Management of Selling - Case Study Example

Management of selling Though Stephen Oldroyd is worried because things have not moved as smoothly as he had calculated, he has done a commendable job. In the first month itself of his new job as a sales manager, he has been able to get the bird's eye view of the whole situation that was of his immediate concern in the company. It was only because he decided to accompany the sales force on their sales visits, talking to customers and minutely observing those visits that he has been able to get to the crux of the problem so early. 1. In order to further investigate the problems that he has come across during the initial phase of his research, he should pay attention to the following things. These measures would be particularly helpful because it would gain the co-operation of the sales force during the investigation process, which would provide more satisfactory results. Oldroyd would require the following information: Regular interaction with each of the six salesmen would help in knowing the depth of the knowledge they have on their geographical area of operation for e.g. 1. Industry customer base 2. Active competitors in their regions 3. Products in demand in their respective regions 4. Loyal customers lost in 1-2 years 5. Efforts taken to bring them back. An insight of the highly dissatisfied A and B accounts who are about to move out from the customer list. This would help Oldroyd to know the problems of the company in detail and its product acceptance in the market. By accompanying the sales force to gather this information will not only ensure their co-operation but they would also feel that their boss is by their side in difficult times. Oldroyd will gain confidence of his sales force in this way. Knowledge of product pricing and quality and their comparison with that of the competitors. Knowledge of target segment. He should see whether the target segment focussed by the sales force is correct and adequate or not. Sales reporting and monitoring mechanism Profit margin in each product. Knowledge about the competitor who has signed the major deals and how he operates. Salary structure of the industry. Are 6 sales people adequately handling the targeted geographical area or additional manpower is required. What are the area preferences of each salesman Would reshuffle in the designated areas would increase the enthusiasm of the sales force. The inner feelings of each salesman and their complaints if any. 2. There are many disadvantages in the way the sales force is currently organised. They are as follows: It is difficult to properly monitor the sales force The salesmen are sure that the salary would keep on increasing even if they make minimal effort in getting fresh orders as they have spent a number of years with the company which is well above the average duration of stay for sales people in the industry. Hence there is no pressure on the sales force as job security is high. Sale in the company is due to 10 years of brand reputation in the market and not due to any effort by the sales force. There is no scheme of incentive for those who get the highest number of orders or for those who over perform. There is also no system of cutting some amount of money from the salary due to underperformance. So each month the salary of the sales force is guaranteed even if they under perform. Hence each of them is assured of his own personal income and do not bother about the company's overall growth. Since there is no incentive scheme, in the words of Dive (2005, p. 13) there is "slow reaction to customers and competitions" which results in "quality work not being done.." There is rather unclear or total lack of vision for the sales force. They themselves are not sure where they are heading. 3. In the next six months Stephen Oldroyd can improve the sales performance of his company in the following ways: He should set up a future course of action and communicate it effectively to the sales force. He should demonstrate his best planning skills because the sales department of Supplies-4-Gardens seriously needs it. According to Rue and Byars, "Setting the future course involves generating possible strategic alternatives, based on the mission and long range objectives, and then selecting the most promising alternative." (1992, p. 184) Since customers in the A, B and C category are fixed; Oldroyd should create a fresh 'monthly customer meeting plan'. Each sales person should make his plan in the form of a chart in horizontal as well as vertical manner so that if sorted by customer name, it would provide visiting dates to that customer for the next three months and if sorted by month, it would provide dates of the customer visits for the chosen month. Later, one can compare whether he has kept up to the schedule or not. Customer Meeting Record Sheet Month Customer X Customer Y Customer Z Planned Date Actual Date Planned Date Actual Date Planned Date Actual Date August' 07 September' 07 October' 07 Oldroyd should also introduce a customer feed back form and ask each sales person to get it filled by the customer during each visit. Oldroyd should personally scrutinize these forms in order to keep track of any progress in the quality of visit by the sales force. Customers comment will make the scenario clearly visible. Movement of customer's rating from poor to excellent will help to study the relationship development with that organisation over a period of time and also inform how satisfied or dissatisfied a customer is and whether he will remain in the network or is on the verge of moving out. Oldroyd would then be able to immediately address those customers who are rating his organisation poor or average. This form would also help Supplies-4-Gardens in taking feedback from customers' on the last order placed by them and the sales team could keep themselves updated on the supply status of the last order before visiting the customer. Not only this a salesman would also get a chance to put forward his views to the customer, which can be later referred in case of any dispute. Any commitment given by the salesperson will also get recorded here and Oldroyd will come to know in case any extraordinary or false commitment has been given in writing to the customer. Customer Feedback Form Meeting Date. Customer Name Represented By: 1 2 Represented from Supplies-4 -Gardens Ltd 1.. 2.. Last Order Status: Delivered In Transit Under Process Customers' Remarks on last order Salesman's Remarks on last order. Order Booked Today Sl.No. Product Quantity 1. 2. 3. 4. 5. Customer's Feedback Overall Customer Rating: Excellent Very Good Good Average Poor Salesman's Feedback ------------------------------ ---------------------------- Customer's Signature Salesman's Signature In addition to the customer feedback form, Oldroyd should also introduce a form in which each sales person is able to do his own activity analysis. It is not easy to evaluate one's performance of a day, week or a month mentally. Until and unless the sales people make an account of their own targets at the beginning of the day and compare it to their achievement at the end of the day, week or month, they would not be able to identify the loopholes. Oldroyd can help them in setting up their targets in the beginning of the month. The introduction of the form would help in comparing one's target with the actual performance that can be analysed in a meeting at the end of the month. This strategy would help in the improvement of the performance of the sales force. Oldroyd should teach the sales force the lesson of flexibility. According to Weitz, Castleberry and Tanner, "Although working out a daily plan is important, times will arise when the plan should be laid aside. You cannot accurately judge the time needed for each sales call. And hastily concluding a sales presentation just to stick to a schedule would be foolish. If more time at one account will mean better sales results, then the schedule should be revised." (1992, p. 457) The sales force should be made to pay attention to this fact because there have been complaints from the customers that the sales people do not spend required time with the customers and are only interested in the orders. Oldroyd should try to introduce individual quality sales incentive. Since the average rate of growth of sales of the company is 5 percent when compared to the industry growth of 10 percent, it is clear that there is room for more growth. Every sales person should get some percentage of additional sales incentive. This percentage should be calculated on sales made over and above the average sales of last quarter of that salesman. This will motivate each salesman to perform better than the previous quarter. Based on the profit margin of each product category, the management should decide the percentage of incentive. Rue and Byars (1992, p. 495-496) state " This performance-reward relationship is desirable not only at the corporate level but also at the individual employee level. The underlying theory is that employees will be motivated when they believe good performance will lead to rewards." If the company succeeds in crossing the annual industry growth of 10 percent on cumulative sales then each sales person should be awarded a percentage on additional profit made by the company. After consulting the management, Oldroyd should also introduce some kind of reward or incentive for signing up a new customer. Direct call by Oldroyd himself once in three months to all customers would help in the improvement of sales performance. This way he would be able to understand the need of the customers in a better way. Just making out plans and policies should not be his job because problems in customer care cannot be removed by being remote to them. Though the sales force has the main responsibility of taking customer care but until the sales manager himself serves them from time to time he will not able to gain "the insights that arise from serving them." (Stone, Bond and Foss, 2004, p. 61) This measure would also help in long-term partnership between the customer and the company. In the words of Stone, Bond and Foss (2004, p. 60) "Caring for customers is a simple idea. It means looking after customers and meeting their needs. In a world where most suppliers need to meet their customers' needs, the experience of many customers is not very happy. When customers do have poor experiences, rather than tell the supplier, they often allow the situation to fester. They infect other customers with their attitudes, creating a snowball effect. Meanwhile the supplier carries on in blissful ignorance, until its overall success starts to falter." Since the customers have already expressed unhappiness with the company's sales staff. Oldroyd should immediately try to turn their negative remarks to positive remarks before the problem aggravates. Oldroyd should not only catch up with the customers but also catch up with the sales force from time to time and meet them individually to know their side of the story. For building a good relationship, which would ultimately help in increase of the sales figure, recruitments of female telecallers should be made in order to facilitate regular customer updates on their order processing. The sales force should be given product training. Until and unless the staff is well versed in all the information of the products they are trying to sell, their sales visits cannot deliver lucrative results. The customers have complained that the salespeople are not able to answer some of the questions regarding the products and that they lack enthusiasm. With proper product training the sales force would be fully equipped in handling customer queries about the products. Thorough knowledge about the product would automatically increase the enthusiasm level too, which would result in increased sales. The sales force should be groomed in basic etiquettes of meeting with the customers. Sometimes even though the sales people are interested they don't look that way because of their nonverbal communication like body language, facial expression etc. So the sales force should not only be interested in the meetings with the customers but look interested too. This would result in more fruitful results. The salespeople should also be acquainted of understanding the situation before delivering presentation especially to a new customer. In this context Hawkins, Best and Coney say "The situation in which the consumers receive information has an impact on their behaviourIf we are interested in the product and are in a receptive communication situation, a marketer is able to deliver an effective message to us." (1992, p.415) Oldroyd should facilitate training for the sales force to manage their time effectively. Arrowsmith and Sisson (2000, p. 287) observe, "The organization of working time, how it is scheduled and utilized, are fundamental to productivity, motivation and performance." Weitz, Castleberry and Tanner rightly state, " Many salespeople work in the field, their only contact with the office by telephone, computer, and fax. Because no one tells them when to start working and when to quit for the day, they must be self- sufficient. Their success or failure depends largely on their own efforts. Sales people have more individual freedom than almost any other type of employee. With that freedom comes the responsibility to manage themselves. Self-management involves using their scarcest resource, time, so that they get the most out of their other resources, their customers and their skills." (1992, p. 442) Hence keeping this in mind, apart from the product training there should be arrangements of work enhancement training for the sales force. This kind of training helps the professionals in recognizing their goals and abilities, reflecting upon their responsibilities, effective time management and fill them up with a fresh zeal to excel in their work. If the above-mentioned initiatives were taken then there would be product push rather than pull from the market in the next six months. Stephen Oldroyd will have to demonstrate good leadership skills, which are the backbone of a successful sales manager in order to make his organisation a healthy and rapidly growing organisation. Dive, has the following vision of a healthy organisation, " it is an organisation with the optimal number of layers of leadership, which demonstrably add value to the work of others. This includes the design and delivery of mission and strategy." (2005, p. 25) Hence if Stephen Oldroyd makes further investigations of the problems that has surfaced after his initial research, is able to understand the repercussions of the manner in which the sales force is organised at present and works with an optimistic outlook then he would be able to make a significant difference in the sales of his organisation. Word count: 2517 References Arrowsmith, J. and Sisson, K. in Bach, S. and Sisson, K., eds., 2000. Personnel Management. 3rd ed. Oxford: Blackwell Publishers Ltd. Dive, B., 2004. The Healthy Organization. 2nd ed. London: Kogan Page Limited. Hawkins, D.I., Best, R. J. and Coney K.A., 1992. Consumer Behavior. 5th ed. USA: IRWIN. Rue, L.W. and Byars, L.L., 1992. Management Skills And Application. 6th ed. USA: IRWIN. Stone, M., Bond, A. and Foss, B., 2005. Consumer Insight. London: Kogan Page Limited. Weitz, B.A., Castleberry, S.B. and Tanner, Jr. J. F., 1992. Selling: Building Partnerships. USA: IRWIN. Read More