ORGANIZATION AND METHODOLOGY
Program: B.A in Hospitality management and marketing
Project overview: this is a group report which entails the management of sales force of a travel agency. The components to be managed include motivation, organization, and prospecting.
Overall aim: to aid students in managing sales force
SALES FORCE MANAGEMENT
Introduction
Background
The international travel agency is currently experiencing sales force problems in the sales department. The president of the organization was concerned about the performance of the sales force, this is attributed to the feeling that the sales representatives of the organization did not adequately use their positions and opportunities. Basically the problem was associated with the sales person’s neglect of the service mix offered by the company and just selling tickets to customers travelling from one place to another.
The agency has an adequate sales force of eight personnel, five of whom are referred to as travel counselors who entirely work in the office. The other three are referred to as sales executives who spend most of the time out of the office. The sales executives were given a particular sales quota to meet. The company offers a mix of services including travel, hotel, restaurant, rental cars and entertainment.According to the president of the agency, the sales force is not putting enough effort to market and sale the product mix, which would lead to maximum profits.
Purpose/ objectives
Sales and marketing is a vital component in determining the economic performance and relevance of the enterprise, institution and organization. Many enterprises have sales and marketing teams set aside to market the company’s activities and increase their sales respectively. Travel agencies are some of the organizations that need an effective sales force to enhance their economic sustenance and progress. A number of sales and marketing strategies and plans are developed in order to attain the sales goals and objectives.
Travel agencies need to always remain relevant and reachable by the prospective clients in the travel and hospitality industry thus any travel agency needs a sales force. Establishing a sales force is however only a start, the sales force needs to be effectively managed to realize the desired objectives. This topic has been discussed between professional supervisors of travel agencies and other industries. Questions that arise in such discussions are related to how to boost sales force management and how to improve their skills and performance. Generally sales force management is an essential element in a selling company particularly a travel agency.
This paper therefore discusses the major roles played by the sales force and the ways in which the sales force can be managed in a travel agency in terms of motivation, compensation, organization, sales force management and prospecting. It entails the objectives and goals of sales force management in a travel agency, its importance and the prospective impacts to the organization.
Importance of the sales force
The sales force is primarily important since they generate revenue to the organization by ensuring the company has clients and the products and services are being consumed. In addition to this, the sales force establishes trust and relationship with the customers. They engage the customers at all stages of the relationship and continuously build their trust. New customers need regular and constant interaction and opportunities to learn about the services, products and the company. Current customers also gain trust through consistent interactions and communication with the sales representatives. They also work to re-engage previous clients and customers through promotions communications and discounts. The continuous establishment of trust and communication throughout the customer sales cycle creates and increased customer satisfaction.
Sales force management
Sales force management is the management and supervision of the team that is established to carry out sales and marketing for the organization. As indicated in the introduction part the organization is experiencing problems arising from poor performance by the sales force. The situation can be addressed by properly managing the sales force in the organization.
According to Drew ( 2008), there are several ways of managing a sales force, that begins with the basic steps and procedures that will eventually result in an effective and efficient sales force in the organization.
Organization
The organization of the sales force begins with evaluation of the sales process with the agency. It will involve an analysis of all the steps that are followed in the selling of the agency’s services. International travel agency basically offers travel advisory services, ticketing, car rental and hire, hotel and restaurant, accommodation and entertainment. Ideally, when a customer needs a travel service for instance the agent is supposed to also recommend accommodation, car hire and other services that the customer may require. Therefore it is evident that there are two processes that need to be done. First is to get the customer to buy one service and then recommend additional products and services. Therefore it is important to have two sets of sales representatives, one to sit in the office and one who works outside the office.
As described earlier the agency is structured in such a manner with three sales executives and five travel counselors. The sales executives bring in customers to the agency while the travel counselors describe to the clients the range of products and services offered by the agency. This process is quite simple, easy to track, manage and communicate. However, the poor sales in the agency could be attributed to employee attitude and capability. It is therefore important to identify the level of knowledge of each sales person about the process and the business. It is important to note that the sales realized is not only a function of the sales person but also the product or service, the assigned territory and the general market conditions.
After recruiting the sales force, proper organization is necessary to ensure each individual has responsibilities that corresponds to his or her knowledge and experience. In view of this, the agency has adequate sales force that needs to be reorganized to realize maximum profits. First the evaluation of knowledge and capability will determine whether the current sales force can adequately deliver. Secondly, reassignment of duties and responsibilities to determine weaknesses in the current setup. And finally realigning objectives of the team to ensure the sales team promote the entire product mix and not only the travel and ticketing. This could be done by defining a product mix that is itemized and even discounted such as travel (ticketing), accommodation and car rentals. This would need a proper market study and organization before assignment of sales personnel.
Motivation
The most successful way of managing the sales force and ensuring their productivity is through motivation. Motivation begins from the leader of the team, the leader should view the management of the sales force as a pleasure and not a daunting task. Sales persons dread sales managers and naturally dislike them, this has been a phenomenon in the industry for quite a long time. The sales force at the international travel agency have a negative attitude towards their work probably due to poor motivation. The sales force is required for sale all the services offered by the agency which is not the case.
The management is currently offering some incentives in order to motivate the sales force to market the entire product mix and not only travel tickets. The agency offers nine firm trips one to each sales person in the agency on an annual basis. This helps to increase the employees’ knowledge and experience of the travel agency service and to motivate them to sell the service to its customers.
Sales persons tend to be highly competitive and respond well to direct challenges. Thus in addition to firm trips, the agency should also enhance performance by maintaining a regular incentive program and offer sales contests that will create healthy competitions within the organization. In addition to this motivation, the agency could also enhance performance by providing real rewards for extra efforts.
A motivated sales force will have a positive attitude towards the agency and also to the product or service. They will also have constructive collaborations, commitment and a will to succeed. The president of the international travel agency indicated that despite being allocated quotas, the sales executives often did not meet the targets. Failure to meet these targets was not addressed adequately since the sales executives were not held accountable and did not give any explanations or reasons as to why they did not meet the quotas. Motivation and accountability which include periodic reports (weekly or monthly) will enhance behavior and attitude of the sales force.
It is also important to hold periodic meetings and group discussions with the sales force. During these meetings the management should take views and ideas from the sales force on their experience on the services and products and their performance in the market. This will not only enhance team work and cooperation but also make the sales force to have a feeling of ownership and identity with the agency and the services, both of which are imperative to attaining agency objectives.
Compensation
Compensation is the most important reward that is used in the motivation of the sales force. It is a culture for sales and marketing to have a structured compensation scheme for the sales force. The level of pay, or compensation, is the amount that the company intends to pay a salesperson over the course of a year. It can be viewed as a range due to the fact that its total value will vary with bonuses or commissions .The Agency should therefore optimize their compensation plan by making sure that it is in line with industry standards, easy to understand and consistently applied. The travel agency should determine the four components of the sales force compensation which are variable amount, fixed amount expense allowance and benefits.
There are three basic types of fixed and variable amount compensation plans which include; straight salary, straight commission and combination salary and commission. Majority use the combination of both salary and commission plan, the recommended plan for the agency would be to adopt the salary and commission plan. However, the rate of commission can be varied for the sales executives and the travel counsellors. Given the nature of services and products offered by the agency, the sales executives seek out clients and identify sales opportunities thus their plan should be weighted towards commissions on top of salary. On the other hand, the travel counsellors basically manage existing clients and customers thus their compensation plan should can be more salary based.
Generally, when designing a compensation package for the sales force, there are four considerations that the management of the agency face; mix between salary and incentives, level of pay, measures of performance and performance pay-out relationships.
Sales force strategic management
This entails the general management of the sales force and particularly addresses the leadership team and management that is in charge of supervising and leading the sales force.One of the secrets to successful force management is to always exhibit a behavior desired from the sales force team. To be an effective leader of the team one should be someone whom the rest of the staff can look up to. Hence the most important element the management team of the agency is to be the type of sales person you want the sales force to become.
The management of the sales force should be approached in a unique and should reflect the agencies interests and objectives. For instance the president of the agency mentioned that the employees are given annual vacations to different destinations with an intention of improving their productivity, this is a totally different and unique way of motivating and enhancing the productivity of the sales force.
Compensation, motivation, organization and even prospecting will improve productivity of employees. However, the management team should always be in touch with the sales force to closely monitor their performance. The failure by the agency sales force to sell the product mix is probably attributed to invisibility and unavailability thus resulting in poor sales force management. To have a proper managed sales force, the management needs to be out there with the sales representative, handle clients and customers together, work with and listen to the sales force. It will also include asking them how they are doing, listen to their responses and respond to them. This will greatly help in the effective management of the sales force.
Problem identification and solving before they escalate also helps a great deal in the management of the sales force. The problem could arise from negative influence by individual sales person and dissatisfaction among other factors. The sales force in the agency are currently not selling the entire product and service mix but rather concentrating on the travel tickets. Despite the agency offering them annual firm trips to different destinations with an aim of encouraging them to sell the product mix, they do not sell the product mix. This could be attributed to other problems such as attitude, knowledge and also influence. The sales force leadership should identify the problem and address it at an early stage before it becomes a culture in the agency.
The agency should also equip the staff with the tools for success in their work. More than often sales managers forget that sales force management also involves issuing the staff with the necessary tools to get the job done. The management should ensure that the sales force are well equipped to succeed in their work. One of the ways is equipping them with the computer systems that could aid them in their work.
Prospecting
Prospecting entails scouring for potential clients and customers in the future. The travel agency is a kind of business where prospecting has to be done on regular basis to ensure continuous customer base. The information can be obtained by the sale force through various methods and contact made through e-mail, phone or social media. To ensure success in prospecting adequate resources must be allocated to allow acquisition of the list, and the best qualified and skilled sales representatives assigned the duty of searching and contacting the prospective clients.
The prospecting exercise should be well handled by qualified and skilled persons and closely managed by the sales manager. This is due to the fact that prospecting will either improve company performance or create a negative public perception if not handled well.Furthermore, a prospecting list may provide a handful of worthwhile connections that may in turn lead to greater opportunities. Thus it is always important to test and evaluate the prospecting list and identify those with greater returns on investment.
Conclusion
In conclusion, it is evident that a sales force in the travel agency is important and they play a major role in the success of the company. The presence of the sales force alone is not sufficient, their productivity and efficiency in delivery of service and meeting company objectives is imperative. Therefore, effective sales force management must be put in place to minimize losses and maximize profits earned by the agency.
The sales force can either make the business succeed or cause it to fail, depending on their level of commitment, professionalism and integrity. Thus when hiring the sales force the organization must first check the reference and use effective interviewing techniques to find persons who can best fit the company’s culture, meet its goals and objectives.
As indicated by the president of the international travel agency, the bigger problem in the agency is basically management of the sales force. a greater role of close supervision and management will enhance their productivity and delivery of service. It is also important that the company identifies the problems faced by the sales force in their line of duty and address them with a view of changing their attitudes towards selling the product mix in the agency.
In the current business environment, people have to nurture and grow great business relationships with clients. This is an important task yet sometimes difficult to achieve, thus most organizations are adopting the use of technology and information systems such as CRM systems. These systems combine automated sales force management information systems with customer database and inventory data. The automated sales force management information system is currently the most efficient and effective way of managing the sales force. The agency should therefore adopt these new strategies that are aimed at effectively managing the sales force and maximizing profits in the company.
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