Sales Force Automation Pros and Cons - Essay Example

SALES FORCE AUTOMATION PROS AND CONS Table of Contents Page 3 2 Introduction 4 3 Integration of Information 5 4 Sales Force Automation 6 5 Advantages of SFA 7 6 Shortcomings of SFA 10 7 Conclusion 10 8 Bibliography 11 1 Abstract Customer satisfaction is topmost on the minds of all companies and for this they choose the use of Sales Force Automation. The system, its uses, advantages and disadvantages have been discussed in this paper and the conclusion is that when used along with Integration of all data within the Enterprise, it will indeed serve its purpose. It will further enhance the capabilities of both the Sales and Marketing departments and will also result in better co-ordination of all activities in the company. The only daunting aspect is its Implementation which will be successful only if there is unqualified commitment from top management. 2 Introduction In modern Business Organization it is well understood that customer satisfaction guarantees the health of a company. This can be achieved only by awareness of customer needs and being able to fulfil them both within time and the acceptable price and quality parameters. The big question is how to be able to obtain this awareness and further how to make the sales force or the marketing people understand the vital role this plays in the ultimate performance of the company. The firs exercise to apply the control approaches to the sales force was made by Anderson and Oliver (1987). A few tests of the performance of the sales force control system was conducted by Challagala et al (1996). Cravens et al (1993), Oliver and Anderson (1994 & 1995). It is only recently that this has taken shape as SFA. It is fortunate that Information Technology is here to assist businesses across board with a multitude of solutions that can help them to tackle this issue. There are many Sales Force Automation Systems that are based on Information systems and are used in marketing. These are automated solutions that combine the marketing management functions and the customer relationship management systems. The aim is to gather information of each individual customer’s behavioural pattern. The purchases they make, the brand and quality preference. The price ranges they accept, the ratio of purchase within seasons, schedules and the variances in selection of products etc. The list goes on depending on the product type and the location and other circumstantial factors. A pattern emerges which can then become predictive and the solution can then forecast the possibility of a sale at a particular time or when a suitable product is available. It also has inbuilt interactive features which can encourage a customer to engage in a dialogue and offer a direct lead to the sales or marketing people to carry on the transaction. The way to achieving efficiencies and utilizing installed capacities lies in Technology upgradation. This is the most important, yet the weakest of all our resources. To overcome this issue it is imperative to have an integrated ERP solution. This will result in seamless flow of data from point to point and instant information will be available. This will enable marketing department and the sales force in making fact based decisions. 3 Integration of Information Availability of solutions has lead many a company to customize a solution for its specific needs and to train its sales force around it for maximum results. In such a case the ideal solution will combine the features of marketing, delivery, customer information with his various preferences in order of his choice by priority and the production schedules. This will involve integrating many a department in order to be really workable and useful. It means that before embarking on a SFA programme, the company should first incorporate a culture of laying down a system for its own functioning which can then give correct and useful information to its marketing and sales people who can take predictive or positive actions on the basis that their decisions are based on facts and not assumptions. Sales take place on facts more readily than on assumptions. Customer satisfaction is also a result of actually delivering value to the customer which he measures by factors like price, delivery and quality. Service is an important feature in any customer relationship and this too is dependant on these reasons that convey a perception of reliability. The best method for a company would be to adopt an Enterprise Solution that encompasses all its activities and results in a cohesive and central information gathering and dissemination system through various reports. These reports should be readily available with current up to date accurate information and it will be additionally helpful if they are generated dynamically, meaning that information is updated automatically with regularity. Such a system will equip the sales person to be able to give out accurate information to the customer thereby enhancing his trust and developing his loyalty to the company. 4 Sales Force Automation The next step will be to design a Sales Force Automation (SFA) system that will offer the sales staff an accurate position of likely availability of products with price and quality parameters that they can offer the customers. This will be done readily through the use of the ERP solution. They will also have a list of prospective customers for different products, both past and future, based on the data available. This will assist them to focus on their core activity of enticing the customers and save them the time they would be using unproductively gathering information. This will also make them more active and well informed and be able to handle a customer enquiry or grievance with more authority based on facts and without having doubts emanating out of wrong assumptions. Current SFA’s also include features like sales tracking systems through lists of potential customers by making cold phone calls. These are provided for in the SFA and the sales person can go through these backed by the product related information available through the system. Online product billing using which the customer can order online through a B2C site is also part of the modern SFA. In such cases the customer is also allowed to opt for alternate features in order to arrive at his choice. Such inter-active designs actually lead to higher sales as has been noticed in automobile sales where the customer adds on features he likes online and completes a sale faster than in a physical transaction. Empowerment is the name of this and the objective to actively engage the customer in making spot decisions. An SFA would module will feature information on the fly with sales figures, sales promotion information, product information, product features, product quality and delivery features. It will also contain all relevant customer information including past history, performances and likely trends. Integration of data is the essential starting point of a successful SFA. 5 Advantages of SFA SFA will be useful to several people in the organisation. The sales persons or the marketing managers will benefit most from SFA. As a result of Integrated information gathered and displayed by the Enterprise solution all information will now be readily available to authorised users on their desktop displays. They no longer have to wait or call for information and they can access the required data instantly. Additionally this data will be updated automatically by the system as any part of a transaction, when concluded has to enter the system and it automatically updates the previous information. Further if any analysing is required the system can be either configured in advance to produce such analysis that may assist the sales person to draw conclusions or take information to guide him through the existing or future transactions. The time this system saves and the effortless availability of vital data will result in the sales staff getting more time at hand for productive work like contacting the prospective and existing customers for further orders and for updating them on future or current product information and availability. A great part of the Customer Management comprises of settlement of petty grievances which if remain unattended snowball into major crisis. This communication gap often takes place in absence of relevant data and the sales person often falls into disrepute due to non-reply or wrong reply to questions raised by customers. The instant availability of data ensures that customer is attended quickly and Redressal takes place readily thus increasing customer confidence in the company and the product. Co-ordination of activities like sales with finance and delivery sections makes the transactions and solutions of problems possible at faster rate thus raising the satisfaction level of the customer. This is made possible by the integration of the entire software system and by giving proper access rights to users for getting their queries answered by relevant departments. Analysis of the data provides the identification of the customer profiling in accordance with performance and profitability. It helps to decide priorities required by individual customers. Finally tracking of orders keeps the sales person abreast of the status of transaction to determine his next moves and prepares him better to deal both with the customer and the various departments. The Marketing department is also assisted by the SFA as they are able to foresee and forecast market trends for products. It further helps in segmenting the market on basis of demography, ethnicity, behaviour or other parameters like education level of customers preferring certain products. These classifications help them to design better promotion for the products and decide the best communication modes for them. For Marketing the most important task is to identify the potential customer and decide who to target with its campaigns. This is a very delicate task and becomes easier with data available trough the use of the SFA systems. SFA is also useful for doing market research as it provides rich data both about customers and product movement. The understanding of competitor’s products becomes possible because SFA helps them to understand their own products strengths and weaknesses. Knowledge is power and when used judiciously it empowers the marketing people to understand the opportunities and threats to their own products. They can then even help in developing new or better products from the knowledge this gained from SFA and the study of the market. A study of customer behaviour as thrown up by use of SFA helps to develop market strategies as well as create sustainable advantage to compete with other products offered by competition. 6 Shortcomings of SFA There are no real shortcomings or disadvantage of the SFA. But the big question mark lies in its Implementation. This is the greatest headache as it requires that every single transaction must be recorded in detail to get maximum mileage out of SFA. A lot of training goes into this effort and the company has to ensure that there is strict compliance on this issue. If records are not entered regularly and within the time, and often it is simultaneous with the actual happening of the transaction, then the whole system will fail. Sales force automation systems are fast becoming a marketplace reality. Implementation of these systems represents a significant change for many organizations, often presenting difficult challenges for managers. (Morgan A.J., Inks S.A. 2001) 7 Conclusion SFA is the vital tool that can really raise the standards of the sales force and make them more efficient and productive. SFA also is the right step towards achieving customer satisfaction. The Implementation of SFA is difficult but with due diligence and careful planning and commitment of the top management it is possible. In the interest of improving the bottom line it is recommended that companies pay greater attention to it with sincerity. 8 Bibliography Anderson, E. and Oliver, R.L. (1987), Perpspectives on Behaviour-based versus outcome based sales force control systems, Journal of Marketing Vol 51 No 4 pp 76-88 Challagalla, Gautam N., and Shervani, Tassaduq A., (1996), Dimensions and Types of Supervisory Control : Effects on Salesperson Person and Satisfaction, Journal of Marketing 60(January), pp 89-105 Cravens, D.W., Ingram, T.N., LaForge, R.W., and Young, C.E. (1993), Behaviour-based and outcome-based sales force control systems, Journal of Marketing Vol 57 No 4 pp 47-69 Morgan A.J., Inks S.A. Technology and the Sales Force: Increasing Acceptance of Sales ForceAutomation(2001) IndustrialMarketingManagement, 30 (5), pp. 463-472. Marshall G.W.; Moncrief W.C.; Lassk F.G. Industrial Marketing Management Volume 28, Number 1, January 1999 , pp. 87-98(12) Oliver, R.L., and Anderson, E. (1994), Emperical Test of the consequences of behaviour and outcome based sales force control systems, Journal of Marketing Vol 58 No 4 pp 53-67 Read More