Q. 1: The article discusses the role of a sales manager in the relationship selling process. This is achieving by exploring the five critical components that entail management of the relationship selling process. The performance of a salesperson is examined in the article based on the perspective of the manager and the salesperson. Role perceptions and motivation are termed as the key elements in management of salespersons in an organization. The recruitment and selection of a sales force in an organization is investigated in one section of the article where the objectives of sales training and various training techniques are examined. The move is depicted as an important step in ensuring recruitment of individuals with competent skills in sales and interaction with customers and their seniors. Incentive programs that bring about rewards in an organization and how they can be incorporated into effective sales corporations are discussed in the article. Evaluation is emphasized in the last section of the text but depicted as the most essential management function in relationship selling (Hanna, n. d.). The performance of a sales person is, hence described in the text as a conglomeration of many factors including individual characteristics, motivation and job perception by the salesperson.
Q. 2: Once new sales recruits are received in House Handy, they are assigned new territories where they carry their duties under the district manager. The manager is responsible for managing between 15 and 20 sales representatives. Furthermore, each recruit for the company is assigned a mentor who is supposed to answer questions for the recruits. The first training for the recruits is usually in the form of product manuals where the manual contains items in the stores and their description (Hanna, n. d.). This is meant to give the new recruits a quick preview of the products on sale, their prices, features and substitutes for the products. The recruits are also told to navigate around the stores and observe the range of products being sold by House Handy to get the real image of the range of products of sale. Training for each products is done manually apart from the one contained in the manuals to ensure that the new sales persons get the real picture and use of the products. This helps the sales person to be able to demonstrate the products use to the customers whenever asked to do so (Fred Miao & Evans, 2007). The training offered by House Handy ensures that the new recruits practically engage themselves with the products they are about to sell and gives them confidence in their job especially when engaging the customers. The relationship selling in this context is, by a bigger extent, influenced by the sales management team.
Q. 3: House Handy needs to diversify the On-the -Job Training (OJT) method already employed at the place but requires incorporation of other elements of training techniques to make it more effective for the sales activities in the company. Apart from individuals coaching on the features, application and use of products, the company should add use of lectures and video tapes on sales skills in for the new sales persons. The company should also first ensure that it identifies the needs of the sales person as pertains to the job. This is important because needs of salespeople vary significantly and also change with time and under certain circumstances. With this regard, the company should classify its training programs to separate the needs of the sales people and the offer the most effective training programs for the new recruits. Combination of the OJT techniques is also said to achieve the best possible balance in developing the skills of new sales recruits in an organization. Knowledge and enough training materials should be adequate for the company in order to offer the best out of the training exercise and generate more competent individuals in the sales field (Fred Miao & Evans, 2007). This shall improve House Hendy’s sales performance within the shortest time possible after acquiring new sales staffs.
Q. 4: Return on investment for the cash used in training salespersons can be evident in the company’s performance in terms of profit and increase in number of customers within a specific period after the recruitment exercise. Increase in product sales is an automatic indication that the sales persons are already delivering in their tasks and the revenues generated per sales person can correspond to the efforts used in training the particular salesperson. It is important to keep the sales records of each salesperson as well as in general to enable estimations of each salesperson’s performance. If the profits generated by the company exhibit a significant measure to exceed the normal profits in the first two months of working, then the return on investment for training the salespersons would be recovered. The company should also learn if the return on investment is yielding fruits by examining the increase in number of loyal customers for the company. Having many loyal customers implies that the profits margins would remain steady for a long period of time and this will help recover more funds that were used in training new sales recruits (Fred Miao & Evans, 2007). Most of all, the company can measure whether its investment on training new sales personnel is yielding fruit by measuring its sales of stock within specific times to determine the rate of stock selling.
Q. 1: This chapter in particular gives an overview of significant issues linked to compensation of salespeople. These include the type of compensation such as the incentive compensation forms and the best time to access them. The chapter discusses the merits and demerits of certain compensation issues such as straight compensation, straight salary, and combination plans. It is also interesting to note that the section gives an important insight on how and why bonus components to compensation can be applied as an incentive in certain instances. Compensation of sales people in this txt is described in terms of understanding the effective application sales contests and potential drawbacks to the exercise. Non-financial rewards of salesmanship are also described as important and a few of them are also identified. Relationship selling and expenses are also brought out and key issues surrounding the expense account with regards to relationship selling are brought to light. This enables proper management of sales finances to ensure that they bring back the most desirable reward (Lacy, n. d.). Compensation and incentive programs sometimes may appear ineffective but the way to make them work forms the peak of the section where managers are advised on how to keep the exercise effective and admirable to the sales persons and the customers. The decision making criteria on the level of compensation and the mix is explained as critical in making the exercise work out smoothly.
Q. 2: Straight Commission form of salesman’s compensation is a direct motivation for the salesman since the link between what they sell and what they earn is well defined. The salespeople can, hence, work harder to earn more. This method is also best with the introduction of a new product which MedTech intends to introduce where it provides more earnings by the sales person for a new product. Strait commissions are also easy to compute and administer by the sales manager (Lacy, n. d.). Bearing in mind that the company intends to spread the product all over the united states, the method shall be efficiently administered, and hence, effective. The compensation costs are directly proportional to the sales and this is an advantage for a firm like MedTech that is introducing a new product yet to be popular in the market. However, this method of compensating the sales persons is disadvantageous because of lack of management control over the sales force. Due to the fact that the compensation is linked to the sales, the salespeople might not engage in proper relationship selling but may aim at ‘milking’ customers to maximize on their commission. To the salespersons themselves, this method is disadvantageous because it makes their earnings unpredictable and unstable (Widmier, 2002). The sales persons suffer whenever business conditions are poor and this causes turnover rates to be high.
Q. 3: In direct reimbursement, all allowable and reasonable expenses are involved whereas in limited reimbursement, firms limit the total amount of expenses reimbursed by setting limits or issuing each sales person with a predetermined lump-sum payment to stand for total expenses. In direct reimbursement, the sales managers have a certain degree of control over the entire magnitude of sales and the forms of activities that can motivate the salespeople. In limited reimbursement, this element is determined by a planned budget at the beginning of every year and denies the sales manager control over the expenses (Lacy, n. d.). In direct reimbursement, policies enacted are seen as a form of motivation and direction of sales efforts whereas limited reimbursement tends to hurt motivation and sales efforts. This is because the individual sales people may develop the notion that their ability to perform a good job is prevented by tightened reimbursement policies in the limited reimbursement. Direct reimbursement requires that the sales people submit receipts of detailed records that would later justify expenses on their claims but this is not the case with limited reimbursement. This submission of detailed records makes direct reimbursement more costly as compared to limited reimbursement because of the expenses involved in gathering, preparing and maintaining the records (Lacy, n. d.). Direct reimbursement would work best with MedTech because the product is new and needs not limitations with respects to selling so as to attract more customers.
Q. 4: The compensation program for the sales persons in MedTech should introduce various changes to retain its sales people that are at risk of being taken away by competitors. In this case, there should be changes in the compensation plan that would lead to a more flexible implementation and good incentives for the sales people. The salespeople should be allowed to operate freely and earn through straight commission and the pay should increase with increase in individual’s efforts to build the company’s relationship selling (Widmier, 2002). This shall be beneficial for the company because in as much as the salespeople strive to make their income, they also leave a good relationship between the company and the customers. Increased motivation for the sales person should be evident not only in terms of pay but also in the manner in which the managers deal with their salesmen. The needs of the sales men should be addressed accordingly to ensure that they are comfortable while working in the organization than in any other company (Widmier, 2002). The compensation program should also be in such a way that it is flexible and can incorporate changes taking place in the sales department. Technology, for instance, introduces various mechanisms of change for the sales people and the customers. The salespeople should be fully aware of the changes and this should be the work of the compensation program to offer proper education and make the work easier for the salespeople. MedTech has also a responsibility to ensure that the compensation program meets the current economic needs of its sales employees by offering favorable incentives and rewards for hard work. The program should clearly exhibit the relationship that exists between the salespeople, the customers and the organization itself. In this case, the public reputation about the company is not only builds with regard to the way the salespeople deal with the customers but also as a result of the way the company treats its sales employees. This shall enable build a comfortable working environment that shall maintain the sales people regardless of other opportunities outside that may appear attractive to the existing salespeople in the company.
References
Fred Miao, C., & Evans, K. R. (2007). The impact of salesperson motivation on role perceptions
and job performance—a cognitive and affective perspective. Journal of Personal Selling
& Sales Management, 27(1), 89-101.
Hanna, N., (n. d.). Behavior, Motivation, and Role Perceptions: Selling Relationships. Lancaster
Kendrick
Lacy, D., (n. d.). Salesperson Compensation and Incentive: Relationship Selling. Lancaster
Kendrick
Widmier, S. (2002). The effects of incentives and personality on salesperson's customer
orientation. Industrial Marketing Management, 31(7), 609-615.
