Sales Management Quiz 3

Recruiting Equations

(H)/(S*A) R = number of recruits H = required number of hires S = percentage of recruits selected A = percentage of those selected who accept

Turnover Rate

(Seperations per year)/(Average size of the sales force) Low turnover rate may indicate a lack of career growth opportunity by promotion or lateral movement

Kirkpatrick's Four-Stage Framework

*Level 1: Reactions* - measures trainee's reactions or feelings about various aspects of a sales training program *Level 2: Learning* - assess the acquisition and retention of declarative knowledge, procedural knowledge and/or attitude change *Level 3: Behavior* - the extent to which salespeople modify their job-related behavior as a result of the training *Level 4: Results* - measure the extent to which a training program has reached the objectives set forth by the organization

Most Important Job as a Sales Manager

*Recruiting is the most important job that you have as a sales manager* o Everything rides on the people that you bring in o Your bonus, your companies success First thing you should do when you take over as sales manager is evaluate your sales team • Determine what their needs are • Need to have a passion for recruiting

Setting a Training Budget

Costs for new salespeople include: 1. Salary 2. Benefits 3. Sometimes lodging and meal expenses if the training is out of town Costs for veteran salespeople include: 1. Lost sales while the rep is out of the field

Aptitude

Designed to determine whether a candidate has an interest in certain tasks and activities

Why do you train?

Education Reduces turnover Improves customer relations Builds enthusiasm Trained sales people always sell more

Skills of effective leaders

Empowerment Intuition Self-understanding Vision Value congruence

Cross-Tabulation

Examining performance by certain sales force characteristics

Recruiting

Find and attract the best-qualified applicants for sales positions i. The number of applicants needed to meet personnel requirements will be larger than the number of people to be hired

Job Analysis Interview

In-depth interviews are conducted with management and salespeople

Semistructed Interview

Intended to gather critical pieces of information, but the questions are not repeated word for word, candidate is expected to take a more active role in the direction an interview takes

Follow Up

Interview does not end after the face-to-face discussion has ended Interviewer should rate their impressions Comments, to help remember the candidate's pros and cons at each stage of the interview process

Telling

Managers tell a salesperson what, when, how and where to do various tasks

Validation

Most useful in large samples where information is collected on the progress of sales personnel and is fed back into the system to modify the factors considered in the hiring process. -Objective of the validation process is to build a profile of the successful performer that can be used to select additional salespeople

Third Party Referrals

Requesting a referral from the person you really want to hire

Improving teamwork

Sales teams are generally composed of a group of specialists, each of whom contributes different skills to deliver a system-oriented solution to customer problems Salesperson may be responsible for motivating and coordinating the team

Assessing Sales Training Needs

Training needs analysis Strategic objectives Sales force observation and survey Customer information Company records

Personnel Needs

Turnover: important for assessing personnel needs 1. Resignation because of poor performance 2. Resignation for another job 3. Retirement 4. Promotion

Success in a nutshell

-Hire people with a sense of humor -Quit pretending, give yourself the freedom to by yourself -Train for skill. Hire for spirt, spunk, and enthusiasm -Be religious about hiring the right people. If you make the wrong hiring decision, within the first ninety days make the tough decision to say goodbye -Do whatever it takes. Remember, there is very little traffic in the extra miles -Define you own standard of professionalism -Treat everyone with kindness and equal respect; you never know to whom you are talking

Customers, Suppliers, and Competitors

-Know the business, are familiar with the company and may know what is expected of a salesperson -Good when customers are loyal to the salesperson as they will buy from the new company -Legal issues when the divulging of company secrets is suspected -The higher costs associated with attracting these people may offset their higher productivity, making this source the least profitable

Chapter 7 Summary

-Recruitment and Selection of salespeople is one of the primary responsibilities of filed sales management -A poor hiring decision will increase out-of-pocket costs, damage employee morale, productivity, and client relationships -Discuss how to plan for recruiting and selection -Identify relevant hiring criteria for sales jobs -Identify different sources of recruits -Understand the selection and validation process.

What to find in someone interviewing

-Self Esteem -How do they feel about the person they see in the morning -Attitude -Risk-taker -Honest -Disciplined -Set demanding goals -Where you want to end up

Chapter 8 Summary

-Understand the benefits of Sales force training -Determine specific training needs for sales force -Discuss the topics to include in a training program -Describe the advantages of centralized and decentralized training -Understand the use of line, staff, and outside trainers -Recognize the value of alternative training methods -Describe the different methods for evaluating training results

Product Knowledge

A common misconception is that sales training is designed primarily to improve the selling skills of sales representatives Many companies spend a significant amount of time presenting product information

Empowerment

A leader's ability to share power with others by involving them in setting objectives and planning

Value congruence

A skill achieved when everyone in the organization is striving for the same business objectives

Job Analysis

A systematic way to describe how a job is to be performed, as well as the tasks that make up the job. Incongruency between a candidate's job expectations and the actual job activities can lead to increased turnover.

Self-understanding

A willingness to receive and understand both positive and negative feedback from others, including subordinates

Single most important thing to look for in a candidate

ATTITUDE All in the questioning skills • Integrity • Motivation • Trainable • Appearance/Presentability • Initiative • Education

Assessment Center

An additional selection too to help choose the best candidate by having him or her participate in job-related exercises -Simulated exercises that they must perform as if they were in a real organization -Individual presentations, role playing, case analyses, business games, and team-based assignments

What is coaching?

An ongoing sequence of encouragement with your sales team with the goal of improvement

Application Blank

Application in a standardized format that the applicant fills out -Provides information gathered in a standardized manner -Obtain information that may be needed during an individual's employment 1. Educational background 2. Past employment All applications forms should include a statement indicating that any applications with unrequested information will be automatically rejected to prevent the possibilty of somebody claiming discrimination

Job Qualifications

Aptitudes, skills, knowledge, and personality traits necessary to perform the job successfully 1. Education 2. Previous work experience 3. Technical expertise 4. Aptitudes 5. Interests

Change management process

Assessment Redesign Measurement Sales support programs Implementation

Legality of Job Qualifications

Avoid employment discrimination which is caused when qualifications are used to exclude individuals from certain jobs Americans with Disabilities Act (ADA) - prohibits employment discrimination against individuals with disabilities

Legitimate power

Based on the manager's position in the organization

Expertise power

Based on the perception that a manager has special knowledge, usually based on past success

Where to train

Centralized vs. Decentralized training

Desirable Salesperson Qualifications

Certain personality traits have been linked with higher performing salespeople a. Extraverted, optimistic, conscientious salespeople perform better

Technology-Based Selling Skills

Changes in technology and the marketing environment are driving new sales force automation (SFA) products and as a result, new sales training topics a. Winning sales force commitment to SFA can be difficult

Sales Training

Chapter 8 Sales training pays off

Salespeople perform better when managers

Clarify sales roles Demonstrate difficult tasks Clearly define how salespeople are rewarded for their efforts

Colleges and Universities

College graduates are attractive source for entry-level sales positions because they are easily trained and are often more poised and mature than those without degrees Require considerable training and one-on-one coaching before they become productive Lack experience 1. Overcome this by offering sales internships

Recommendations

Common error by recruiters is to adopt some readily available intelligence or psychological test that may be inappropriate for selecting field sales agents. Better to have tailor-made test by testing experts and human resource specialists

Don't train enough on

Competition Customer Base Analysis

Coercive power

Compliance due to fear of punishment

Company Culture

Creating a good company culture can keep turnover low and your customers happy

Present Employees

Current employees make good candidates for sales reps as they are already familiar with the company's products Hiring from within can have potential pitfalls: 1.Bad feelings may arise if managers in other departments think that their best people are being pirated by the sales force 2. Past experience may hinder them: a. Engineers may rely heavily on facts and figures b. Customer service people may find it hard to take a tough negotiating stance

Experts possess two types of knowledge

Declarative knowledge - permits them to recognize a selling situation requiring a somewhat unique selling process Procedural knowledge - consists of the process or sequence of behaviors that are necessary to achieve a successful conclusion in a particular sales situation

Situational Leadership

Directive Supportive Telling Selling Delegating

Background and Credit Checks

Don't assume people are telling the truth Web search tools allow firms to investigate an applicant's job history and criminal record at a reasonable cost Credit checks - assess the financial responsibility of applicants, since financial responsibility goes hand in hand with job responsibility

Why Train Salespeople

Estimated cost per new hire in excess of $100,000 per salesperson Increased productivity Reduced turnover Improved customer relations Better morale Improved time and territory efficiency

Personality

Evaluate an individual on numerous personality traits

Salesperson Development

Helping people develop goals, skills and habits beyond those necessary for the present job

Field Observation

Includes taking candidates out to observe a day of field sales work. Candidates are shown exactly what the job entails

Outside Specialists

May be entirely responsible for the training programs or may be brought in to conduct specific sessions within a total training program Con: a. May be unfamiliar with a company's selling situation (lack of familiary with industry jargon, customers and competitors)

Intelligence

Measure the degree to which a candidate has the minimum mental capabilities to perform the job Cognitive ability tests have proven to be the most valid predictor of success

On-The-Job Training

Most widely used method of sales training for new recruits. Every time salespeople call on customers they should learn from the experience Coaching and counseling b. Con: i. Sales are lost and relationships may be strained ii. The quality of training is likely to be uneven

Transactional Leadership

Motivates followers by appealing to their self-interest

Transformational Leadership

Motivates salespeople by appealing to higher ideals and moral values so that they are motivated to exceed performance expectations. -Make people more aware of and accepting of the goals of the organization

Referrals/Networking

Networking and referrals tend to be among the cop conduits for effective recruiting in the workplace References from managers and salespeople are particularly valuable because these people tend to have wide social contacts and often meet individuals who make good prospects for a sales team

Selling

New recruits must be familiar with how the sales process works before they can be effective and productive field representatives Recommend adopting a long-term approach toward training and retraining that includes elaborating on prior knowledge by teaching pattern recognition through discrimination tasks and explanations

Centralized Training

Occurs when all the salespeople to be trained are brought to one central location - a plant, the home office or a training facility a. Pro: i. Quality through the use of specially trained instructors, custom-designed materials and audiovisual equipment such as close-circuit television systems ii. Consistency as communications and coordination are enhanced when everone receives the same training iii. Meet people from corporate b. Con: i. Costly because training facilities and equipment are expensive and trainees have to be reimbursed for travel to the central site and for lodging, managers usually attempt to keep these sessions very short ii. Time consuming

Biggest Mistake in Recruiting

Only recruiting when you need to, not all the time Loss in time - don't amplify it by not being prepared when it comes time to fill a position Have to know exactly what you need before you recruit • In terms of the opening you're going to fill • In terms of the characteristics and capabilities of the person you're going to hire • Firmly, recruiting all the time

CDs, Podcasts, and Audiotapes

Popular because of their portability and storage capabilities Typically used for information sources for products and market intelligence

Using power effectively

Power: the ability to influence the behavior of others

Physical Examination

Preemployment medical examinations are prohibited, but once an employment offer is made and prior to commencement of the job an employer could make a contingency based on the successful completion of the examination

Recruiting and Selecting Personnel Planning Process

Preliminary analysis of personnel needs, company culture, a job analysis, and a job description with the necessary job qualifications

Training Needs Analysis

Process for determining where problems and opportunities exist and whether training can best address the issues

Interviewing Process

Proof of Perseverance Willingness to learn How empathetic person is Humble with pride Good communication skills Ability to make decisions on your own Ability to handle detailed work Competence Desire - passion Listening Skills Background of accomplishments Can you survive success Are you selling your product (yourself) Have they done their homework relative to my company

Observer

Record the differences in the amount of time higher- and lower-performing salespeople spend talking to customers, traveling, record keeping, setting up displays and attending meetings

Reward power

Reloads on a leader's ability to reward subordinates for outcomes that they value

Role Playing

Requires active participation and practice Con: Stress caused by the videotaping People may be unable to focus on the subject to be learned when under stress

Company Orientation

Salespeople must be well-versed in the company's history, organization and policies, as well as having an understanding of corporate citizenship and workplace competencies

Employment Agencies

Save busy sales managers time and money 1. Advertise 2. Screen resumes 3. Interview prospects 4. Present successfully prequalified applicants to the client

Classified and On-Line Advertising

Sometimes overburden's the selection process with unqualified applicants 1. Costly and extensive screening process 2. Results in high cost per hire despite low cost per applicant Ad should provide enough information to successfully screen unqualified applicants. On-line ads are much cheaper than print ads ($100-300 versus $1000 or more for a typical Sunday newspaper)

Who Should Train

Staff Specialists Outside Specialists Line Executives

Staff Specialists

Staff specialists in the central office usually prepare the program materials, and the instruction is carried out by line managers Con: a. Lack experience in realistic field-selling situations, making it difficult for trainees to apply the classroom instruction to realistic customer situations

Testing

Tests provide more objective information than can be obtained from subjected conversation Three types: Intelligence Personality Aptitude

Intuition

The ability to anticipate change and take risks

Vision

The ability to conceive what may affect a business in the future and what changes are needed for it to prosper

Leadership

The ability to influence and inspire the actions of people to accomplish worthwhile goals

Directive behavior

The extent to which a leader engages in one-way communications spelling out what, where, when and how to do it

Supportive Behavior

The extent to which a leader engages in two-way communication involving listening and providing support and encouragement Characterized by highly supportive behaviors and low amounts of directive behaviors A shift of day-to-day problem solving from the sales manager to the salesperson by allowing them to share in the decision making

Cognitive Selling Scripts

The knowledge an expert, such as an effective salesperson, possess based on remembered similar experiences

Referent power

The leader's influence on others because of friendship with the leader

Leadership Style

The pattern of behaviors that others perceive you to use when trying to influence their behavior

Patterned Interview

The sales managers asks each prospect a set of questions and records the response on a form

Internet

Through the use of internet training managers ensure their salespeople have access to the necessary information as soon as it's available without leaving their territories or customers Con: a. Initial startup costs are high b. Distractions at rep's location could affect learning and retention

Other topics

Time and territory management - other areas where salespeople typically receive training a. Training salespeople how to allocate their time among the selling, service and administrative responsibilities can significantly increase their productivity Also legal and ethical issues

Setting Objections

Training objectives should be specific enough and measurable so that the extent to which they have been met can be evaluated following the training program

Customer and Marketing Information

Training time is also devoted to giving recruits customer information and the general background on the market for the goods and services produced by the firm. Training salespeople to manage the account for long-term profitability rather than the short-term sale requires engaging the customers at multiple levels of the organization as well as a great deal of commitment, openness and trust

Personal Interview

Typically conducted at two levels 1. First interview - Inform the candidate about the job and look for knockout factors a. Knockout factors - characteristics which would eliminate a person from further consideration, poor speech, unacceptable appearance, or lack of necessary maturity 2. Main interview - series of interviews with sales managers, typically including the person to whom the candidate would report a. Interviews all managers to assess the applicant's level of interest and desire for the job b. Allow managers to observe a candidate's conversational ability and social skills

Decentralized Training

Usually done in field or regional sales offices, which moves the learning process closer to the customers and directly involves field sales management a. Pro: i. New recruits are able to observe top salespeople selling to customers similar to those they will encounter in their own nearby territories ii. Reduces travel and instructional expenses b. Con: i. Managers are busy supervising current sales force and fail to take the time needed to train new recruits

Line Executives

Usually sales managers and top performing salespeople Sometimes preoccupied with current sales problems and may not have time to do a good job of training

Training Topics

Varies depending on the firm, technical products typically require more product-related material

Self-Esteem

What is your own self-esteem and what is the self-esteem of the person you are interviewing? • Are they high achievers • Are they risk takers • Are they honest with themselves o Or are they blaming other people for their failures • How do you feel about yourself when you look at yourself in the mirror in the morning? • Does the person or you set demanding goals? (not unrealistic, just demanding... willing to dream a little) • Prove how you're going to accomplish those goals realistically • Always be positive: o Living in the present tense not in the past • Establish good habits • Do you have the skillset to learn from role-models • People who can thrive under pressure o Disciplined • Ferociously Persistent • Learn from adversity • Don't sit still but don't forget what you did in the past to be successful

Job Description

Written document that spells out the job relationships and requirements that characterize each sales position 1. To whom the salesperson reports 2. How the salesperson interacts with other staff marketing people 3. The customers to be called on by the salesperson 4. The specific tasks to be carried out 5. The mental and physical demands of the job 6. Types of products to be sold

Where to find recruits:

• Employment agency • University / college • Referrals / networks • Advertising • Career fairs • Trade shows • Third party referrals • LinkedIn