is to show the level of effectiveness of the of Ace Distributors’ salespeople. Since the company Ace has experienced a drop in its sale of products, and faces competition from other companies in the industry, it has become essential for an investigation to be launched, in order to ascertain the factors that have contributed to the drop in sales, even as Ace continues to face heightened competition from other companies in the industry. This report therefore, identifies the factors contributing to the ineffectiveness of the Ace distributors’ salespeople, and recommends possible ways through which the effectiveness of Ace distributors’ salespeople can be enhanced. Scope This study was limited to the evaluation of the effectiveness of Ace distributors’ salespeople. This study was also restricted to dealers operating in three major retail areas, including New York, Chicago, and Dallas. These dealers were selected randomly, and included those from the five leading brands of television in the country, including Todd Manufacturing Company; Apco, Incorporated: Davis Manufacturing Company; and Barr Industries, Incorporated, and Ace Manufacturing. Limitations This study may be limited through the insufficient time for doing the work. The scope of this study was wide; hence sufficient time was required for accurate completion of the study. In addition, the topic of study was wide; hence the aspect of subjectivity might have been introduced in the study, and some areas in the scope of the study might have been left out. Furthermore, this study adopted the use of questionnaires as the main data collection instrument in conducting the survey. Since questionnaires must generally be brief, areas that may have influenced effectiveness of distributors’ salespeople may not have been included in the questionnaire. Historical background The main goal of this report is to show the effectiveness of Ace distributors’ salespeople. It has become important for the company to launch investigations into the effectiveness of the salespeople, owing to the poor performance of the company in the last three years. Prior to these last three years, the company Ace Manufacturing ranked the top in all the five leading home television brands in the country. However, in the last three years, the performance of this company has dropped, as it currently ranks at position three. The sales activities of a company are key to its performance in the market. On the other hand, the salespeople involved with a company’s sales of products have a direct influence on the productivity of the company. Therefore, after considering different factors, the executives at Ace Manufacturing deemed it important for the effectiveness of their distributors’ salespeople to be investigated in order to ascertain whether these are the cause of the company’s poor performance in previous years. Sources and Methods of collecting data Data for this study was collected using questionnaire that the researcher developed. The questionnaire was divided into two major parts. Part one focused on the most important activities in each sales phase. The respondents were asked to identify different activities in sales that they applied and felt have the greatest impact on the success of their sales process. The second part focused on the level and type of support that sales professionals receive from their organization, mainly with regard to technology, training and customer support. Respondents were asked to identify, if any, form of support that their organization offered them to ensure that they make high sales. Sample Selection The respondents involved in this study were dealers of all the five leading brands, including Todd Manufacturing Company; Apco, Incorporated: Davis Manufacturing Company; and Barr Industries, Incorporated, and Ace Manufacturing, who were all selected randomly. This study focused only on the dealers operating in Dallas, Chicago, and New York. Questionnaires were distributed to all the selected respondents. In order to ensure confidentiality, the questionnaires given to the respondents were self-addressed. Report Preview This report is divided into three major parts. These include: I. Introduction: Report Body Introduction This study was designed to determine the effectiveness of Ace distributors’ salespeople and to discover ways of enhancing their effectiveness. Sixty questionnaires were distributed to dealers in all the five leading brands, including Todd Manufacturing Company; Apco, Incorporated: Davis Manufacturing Company; and Barr Industries, Incorporated, and Ace Manufacturing in the retail regions of Dallas, New York, and Chicago. The response rate was at 90%. This section includes findings, conclusions, and recommendations. The findings of this study base on two key areas. These include important activities in each sale phase and organizational support activities. In addition, the study also focuses on the level and type of organizational support activities for salespeople and how they compare for the low and high performers in sales. In this case, the respondents from Ace Manufacturing Company were ranked among the low performers in sales. Findings The findings will be presented in three major sections according to the following characteristics: Demographic profile, activities they undertake in their sales process, and level and type of support that sales professionals receive from their organization. Demographic Profile All the involved respondents that participated in the survey were full time employees by their employers. In the questionnaire, the respondents had been requested to indicate the age group they belonged. In the results, there were representations of the results, as pertaining to the age groups of the respondents, as the figure below shows. The following is the breakdown of the age groups for all respondents: age 20 and below comprised 2.1%, between age 20 and 29 comprised 33.7 of all respondents, between age 30 and 39 comprised 29.4%, between age 40 and 49 comprised 26.1%, between age 50 and 59 comprised 5.4%, while age 60 and above comprised 3.3%. Fig. 1: Age Distribution of Respondents Activities that enhanced Effectiveness in Sales The respondents were given a list of activities that might enhance effectiveness in sales and help them to realize success. They were then asked to choose whether the activities increased, reduced, or had no change on their sale volumes. The results for this aspect varied among all the respondents, mainly based on their sales performance, and training they had received. The activity that the respondents identified in which they experienced more success with was “Establishing relationships and identifying the needs of customers” (36%). On the other hand, the activity that most respondents had failed to realize success with in sales was “Developing new business (54%). There was more agreement among the respondents with regard to the aspects of “Establishing Relationships,” “Personal Selling Attributes,” and “Following up after the sale.” Most respondents shared the same view that honesty, being direct, and embracing a high ethical standard were related to the integrity of a salesperson. Level and Type of support that Sales Professionals receive from their Organization This section listed various types of support that employers offered the salespeople. The respondents were required to indicate which programs their companies or employers offered them that might have enhanced their effectiveness in their sales process. The respondents were required to rate their agreement with the listed support activities by their organization. The responses for each kind of support were as shown in the table below. The table ranks the mean score (five-point scale) from highest to lowest activity. Respondents were in most agreement that their company offers training programs to salespeople. On the other hand, the respondents were in least agreement that salespeople in their company attend stress management seminars. On a scale of 1 (completely disagree) to 5 (completely agree), to what extent do you agree with the following? TYPE OF SUPPORT TOTAL Our company offers training Programs to salespeople 5.96 Salespeople in our company receive rewards for selling efforts 4.88 Our salespeople attend stress management seminars 4.80 Sales managers provide coaching to salespeople 5.77 There are employee empowerment programmes for salespeople 5.75 There are team building exercises for salespeople 5.69 Our salespeople participate in decision making process in the sales department 4.89 My organization has a formal sales process that defines how we sell 5.47 Table 1: Level of Agreement with Statements Related to Organizational Support The respondents were also asked to identify their most challenging sales phase and the phase where they have experienced the most success in the prior year. The table below shows the percentage of responses by sales performance. Results showed that most respondents had a challenge in “presenting a solution,” and the overall “personal attributes,” except for the high performers who performed better in these phases. However, the low performers had more challenge in “closing a deal.” Table 3: Most Challenging and Most Successful Sales Phases The researcher also examined the relationship between the sales performance and agreement with the organizational support activities. The table below indicates the mean score (on a five-point scale) for sales performance. As shown the sales performance has a considerable relationship with the organizational support activities. Overall, the results show that respondents that are more successful work in organizations that are more likely to provide them with coaching, rewards, training, empowerment programmes, stress management seminars, team building, and a formal sales process. On a scale of 1 (completely disagree) to 5 (completely agree), to what extent do you agree with the following? SALES PERFORMANCE High Low Our company offers training Programs to salespeople 3.7 3.4 Salespeople in our company receive rewards for selling efforts 4.1 3.8 Our salespeople attend stress management seminars 4 3.7 Sales managers provide coaching to salespeople 3.5 3.2 There are employee empowerment programmes for salespeople 3.9 3.7 There are team building exercises for salespeople 3.4 3 My organization has a formal sales process that defines how we sell 3.9 3.6 Discussion and Details This study has shown that the Ace distributors’ salespeople are quite ineffective in their work. This has therefore, contributed to the low performance of Ace Manufacturing Company that has been experience over the past few years. In addition, this study has shown that the salespeople lack enough motivation. For instance, these have registered a low agreement on the organizational support activities they are exposed to. The main aspect that has also been observed is that the high performers are in a high agreement with regard to the organizational support activities they receive. This therefore, contributes to their high effectiveness. There are important aspects that have been observed in this study with regard to the Ace distributors’ salespeople and their effectiveness. These are discussed below. Training of Salespeople Sales-training involves helping salespeople to master relevant skills, behaviours, concepts, and attitudes in sales. This is important as it enhances the ability of salespeople to influence prospects positively to make purchasing decisions. This also focuses on the interaction between the salespeople and prospective customers. Sales-training presents salespeople with instruments and techniques that will help them to present their goods and services to buyers in the most appropriate and persuasive manner to elicit positive response from the buyers. In this case, therefore, it is important for the Ace distributors’ salespeople to be subjected to intense sales-training in order for them to increase their productivity in sales. If the salespeople are subjected to an adequate training in sales, this will have a positive impact on the sales volume of Ace Manufacturing. Sales-training will also ensure that there is a positive customer relationship, among other more benefits. For instance, Deluxe Corporation experienced an increase in its rate of customer retention from 85% to 95% in less than two years after the company adopted and implemented sales-training for its salespeople (James 25). Similarly, a company that manufactures toothbrushes experienced increased sales by $30 million within the first two years after introducing sales-training (James 25). This therefore, proves that sales-training is an important investment for any company. Rewards for Sales Efforts Salespeople serve important responsibility, thus influence the productivity of a company at a larger extent. Effective rewards comprise both monetary and non-monetary compensation. According to Suff and Reilly (2), the nature of the sales job compels an employer to give rewards in order to enhance their results. Rewards for salespeople can be in the form of bonuses and incentives. For instance, 66 per cent of the companies in the UK award their salespeople with salary and commission, as they assume that this will motivate the salespeople to increase their effort, thus resulting in their increased productivity, which will also boost the profitability of the companies (Suff and Reilly 3). This study has shown that the Ace salespeople were among the least motivated employees, and these have registered poor results in sales that have had an adverse impact on the company. Therefore, in order to enhance the performance of the salespeople and boost the productivity of the company, it is vital that the salespeople are motivated through being rewarded for their good efforts in sales. Stress Management Seminars for Salespeople Although stress-reduction techniques and skills are paramount in all professional fields, these are more important in the field of sales. This is mainly because the field of sales focuses more on individual results and motivation. In order to ensure excellent results, sales people should have lower stress levels and no wasted time. Therefore, stress management workshops for salespeople are instrumental in ensuring that they learn how to manage and reduce their stress levels, thus increasing their productivity. According to Roberts, Lapidus, and Chonko, stress in the workplace cost American companies huge amounts of money every year, which amounts to approximately $68 billion every year (93). In the case of professional salespeople, Roberts, Lapidus, and Chonko (93) argue that these are faced with stress on a daily basis, given the nature of their job, where they have to adapt to numerous demands, uncertainties, and opportunities. Stress has a harmful effect on individuals, especially the salespeople, who are more exposed to it. This study has revealed that the low performers in sales, including Ace salespeople, are less subjected to stress management workshops. Therefore, in order to enhance their productivity, it is important that the salespeople attend more stress management workshops. This will have a direct effect on their sales performance. Coaching for Salespeople The study has shown that the low performers in sales rarely receive coaching, as compared to the high performers. Since the Ace salespeople have been ranked among the low performers, it is therefore, important that a solution is adopted. According to Reilly (Web), various researches show that companies today offer inadequate coaching to their salespeople. After hiring salespeople, it is important for sales managers to perform adequately their role of coaching both to the new and existing salespeople. This is important in developing the salespeople. Nonetheless, since coaching enhances the performance of salespeople, it is therefore paramount that the Ace salespeople are coached, as this will develop them and enable them to be more productive. Employee Empowerment Programmes for Salespeople Employee empowerment programmes are crucial, as these provide employees with the necessary skills and resources that they might need in order to reach their potential and contribute to the overall growth of the company. According to Yim, salespeople require empowerment; therefore, it is important that various empowerment programmes are designed specifically for them (2). This study has revealed that the low performers in sales experienced lower empowerment. For this reason therefore, it is vital that the Ace salespeople are treated to empowerment programmes. An empowered salesperson will register greater sales volume as compared to one that is not empowered. Therefore, if the Ace salespeople are empowered, this will bring a positive change in this company’s productivity. Team Building Exercises for Salespeople Team training is an important aspect for all professionals, including salespeople. According to Yim (5), team building helps salespeople to develop trust and provides them with influence and greater input. In addition, team building also makes the salespeople to view work as having a greater meaning. These will not just be fulfilling their assigned tasks, but will also be helping their team to be successful. In this study, it has been noted that the low performers, including Ace salespeople experience low team building, as compared to the high performers. This therefore, shows that team building has a positive influence on salespeople. For this reason, it is vital that the Ace salespeople are involved in team building exercises, as these will impact on their sales performance in a positive manner. A Formal Sales Process for Salespeople This study has shown that salespeople that follow a formal sales process from their organization are more likely to have a higher sales performance, as compared to those that lack a formal sales process from their company. Therefore, the adherence to a provided formal sales process correlates with sales performance. In this study, most of the low performers in sales, including the Ace salespeople did not adhere to a formal sales process, as this was not provided for them. Therefore, lack of a clear sales process contributed to their low performance in sales. In order to ensure that the effectiveness of these salespeople is enhanced, it is important that these are provided with a formal sales process, which will guide them in all the sales phases, hence enhancing the effectiveness of the salespeople. Conclusions On the basis of these findings, several conclusions concerning the effectiveness of Ace distributors’ salespeople can be drawn. The findings of this study indicated that these salespeople are ineffective. Overall, these lack the motivation to work to their best level. The lack of motivation is mainly caused by the lack of adequate organizational support activities for them from their employers. In addition, the lack of motivation by these salespeople has had a negative impact on their personal attributes, and this affects their sales performance in an adverse manner. From this study, Ace Manufacturing has realized that organizational support activities for salespeople are important in boosting their motivation to work, as well as their sales performance. Works Cited Katz Jordan. “How Suppliers Should Manage Their Distributors.” GALLUP Business Journal, 2013. Web. Marone Mark and Blauth Chris. “A Survey of Sales Effectiveness.” AchieveGlobal. n.d. Web. Reilly Tom. “Coaching for Sales Success.” 2005. Web. Roberts James, Lapidus Richard, and Chonko Lawrence. “Salespeople and Stress: The Moderating Role of Locus Control on Work Stressors and Felt Stress.” Journal of Marketing Theory and Practice. 5(3): 93-117. Teas Kenneth and Horell James. “Salespeople satisfaction and performance feedback.” Industrial Marketing Management, 10(1): 49-57. DOI: 10.1016/0019-8501(81)90027- 4 Suff Paul and Reilly Peter. “Selling Rewards: Paying for Performance in your Sales Force.” Institute of Employment Studies. 2006. Web. Sujan Harish, Weitz Barton, and Sujan Mita. “Increasing Sales Productivity by Getting Salespeople to Work Smarter.” Journal of Personal Selling & Sales Management. Pp. 9-20. August 1988 Weitz Barton, Sujan Harish, and Sujan Mita. “Knowledge, Motivation, and Adaptive Behavior: A Frame-work for Improving - Selling Effectiveness.” Journal of Marketing, 50, 174-191. 1986. Yim Kit. “Psychological Empowerment of Salespeople: The Construct, Its Inducement, and Consequences on Customer Relationships.” 2008. Web. Read More