Sales Force Management: Prepared by Ladvia Anak Ajiu - Sesi Dec 2017

CHAPTER 3
SALES FORCE
MANAGEMENT
Prepared by Ladvia Anak Ajiu_Sesi Dec 2017
TYPES OF SALES JOB
• Whether applying to sales jobs for the first time or re-entering the market, it is important to
understand the types of sales jobs that are available, and to know what your responsibilities will be.
• There are many different industry terms for sales jobs, and the job that you are applying for may not be
the kind of job that you want.
1. Hunters and Farmers
• The most common distinction you will see for a sales job at any level will be between "hunter" and
"farmer". Hunters are salespeople whose main responsibility is to bring in new business for a company,
be it by cold-calling over the phone or by going door to door to bring in new accounts, or by any other
means. Hunters are usually measured by the amount of new sales they bring to their company.
• Farmers focus solely on existing accounts, ensuring their needs are being met and often finding new ways
to sell their company's services to their clients. Farmers are usually measured by their rate of client retention,
as well as by how much they can increase their company's share of a client's purchasing budget. Both
kinds of salespeople are crucial to a business, and a sales job will often require a mix of both hunting
and farming responsibilities.

TYPES OF SALES JOB
2. Inside and Outside Sales
• Inside salespeople work entirely from an office, managing the entire sales cycle
over the phone and through email. While much of their time is spent cold-
calling prospects, inside salespeople are not telemarketers. They must build
strong relationships with their clients over the telephone, as well as intelligently
nurture leads and structure deals; It takes skill and persistence to close a sale
without ever meeting a prospect.
• Outside salespeople, as you might guess, spend a lot of time outside their
offices visiting their clients in their territories and only entering the office for sales
meetings. Outside salespeople thrive on face-to-face interaction with their
customers, and often become regular faces around the offices of their clients.
Outside salespeople need to be well-organized and self-motivated to meet all
of their objectives with little supervision.
TYPES OF SALES JOB
3. Business Development Managers and Account
Managers
• Business Development Managers and Account Managers often
have different meanings in different organizations but as a
general rule, Business Development Managers spend more time
hunting and Account Managers spend more time farming.
• Business Development Managers and Account Managers could
work 100% inside or outside, or split their time between the
office and the road.

1. RECRUITING
5.
Compensation 2. SELECTING
Sales force
4.Evaluation 3. SALES
management
procedure process TRAINING

1. RECRUITING
Definition: refers to the decision about where and how to look for job applicants.
Job description versus job specification
• Job description – serves as a guideline for recruiting, training, compensating, supervising and
evaluating salespeople.
• The description should be in writing, sufficiently detailed and specific so that both salespeople and
their managers understand , what is expected and ow they will be evaluated
• e,g; numbers of sales call per day, the number of promotion display set up, how the often each class of
customer is to be called on etc.
• Job specification – detailed personal requirements an individual should have in order to successfully
perform the job as described.
• Should be developed between the sales manager and the salesperson to get the best performance
from salesperson.
• E.g’ individual qualification, experience, specific skills, languages etc.

GROUP ACTIVITIES
• Form a group consist of 5 persons.
• Each group need to create their own job
description and job specification for sales
people based on their company business.
Group 1 – Jojo home and office cleaning services
Group 2 – Cleono home and office cleaning services
Group 3 – Chongi life insurance
Group 4 – Habibun life insurance
Group 5- Jenner dancing and musical center
Group 6- John dancing and musical center
SOURCES OF RECRUITING
1. Sources within the company (Internal sources)
a. Other departments
b. Company sales personnel
c. Company executives
2. Sources outside the company (External sources)

a. Direct unsolicited applications
b. Employment agencies
c. Salespeople making calls on the company
d. Employees of customers
e. Sales executives clubs
f. Sales force of non-competing companies
g. Sales forces of competing companies
h. Educational institutions
i. Professional association
j. Classified advertisement Prepared by Ladvia Anak Ajiu_Sesi Dec 2017
INTERNAL SOURCES
1. Other departments
• non sales personnel look upon sales work as glamorous and exciting and consider the opportunity to
transfer to sales department as a promotion.
• These employees are already familiar with the company policies and know a great deal about the technical
aspects of the product and on the part of personnel department considerable detailed information already
in the company’s hand.
• The internal staff can be moved very quickly and successfully into a sales position with a minimum training
2. Company sales personnel
• One of the most successful sources of recommendations for new salespeople can be the company’s
current sales forces
• These applicants already know something about the company policies from their friends
• Salespeople have wide circles of acquaintance since both on and off the job (continually meet new people
and have many friends with similar interest)
3. Company executives
• The recommendations from the top management are an important source of recruiting because of their
understanding of the needed qualifications. Prepared by Ladvia Anak Ajiu_Sesi Dec 2017
EXTERNAL SOURCES
1. Direct unsolicited applications
• Company receive unsolicited “walk-in” and “write-in” application for sales positions especially from young
graduates who just completed their studies
• This techniques do not provide steady flow of applicants, the volume fluctuates with changing business
conditions
2. Employment agencies
• Unpromising sources because company believe that good salespeople neither need nor will use an agency
services
• Careful records should be kept on the result of using employment agencies
• Some employment agencies charge the employer for their services while others charge the appilcants
3. Salespeople making calls on the company
• The purchasing director of a company is in direct contact with sales personnel from other companies and is in a
position to evaluate their on the job performances
• The purchasing director meets high-caliber salespeople for whom job and with company would br attractive
both financially and in other respects.
• In well-managed companies, the purchasing director acts as a “Center of influence”, that contributes names to
the pre-recruiting reservoir.
SOURCES OUTSIDE THE COMPANY
4. Employees of customers
• Customers normally recommend people in their organization who have reached the maximum potential of their
existing jobs. (some companies regards their customer as their business partner)
• Should be recruited only with prior approval of the customer
5. Sales executives clubs
• Sales people who seeks new position submit personal data sheets that are duplicated and forwarded to
members.
• At the club meeting, sales executives have opportunities for informal discussion and exchange of placement
information
6. Sales force of non-competing companies
• An individual works in non –competing company is often attractive recruiting prospect.
• Theses people have selling experience some of it readily transferable and for those who have worked for
companies in related industries, there is attraction of knowing something about the product line.
7. Sales forces of competing companies
• Good source id getting experience salespeople selling similar products line in a similar market with les amount
off training
• Quite costly because company have to offer better pay and benefits to attract this salespeople
SOURCES OUTSIDE THE COMPANY
8. Educational institutions
• Fruitful source of new sales personnel at graduation time
• Universities often are fertile sources of employees for sales job that are highly
technical, highly creative or managerially oriented skills
9. Professional association
• Executives secretaries of these organizations provide this information themselves
10. Classified advertisement
• Classified newspaper advertisement for recruiting new salespeople is another
source of recruitment that is widely used and will draw faster responses

2. SELECTING PROCESS
Definition:
• The selection process involves choosing which candidates best meet the qualifications and have the
greatest potential for the job.
• Employee selection can range from a very simple process to a very complicated process depending on
the firm hiring and the position. The most commonly used steps in the selection process are:
1. Preliminary
6. Physical 7. Placement
screening
examination offer
interview
2. Application 5. Background
forms investigation
3. Personal 4. Psychological
interview tests
1. Preliminary screening interview
• purposes is to eliminate the unqualified candidates
• The interview usually lasts from 20-30 mins and are usually conducted by the personal manager,
sales manager and sales personnel
2. Application forms
• Includes name, address, position applied for, physical conditions, educational background, work
experience, participation in social organizations, outside interests and activities and personal
references
• Questions about educational background are asked because companies believe that applicants'
activities and performance in school tell something about their mental activities and personality
traits.
3. Personal interview
• The interview is use to help determine if a candidate is right for the job. It can bring out personal
characteristics that no other selection tool is capable of doing (conversational ability, speaking voice
and intelligence).

4. Psychological test
• 5 types of tests commonly used ; intelligence test, knowledge tests, aptitude tests (selling),
interest tests and personality test
5. Background investigation
• Require references- someone who will vouch for the candidates’ character and abilities
6. Physical examination
• Having poor physical condition can only hinder a salesperson’s job performance
• Therefore, companies are insisting that candidates undergo a complete examination to
make sure the candidates are physically fit for the job they are applying
7. Placement offer
• When all the steps have been completed, the company must make the decision whether
or not to hire each applicant
• The details of the offer should be set down in writing for the protection of both the
recruit and the firm

GROUP ACTIVITIES
• Form a group consist of 5 persons.
• Each group need to explain with example one type of
test used in selecting process.
Group 1 – intelligence test
Group 2 – knowledge tests
Group 3 – aptitude tests (selling)-
Group 4 – interest tests
Group 5- personality test

IDENTIFY QUALITIES OF A GOOD
SALESPERSON
1. Honesty and ethical conduct on every level
2. An ideology like that of your organization’s
3. Mastering the basics – the technique and curiosity
4. Impeccable communication skills – Language, the verbal and
non-verbal
5. PDCA revised: perseverance, dogged optimism, challenges,
and ability to adapt

3. SALES TRAINING
• Sales training is very important and covers generally
three broad areas namely – knowledge, skill and
attitude – all three a must for development of an
effective salesman.
Definition:
• According to E.B. Fillippo, “ Training is the act of
increasing the knowledge and skills of an employee for
doing a particular job.”
OBJECTIVES OF SALES TRAINING
• Identifying Customer Needs

• Qualifying Opportunities
• Demonstrating Value
• Overcoming Objections

IMPORTANCE OF SALES TRAINING
• Lower turnover of sales people
• Better customer relations
• High sales volume
• Reduces control and supervision
• Reduces selling cost
• Provides expert knowledge

Market
knowledge
Selling
Company technique
knowledge
Training content
Customer
motivation
Product
knowledge
Non selling
activities

TRAINING CONTENT
The subject covered in a sales training program for new salespeople will include:
1. Product knowledge – understanding product uses and applications (to solve
customer’s problem effectively)
2. Company knowledge – knowledge about a company, its organizational
structure and procedures and what it stands for are all important to the new
salespeople
3. Market knowledge – must know who the customers are, their needs, buying
influences and how the company’s products are used.
4. Selling technique - prospect, gather relevant information, approach the
prospect, qualify the prospect, develop a sales presentation, anticipate and answer
objections, close the sale and maintain continuing good relations
5. Customer motivation – trained how to develop enthusiasm within their
6. Non selling activities – to get involve in a number of non-selling activities
which are necessary in their selling jobs (customer service, sales inquiries, time
and territory management and various types of paper work)
TYPES OF SALES TRAINING
Role Playing Initial training
On the job training
Self development Refresher training
Demonstration Types of Lecture

sales
training Discussion
Home study

1. Initial training
• new recruits are given an orientation training so as to know about the company and its
products. He may be allowed to work for sometime in the firm itself to gain sufficient
information about the products.After that he is sent to work in his field.
2. On the job training

• In this method, a new salesman is placed under an experienced or senior salesman who
trains him. Initially he trains the sales techniques, later, takes the trainee along with him on
his rounds and gives him chances to observe the dealings with the customers.
3. Refresher training
• Short-term course aimed at recall and reinforcement of previously acquired knowledge
and skills. It is a form of updating knowledge.

4. Lecture
• Most common of teaching. Modifications of the lecture can increase interest
and learning
• Use to introduce certain points, then discuss in small groups
5. Discussion
• Cases are common used to give practice both in finding creative alternatives
and in solving problems (more value if participants are relatively experienced
6. Demonstration
• Effective in sales training and retention is enhanced because both the eyes and
ears are involved (using visual aids)

7. Role playing
• Most effective training techniques for the art of selling (stimulate selling situation)
• Effective if done before an audience of other salespeople
8. Self development
• Encourage salesperson to take self development course such as public speaking and etc.
• The expectation is to produce a more effective employee and more strongly motivated
9. Home study
• Requires self-motivation and willingness to study
• Little training, especially for some firms that recruits by mail.

4. EVALUATION PROCESS
Definition:
The process of making a judgment about the amount,
number, or value of something; assessment
(an act or instance of evaluating or appraising).

BENEFITS OF PERFORMANCE
EVALUATION
1. Motivation and Satisfaction
• Performance appraisal can have a profound effect on levels of employee
motivation and satisfaction - for better as well as for worse.
• Performance appraisal provides employees with recognition for their work efforts.
The power of social recognition as an incentive has been long noted
2.Training and Development
• Performance appraisal offers an excellent opportunity - perhaps the best that will
ever occur - for a supervisor and subordinate to recognize and agree upon
individual training and development needs.
• Performance appraisal can make the need for training more pressing and relevant
by linking it clearly to performance outcomes and future career aspirations.

BENEFITS OF PERFORMANCE
EVALUATION
3. Recruitment and Induction
• Appraisal data can be used to monitor the success of the organization's recruitment and
induction practices
• Appraisal data can also be used to monitor the effectiveness of changes in recruitment
strategies
4. Employee Evaluation
• the need to evaluate (i.e., to judge) is also an ongoing source of tension, since evaluative
and developmental priorities appear to frequently clash.
• Yet at its most basic level, performance appraisal is the process of examining and
evaluating the performance of an individual.

PROBLEMS IN EVALUATING
PERFORMANCE
1. Don’t assess actual performance — most of the assessment that managers complete
focuses on “the person,” including characterizations of their personal “traits” (i.e.
commitment), knowledge (i.e. technical knowledge) or behaviours (i.e. attendance). While
these factors may contribute to performance, they are not measures of actual output.
2. Infrequent feedback – if the primary goal of the process is to identify and resolve
performance issues, executing the process annually is silly. A quality assessment/control
program anywhere else in the business would operate in real time. At the very minimum,
formal feedback needs to be given quarterly, like the GE process.
3. Non-data-based assessment — most processes rely 100% on the memory of those
completing the assessment because pre-populating the forms with data to inform decisions
would be too difficult (cynicism). In addition, most assessment criteria are “fuzzy” and
subjective.

PERFORMANCE
4. Lack of effectiveness metrics — many accept that the goals of the process
are to recognize results, provide feedback to address weaknesses, determine
training needs, and to identify poor performers. Unfortunately, rarely do process
owners ever measure their processes’ contribution to attaining any of these goals.
Instead, the most common measure relating to performance appraisal is the
percentage completed.
5. Lack of accountability – managers are not measured or held accountable for
providing accurate feedback. While they may be chastised for completing them late,
there is no penalty for doing a half-assed job or making mistakes on them, which is
incredibly common. One firm attempting to remove a troublesome employee found
that the manager had rated the individual the highest within the department and
awarded them employee of the year.
PERFORMANCE
6. Assessments are kept secret — although a salesperson’s performance ranking
may be posted on a wall, performance appraisals are often kept secret. An
overemphasis on privacy concerns might allow managers to play favourites, to
discriminate, and to be extremely subjective. Keeping ratings secret allows managers
to avoid open conversations about equity.
7. No comprehensive team assessment – although individuals on the team are
assessed, there is no simultaneous overall assessment of the team. Often contingent
workers on the team are not addressed at all.

PROCEDURES FOR EVALUATING
PERFORMANCE
To create a performance evaluation system, follow these five steps:
1. Develop an evaluation form - Performance evaluations should be conducted fairly,
consistently and objectively to protect your employees’ interests and to protect
your practice from legal liability. One way to ensure consistency is to use a
standard evaluation form for each evaluation. The form you use should focus only
on the essential job performance areas.
2. Identify performance measures - Standard performance measures, which allow you
to evaluate an employee’s job performance objectively, can cut down on the
amount of time and stress involved in filling out the evaluation form. A job
description alone can serve as a measurement tool during an evaluation

PERFORMANCE
3. Set guidelines for feedback - before you implement your performance evaluation
system, make sure that everyone who will be conducting evaluations knows what kind
of feedback to give, how to give it and how to get it from the employee in return.
4. Create disciplinary and termination procedures- You need to be prepared to handle
such a situation by having well-defined, written disciplinary and termination
procedures in place.
• These procedures should outline the actions that will be taken when performance
deteriorates – a verbal warning, a written warning if there is no improvement or a
recurrence, and termination if the situation is not ultimately resolved.

PERFORMANCE
5. Set an evaluation schedule
• Once you’ve built your performance evaluation system – the evaluation form, the
performance measures, the feedback guidelines and the disciplinary procedures –
you just need to decide when to conduct the performance evaluations.
• Some practices do all employee evaluations at the same time of year, while others
conduct them within 30 days of each employee’s anniversary of employment.
• However you decide to schedule the evaluations, ensure that each appraiser
consistently meets the deadline. Ignoring employees’ overdue evaluations will make
them feel devalued and may hurt morale and performance.

5. COMPENSATION
Definition: is the total money that an employee receives in
exchange for the services he/she performed for the employer
• Typically, this consists of monetary rewards, also referred to as
wage or salary and includes a number of complementary
benefits.
• In other words, it is reward for employment in the form of pay,
salary, or wage, including allowances, benefits (such as company
car, medical plan, pension plan), bonuses, cash incentives, and
monetary value of the noncash incentives.

COMPENSATION ELEMENTS
A sales compensation plan has many as four basic elements.
1. A fixed element, either a salary or a drawing account, to provide some
stability of income.
2. A variable element (for example, a commission ,bonus, or profit sharing
arrangement) to serve as an incentive.
3. An element covering the fringe or “plus factor”, such as paid vacations,
sickness & accident benefits, life insurance, pensions.
4. An element providing for reimbursement of expenses or payment of
expenses allowances.

TYPES OF COMPENSATION PLAN
1. Time Rate Method
2. Piece Rate Method
3. Fixed Salary or Straight Line Method
4. Straight Commission Method
5. Salary and Commission Method
6. Drawing Account and Commission Method
7. Salary Bonus and Commission Method
8. Bonus Method
9. Quota Method
10. Promotion Method
11. Fringe Benefits Method
12. Pooled Commission Method
13. Sales Contest and Prize Method
1. Time Rate Method - The employees are paid a fixed pre-decided amount hourly, daily, weekly or
monthly irrespective of their output
2. Piece Rate Method - paid on the basis of units or pieces produced by an employee
3. Fixed Salary or Straight Line Method - Salesperson receive fixed sums as regular
intervals(usually each week or month sometimes every 2 weeks), representing total payments for
their services
4. Straight Commission Method - As sales volume rises to different levels, the commission rates
differ for different products, categories of customers, or during selling seasons
5. Salary and Commission Method -Most sales compensation plans are combinations of salary &
commission plans. By a judicious blending of the two basic plans, management seeks both control &
motivation.Actual results depend upon management’s skills in designing & administering the plan.
6. Drawing Account and Commission Method - the firm maintains salespeople’s individual
accounts from which the money is advanced to the salespeople against future commissions and the
commissions due are credited to this account periodically. The overdrawn amount is adjusted in
future

7. Salary Bonus and Commission Method - the straight salary is paid for certain specific
duties performed by the salesmen. In case the salesmen puts extra efforts or sells beyond a
pre-determined limit, he is paid commission and bonus.
• The quantum of commission bonus depend upon volume of sales, Profits of the company
• The form of commission bonus may be in the form of cash or prizes or services to
members of the family
8. Bonus Method - It is like an additional financial reward to the sales person for achieving
results beyond a predetermined minimum
9. Quota Method - a fixed salary is paid but the calculation of commission is not paid on
total sales effected by salesperson. A minimum quota is fixed for each salesman and no
commission is paid until he crosses his quota figure.
10. Promotion Method - A job promotion may be the result of an employee's proactive
pursuit of a higher ranking or as a reward by employers for good performance. Typically is
also associated with a higher rate of pay or financial bonus.

11. Fringe Benefits Method - Fringe benefits do not bear direct relationships to
job performance.
• They lack the motivational force, but take care of the safety and security needs.
• For example, payment for social security premiums, unemployment compensation,
worker’s compensation, pension plan, holidays, vacations, hospitalization, insurance,
car parking, company providing housing etc.
12. Pooled Commission Method - salesmen working in a certain area are
regarded as a team. The total commission earned on the sales of the group as a whole
is then divided amongst the salesmen.
13. Sales Contest and Prize Method - Sometimes companies use sales contests
and offer prizes to boost the competitive spirits of the salesmen. As a result to win
sales contest, salesmen make special efforts to increase sales volume.
• Special quotas are fixed and salesmen who are able to reach those targets are
properly rewarded.These rewards may be in the form of cash or other benefits
SELF TEST
1. Describe any FIVE (5) qualities of good sales
person. (10 marks)
2. Explain FIVE (5) types of training provided to
improve sales person skills and knowledge.
Support your answer with appropriate example.
(15 marks)
3. Identify FOUR (4) problems in evaluating sales
person performance. (10 marks)
4. Determine and explain FIVE (5) characteristic
of great compensation plan. (10 marks)
END OF CHAPTER 3

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CHAPTER 3

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2. Sources outside the company (External sources)

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• Identifying Customer Needs

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Self development Refresher training

Demonstration Types of Lecture

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2. On the job training

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