Copyright 2006 by The McGraw-Hill Companies, Inc.

McGraw-Hill/Irwin
 Chapter 7

Salesperson Performance:
Motivating the Sales Force

McGraw-Hill/Irwin Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Learning Objectives
• Understand the process of motivation
• Discuss the effect of personal
characteristics on salesperson motivation
• Understand how an individual’s career
stage influences motivation
• Discuss the effect of environmental
factors on motivations
• Discuss the effect of factors inside the
company on motivation
McGraw-Hill/Irwin 7-3 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Psychological Process of Motivation

• Motivation is an individual’s choice to:

– Initiate action on a certain task
– Expend a certain amount of effort on that task
– Persist in expending effort over a period of
time

McGraw-Hill/Irwin 7-4 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin 7-5 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Bases for Motivation
• Expectancies – the perceived linkages between
more effort and achieving improved performance
• Instrumentalities – the perceived relationship
between improved performance and receiving
increased rewards
• Valence for rewards – the perceived
attractiveness or intrinsic value the rewards the
salesperson might receive

McGraw-Hill/Irwin 7-6 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Expectancy
• A salesperson’s perceived link between job
effort and achieved performance
• Estimates the probability that increased effort
will lead to improved performance
• Accuracy of expectancies is based on one’s
understanding of the relationship between effort
and achievement
• Magnitude of expectancies is the perceptual
value assigned to an expectancy based on the
ability to control the required performance

McGraw-Hill/Irwin 7-7 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin 7-8 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin 7-9 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin 7-10 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Instrumentalities
• Link job performance and available rewards.
• Estimate of the likelihood that an improvement in
performance will lead to a specific reward.
• Accuracy of Instrumentalities - based on the
perceptual clarity of understanding the
relationship between improvement, achievement
and available rewards
• Magnitude of Instrumentalities - an estimate of
the intrinsic value of firm’s compensation plan

McGraw-Hill/Irwin 7-11 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin 7-12 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin 7-13 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Valences for Rewards
• Measure perceptions of the desirability of
receiving increased rewards through improved
performance
• Other rewards may equal or exceed the value of
increased financial compensation
• The kinds of rewards deemed most desired and
most effective for motivation varies per individual
• Satisfaction with current rewards depends upon
perceived value

McGraw-Hill/Irwin 7-14 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Personal Characteristics Affecting
Motivation

• Individual satisfaction with current rewards

• Demographic variables
• Job experience
• Psychological variables –personality traits
and attribution of meaning to performance

McGraw-Hill/Irwin 7-15 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Satisfaction
• Workers currently dissatisfied with their rewards
value lower-order rewards most highly
– Maslow’s hierarchy of needs
– Herzberg’s theory of motivation
– Alderfer’s existence and growth theory
• High-order rewards will be valued more highly
after lower-order needs for rewards have been
satisfied
• Salespeople satisfied with their current income
(a lower-order reward) assign lower valences to
earning more pay

McGraw-Hill/Irwin 7-16 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Demographic Characteristics
• Older, more experienced salespeople
obtain higher levels of low-order rewards
• Satisfaction with the current level of lower-
order rewards may also be influenced by
the demands and responsibilities the sales
rep must satisfy with those rewards
• Individuals with more formal education are
more likely to desire opportunities for
higher-order rewards

McGraw-Hill/Irwin 7-17 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin 7-18 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Job Experience
• More experience provides
– clearer idea of how expending effort affects
performance
– understanding of how superiors evaluate
performance
– how certain performance leads to rewards
• Magnitude of expectancy perceptions
relates to experience.

McGraw-Hill/Irwin 7-19 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Psychological Traits
• Motivation seems to be affected by
psychological traits.
• Strong achievement needs coincide with
higher valences for higher-order rewards
• Self-esteem, perceived competence, and
ability to perform job activities relate
positively to the magnitude of expectancy
estimates

McGraw-Hill/Irwin 7-20 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin 7-21 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Performance Attributions
• People try to identify and understand the causes
of major events and outcomes in their lives
• Stable internal factors – unlikely to change much
in the near future
• Unstable internal factors – vary from time to time
• Stable external factors – e.g., the nature of the
task or competitive situation in a particular
territory
• Unstable external factors – may change next
time

McGraw-Hill/Irwin 7-22 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin 7-23 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Management Implications
• Relationships between characteristics and
motivation levels have two broad
implications for sales managers:
– They suggest people with certain
characteristics are likely to understand their
jobs and their companies’ policies especially
well
– Some personal characteristics are related to
the kinds of rewards salespeople are likely to
value and find motivating

McGraw-Hill/Irwin 7-24 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin 7-25 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Career Stages and Motivation
• Exploration – lack of assurance
• Establishment – selection of selling as an
occupation and desire for career success.
• Maintenance – seeking to retain present
position, high status, and achievement
• Disengagement – preparation for
retirement and possible loss of self-identity

McGraw-Hill/Irwin 7-26 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin 7-27 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Causes of Plateauing
• Lack of a clear career path
• Boredom
• Failure to manage the person effectively

McGraw-Hill/Irwin 7-28 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Solutions for the Plateaued
Salesperson
• Talk with salesperson about problem
• Discuss reasons and possible solutions
• Conduct motivations sessions
• Manage, lead and communicate
• Cut salesperson’s responsibilities
• Assign to a new territory
• Inform rep on his/her responsibilities
• Provide time off

McGraw-Hill/Irwin 7-29 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Impact of Environment on
Motivation
• Variations in territory potential and
strength of competition constrain ability to
achieve high levels of performance
• Understanding how and why salespeople
perform differently under varying
environmental circumstances is useful to
sales managers

McGraw-Hill/Irwin 7-30 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin 7-31 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin 7-32 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin 7-33 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Supervisory Variables and
Leadership
• Closeness of supervision
– Most occupations prefer relatively free from
supervision
– B-2-B salespeople prefer close supervision
• Span of control – increased span of
control results in decreased supervision
• Frequency of communication – increased
communication means decreased role
ambiguity

McGraw-Hill/Irwin 7-34 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Incentive and Compensation
Policies
• Policies concerning higher-order rewards can
influence the desirability of such rewards
• Preferential treatment for “stars” may reduce
morale
• The range of financial rewards currently
received may influence the valences of
additional financial rewards
• Earnings opportunity ratio
– The ratio of the total financial compensation of the
highest paid salesperson to that of the average in a
sales force
– higher ratio equals a higher valence

McGraw-Hill/Irwin 7-35 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 BRAINSTORMING
QUESTIONS
• How do you motivate sales representatives when money
is not effective? What can a sales manager do to
motivate the successful salesperson?

• How would you respond to a salesperson who says the

following? “You are asking me to spend more time
calling on new accounts, but I do not see the point in
doing so; most of my business comes from my existing
accounts.”

McGraw-Hill/Irwin 7-36 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 MINI CASE

MINICASE: LAND
ESCAPE VACATION
CLUB

PAGE 252 - 253

McGraw-Hill/Irwin 7-37 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Key Terms
• motivation
• expectancies
– accuracy of expectancy estimates
– magnitude of expectancy estimates
• instrumentalities
– accuracy of instrumentality estimates
– magnitude of instrumentality estimates
• valences for rewards
• performance attributions
– stable
– unstable
– internal
– external
• career stages
– exploration
– establishment
– maintenance
– disengagement
• plateauing
• earnings opportunity ratio

McGraw-Hill/Irwin 7-38 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.
 Mark W. Johnston Greg W. Marshall
Rollins College Rollins College
McGraw-Hill/Irwin 7-39 Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved.