Business
1.0 Sales Process
1.1 Introduction
A key to a successful sales process requires the process to be adaptive instead of manipulative (James 2013). Business analyst and experienced business leaders are recommending customer-centric as opposed to the traditional product-centric sales processes (James 2013). Briefly, the customer has control of the process and the seller adapts to the customers decisions (James 2013). The sales process follows the engineering model of decision-making, but flexibility has a major role to play in the process.
1.2 Sales process strategy
A sales process strategy relies upon problem-solving techniques similar to those used in the engineering discipline. Lodato (2006: 15) explained that a process is a series of decisions and activities with the purpose of achieving a certain goal. A successful sales process enhances the business’s capability to increase profits and stay ahead of their competitors. Lodato (2006) has recommended the systemization of the sales process in order to gain success; since process components can be measured they can be controlled, changed and improved upon; appropriate management is the key (Lodato 2006: 15). One configuration for Sales Management Processes is diagrammed in Figure 1. The first management activity is (1) Planning. Planning leads to carrying out activities that implement (2) Arranging, (3) Sourcing, and (4) Orchestrating sales. (5) Control is the element that determines whether the planning needs to be modified by evaluating whether or not the criteria set during planning has been meant. Control also studies performance data from the Implementation feature to decide whether or not corrective action is needed to achieve success.
Figure 1 Lodato’s five primary management activities for sales (Lodato 2006: 6)
2.0 Business process
A holistic consideration of the sales process recognizes the components of business management and how they are interrelated. Business management processes can be described as nesting one inside another. Lodato (2006: 15) has explained a three-dimensional approach to management in order to improve sales using the nesting metaphor. (See fig. 1) The Strategic Management Process (SMP) is the foundation of the process, the Product Marketing Management Process is nested in the SMP and the Sales Management Process is a part of both the larger processes (Lodato 2006: 16).
Figure 2 Nesting of business processes (Lodato 2006: 16)
A successful sales process enhances the business’s capability to increase profits and stay ahead of their competitors. A successful sales process enhances the business’s capability to increase profits and stay ahead of their competitors. A successful sales process enhances the capability of businesses capability to increase profits and stay ahead of their competitors.
3.0 Sales as a part of business process
Page (2010: 20) explains that sales as an integral part of a business can be broken down into smaller processes. A sales representative needs time to look for and generate leads of prospective customers. In terms of the business process, the activity of Lead Generation Process “defines how the sales group generates, assigns and evaluates leads” (Page 2010:20) Another activity of sales representatives is the sales process which is part of the business process because the steps of approaching and engaging potential customers and closing sales transactions are part of this step. (Page 2010: 20) A third example is the sales representative activity of the Account Management Process; a daily account management project for dealing with key customers. (Page 2010: 20)
4.0 Sales process structures
According to some authors, like Jay R. Galbraith, sales process structures transitioned during the early 2000s towards customer-centric sales processes. In fact, Galbraith (2005) feels that the strategic change to customer-driven decision-making in sales is “imperative” for business success. Customer-centric sales are the opposite of product-centric sales. In a product centered sales process structure most of the time and effort of a business is spent improving a product and devising ways to make the product attractive to consumers. On the other hand, the customer centered sales process structure focus totally on the consumer, their needs, their preferences, their problems, solutions to their problems and other similar traits. Galbraith (2005) also supports the research that nurturing customer loyalty will lead to repeat business.
Storbacka and Nenonen (2011: 360) have evaluated how customers in terms of value capture and business performance. Value capture can be thought of as the future value, the future economic profit from a relationship that is expected to increase from the present value. It is a type of maximizing customer management with an eye to the longevity of the relationship. Many researchers are proponents of the customer loyalty because key accounts can help businesses weather difficult times like the recent global financial crisis. The traditional sales process structure focusing on the customer was the Customer Relationship Management (CRM) model, but that structure is being replaced in many businesses by the Customer Value Maximization (CVM) model.
5.0 Managing sales process
Older models for managing the sales process may be making way for some new ideas. One example is the use of joint decision making by encouraging “management group meeting interactions” in order to devise innovative sales practices (Peltola 2013, 48). Peltola (2013, 48) evaluated one method from the perspective of the negotiation process in “the emergence of entrepreneurship.” The process was broken down into four major steps (a) arriving at a joint decision for the proposed activity, (b) access to the same information/knowledge, (c) agreement, and (d) commitment. The author noted that success is dependent on the participants’ agreement and their commitment to apply the concept during daily work activities Peltola (2013, 49).
The sales process in many businesses is global so cross-cultural strategies need to be adopted to avoid misunderstandings. Sales training for sales representatives who will be dealing with an non-native customer base are key to success (Honeycutt, Ford & Simintiras 2003, 129). Honneycutt (et al. 2003, 129) has pointed out that sales training is not a one-time activity, but it is a process. The stages of the sales training process are as follows.
- Needs assessment (What are the strengths and weaknesses of the sales force members?)
- Objective setting (Interviews and/or surveys with salespersons, customers and former salespersons)
- Planning the training program (What are the goals of management?)
- Conducting the training program, (What cultural information will be taught and What culture are the students?) and
- Evaluating the program afterwards
6.0 Service sales strategies
O’Halloran (2010) suggested three strategies for new service creation or for including a product in the service category (a) net promoter scoring, (b) hidden assets, and (c) applicable processes. The measurement termed net promoter scoring is directly related to customer retention/customer loyalty. The goal of nurturing customer loyalty is to gain repeat business so that profits will continually grow. The hidden assets strategy first calls for identifying and removing the activities that are bogging a company down. The second step is to find the assets that have not been appreciated and exploited. Assets can be “company’s relationships, market position, networks and information” (O’Halloran 2010, par. 9). “Assets’ is another word for strengths. The third strategy, applicable processes, is those business processes that can enhance profitability. Solutions can be integrating delivery processes to provide better service and more efficiency. Another example would to use new technology to improve service sales. (O’Hallarhan 2010)
In general, managing employees that are responsible for offer services to customers is a critical process and key to business success. Sales people offering services need to be trained and continuing training at reasonable intervals of time would be good, sense training is a process, too.
7.0 Customer management
Business to business (B2B) is a marketing term that refers to transactions between businesses. Sandhusen (2008, 517) has described how B2B has been successfully adapted to e-commerce. The Internet allows businesses and organizations to conduct money, orders and other transactions quickly, efficiently, and globally. The businesses could be the producer and the wholesaler or the retailer and a wholesaler. An important distinction must be made between B2B and Business to Customer (B2C); the volume of sales passing between the players in B2B transactions is far greater than between the business and its customers.
The marketing relationships between businesses are complex and can be broken down into five flows of the transactions (Sandhusen 2008, 545).
- Physical flow
- Information flow
- Promotion flow, and
- Payment flow
The interactions can be as few as two or as many as five or more, before the product or service reaches the customer. For example, the physical flow starts with the suppliers of the raw materials and then, transporters/warehouses to the manufacture to their transporters/warehouses, to the dealers to transporters and then finally to the customer. The physical flow of the product or service can be transported directly from the manufacturer to the customer or from the manufacturer’s warehouse directly to the customer without using a dealer (Sandhusen 2008, 545). Information is shared in two directions, such as between the manufacturers, the warehouse, transportation providers and banks (Sandhusen 2008, 545).
8.0 Sales planning and steering
Three major professional strategies or steps characterize sales planning and steering. The first step is to create a common definition for the sales strategy, establish the objectives, planning sales activities of the sales force and establish a common understanding of the customer portfolio (Alanen 2013, 1). Management and leaders in the company need to make sure the tools and contacts that are necessary are available so that that optimal planning can take place. (Alanen 2013, 1) The second step is to proceed with business activities and continually update new data that can help meet the goals of the project. The activities include keeping up the sales momentum, build the customer platform, and updating sales force tasks. At the same time the results of activities must be managed, the competencies need to be recognized and the products (or service) must maintain a high level of quality. An on-going assessment of the sales force members can enhance communication, understanding of goals and enhance business results (Alanen 2013, 2). The third step is to make sure communication channels are open and a two-way flow of information is available between the manager (and other leadership) and the people doing the selling.
9.0 References
Alanin, J. (2013). “Sales steering opportunities and challenges for sales steering.” White paper, Mercuri International. 2014 May 3. www.mercuri.net.
Bell, C. R. and Zemke, R. 2013. Managing knock your socks off service/ NY: American Management Association. 2014 May 1. www.questia.com.
Davis, K. 2011. Slow down, sell faster! Understand your customer’s buying process and maximize your sales. NY: American Management Association.
Galbraith, J. R. 2005. A guide to strategy, structure, and process. San Francisco, CA: Josey-Bass.
Honeycutt, D., Ford, J. B., & Simintiras, A. C. 2003. Sales management: A global perspective. [Online] London: Routledge. 2014 May 1. www.questia.com
James, G. 2013. “The real truth about sales process.” Inc. 2014 May .1 http://www.inc.com/geoffrey-james/the-real-truth-about-sales-process.html.
Lodato, M. W. 2006. Integrated sales process management: A methodology for improving sales effectiveness in the 21st Century.Bloomington, IN: AuthorHouse™ UK LTD. 2014 May 1. http://books.google.
O’Hallerhan, P. 2010. “Strategies for selling services.” Technology Innovation Management Review. 2014 May 1. http://timreview.ca/article/388.
Page, S. 2010. 10 Simple steps to increase effectiveness, efficiency, and adaptability. NY: American Management Association. 2014 May 1. www.questia.com.
Peltola, S. 2013. “The emergence of entrepreneurship in organizations: Joint decision-making about new sales practices in management group meeting interaction.” The Poznan University of Economics Review, 13(1): 48. 2014 May 1. www.questia.com.
Reichheld, F. &Markey, R. 2011. The ultimate question 2.0: How net provider companies thrive in a customer-driven world. Boston, MA: Harvard Business School Publishing.
Sandhusen, R. L. 2008. Marketing. Hauppauge, NY: Barron’s Educational Services.
Storbacka, K. & Nenonen, S. 2009. “Customer relationships and the heterogeneity of firm performance.” Journal of Business & Industrial Marketing, 360-372. 2014 May 1. www.emeraldinsight.com/0885-8624.htm.
