SALES MANAGEMENT

Approach to MBA studies w.r.t. Sales

Management

From the earlier batch interactions with the students at IIPM and subsequent queries and doubts normally raised at the 11th hour, I felt the need to design and send to you (visiting students) the following: Text Book It is a good practice to refer to the prescribed textbook, however reference to any other standard text by well-known authors is also ok. What one needs to understand; no textbook will help you to tackle the case analysis directly! Why? Because, a given casequestion can have more than one correct answer! Even the authors provide suggested solutions only or as matter of fact any real time case can have more suggestions or alternatives arising later on which could be add-ons to what were the actual solutions implemented by the company given in the real time case. Refer to notes already sent on how to tackle a case. Now coming to the issues of concepts and keywords. These are bromide tablets (bitter to taste) that a student will have to digest from any textbook or from the facultys explanation in the classroom. The name of your prescribed textbook is given in the first set of power point slides. For those who love spoon-feeding (unlikely to become a manager) i.e. do not remember the name of the book on the eve of the exam it is Sales Management by Richard Still Cundiff Govoni TMH publications and I am Prof Dr Vijay Kumar Jayaram who taught the subject in class FGS (for Gods sake) please press the F5 (refresh) button in your RAM (memory/history) A given text may have 400 pages or 4000 pages, getting shocked on the examination eve (eve here is not Adams eve; yes there is no of after examination) after seeing its contents indicates that the student has been sleeping (even after telling in class to start reading the text). An MBA aspirant knows what to do and when to do what. Simply said MBA students know how to manage any size any time Are you MBA enough? Or do you expect the faculty to spoon-feed i.e. read every line and translate it into understandable language? Better you decide and decide fast before the course is over. My only problem is do not come to me at the 11th hour. 11th hour means coming to me at the last minute/hour. Such a management is not JIT just in time. JIT is actually job in time or justice in time.

Textbook treatment for sales management during class hours will not be done. This paper is more of a prescribed management science than of a described one (like Law, English or Accounting). Past year Question Papers Faculty members like me have a trend not to repeat questions or at least change according to the present subject scenario. So unlike UPSC, university standard education groups or some other pattern or Edu-dinosaurs ( I dont have an equivalent Tamil translation for it sorry) past year papers will not be of much help for the subject handled by me. And of course dont trouble any self by asking for important questions or important portions. (For your information) FYI, I dont teach in a school with kids facing board exams, I teach professionals and those who are in the making of becoming real professionals. Some more notes / Tips The terms given in Sales Management such as: Budget, Reports, Controls, Forecasting is highly related. Obviously, when we balance the expense to revenue we get business done. Sales budgets can involve one or more of the following: All expenses involved in Recruitment and selection, Training, Compensating, welfare measures, promotions, recovery loss, operational, legal and infra structural maintenance can be budgeted. To the above we may try and equate it with the sales forecast which would depict our expected revenues. To understand further the relationships please try and plot the following as a diagram: Stop reading, take a sheet of paper and a pencil right now.

Got it? Good now do this Sample diagram: Position Sales Budget within a circle at the center of a page and surround it with satellite like circles each containing the following labels: Work force, Territory, Quotas & Reports, Products, Time (seasons), Compensation & commission, Distribution expenses, Technology. Have a glance at all the organizational charts and diagrams given in the textbook. Now discuss the subject within your mind with the following thoughts. Sales forecast is highly related to demand forecasting (recollect demand D in economics? Y-Income, price, price of competition & substitutes, tastes & preferences ) During class we also discussed about MPI Market potential Index, the question is how is demand forecasted ? The same way sales is forecasted! Sounds simple? Say the selling price per unit of a given product is Rs.100 and the demand of that product in the given market is 10 lakhs. Your sales forecast is 100 x 1,000,000. If the demand is an industry demand then it includes all your competitors therefore we should calculate only what our percentage would be. Say industry consumption is 1 billion units and ours is a 10% share of that than our demand is 100 million units. (1000 millions make 1 billion). Our demand here means the demand we can expect from the market. Market here means customers/client. Do you think now, if someone gives you the sales forecast and the price per unit, can you not calculate the demand? What is a Sales plan? It is a plan made up of the sales strategy, sales tactical and sales operational plans. Strategy refers to growth* and sustenance, tactical would go into all aspects of control i.e. reporting, quotas, budgeting together with their selling policies (not insurance policy; policy here refers to warranty policy, service policy, recruitment policy etc). Operational plans would go into day-to-day sales affairs for example calls made, demos given, delivery done, repairs, enquiries handled, attendance etc. * Growth plans could be intensification, integration and diversification related or unrelated. It could relate to innovations and change management. When a case analysis has a question to calculate sales forecast look for applying any one of the best methods discussed in class, and for a question on sales plan look at developing the critical thoughts on the case from the above explanation. Do not forget that it is the unmet needs that contribute to a companys objectives from these objectives we derive

upon a strategy (philosophy, power of business intelligence) which in turn leads to tactical (policy, procedures) and operational plans (programs, promotions and projects). MIS Sales Information is knowledge derived from processing data. Data are facts or figures. Objectives of MIS (Management information Systems by David Kroenke) 1. 2. 3. 4. 5. Support Strategic planning Support Management control Support Operational control Improve product quality Improve product delivery

Types of Information systems TPS Transaction processing systems these would pertain to accounting, billing, inventory management, they keep a log of day-to-day transactions. Attendance, enquires all fall under this category. OAS- Office automation systems These are those information systems that take care of organizational communications such as email, intranet, fax, teleconferences, desk top conferencing. Simply put they store and share information. MIS- Management information systems This is control or supervisory in nature. It normally extracts information using TPS data and provides structured summarized reports on a periodic basis, which is used for controlling the sales organization. Sometimes the MIS reports are also used for strategic planning. DSS Decisions support systems This helps in decision-making particularly in issues pertaining to areas of risk and uncertainty. The DSS can use data from the TPS, MIS and also external data. DSS are created with statistical support i.e. they contain all the related tables, data and information which are used by logistics. Therefore using a DSS would mean that a manager will have to give a set of data in the prescribed format and the DSS will reveal solutions just like a statistician using a logical approach. It is faster and does not have human errors during calculations. The manager need not know statistics or related models. For example Test of hypothesis or the Chi square test can be done. Do you feel the above can help sales plans, forecast and budgets under the gamut of technology?

EXAM pattern: 70 marks 3 hours.

Part A: 30 marks write any three out of four. PART B: 10 marks. Using diagrams represent the given terms or questions. Part C: 30 marks Case analysis. Remember two things: Good managers do not panic they give an iron handshake with a velvet glove Mother Nature is a tough teacher, she gives the tests first and lessons later on! Business is from nature For queries email to: prof_vkj@yahoo.com