Training Program, Sales Force Compensation, Maslow’s Need Hierarchy Theory, Herzberg’s two factor theory, Evaluating Sales Force,

1. Module 5 : Sales Force Management II

2. Training Sales Persons
Training substitutes for, or supplements experience.
Objectives of training:
Improve Productivity
Improve Job Satisfaction
Reduce Recruitment & Selection Costs
The marginal payoff from Improvement in Sales
Training Exceeds those from Improvements in
Recruitment & Select

3. Designing a Training
Program
 Defining Training Aim
 Deciding Training Content
 Selecting Training Method
 Selection of Trainer
 Fixing the place of training
 Duration & time of training
 Evaluating Training Program

4. Methods of Training
Method Purpose
Lectures Provision of information relevant for job
performance
Films Enables demonstration of how a skill can be
performed
Role playing Enables the performance of a learned skill
Case studies Development of analytical skills
In-field training Providing real life selling experiences to
employees
E-Learning Allows training to take place over long
distances without physical presence

5. Sales Force Compensation
1. Straight Salary: Used in organization require sales people to mainly
sell and maintain customer relationships; also for team selling in
industrial markets
Benefits
 Stable income, sense of security
 Reduces costs in growth market
 Better direction & control by management because sales people
do not depend on sales for pay.
 Switching territories / quotas does not rouse resistance
 Related work is taken w/o complain

6. Sales Force Compensation
Negatives
 Complacency, no extra effort in selling
 Sales are distorted in favor of easy to sell products
 Capable sales people do not feel rewarded
 Turnover rises

7. Sales Force Compensation
2. Straight Commission
Most effective for small and new organizations; may be different for
different products, at different volumes etc.
Benefits
 Objective measure to judge performance
 Incentive to sales people for volumes
 Exodus among low performers
 Helps in setting targets
 Hinders transfer of sales people between territories

8. Sales Force Compensation
Negatives
 Customer service / relationship building overlooked
 Little control over sales people – become proprietarily do not
give reports, do not follow up leads, shed prices, force sell
 Focus is on sales not on profits
 Hinders transfer of sales people between territories
 Wide differences of pay leading to de-motivation
 Difficult in declining stages of product life cycles
 High turnover

9. Sales Force Compensation
3. Combination Pay Plan
Most sales compensation plans are combinations of salary & commission
plans. By a judicious blending of the two basic plans, management
seeks both control & motivation.

10. Motivating Sales Personnel
 Motivation is the process that produces goal – directed
behavior in an individual.
 Motivation in the sales function refers to the amount of effort a
salesperson is willing to expand in the selling job.
 Sales people are required to be self-starters, highly ambitious,
result oriented and go-getters. Thus the sales-force has to be
kept highly motivated and committed.

11. Maslow’s Need Hierarchy Theory
Physiological needs
Safety needs
Social needs
Esteem needs
Self-
actualization
needs
Lower-order
needs
Higher-order
needs

12. Goal Setting Theory

13. Herzberg’s two factor theory

14. Contests
A special selling campaign offering incentives in the form
of prizes or awards beyond the compensation plan.
Contest Prizes:
Cash
Merchandize
Travel
Special Honor or Privileges

15. Awarding Prizes for Sales
Contests
•Should motivate average, inexperienced salespersons along with
star performers
•Danger in offering too many small prizes or too few large prizes
•Basis of award can be overall performance or improvement in
quota achievement

16. Evaluating Sales Force
Performance
Four Main Steps:
 Establishing Performance Standards
 Recording Performances
 Evaluating Performances against Standards
 Taking Action

17. Evaluating Sales Force
Performance
1. Setting Performance Standards (Quantitative)
A. Quotas
B. Selling Expense Ratio
C. Territorial Net Profit or Gross Margin Ratio
D. Territorial Market Share
E. Sales Coverage Frequency Index
F. Call Frequency Ratio
G. Calls per day
H. Order Call Ratio
I. Average Order Size

18. Evaluating Sales Force
Performance
1. Setting Performance Standards(Qualitative Job
Factors)
A. Product Knowledge
B. Awareness of Customer Needs
C. Relationship With Customers
D. Service Follow Up
(Qualitative Personal Factors)
E. Punctuality
F. General Attitude
G. Dress & Appearance
H. Cooperation
I. Adaptability

19. Evaluating Sales Force
Performance
2. Recording Actual Performance
Source:- Field Sales Report
 Progress or Calls reports
 Expense report
 Sales work plan
 New business report
 Lost Sales Report
 Report for Complaint & Adjustment

20. Evaluating Sales Force
Performance
3. Evaluation : Comparison against Actual
Issues Involved
 Differences in individual territories
 Sales Potential
 Impact of Competition
 Personalities of Sales persons & their customers
 Comparison of both qualitative & quantitative data

21. Evaluating Sales Force
Performance
4. Taking Action
No Deviations/Low Significance deviations
 No Action Required
Highly Significant deviations
 Adjust Performance to Standards
 Revise the policy or plan or strategies
 Lower or raise the objectives or standards

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