sales organization structure sales force deployment l.
Download
Skip this Video
Loading SlideShow in 5 Seconds..
Sales Organization Structure & Sales Force Deployment PowerPoint Presentation
Download Presentation
Sales Organization Structure & Sales Force Deployment

Loading in 2 Seconds...

play fullscreen
1 / 41

Sales Organization Structure & Sales Force Deployment - PowerPoint PPT Presentation


  • 194 Views
  • Uploaded on

Sales Organization Structure & Sales Force Deployment. Module Four. Sales Organization Structure . Sales Organization Concepts. Specialization

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Sales Organization Structure & Sales Force Deployment' - shirley


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
sales organization concepts
Sales Organization Concepts

Specialization

The degree to which individuals perform some of the required tasks to the exclusion of others. Individuals can become experts on certain tasks, leading to better performance for the entire organization.

Centralization

The degree two which important decisions and tasks performed at higher levels in the management hierarchy. Centralized structures place authority and responsibility at higher management levels.

sales force specialization continuum

Generalists

All selling activities

and all products to

all customers

Specialists

Certain selling activities for certain products for certain customers

Some specialization

of selling activities,

products, and/or

customers

Sales Force Specialization Continuum
span of control vs management levels

Flat Sales Organization

National Sales Manager

Management Levels

District Sales Manager

District Sales Manager

District Sales Manager

District Sales Manager

District Sales Manager

Span of Control

Span of Control vs. Management Levels
span of control vs management levels6

Tall Sales Organization

National Sales Manager

Regional Sales Manager

Regional Sales Manager

Management Levels

District Sales Manager

District Sales Manager

District Sales Manager

District Sales Manager

District Sales Manager

District Sales Manager

Span of Control

Span of Control vs. Management Levels
line vs staff positions

National Sales Manager

Regional Sales Managers

District Sales Managers

Sales Training Manager

Sales Training Manager

Salespeople

Staff Position

Line Position

Line vs. Staff Positions
selling situations

Dynamic sales environment

Specialization

Nonroutine

Adaptiveness

Relatively stable

sales environment

Centralization

Repetitive

Effectiveness

Selling Situations

Selling-Situation Factors & Organizational Options

Organizational

Structure

Environmental

Characteristics

Task

Performance

Performance

Objective

geographic sales organization

National Sales Manager

Sales Training Manager

Eastern Region Sales Manager

Western Region Sales Manager

Zone Sales Managers (4)

Zone Sales Managers (4)

District Sales Managers (20)

District Sales Managers (20)

Salespeople (100)

Salespeople (100)

Geographic Sales Organization
product sales organization

National Sales Manager

Office Equipment Sales Manager

Office Supplies Sales Manager

District Sales Managers (10)

Salespeople (100)

Salespeople (100)

District Sales Managers (10)

Product Sales Organization
market sales organization

National Sales Manager

Commercial Accounts

Sales Manager

Government Accounts

Sales Manager

Sales Training Manager

Zone Sales Managers (4)

District Sales Managers (25)

District Sales Managers (5)

Salespeople (50)

Salespeople (150)

Market Sales Organization
functional sales organization

National Sales Manager

Field Sales Manager

Regional Sales Managers (4)

Salespeople (40)

District Sales Managers (2)

District Sales Managers (16)

Telemarketing Sales Manager

Salespeople (160)

Functional Sales Organization
sales organization structures major accounts options

Develop Major Account Salesforce

Assign Major Accounts to

Sales Managers

Assign Major Accounts to Salespeople along with Other Accounts

Sales Organization StructuresMajor Accounts Options
slide14

Organizational

Structure

Advantages

Disadvantages

  • Low Cost
  • No geographic duplication
  • No customer duplication
  • Fewer management levels
  • Limited specialization
  • Lack of management
  • control over product or
  • customer emphasis

Geographic

  • Salespeople become experts
  • in product attr. & applications
  • Management control over
  • selling effort
  • High cost
  • Geographic duplication
  • Customer duplication

Product

Comparison of

Sales Organization Structures

slide15

Organizational

Structure

Advantages

Disadvantages

  • Salespeople develop
  • better understanding of
  • unique customer needs
  • Management control over
  • selling allocated to different
  • markets
  • High cost
  • Geographic duplication

Market

  • Geographic duplication
  • Customer duplication
  • Need for coordination
  • Efficiency in performing
  • selling activities

Functional

Comparison of

Sales Organization Structures

hybrid sales organization structure

National Sales Manager

Major Accounts

Sales Manager

Regular Accounts

Sales Manager

Office Equipment

Sales Manager

Office Supplies

Sales Manager

Field Sales

Manager

Telemarketing

Sales Manager

Commercial Accounts

Sales Manager

Government Accounts

Sales Manager

Western

Sales Manager

Eastern

Sales Manager

Hybrid Sales Organization Structure
slide18

Sales Force deployment decisions can be viewed as providing answers to three interrelated questions.

  • How much selling effort is needed to cover accounts and prospects adequately so that sales and profit objectives will be achieved?
  • How many salespeople are required to provide the desired amount of selling effort?
  • How should territories be designed to ensure proper coverage of accounts and to provide each salesperson with a reasonable opportunity for success?
interrelatedness of sales force deployment decisions
Interrelatedness ofSales Force Deployment Decisions

How much selling effort is needed to cover accounts and prospects adequately so that sales and profit objectives will be achieved?

Allocation of

Selling Effort

Sales Force

Size

How many salespeople are required to provide the desired amount of selling effort?

How should territories be designed and salespeople assigned to territories to ensure proper coverage of accounts and to provide each salesperson with a reasonable opportunity for success?

Territory

Design

allocation of selling effort analytical approaches

Easy to Develop and Use

Low

Analytical

Rigor

High

Analytical

Rigor

Difficult to Develop and Use

Allocation of Selling EffortAnalytical Approaches

Single Factor

Models

Portfolio

Models

Decision

Models

allocation of selling effort single factor models
Allocation of Selling Effort:Single Factor Models

Accounts classified into categories based on one factor, such as volume potential

  • All accounts in the same category are assigned the same number of sales calls
  • Effort allocation decisions are based on the analysis of only one factor and differences among accounts in the same category are notconsidered in assigning sales call coverage
allocation of selling effort single factor model example

Market Potential

Categories

A

B

C

D

Average Sales Calls to

an Account Last Year

25

23

20

16

Average Sales Calls to

an Account Next Year

32

24

16

8

Allocation of Selling EffortSingle Factor Model Example
allocation of selling effort portfolio models
Allocation of Selling EffortPortfolio Models
  • Accounts are ‘grouped’ by specific criteria to determine their value to the firm ie.
    • Account (Growth) Opportunity - an account’s need for and ability to purchase the firm’s products
    • Competitive (Advantage) Position - the strength of the relationship between the firm and an account
allocation of selling effort decision models
Allocation of Selling Effort:Decision Models
  • Simple Basic Concept - to allocate sales calls to accounts that promise the highest sales return from the sales calls
  • Optimal number of calls in terms of sales or profit maximization
sales force size key considerations
Sales Force Size Key Considerations
  • Sales Volume Growth
    • Anticipated increases
  • Sales Productivity
    • The ratio of sales to selling costs
  • Sales Force Turnover
    • Should be anticipated
sales force size analytical tools
Sales Force Size: Analytical Tools
  • The Breakdown Approach
  • Is used to determine the number of salespeople needed to generate a forecasted level of sales.
  • It is weak conceptually.
  • The concept underlying the calculations is that sales determine the number of salespeople needed— putting “the cart before the horse.”

Salesforce size = Forecasted sales / Average sales / person

sales force size analytical tools27

Total selling effort needed

Number of salespeople =

Average selling effort per salesperson

Sales Force Size: Analytical Tools
  • The Workload Approach
  • Determines how much selling effort is needed to adequately cover the firm’s market.
  • Then the number of salespeople required to provide this amount of selling effort is calculated.
  • This approach relatively simple to develop and is sound conceptually.
sales force size analytical tools28
Sales Force Size: Analytical Tools
  • The Incremental Approach
  • Its basic concept is to compare the marginal profits and marginal costs associated with each incremental salesperson.
  • The major advantage of this approach is that it quantifies the important relationships between salesforce size, sales, and costs.
  • However, the incremental method is difficult to develop, and it cannot be used for new sales forces where historical data and accurate judgments are not possible.
designing territories
Designing Territories

Territories consist of whatever specific accounts are assigned to a specific salesperson. The territory can be viewed as the work unit for a salesperson.

Territory Considerations

  • Trading areas
  • Present effort
  • Recommended effort
designing territories30
DESIGNING TERRITORIES

EXTREMELY RARE

Most often territories evolve

with market development & volume,

And are revised / adjusted

on an ‘ongoing basis.

design goals
DESIGN GOALS
  • EQUALITY OF SALES
  • WORKLOAD
  • GROWTH POTENTIAL
six design steps
SIX DESIGN STEPS
  • Select a control element for territory boundaries / size.
  • Determine location & potential of customers.
  • Determine basic territories
  • Assign sales people to territories.
  • Establish territorial coverage plans for sales reps.
  • Monitor sales & cost of sales on an ‘ongoing’ basis.
step one
STEP ONE

TERRITORIAL SIZE (miles covered)

  • Boundaries (usually political or geographical):
    • BASED ON:
      • REGION (WESTERN CANADA)
      • PROVINCE (BC)
      • CITY / COUNTRY (PRINCE GEORGE / VANDERHOOF, QUESNEL, ETC.)
step two
STEP TWO
  • Determine the location of potential customers from:
    • phone book
    • Mailing lists
    • route riding
step three
STEP THREE
  • TO DETERMINE BASIC TERRITORIES USE EITHER:
  • BUILD UP METHOD:
    • Establish individual performance parameters (workload capacity: # of calls per day x # of days), frequency / miles, account types a, b or c, length of call.
    • Draw out individual territory boundaries
    • Adjust as needed
step three36
STEP THREE

BREAKDOWN METHOD:

  • Determine total market sales potential
  • Establish individual territories:
  • Can use a market index x total sales potential, should use ‘hands on’ territory analysis as territories are rarely sufficiently uniform
  • Estimate sales volume per person and draw boundaries.
  • Adjust as needed
step four
STEP FOUR
  • Assigning sales people to territories
  • Need to match personality of the SR to the personality of the territory (ie. miles, account type, culture, etc.)
  • Can be a management tool
    • Beginner territories
    • ‘Penal’ territories
    • ‘Plum’ territories
  • Territory adjustment need is ‘ongoing’
step four continued
STEP FOUR continued
  • Set performance norms that ‘flag’ when the need becomes critical.
  • Territory can ‘boom’ & far out pace sales (Alberta) / can shrink / dry up (Nfld.)
  • Claim jumping ~ territory / account overlap
  • Consequence of revising territories
    • People don’t like change: it means more work / less return.
    • The change needs to be ‘sold’
    • Compensation format may need adjustment
step five
STEP FIVE
  • Territory coverage
  • The plan of how the territory is to be serviced
  • Call sequence / frequency, routing
  • Sales management should only ‘do’ the initial ‘set up’
  • Assigned rep should submit modifications with as their territory knowledge develops.
  • Managements role is to set performance standards e.G. Calls per day, etc.
  • Need to factor in account merchandising, prospecting.
step six
STEP SIX
  • Monitor sales
  • Cost of sales on an ‘ongoing’ basis.
sales organization structure sales force deployment41
Sales Organization Structure &Sales Force Deployment

A dynamic management undertaking

that must be constantly

assessed and ‘fine tuned’

to ensure the ideal balance

between profitability

and the development of

continued sales growth.