The document discusses organizing and staffing a salesforce. It describes the main types of sales organizations as line, line and staff, functional, and horizontal. It also covers specializing the salesforce by geography, product, and market. When determining salesforce size, the workload, sales potential, and incremental methods are outlined. The staffing process involves planning needed positions, recruiting applicants, selecting candidates through interviews and testing, hiring, and socializing new salespeople.

1. Organizing and Staffing the
Salesforce

2. Introduction
The management process consists of first setting the firm’s
objectives and goals
Planning the suitable strategies and actions to achieve the
stated objectives and
goals
To implement the strategies and action plans, the company
must have an
organization structure and people.

3. Concepts of Sales Organisation
• A sales organization assists the sales manager to
carry out needed tasks efficiently and effectively
• The basic concepts included in sales organization are:
• Degree of centralization
• Degree of specialization
• Line or staff positions
• Market orientation
• Effective co-ordination

4. Basic Types of Sales Organisations
Sales organizations are generally classified into four
basic types:
• Line Organization
• Line and staff organization
• Functional organization
• Horizontal organization
We shall discuss main characteristics, advantages, and
disadvantages of each type of sales organization

5. Line Organisation
Characteristics: All managers have line authority to direct and control
subordinates. Used in small firms / departments
Advantages: Simple organisation, clear authority, quick decisions, low cost
Disadvantages: No support to line managers from subordinates who have
specialised knowledge / skills. Less time for planning / analysis

6. Line and Staff Organisation
Characteristics: Specialist staff managers are available for senior marketing /
sales managers. Staff managers’ role is to assist / advise line managers. Used in
medium and large size organisations
Advantages: Better marketing decisions, superior sales performance
Disadvantages: High cost and coordination, slower decision making, conflict may
arise if staff managers’ role is not clear

7. Functional Organisation
Characteristics: Each functional specialist has line responsibility over
salespeople. Used by a large firm with many products / market segments,
minimising line authority to functional managers
Advantages: Qualified specialists guide salesforce, simple to administer
Disadvantage: confusion due to more managers giving orders to salesforce

8. Horizontal Organisation
Research & Design Team:
•Customer Research
•Product / Service Design
Planning Team:
•Strategic Planning
•Accounts, Finance
•HR, Administration
•Chief Operation Officer
Operations Team:
•Production / Operations
•Quality Assurance
•Systems Engineering
Customer Support Team:
•Information
•Service
•Training
Customer Satisfaction Team:
•Sales & Marketing
•Pricing, Promotion
•Channels, Logistics
Characteristics: Removes management levels & departmental boundaries.
Except planning team, all others are members of cross-functional teams. Used
by firms having partnering relationships with customers.
Advantages: Reduction in supervision, unnecessary tasks, & cost; Improved
efficiency and customer responses.

9. Specialisation within Sales Organisation
• In order to increase effectiveness of Salesforce
• Done by expanding basic sales organization
• Basis of specialization are factors such as :
• Geography
• Type of product
• Market
• Combination of these factors
• Criteria to be used – (1) meeting customer needs, (2)
nature and number of products (3)sales force
abilities, (4)Sales cost

10. Geographic Specialisation
Characteristics: salespeople, assigned geographic areas, are responsible for all
selling activities to all customers within assigned areas. Branch sales managers
adjust marketing plan to local needs
Advantages: Better market coverage and customer service, more control over
salesforce, quick response to local conditions & competition
Disadvantages: Limited specialisation of marketing tasks. Hence, it is combined
with product / market sales organisation

11. Product Specialisation
• Used when the company has many products and / or brands
• Two types of product specialization
(a). Sales organization with product managers
(b). Sales organization with product specialists Salesforce
Head-Marketing
Marketing
Research
Manager
General
Sales Manager
Area Sales
Managers –
Product Group ‘A’
Salespeople –
Product Gr. ‘A’
Area Sales
Managers –
Promotion
Manager
Product Group ‘B’
Salespeople –
Product Gr. ‘B’
Sales Training
Manager
Fig. ‘x’ Sales Organisation with product specialised salesforce

12. Product Specialisation Head-
(Continued)
Marketing
Marketing
Research
Manager
Promotion
Manager
General
Sales Manager
Area Sales
Managers
Salespeople
Product
Manager
Product Gr. ‘A’
Product
Manager
Product Gr. ‘B’
Fig. ‘y’ Sales Organisation with Product Managers as Staff Specialists
In fig. ‘x’: Characteristics: Salespeople in each product group sell only the products in that
group
Advantage: Each product gets specialized attention from the Salesforce
Disadvantage: Sometimes, more salespeople contact the same customer, resulting in
customer dissatisfaction and higher cost
In fig. ‘y’: Characteristics: Each product manager plans to ensure attention to product lines
and brands at planning level.
Advantage: Corrects the problem of duplication calls on a customer by salespeople
Disadvantage: Lack of product specialization by salespeople

13. Market Specialisation
National sales manager
Sales Manager-
Commercial
Area Sales Managers-
Commercial
Salespeople
• Characteristics: Desirable when customers are classified by type, user industry, or
channel. Salespeople carry out all activities for all products only for specific
customer groups
• Advantages: Meets needs of specific customer groups, implements customer-centred
philosophy of the company
• Disadvantages: Geographic duplication, high cost
Sales Manager-
Government
Area Sales Managers
-Government
Salespeople

14. Director –
Combination Sales Organisation
Sales
& Marketing
General
Manager
Sales - North
General
Manager
Sales - East
Regional Sales
Mgr. – Govt.
Salespeople
Regional Sales
Mgr. -
Commercial
Salespeople
General
Manager
Sales - West
Regional Sales
Mgr. - Dealers
Salespeople
General
Manager
Sales - South
• Characteristics: Many firms use some combination of specialisation
organisations, called hybrid or combination sales organisation, with a view
to minimise disadvantages and maximise advantages of specialisation
organisations
• Figure above shows combination of geographic and market specialisations

15. Alternatives for Major Accounts
• Major accounts / customers are called by various
names like key accounts, National accounts, head
quarter accounts, corporate accounts, house
accounts
• They make up a large share of a firm’s sales volume
and profits
• Firms use the following alternative approaches to
deal effectively with them
• Create a major or key account management team
• Use existing sales managers
• Creating a separate division
• Creating a separate Salesforce

16. Size of the Salesforce
• How many salespeople needed (or salesforce size) to
achieve a firm’s sales and profit objectives is a key
decision
• Methods available to decide optimum salesforce size
are as follows:
• Workload
• Sales potential (or breakdown)
• Incremental
• We shall discuss these methods briefly:

17. Workload Method
• Assumption: All salespeople have equal workload
• Steps involved to calculate Salesforce size are:
1) Group present and potential customers according to their
sales potential
2) Decide time per sales call and call frequencies for each class
of customers
3) Calculate total market workload necessary to cover the entire
market
4) Decide total work time available per salesperson
5) Divide total work time available by different activities per
salesperson in hours
6) Calculate total number of salespeople needed
(5)
(3)
totalmarket workload
total selling time available per salesperson


18. Workload Method (Continued)
• Advantages: simple method, conceptually sound, used for all types of
selling situations
• Disadvantages: Neglects sales productivity & salesforce turnover
Sales Potential / Breakdown Method
• The formula used is: , where
N=Number of salespeople needed, or salesforce size
S
N  (1 
T)
S=Annual sales forecast for the P
company in value (Rs. Million)
P=Estimated productivity of the average salesperson in sales (Rs.
Million)
T=Estimated percentage of annual salesforce turnover
• Advantages: Simple and straight forward
• Disadvantages: Conceptually weak; lead time needed for a new
salesperson to reach average productivity

19. Incremental Method
• It is based on marginal analysis theory of economics
• Basic concept: Net profits will increase when additional
salespeople are added, if the incremental sales
revenues exceed the incremental costs
• Merit: Conceptually accurate, as it quantifies
relationships between salesforce size, sales, costs,
profits
• Demerit: Can not be used if historical data on sales and
costs are not available

20. Salesforce Staffing
• It is one of the most challenging and important
responsibilities / activities of sales management
• Salesforce Staffing Process includes following
stages:
• Planning
• Recruiting
• Selecting
• Hiring
• Socialisation
• We shall briefly discuss each of the above stages

21. Planning Stage
• It consists of three steps:
• Establish responsibility for staffing process
• Decide number of salespeople needed
• Outline the type of salespeople needed
• Establish responsibility for staffing process
• Company management decides responsibilities for
various stages / activities of staffing process
• Generally in a medium / large size company,
middle and senior levels H.R. and sales managers
are responsible
• Proper coordination needed between sales,
marketing, and HR executives

22. Planning Stage (Continued)
Decide the number of salespeople needed
• Steps followed by each territory sales manager to plan
requirement of sales people:
1) Decide optimum salesforce size (using methods discussed
earlier)
2) Add number of promotions, retirements, transfers out,
terminations, resignations expected from existing salespeople
3) Subtract expected transfers into the territory and existing
salesforce
4) Make a total of new salespersons needed
• Territory sales managers submit their requirements to national /
general sales manager, who calculates the total number of new
salespersons to be hired

23. Outline Type of Salespeople Needed
The steps involved in the process are:
• Conducting a job analysis
• Preparing a job description
• Developing job qualifications / specifications
Conducting a Job Analysis
• It is done by a person from sales / H. R. department,
or a consultant. It consists of two tasks:
(1) Analyse environment in which the salesperson
would work – E.G. nature of customers, competitors,
products.
(2) Determine duties and responsibilities of the
salesperson. Obtain information from sales managers,
customers, etc.

24. Preparing a Job Description
• It is a written document developed from the
job analysis
• The detailed job description is a useful tool for
recruiting, selecting, training, compensating,
and evaluating salespeople
• Some of the points it generally covers are:
• Job title, reporting relationship, types of products /
services sold, types of customers, duties and
responsibilities, location and geographic area to be
covered

25. Developing Job Qualifications / Specifications
• These are generally based on job description
• Job specifications / qualifications include education, sales
experience, skills, and personality traits
• Many studies done, but no generally accepted job
qualifications for selecting salespeople, due to many types of
sales jobs
• Some methods used for developing job specifications are as
under:
• Study job description. Useful for a new company
• Analyse personal histories of salespersons
• Ask customers

26. Recruiting Salesforce
• Recruiting include activities to get individuals who will apply
for the job
• The general purpose of recruitment is to get enough qualified
candidates, to enable company select the right persons
• H.R. and sales managers must update information on
government employment regulations
• Recruiting stage / process includes following activities:
• Finding the sources of sales recruits
• Evaluating and selecting recruiting sources
• Contacting candidates through the selected
source

27. Finding the Sources of Sales Recruits
• For identifying prospective candidates, firms use internal and
external sources. They include:
Internal Sources External Sources
• Employee referral
programmes
• Current employees
• Promotions and transfers
• Advertisements in
newspapers and journals /
magazines
• The Internet (job sites)
• Educational institutions
• Employment agencies
• Job fairs
• Other companies

28. Evaluating and selecting Recruiting Sources
• Recruiting sources are evaluated based on the database built
over number of years
• Evaluating factors are:
• Performance rating of salespeople, after 2 years
working
• Percentage of salespeople retained, after 2 years
working
• Total cost of recruiting
• Selecting most effective source of recruiting at
least cost
• For a new company, selection depends on cost
• Contacting candidates through the selected source is done by
H. R. department

29. Selecting Salesforce
• Selection process consists of seven major selection steps /
tools
• Companies differ in using selection tools, depending on
expenditure budget and time available
• Major selection tools / steps are:
• Screening resumes
• Application blank
• Initial interview
• Intensive interview
• Testing
• Reference check
• Physical examination

30. Screening Resumes
• It is done when the company receives many resumes
• This step / tool not required, if somebody else like
employment agency does initial screening
• Initial screening of resumes are done by comparing with job
specifications
Application Blank
• Widely used, it is a methodical way of collecting relevant
information from the applicant
• Advantages of using application blank (also called “formal
application form”) are:
(1) Easy comparison of many applicants
(2) Useful for asking question during interview sessions

31. Interviews
• Widely used selection tool
• A good predictor of the candidate’s performance
• Initial interviews are used for screening candidates
• Intensive interviews are conducted to get indepth view of
candidates
• Interview structure / type of interviews:
• Structured / patterned / guided interviews
• Unstructured / non-directed / informal interviews
• Semi-structured interviews
• Behaviour and performance based interviews
• Stress interviews
• Purpose is to decide a candidate’s fitness for a job

32. Testing
• Many firms use tests as a selection tool – EG P&G, IBM
• Purpose of testing: To find whether applicants have traits /
characteristics that lead to success in sales job
• Type of selection tests:
• Aptitude tests measure ability for selling and learning
• Intelligence tests find out mental intelligence or intelligence
quotient (IQ)
• Interest tests find out level of interest in a sales career
• Knowledge tests measure knowledge of products, markets, etc
• Personality tests find out attitude or traits like empathy, self-confidence
• Tests must have reliability and validity
• Tests should be one of the selection tools and not the only tool

33. Reference Checks
• They are important due to possibilities of resume frauds and false
personal information
• They are done by letters / e-mails, telephones, or personal visits
• Instead of candidate’s references, previous employers / customers
to be included for reference checks
Physical Examination
• Objective is to find a physical problem that may prevent job
performance of an applicant
• Most companies want their prospective employees to undergo
physical examination
• Increasing number of firms ask applicant to complete the health
information form without seeing a medical doctor

34. Hiring Stage
• After completing selection process, a list of candidates to be hired is
made
• In hiring stage, two activities are performed:
(1) The company making the job offer
(2) Persuading the applicant to accept it
Socialisation Stage
• It is the process through which new salespeople learn values,
norms, attitudes, and behaviour of people working in the firm
• Socialisation process starts before the new salesperson accepts the
job offer and continues until the person is assimilated into the
company culture
• Assimilation is the second stage of socialisation process
• Companies have this process, in order to retain new salespeople

35. An effective socialization and assimilation process
can help :
 Increase job satisfaction and performance of
salesperson
Reduce turnover of people and cost of the company
Give positive image to the company and the job
Minimize job related uneasiness for the salesperson