Andris A. Zoltners
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Sales Management Courses
Sales Force Effectiveness: A Framework for Researchers and Practitioners
This paper presents a Sales Force Effectiveness Framework that organizes the complexities of sales organizations, providing a holistic approach to defining and assessing sales force effectiveness. Sales practitioners can use the framework to diagnose sales force issues and develop multidimensional solutions, either when responding to external and internal events or when striving to improve. Sales researchers can use the framework to discover ways to expand their research focus to benefit practitioners. The framework is supported by an inventory of sales force effectiveness issues from sales leaders and recent academic publications.
Match Your Sales Force Structure to
Your Business Life Cycle
Sales Force Architecture decisions encompass four questions: What is the role of selling partners in customer promotion? How big should the sales force be? How should the sales force be structured? What is the best product/market allocation of sales force resources? These decisions strongly influence both the efficiency and the effectiveness of the sales force investment and are directly linked to company profitability.
Customer strategies change throughout the business lifecycle. During the startup stage, the business is focused on creating awareness and generating quick uptake in high-potential market segments that are responsive to selling effort and are likely to become early adopters of the new product or service. As business takes off and enters the growth stage, customer strategies evolve to emphasize increased penetration of initial market segments and expansion into new segments. As growth slows and the business enters the maturity stage, customer strategies focus on retention and continued effective coverage of market segments developed during the growth stage, but with added emphasis on serving these segments efficiently and profitably. Finally during the decline stage, customer strategies take on an even stronger efficiency focus, as the business aims to protect the most profitable and retainable customer relationships while exiting unprofitable segments.
As customer strategies evolve throughout the business lifecycle, the emphasis of management attention to critical sales force architecture issues evolves as well. While all of these sales force architecture decisions are important during every stage of the lifecycle, the decisions that receive the greatest attention at each stage are those that have high impact, have significant scope for error, and are particularly difficult to address effectively, given the customer strategy that the business is pursuing and the challenges that the business faces during that stage.
This paper summarizes how customer strategies and therefore the emphasis of management attention to different sales force architecture issues varies throughout the four lifecycle stages.
Sales Territory Design: Thirty Years of
Modeling and Implementation
Sales territory alignment is the assignment of accounts and their associated selling activities to salespeople and teams. This paper traces the evolution of models, alignment systems and processes over a 30-year period during which we have implemented these alignment approaches in over 1500 projects for over 500 companies in 39 countries and designed an estimated 500,000 sales territories.
We trace the evolution along four dimensions � models, systems, process, and wisdom. Technology hass enabled the models to get closer to sales managers. Efficient mapping systems and effective implementation processes have enhanced the model-based answer and have generated sales manager buy-in at the same time. The sales territory alignment decision touches everyone in the sales force and any model only captures some of the information that impacts the decision. Incorporating local knowledge into the alignment answer is a key to its success. We have developed and used a process that first creates a model-based answer, and then integrates field manager input in a structured way by having the manager work one-on-one with an alignment expert and the model. It is this process that has led to a 100 percent implementation rate for the models. This process creates alignments that are simultaneously good for the business and good for the salespeople. The repeated implementations have helped us evolve the models, systems and processes to solve a broader set of alignment situations better.
Sales and Marketing Integration: A Proposed Framework
We identify sales and marketing activities, and common impediments to their integration. Next we discuss the concept of sales-marketing integration, and distinguish it from related concepts such as involvement and communication. Following this, we discuss approaches businesses can use to improve sales-marketing integration as well as their potential costs and drawbacks. We conclude with a set of propositions identifying the conditions under which sales-marketing integration has the greatest impact on firm performance.
The Changing Environment of Selling and
New developments and trends in selling and sales management are creating demands and opportunities that require adaptation and new approaches on the part of both sales organizations and academic researchers. This article summarizes critical dimensions of change in the environment that affect the practice of selling and sales management and introduces the articles that follow in this special anniversary issue of JPSSM.
Global sales effectiveness initiatives:
What works and what does not?
Most large pharmaceutical companies have initiated global or regional programs to enhance sales performance. In the authors’ experience with such productivity enhancement initiatives in hundreds of situations, there have been clear differentiating factors separating the efforts that work and those that do not.
Sales Force Decision Models: Insights from 25
Years of Implementation
Over 25 years, the authors have developed many sales-force and modeling insights through over 2,000 projects with several hundred selling organizations, in over 50 countries. These insights fall into two categories.
The content insights are some of the market dynamics that need to be considered when making important sales force decisions. Examples include: company profitability is flat for a wide range of sales force sizes; phased sales force growth is rarely optimal; focused strategies dominate scattered strategies; most sales territories (55 percent) are either too large or too small; and no compensation plan satisfies everyone in a selling organization.
The implementation insights are lessons that we have learned about model building, model usage and model implementation. They include: the economic value of a model can come from many possible sources such as reduced uncertainty, accuracy, increased speed, objectivity and stakeholder involvement; theory and practice have different and complementary perspectives; experience and wisdom are sometimes better than models; and models provide insights - people make decisions.
Several project examples illustrate how models have helped integrate sales forces during mergers, how models have helped to create a virtuous modeling-learning cycle, and how models have been used to assure control and consistency in the annual planning process of a large multi-country organization.
Territory Alignment: An Overlooked Productivity Tool
Sales force productivity is a hot topic. Sales managers, like managers in most areas of business, are feeling the pressure to "do more with less." The focus on productivity of sales forces is warranted, because they cost American companies over $500 billion a year.
Sales territory alignment is one of the most frequently overlooked sales force productivity areas. Many sales forces are losing millions of dollars each year because of territory imbalances. Well-managed companies are overcoming the main obstacles to good territory design by using a cogent process to realign territories. This process ensures that consistent, objective criteria are used to evaluate alignment needs, yet recognizes the importance of incorporating local management judgment.
Drivers That Make Sales Teams Tick
Every sales force has an opportunity to increase its sales by identifying key productivity drivers and improving performance on those criteria. This in-depth article examines how productivity drivers can be used to prioritize changes in sales force strategies and processes. The best sales forces not only rework their strategies to meet today's competitive circumstances, but also fine tune their performance to withstand opportunistic challenges in the future, by addressing productivity drivers key to their position.
to Make Sales Force Mergers Work
Mergers provide an opportunity to create a new and superior selling organization. Unfortunately, the opportunity is often missed. The "conquer" mentality of the dominant company, combined with cost-cutting pressures, too often results in insufficient effort towards creating a new selling organization that blends the best of both. And because the sales force drives the top line, downsizing has a disproportionate effect on sales revenue. This article reviews in detail these and other problems encountered in merging sales organizations, and provides guidelines for overcoming them.
a Sales Force to be Reckoned With
As the public face of the company, the sales force has the power to directly influence sales and productivity. Hence, decisions about its size and structure are critically important. This article provides some guidelines for managers, including how to size a force to cover customers appropriately, the product line fully, and to develop new potential. Further discussion demonstrates how the right sales force structure effectively and efficiently handles product and market complexities.
Other Representative Publications
"Integer Programming Models for Sales Resource Allocation," (with P. Sinha), Management Science, Vol. 26, No. 3 (March 1980), pp. 242-260.
"Impact of Resource Allocation Rules on Marketing Investment-Level Decisions and Profitability," (with M. Mantrala and P. Sinha), Journal of Marketing Research, Vol. 29 (May 1992), pp. 162-175.
"An Integrated Model-Based Approach for Sales Force Structuring," (with A. Rangaswamy and P. Sinha), Marketing Science, Vol. 9, No. 4 (Fall 1990), pp. 279-298.
"Structuring a Multiproduct Sales Quota-Bonus Plan for a Heterogeneous Sales Force: A Practical Model-based Approach," (with M. Mantrala and P. Sinha), Marketing Science, Vol. 13, No. 2, Spring 1994, pp. 121-144.
"Sales Territory Alignment: A Review and Model," (with P. Sinha), Management Science, Vol. 29, No. 11 (November 1983), pp. 1237-1256.