A salesman is an ambassador of his company to the external world. He leaves a lasting impression on those with whom he interacts and form an opinion about the company from his behaviour.
A salesman is out in the field, with no direct or little direct supervision, whereas other employees have to work under close supervision. A salesman needs human relations skill much more than others. As he interacts with a variety of people in diverse situations, he must show diplomatic skills and composure.
He should show tact and intelligence while dealing with his customers. A salesman is authorized to spend company’s money for his lodging, boarding, travelling and entertainment. A salesman cannot enjoy family life like people in other walks of life do. He has to travel his territory while servicing it.
Besides, selling is a high pressure job. All this makes him prone to stress. Thus, a salesman has to brave all kinds of adverse situations, while being away from home. It is, thus, a very tough job.
1. Meaning of a Sales Person 2. Qualities of a Salesman 3. Types 4. Why a Salesperson Needs Product Knowledge? 5. How to Select a Salesperson
6. How to Monitor and Control Salesperson 7. Position of Salesman 8. Performance Evaluation 9. Methods of Motivating Salesmen 10. Salesmen Compensation.
Sales Person: Meaning, Qualities, Types, Selection, Position, Performance Evaluation, Motivation and Salesmen Compensation
Sales Person – Meaning
A salesman is an ambassador of his company to the external world. He leaves a lasting impression on those with whom he interacts and form an opinion about the company from his behaviour. By no stretch of imagination, we can consider the production staff or, for that matter any other staff of the organisation wielding the same influence as the salesman does.
A salesman is out in the field, with no direct or little direct supervision, whereas other employees have to work under close supervision. Field duties involve hard physical labor, and are never a bed of roses. Besides, selling demands creativity, doggedness and initiative. Thus, a successful salesman should have a combination of brain and brawn. As he is to be self-directed, he needs strong motivation.
A salesman needs human relations skill much more than others. As he interacts with a variety of people in diverse situations, he must show diplomatic skills and composure. He should show tact and intelligence while dealing with his customers.
A salesman is authorized to spend company’s money for his lodging, boarding, travelling and entertainment. Very few in the company are so authorized to use the company’s funds.
A salesman cannot enjoy family life like people in other walks of life do. He has to travel his territory while servicing it. Besides, selling is a high pressure job. All this makes him prone to stress. Thus, a salesman has to brave all kinds of adverse situations, while being away from home. It is, thus, a very tough job.
A salesperson is an individual whose fundamental job is to sell a product/service. They are people who are predominantly engaged in personal selling activities on behalf of the company with a view to generate business connections that culminate the salespeople in delivering the product or service to the customers.
This is the description of salespeople that was portrayed in traditional selling. However, in modern selling, a salesperson’s role extends much over than just delivering the product to the customers. Today, the bigger role of a salesperson lies in the post-selling period.
The job of the salesperson apparently sounds simple in ideation but intricate in execution. Selling is an all-important task of an organization. It is the wheel of the organization that gives mobility to it. It determines the success or failure of the organization. It guides and controls the performance of the organization. Salespeople are the drivers of the ‘organization’ wagon.
Salespeople are the human factors in selling that stimulates prospective customers to be the real customers and the present customers to stay with the firm and opt for higher rate of consumption. Salespeople also act at the operational ambit of the organization. Success in sales plans, policies, strategies rely heavily on the personalized selling demonstrated by salespeople. A salesperson can work on behalf of a manufacturer, wholesaler, distributor, retailer, institution, franchisee, etc.
In the traditional selling format, salespeople held a ‘pushy’ image. They used to coax and cajole innocent customers into buying their products. Even for narrow interests, salespeople did not hesitate to cross ethical lines of business and dupe naive customers by swallowing over-priced products or inferior-quality products. Tall talk and lofty claims were often used as means to persuade customers to lean towards their products. Often, these salespeople were talkative and deceptive. They persistently used to flatter less or non-informative customers to join hands by pressure tactics.
But gone are the days of nightmarish experiences of the customers in the hands of the overboard salespeople. In fact, professional selling does not endorse pressure tactics in selling. And on top of it, it advocates the need for etiquettes in selling and advises salespeople to learn it for greater interests. Selling is a legal profession. Therefore, salespeople strictly observe legal laws and regulations during business. Selling is also an ethical profession. Honesty and integrity to the profession vouch for ethics in business.
Truthfulness and devotion to the profession exhibited by salespeople delineate the ethical characters of selling. Salespeople are often haunted with ethical complexities during selling. This is because they are of the opinion that winning a customer is almost certain if a few ethical truths are hidden or suppressed. For example, claiming high quality of a product without any real basis is a breach of ethics. Salespeople often behave so because of the pressure of fulfilling sales quota. But once the truths are unveiled, salespeople lose their credibility forever and put the organization in a precarious situation.
Selling is a social profession. Courtesy, humility, decorum, and empathy towards customers and society extend the social chord of selling. Selling involves the social learning process also. Salespeople need to learn the needs and wants of the customers.
Salespeople often converse with customers on non-business issues only to create meaningful rapport with them. Offering dinner, presenting a gift, inviting to a social programme, etc., are common from salespeople to potential customers that help to establish a social tie between the buyer and the seller. So, salespeople should learn how to build social network in their relevant fields.
Selling is a mental process. A salesperson may drift a customer to move through a sequence of mental stages before taking a purchase decision. A prospective buyer goes through cognitive, affective, and behavioural stages to complete the buying process. In cognitive domain, a buyer gathers knowledge and information on the product.
In affective stage, the buyer is influenced by reasons, rationales, emotions, sentiments, beliefs, preconceived notions, etc., to find adequate justification behind the purchase. At the behavioural stage, the buyer enters a state of mind of taking a buying decision. So, salespeople seek to influence the behaviour of the customers.
Today’s selling believes in an unwritten partnership building between salespeople and customers that prompt the customers to generate a business alliance between the sellers on a physical as well as psychological plane. If salespeople are instructed to work on economic relationships with the customers encompassing exchange and transaction alone, the long-term sustainability of the organization would come under question.
A salesperson should understand that he is the face of the organization. An organization finds its identity to the outside world through the salespeople. The dignity of the company depends largely on the salespeople. Salespeople can brighten the image of the firm by projecting themselves as real problem solvers, friends, and guides to the customers. A salesperson can demolish the image of a firm by procreating distrustful, false, and immoral stands.
Due to these reasons, selling is said to be a sensitive profession where well-bred, educated, and good natured salespeople are always in demand. Salespeople should transmit confidence amongst customers and express goodwill to ensure an enduring business relationship with them.
Sales Person – Qualities Required in a Salesman
Selling a product is an interesting but challenging job. It requires imagination, and knowledge of human psychology and the product.
The following qualities are required in a salesman and should be kept in mind when selecting sales personnel and planning for sales:
1. Appearance – A salesman must create an impression on his prospective customers. A well rounded personality goes a long way in this attempt.
2. Speech – This is a very important quality of a salesman. A salesman must be able to speak clearly, smoothly, effectively and be able to convey the message briefly. He must be polite at all times, especially while handling objections and complaints.
3. Listening – A good salesman should always be a good listener. He must listen to the customer carefully and patiently. By listening attentively he generates goodwill for the company and the product.
4. Poise and Manners – Good manners are important, along with poise. These make a salesman acceptable.
5. Maturity – A salesman should be practical and mature. He has to deal with all kinds of people including intelligent and mature people. An immature salesman cannot get results, he could put off prospective customers. Maturity makes a salesman think before speaking and taking action.
6. Knowledge – A salesman should have a thorough knowledge of the product, the company and its competitors. This information helps him convince the customer.
7. Interest – A good salesman always keeps himself aware of his company and its products, customers and work. ‘If you take interest in other people, other people also take interest in you’.
8. Responsibility – A salesman is quite often alone with the customer. There is no one to supervise him directly. It is essential that he realizes this responsibility and does not waste time unnecessarily.
9. Punctuality – A good salesman knows the value of time. He is punctual and keeps his appointments with customers; he knows time is money.
10. Good Health – A salesman has to work hard and generally travel extensively. It is, therefore, essential for him to be in good health to do justice to his work.
12. Persuasion – A true salesman looks forward to his major task, that of influencing the behaviour of buyers. He has the drive to dominate a situation and the willpower and determination to keep on making efforts even in frustrating circumstances.
14. Friendly Nature – A good salesman has a basic liking for people and is eager to meet and know new people. He is friendly by nature and as a result, makes friends easily.
Special qualifications of the candidates are added advantages to the organization as it reduces a lot of training cost and secondly a salesperson can utilize more expertise in the job. Similarly, candidates knowing two/three languages including the language of the region where they will work, intelligence, physical health are verified cautiously as these stimulate a candidate’s ability to work on his duties and responsibilities.
In this profession, a salesperson has to deal with customers of different linguistic abilities and, therefore, conversing under different selling situations asks for communicability in more than one or two languages. Intelligence is a necessary trait for the salesperson because this enhances trainability of the candidate. Secondly, while in selling warfare, intelligence boosts tactical acumen that is needed to cope with complicated selling situation.
Character traits are the yardsticks of a person’s human quality. Selling as a profession demands the coexistence of both basic human qualities as well as self-earned or acquired qualities, that can be acquired through education and experience. Basic human qualities are honesty and integrity to the job, perseverance, industriousness, loyalty to the employer, empathy, i.e., ability to identify with the wants or problem situations of another person, personality, competitive attitude, etc.
These qualities generally stay dormant in the salesperson in the initial stages of the selling career and gradually become expressive with age and experience.
Some psychological traits such as – emotional balance, willingness to accept responsibility, capacity for self-discipline, communication skill, understanding of problems, leadership quality, sociability, etc., is gradually acquired with time. Basically, for highly potential rookie salespeople with a strong presence of basic human qualities can achieve the learnt qualities easily. Sales managers should also have the insights to recognize the qualities of the job applicants.
The top management also examines the motivational influencers of the potential sales candidates. For high-flying selling jobs such as – selling capital goods/ installations or motor cars, etc., where the unit cost of the product is high and returns are also substantive, prestige or status associated with the selling is naturally high. So the company always looks for experienced and dynamic salespeople who link status, power, and perfection with the selling profession.
Security is connected with the remuneration pattern of the sales positions. An organization often appoints sales agents or salespeople who will work on commission basis and security of the job is less. However, for successful achievers, payment knows no limits. Therefore, candidates with risk-averting mentality, low-competitive spirit or less achievement do not find place in such selling situations.
Sales Person – Types of Salesmen
A. Manufacturer’s Salesmen:
Three types of manufacturer’s salesmen are:
(1) Pioneer or Missionary Salesman – He introduces the new product to the market. He is to contact wholesalers, retailers and other distribution factionaries and convince them about product quality.
(2) Service or Resale Salesman – He is also called as Delivery Salesman or Dealer Service Salesman. He moves about from market to market, contacts old buyers, explores new customers and seeks orders for firm’s goods. He ensures that the firm gets regular orders and reorders.
(3) Merchandising Salesmen – He collects information from the market, heeds to customers’ problems, gives advice to firm about ads, displays, service facilities and credit facilities and builds up goodwill of the firm among dealers and customers.
He bears the following functional characteristics:
a. He has highly specialized knowledge about the product of the unit he represents.
b. He deals directly with the middlemen and collects orders.
c. He is a capable organizer and is entrusted with the task of creating and cultivating outlets for a new product.
d. He must have good liaisoning capacity and is required to serve and supply products regularly to well-established dealers.
e. He is a capable person and at times, he is required to make demonstration of newly introduced products to the satisfaction of consumers.
B. Wholesaler’s Salesmen:
Often, a manufacturer does not directly sell goods direct to consumers but to wholesalers. And it is wholesalers who appoint salesmen to sell to retailers as per their requirements. For the purpose, salesmen regularly visit the retailers/ shopkeepers, note their requirements and supply required goods regularly and timely. He may collect payment also from retailers if asked by wholesaler.
His usual functional characteristics are:
a. Basically, he serves as link between wholesaler and retailer. A wholesaler purchases the products from the manufacturer and sales them to the retailers.
b. He must be a capable person to establish rapports and co-ordinate with a large number of retailers and consumers to market the goods of his employer.
c. He informs the retailers about the prospects of the various products stored and offered by the wholesaler.
d. An outdoor salesman goes out into the market and books orders.
e. An indoor salesman attends to the requirements of the prospects in the premises itself.
C. Retailer’s Salesman:
Retailers mostly employ salesmen to sell their products.
Two Types are:
(i) Indoor or Counter Salesman – He works inside the shop/showroom, sits on the counter and sells goods as customers come and demand.
(ii) Outdoor Salesman – He is also called Travelling Salesman. He goes from home to home, office to office with samples in his hand/bag and tries to sell and book orders. If necessary, he gives demos also.
His functional characteristics are:
a. He must know his merchandise well. He must have knowledge about stock position, location of each product and facts about the goods.
b. He must understand what customers say and want and get their view points.
c. He must have the capacity to serve the customers’ satisfaction.
d. He must be courteous, considerate and attentive to the customers’ needs.
e. He must present the goods with respect and appreciation.
f. He must have whole-some attitude and must be enthusiastic about his job.
D. Other Types:
1. Specialty Salesmen:
They are concerned with promotion and sale of some special goods only. Special goods are those which are sold to selective purchasers and are not meant for common buyers. Prices of such goods are high, their sale is not regular and their promotion requires special skill.
2. Industrial Salesmen:
Also called Sales Engineer. He has technical knowledge about industrial products/inputs which he sells to industrial enterprises.
3. Exporters’ Salesman:
He sells products to distributors of foreign markets and is engaged in export business. He has good knowledge of foreign languages and adequate information about foreign distributors. His job is risky because chances of cheating or fraud are more.
4. Creative and Service Salesmen:
This distinction has been made by Dr. William A. Nielander. Creative Salesman who is seeking to introduce a new product or a new brand into market and create a demand for it. He is also described as a missionary or a crusader. Service Salesman is one who sells to those who already want to buy or at least are aware with the product being sold. Creative salesman creates or expands business whereas service salesman maintains or carries on business.
5. Salesmen of Tangible Goods:
Tangible selling salesmen are those who sell tangible goods (which can be seen or felt or tested). Intangible selling salesmen are those who sell things not subject to sensory perception like entertainment giving pleasure, safe investment giving security. A salesman of intangibles sells service or utility e.g., life Assurance.
6. Tired Salesman, Artificial Salesman and Ideal Salesman:
Tired Salesman is one who decides to make a call but does it in a halfhearted way and hardly finds time to talk about his goods. Artificial Salesman is one who tries to be over-impressive and forgets to sell. Ideal Salesman is one who knows how to handle a customer. He knows how to start a sale and when to close it. He is capable of influencing or moulding the customer’s mind his own way.
7. Detail Salesperson:
The term ‘detail selling’ or ‘detailing’ and ‘detail salesman’ or ‘Detailer’- are the contributions of drug industry. Drug companies stock their products first and then create demand by calling on physicians. The salesman has to convince the physicians about the details viz., formula, dosage, use, research and testing result. Medical representatives fall under this category.
Some Other Types of Salespeople:
Type # 1. Hawker Salesperson:
They are generally a missionary salesperson type who are found to move from door to door and sell. The activity can be done for a small business or even for a large organization. For certain small businesses, the seller might buy his wares from the main markets or from small stockists and then move from door to door to sell his wares following the hawking technique.
Some of the basic traits found in hawker salespeople are stout health, piercing voice, strong negotiation ability. There are also certain hawker sales people who are stationed at one particular place to sell their wares.
Type # 2. Door to Door Salesperson:
They move from door to door, also from office to office or shop to shop to sell their wares. Some of the basic characteristics found in these sales people are low level of education, smart way of dressing up, working knowledge of product sold by the seller and the competitive price advantage offered by the salesperson.
Type # 3. Shop Salesperson:
They are also called dealer’s salesperson as they are found at retail stores, supermarkets and at specialty stores. They are generally employed to attract and discipline traffic at the stores. Although self-servicing is the order of the day, these type of salespeople often are found to do significant job in the selling process.
The job description to be found in these salespeople are greeting customers, assessing and analyzing buying situations, informing customers on products available, persuading and guiding customers in the buying process and closing sales and arranging for the billing.
Type # 4. Manufacturer’s Salesperson:
Such salespersons are directly in the payroll of the manufacturer and are generally employed as direct salesperson to sell to distributors, wholesalers, and customers. Basic selling duties and additional and supportive duties are two basic duties of such salespersons.
Basic selling duties involve contacting distributors, customers on a regular basis, keeping the manufacturer informed of customer tastes and preferences, booking orders, searching for newer avenues of selling and also after sales service.
Some of the creative services of such sales people include educating wholesalers, distributors and customers about company’s pricing policy and products, ensuring participation of each distributor and wholesaler, informing the trade about various trade contests and also ensuring enough shelf space for the manufacturer’s products at distributor shelves.
Type # 5. Specialty Salesperson:
These type of salespeople are often required for selling products that require high amount of technical expertise. The sales people of specialty products need to possess high level of education and the product features would decide the level of education required for the sales person.
Also the training needs of such sales people will be quite high and they would be requiring structured induction program. The communication level and the energy levels of the specialty sales people are to be on the higher side and they are required to have thorough understanding of the competition and competitor moves.
Type # 6. Industrial Salesperson:
These are sales people who handle original equipment manufacturers, industrial consumers and the buying agents of the industrial houses. Such sales men are required to tackle both technical as well as marketing functions and have to handle the display at machines. They are expected to answer technical queries on the spot and should also be able to deal with minor defects during the after sales episode.
Type # 7. Internet-Based Salesperson:
These sales people are not found to visit customer premises but sit in front of computers to handle customer queries and complaints on the net. They generate queries through websites, sight customers through the internet and facilitate making buying decisions.
They are required to be computer savvy and must be trained in devising software packages. They must have knowledge of internet operations and must have good communication skills over telephone.
Type # 8. Exporter’s Salesperson:
They are employed by exporters directly and they are often found to work on commissions. The basic task of such salespeople involves travelling between countries and analyzing the potentials of each country visited. Further, analysis and diagnosis of industry preferences, the sales person are also found to make forecasts on sales apart from submitting information on financial standings and after sales claims.
Sales Person – Why a Salesperson Needs Product Knowledge?
Let us know first why one needs product knowledge.
i. Sales, a Pleasant Task:
A salesman should have up-to-date information relating to the products he deals with the customers. When one possesses thorough knowledge, he feels joy to explain to others. Complete and useful knowledge of goods is fundamental requisite of a salesman. These will increase the sales and render better service to buyers.
Correct ideas, not guess work, create self-confidence, which generate potential buyers through satisfactory dealings. Knowledge makes the salesman’s job a happy one.
ii. Technical Knowledge:
There are certain products, which needs complete information regarding their function. Generally customers ask questions to clarify doubts or some may have thirst for increasing their knowledge. In such cases, the salesman will be in trouble to face such prospects who feel that a particular salesman adopts deceitful attitude. To overcome all these, salesman should have complete information of the products, which he deals with.
iii. Product Knowledge Coupled with Personality:
Product knowledge is a background on which salesman’s personality acts as a scooter-plug. Customers are highly interested to see how a salesman explains the products and how he oilers a helping hand for a proper purchase. Sales personality, without the knowledge of product is like a dry water reservoir.
iv. Deep Self-Confidence:
If a salesman lacks full knowledge of the products, it is a shame. The confidence grows when he can explain the products’ capacities, performance, merits and limitations to the perspectives. His perfect knowledge of the product will naturally increase the confidence in himself.
All types of queries can be satisfactorily met by such a salesman. If a single question is unanswered or wrongly answered, there arises a doubt in the mind of the consumers.
v. Winning Customers from Competitors:
At present, the products are of various types and the market increases. Competition is the order of the day. The success in selling a product depends upon the ability of the salesman. The merits and demerits of the rival products understood by the buyers, possibly with facts and figures. All these aid to win the customers from the field of competitors.
vi. Selling Points:
A proper understanding of a product has many advantages-or-selling points. Customers are highly concerned with the selling points, such as durability, attractiveness of product, its package, discount sales, selling terms, designs, price reduction, comfortableness, easy operation etc. All these favour a sale and are related to buying motives. A salesman must know all these to boost the sale at the counter.
How does a salesman get knowledge of the product? He can get product knowledge from-
a. Personal experience
b. Trade journals
c. Discussion with co-workers
d. Going through advertisements
e. Sales bulletin
f. Professional magazines
g. Training programmes
j. Visit to Factories
l. Sales manuals
n. Audio-visuals Aids
Sales Person – How to Select a Salesperson: Step by Step Process
After short listing a pool of potential sales candidates, authorities in an organization start the selection process. The procedure varies from one organization to the other according to hiring policy and the kind of job vacancies that are to be fulfilled. It also depends on the number of applicants who are shortlisted after the recruitment stage.
In the selection for a higher position, a one-on-one interaction or personal interview is undertaken before finally deciding on the job offer. This is a practice in the selection of executives or managers at senior ranks in the organization. Whereas, candidates for lower posts, specially where the number of candidates shortlisted are more, these candidates go through a number of stages in the selection process including group discussions and group activities apart from a number of interviews.
Usually, job applicants differ along many dimensions. Some of these dimensions include educational or work experience, personality characteristics, or any special innate ability, and motivation level. While selecting a candidate, the interviewers like to assume that at least some of these individual differences must be relevant for a particular job. Thus, during the employee selection process, the panel tries to determine these relevant individual differences that would be helpful and needed in the job.
1. Initial Screening – The Maiden Step:
Preliminary screening of resumes of the applicants is made by the authority when it receives a large number as an outcome of a recruiting process. Resume, also called curriculum vitae, are personal datasheets that applicants prepare according to the instructions in the advertisements in the recruiting stage and submit it to the company. These resumes help sales managers to get an initial impression about the applicants and they use it to eliminate unqualified candidates who do not fit the minimum criteria of selection at all.
Application blank, on the other hand, is the formal application designed to record pertinent information of the candidates in a way the company wants. The information includes educational background, physical and personal characteristics, work experience, present and past employment records such as – job responsibilities, position held in the present organization, reasons for leaving the present organization, last salary drawn as well as expected salary, membership with social or professional organization, special interest areas or hobbies, etc.
The application forms are filled by the applicants themselves. Looking at the filled application blanks, the company is able to make a quick review of the personal history of the candidates as well as compare the datasheets. As data is presented in the same order by the applicants, managers can proceed for an initial evaluation of the fitness of the candidates on different criteria of the job qualifications.
The difference between resume and application blanks is that information furnished in a resume may not be complete in all respects as expected by the organization. Application blank is a standardized format of recording all the necessary information about candidates that an organization sets to understand for the suitability of the candidates. This helps it to undertake an initial screening. Based on it, the managers decide which candidates to be called for an interview and whose applications to be turned down. Generally resumes or vitae resemble on only a few points of the completed application forms.
Dessler (2005) underlined the utility of the filled application forms. It helps one to judge whether the applicant has the right educational qualifications and the experience to do the job. Second, the applicant’s previous progress and growth can be known. Third, the applicant’s stability based on previous work experience can also be gauged. Lastly, from the comparative study of information, one may predict which applicant would succeed and who would not.
2. Interviews – Backbone of the Selection Process:
Interviews are a critical part of the selection process. It is a procedure to conduct an oral interactive session with the candidate involving inquiries and responses with a view to obtain information. It is a method of acquiring maximum amount of information from the candidates and judge their suitability for the job under question. In a way, it is a search process to discover the inner potential of a candidate which necessary to fulfil the requirements of the job.
A company after preliminary screening of the application blanks or resumes of the candidates invites applicants for an initial interview. It eliminates the unsuitable candidates and asks the qualified ones for intensive interview. Finally, the company takes a selection decision based on placement analysis.
I. Initial Interview:
The initial interview basically comprises of checking the general health and appearance, dress and cleanliness, present employer and working status, experience, and technical questions on sales and marketing, communication skills, motivation levels, personality, and reasons for leaving the organization where the candidate is working.
II. Intensive Interview:
The intensive interview uses certain psychological tests such as – intelligence, interest, aptitude, and personality to check the various personality characteristics including their interpersonal skills, which is very important for a person to survive in the field of sales. Interviewers also try to judge or rather interpret the career growth and their ambition along with their expected remunerations and other benefits. The panellist also gauges the expected performance of the candidate if selected.
III. Placement Analysis:
The placement analysis is the last and the final stage where it is finally decided if the candidate would be selected to work in the company or not. It is inferred from the earlier interviews if the candidate is worthy enough of being given the job immediately. It is also considered if a candidate deserves to be kept on the job on a trial basis.
3. Psychological Tests – A Critical Step in Selection:
Corporate recruiters use various types of tests to measure the ability of a person to fit in with the desired qualifications. Psychological tests are most effective in this regard to judge the behaviour of the candidate, particularly basic psychological attributes and socializing capacity that are important for success in a specific job. Most specifically, psychological tests examine a candidate’s aptitude, mental ability, intellectual capacity, personality, etc.
Psychological tests help to uncover talents of the candidates that may not be identified in a direct personal interview. It explores a lot of information on the aptitude and mental ability of the person within a short period of time. It eases the selection procedure by differentiating right candidates from the wrong ones.
Interviews may overlook the good qualities of right people and poor qualities of the misfits. Tests also reduce the time of selection because a large number of candidates are evaluated within a short period of time. It further eliminates bias in the judgment of the quality of the candidates. Therefore, psychological tests have more objectivity for the evaluation of candidates.
Tests are crucial selection tools to apply in order to eliminate unsuccessful candidates who fail the tests and choose them who successfully qualify. But, what is vital is proper development of the testing procedures. Selection of suitable tests is a challenge to the human resource division of an organization; otherwise these will measure the wrong qualities of the candidates and misdirect selectors to predict a candidate’s ability
This is the final stage of the selection process. Candidates undergo this stage only if their suitability (in terms of knowledge, aptitude, and skills) to be employed in a particular organization has been established in the earlier stages. It includes some essential formalities of selection such as – reference checks, medical checkups, and the official document discussing the job offer.
1. Reference Checks:
Reference checks help to check the background information and references of the candidates who qualify the rigours of the selection process. These are verified and checked by the employers. Generally, an applicant is asked to provide few names of the people called references that have academic and professional recognitions as well as are familiar to the candidates.
They are also required to submit their postal addresses, phone numbers, e-mail addresses, etc., of the references who are contacted by the employers to justify the information furnished by the candidate in the application blank. A candidate’s academic records, professional experience, honesty and integrity to the society, and the organization where one works are verified by the authority of the recruiting organization.
But often the references supplied by the candidates promote biased information. Therefore, the selectors search for such references whose names are not given by the salespeople but who are quite known for their expertise and behaviour of the recruiting candidates. Previous employers in this regard are the best references to obtain actual information of the candidates. Even customers previous organizations can share valuable information about the candidates.
2. Medical Examination:
Medical examination is a part of the selection process to check the physical ability and stamina of a salesperson. Selling is a strenuous activity involving extensive travelling and visiting numerous customers. Vitality and tact are needed to cope with the stresses of the highly dynamic nature of the selling jobs.
Therefore, the organization asks the initially selected sales recruits to go for medical examinations such as – height and weight measurements, blood pressure, ECG test, ENT test, urine test, neuropsychiatric test, etc. Medical examinations are important to ensure that the candidate is not physically disabled, mentally disordered, has ailments of the heart, has respiratory troubles, is addicted to drugs, etc. The disqualified candidates are simply rejected from the preliminary selected salespeople.
3. Job Offer:
The candidates who are finally selected are provided call letters or appointment letters that are handed personally or sent by post to the respective candidates. In these letters, they are informed about their selection and asked to complete formalities before joining. Upon production of documents and scrutiny of the same, the candidates are asked the suitable dates for joining. It also carries details about the job title, terms and conditions of the organization, and salary structure.
Socialization is a process by which the new recruits acquire culture and values which already prevail among the working class of the organization. The process starts as soon as the selected candidates join the firm and learn about the norms, values, and customs of the organization and start behaving in a way that is quite consistent with the behaviour of the employees of the organization. It also involves an employee finding an identity within it, both physically and psychologically.
Socialization finds meaning when the employee finds recognition through the following:
a. Accomplishment of tasks assigned to him.
b. Acceptability within the group.
c. Performance of tasks that prompts the organization to achieve its goals.
d. When an employee becomes a complete ‘person-organization fit’, i.e., the employee is comfortable working in the company and the company heads are also happy with the performance of their employees. It is also important for the employee to like his job profile. This is applicable to a salesperson who starts working in a company.
Socialization process, in fact begins before an employee joins a company. Getting enough information about the company and the jobs to perform, skills to demonstrate, and efficiency to exhibit are the sole prerogatives of socialization. Indeed, during the final phase of intensive interview, the interviewers should apprise projective employees about all these characteristics so that the candidate gets time to preview the new organizational environment.
Reputed organizations (e.g., American Express, P&G, etc.,) pick students from high-grade business schools for summer internships. The objective is to acclimatize those students with the organization before providing the job offer. Researches reveal that more an employee accustoms with the company and its culture, the greater will be the job involvement and more the job satisfaction.
The general trend of hiring an employee is to appoint him on probationary basis for six months to one year before being confirmed in a job. The objective is to provide the new employee some time to know, understand, and become comfortable in the working environment. This even helps organizations to eliminate the long-term risk of hiring a wrong (or misfit) candidate. Once the socialization of the candidate is successfully completed, the groundwork for conducive and productive working relationship is said to have been established.
Rookie salespeople are sent for training and development immediately after the selection. During this session, trainees are asked to attend classroom lectures, on-the-job programmes where the new recruits find ample scope to know the organizational culture and job situations, and their specific roles to contribute to the organization’s progress. Therefore, it is also said that socialization is a continuing process until the total match between the employee and the organization happens, otherwise, a cent per cent involvement and commitment from the employee is not achievable.
So, through socialization, the organization presents a clear picture of its expectations from a salesperson. The salesperson also gets an opportunity to understand the exact nature and task of the job to perform. Senior managers ought to extend efforts to project the cultural insights of the organization that transcends across the management, working community, and the stakeholders of the organization and tries to flow the same ideology among the new employees too.
Following are the training need for salespeople:
(a) Identification of the Specific Problems:
Specific problems may be related to the product, organization, job-related knowledge deficiency, skill-related problems of a salesperson, strategic and regulatory issues within the organization, and job-related and job-induced problems. These problems are indicators of a need for effective training programmes in the sales organization.
(b) Anticipating Impending and Future Problems:
Problems are likely to arise due to factors such as market expansion, product diversification, entry into new territories, the use of newer methods and technology of sale, entry into new international markets, entry into newer segments in the same market arising from organizational changes, and restructuring related to the type and number of employees required for the future markets.
(c) Management Requests:
Sales supervisors and managers sometimes make specific requests for designing and delivering training programmes. This is the result of performance evaluation of the employees and recommendation for training programmes to overcome employees’ deficiencies. One has to be careful as in many cases requests are made on the basis of faulty assumptions and incorrect evaluations.
(d) Interviewing and Observing the Personnel on the Job:
Training needs can be identified by observing the supervisors and interviewing the sales force in the field through direct questions.
(e) Performance Appraisal:
Organizations can conduct performance appraisals by evaluating the records of past performance and by comparing the current level of performance of a salesperson with both past and standard performance. This can also help a sales manager to identify training needs.
(f) Questionnaire Survey:
Sales managers often use a structured questionnaire to elicit the opinion of the sales force on topics related to communication, job satisfaction, attitude towards working conditions, and the job environment. This kind of survey will be able to reveal much information about employee skills and knowledge deficiencies.
The use of a checklist is a useful addition to interviews and observations. A checklist enables the sales manager to collect more reliable information, which can facilitate evaluating the effectiveness of a training programme.
(h) Attitude Survey:
Attitude is either a favourable or unfavourable predisposition that a sales force holds towards the organization, products, peers, and the supervisors. Attitude often controls the motivation level of the sales force. This kind of a personal audit can be conducted to forecast future training needs and boost the morale of the sales force.
(i) Interpersonal Skill Test:
Testing interpersonal skills through case discussions and incidents also reveals the training needs. These kinds of tests help in-identifying the subjective beliefs about the value of the training programme, as well as the systematic identification of problems requiring a solution.
Sales Person – How to Monitor and Control Salesperson?
The management process starts with the planning function. In the overall business plan, goals are set for different functional areas of business. In the marketing area, there are certain goals of growth, profits and market share to be achieved.
Sales function derives its goals from the overall marketing objectives. In order to achieve the sales goals and objectives, a sales plan is designed and implemented.
Sales programmes are the operational aspects of this sales plan. Ultimately, we have to see whether the performance standards set are being achieved or not. This is the controlling aspect. It has three dimensions – set the standards, measure the performance of the individuals, compare it with the standards and see if there is any deviation.
Last but not the least; we have to take the corrective action. The first three dimensions make control static, and the action-oriented part makes it dynamic. Without action, the other activities of control have no meaning. Corrective action puts the sales function on the right course.
What does action actually amount to? It may mean revising the policy and the plans. It may mean either increasing the level of objectives or reducing it. It may mean revising the criteria for performance measurement. It may mean taking steps which contribute to the attainment of objectives.
Planning, organising, staffing, directing and controlling constitute what is known as the management process. Some authors put it into three basic elements – planning, integrating, and controlling. It is not necessary to carry-out the managerial functions of planning to control in a linear sequence. It is in fact a circular process.
All decisions as to what is to be achieved – standards of performance- are set in the planning function. Planning provides a direction to the sales function. The strategies guide us as to how we can travel on the directed path.
All the performance standards are to be achieved through the sales organisation. The capability of the sales organisation itself affects the standards set. Sales plan and a derived sales programme must be coordinated with the sales efforts.
To begin with, we exercise the first three aspects of control. In the dynamic control function the management brings about the necessary changes in the planning, organising, staffing and directing process and their coordination with each other.
We have taken into account the nature of the selling task to set these standards. In short, it calls for sales job analysis. We then get objectives, duties and responsibilities and other aspects from the job analysis. Some companies have to obtain more and more business from the existing customers.
Some have to obtain sales growth from new customers. Sales standards in both these situations will be different. Promotion strategy also affects the setting of standards. We have to formulate standards for the key result areas (KRAs) and activities carried out under each KRA.
A bank manager must be evaluated in terms of deposit growth as well as growth in advances. A computer salesperson is evaluated in terms of sales and advice he renders. A credit card company measures both the growth in the number of cards in circulation and the card spends per card.
Thus, setting performance standards calls for a deep understanding of the market. We have to consider the total market or sales potential and the contribution that each territory could make.
Customer classification should be done properly in terms of their potential. Selling expenses necessary to achieve these standards must be taken into account.
Sales plans are revised in keeping pace with the changing environment. Sales plans are revised for their suitability to the changed environment. We have to correct the plans depending upon the capability of the sales force and their working conditions. Performance standards must be aligned with the overall business environment and corporate plan.
Each organisation has some specific sales objectives which are derived from the overall marketing objectives. Performance standards are so set that we realise our sales objectives.
Thus, we can say that to have an additional sale of Rs.100 crore, we have to secure 100 new accounts. In other words, the sales objective is broken down into an operational objective. The extent of reconciliation of these two shows our performance.
All organisations consider the total sales potential to which a particular level is to be achieved by way of sales volume. Sales department considers sales volume as the starting point because the attainment of other objectives is possible if we realise this objective. A standard is, therefore, set for the sales volume performance.
To realise a certain amount of profit, we will have to set standards for all those factors which affect the profit level, say for example, sales expenses, sales mix, calls made, call frequency, cost per call and the order size. Growth objectives are set with reference to the capability of the sales force and the overall fundamentals of the economy.
It is necessary to keep our marketing policies and programmes adapted to the changing environment to realise the growth objectives. It is also necessary to upgrade the skills of the sales force. Standards to measure growth are then set in terms of sales to existing customers and new customers, calls on new customers, sales of new products and improvement in sales effectiveness by coverage.
Performance standards are quantitative defining both the magnitude and the nature of performance. These standards are measurable. These salvo objective standards reflect the expectations of the management in terms performance. Everyone should be clear about what is being measured and how.
A particular level of sale volume shows the total performance of an individual salesperson. But what if the salesman indulges in unprofitable sales? Sometimes, we get the present sales at the cost of future sales.
In some fields, sales occur at a future date as a result of selling efforts taken today. There are many variables of sales which are beyond the control of an individual salesman, e.g. differing promotional support, differing potential of sales territories. It is, therefore, necessary to consider other performance standards over and above the sales volume standard.
The selling effectiveness, team spirit engendered, goodwill earned for the company and cordial trade relationship are some of the qualitative performance criteria used by an organisation. These criteria affect the sales results in the long-term. Precise definition of these criteria is not possible and they are subjective so to say.
Some objectivity can be introduced by suitable rating along a scale against properly broken-down factors. Qualitative performance is judged by the executives. Job descriptions are a great help in designing the qualitative criteria.
It is necessary to record the actual performance so that it can be compared against the performance standard set. To do this, the management has to identify the sources of information and the information needed. It can then collect the needed information from these sources. It may be necessary to develop additional standards to take care of additional information that may be generated.
Sales records and expense records are the two basic sources from which performance data can be obtained. The data from these sources needs processing, say classification, tabulation, etc.
Reports come upwards from the managers, supervisors and salesmen. Sales forecast data also comes handy for performance measurement. Information can also be obtained informally through personal observation.
Two most important methods of monitoring are:
(a) Through sales reports.
(b) Through field visits by the supervisors or field sales managers.
The details required in reporting vary from company-to-company. A company with a large number of SRs and wide geographical market needs more detailed reporting than a company with a few SRs. The more the SRs enjoy in planning / scheduling their sales effort, the greater is the need for detailed reporting.
A variety of sales reports has been designed by different companies. However, many of the following components are to be commonly found in the reports of all organisations.
These components are:
(a) Work-Plan Component:
Usually for a week (or a month) in advance, the SR is expected to submit his schedule or work-plan. Here, he lists the doctors he is going to call on, the chemists he is going to visit and the routes he’ll take.
He also lists the non-selling tasks he will undertake. This report helps the SRs himself, and the company too which keeps track of his whereabouts. It also helps to evaluate the SRs achievement against the plan made.
(b) Progress Report:
It is a report not the day-to-day work done. It is prepared after each call or collectively for calls made during a specific time period. It provides information about company’s position in each territory and for each account. The progress reports indicate the response of doctors of different categories and the extent of competitive activity.
(c) Expense Component:
SRs are reimbursement of expenses incurred, or else they may be put on expense account. Most reports have an expense component to keep a check on the nature / extent of his expenses.
(d) Complaint and Adjustment Component:
This component is related to the specific complaints the doctors / the chemists have in relation to the company, its products, its policies and the detailing of the SR. Attending this component improves the products, services and distribution.
(e) New Business or Potential Business Component:
Here, the SR informs the new doctors won over recently and those who have the potential of becoming our patrons in future. It gives the information about the prospecting capability of an SR.
(f) Lost Business Component:
We may lose certain prescribers who start prescribing competitive products. We have to consider the improvements on product, service and training of SRs to take care of this component.
Sales reports are thus good controlling tools. They become the basis for discussion and debate. These are also useful for developing the manpower. Field sales reports provide information to measure performance. They also provide additional information for performance appraisal, sales planning, customer feedback and competitive scene.
The sales manager has to know whether an SR is putting in the sales effort on expected lines. A monitoring system of SRs consists of field visits by supervisors and periodic reporting. It is a formal feedback system.
It controls the sales effort. It forms an input in appraisal of the SRs. Reports are the basic tools used for monitoring SRs. The sales manager comes to know from these reports how the SRs are performing.
A good monitoring system enables the management to take decisions to improve sales performance. Even an SR individually benefits from regular monitoring since he gets a chance to compare his present performance with a corresponding performance in the past. It is a method of self-evaluation.
A good monitoring system serves the following purposes:
i. It facilitates market research.
ii. It facilitates the decision making of a sales manager.
iii. It facilitates the performance appraisal of SRs.
iv. It facilitates the corrective action, in case there are deviations.
v. It facilitates the planning of a SRs work.
vi. It is a mechanism to record consumer / doctor’s reactions and complaints.
vii. It is a mechanism to record competitor’s activities and matters of topical local interest.
viii. It facilitates the building up of a good database.
An organisation should decide the optimum number of reports. Selling reports are prepared on daily, weekly, fortnightly or monthly basis. They take in a lot of time and time is a precious commodity for the best people. It is, therefore, necessary to keep the number of reports in check.
Reports are reviewed continuously to determine whether the information they provide is relevant for our needs. A new report must be justified in terms of its need. If information is available through the means, management can do so, instead of getting it through the field sales reports. Reports found faulty and useless are discontinued.
Reports should be concise and should generate the desired information. The forms should be easy to carry and generally have provision for duplicate carbon copies. Reports should not tax the salespeople with too much clerical workload.
The arrangement should be such that synopsis become easier. These should facilitate the transfer of the operative information to other means, so that retention of the original records may not always be necessary.
What amount of detail a report should contain is dependent on the nature of the business. A large organisation with an all India nature may require more detailed reports. A smaller company may not require such detailed reporting. The more the autonomy enjoyed by the salesperson, the greater is the need to have detailed reports.
Salesmen on commission may submit less detailed reports. Even the calibre of the salesperson is the deciding factor. If salespeople are seasoned, management can be content with less detailed reporting. It is believed that they will exercise self-control in their work.
When we compare the actual performance against the standards set, it is called evaluation. It is here that judgement plays an important role. It is understood that a common set of standard would not work especially amidst such diversity as geographical variations in territories, differing sales potentials of different territories, the effectiveness of the sales force, the customers attended to and the competition faced. We will have to devise separate standards for different territories.
However, how can we accommodate the variations in the customer profile and sales force effectiveness is to be seen. When two sales work for one and the same accounts, their individual performance may differ. Appraisal of salespeople is both quantitative and qualitative.
Some sales-people may not live up to the quantitative norms, but may be doing yeomen’s service to the company by building customer rapport, and trade relations. The subjective in evaluation plays a great role.
Sometimes, appraisal becomes a tool for counseling. A salesperson who was good previously may falter now. We should probe the reasons. We must exercise our judgement and guide the salesman properly. It is also necessary to review the standards. Perhaps, they may not have been set correctly.
It is not possible to isolate the effect of selling effort on the output achieved, especially when there are a host of other factors operating which influence the final output. Some companies do venture into experimental methods of research by setting up control groups and test groups.
The dynamic part of the control process is to take suitable action. When the standards are met, no action is necessary. If they are not met, we may have to improve the performance or revise the performance or revise the objectives and strategies or lower the standards themselves.
Supervision method is also extensively used to control the sales force. Its ultimate aim is performance improvement. A supervisor is a link between the sales force and management. He has to build-up a good rapport with his working team. He observes the working of salespeople. He reports about their activities to the company. He suggests how to overcome the problems. He clears the role ambiguity.
He informs the salespeople about the changing nature of environment and company policies. He solves the actual problems faced in the field. He takes suitable action on behalf of the management to align the standards and actual performance.
What amount of supervision is called for? Perhaps neither too much, nor too little. It is difficult to spell out the precise quantum of supervision. But supervision is necessary when the sales turnover rate is high, customer dissatisfaction is more, order-to-sales ratio is low, total calls made are less, sales expenses to sales ratio is high.
A low morale also indicates the need to have effective supervision, though the above mentioned factors show that something wrong with supervisory method, it cannot, however, be solely attributed to faulty supervision.
There may be other factors. Cultural change in the organisation also calls for a review in supervision. An organisation with a highly educated sales force cannot strictly adhere to the traditional autocratic supervisory style. Supervisory style thus depends upon who are being supervised.
Supervision can be exercised by office persons such as branch managers or district managers or field supervisors. In other words, executives can be assigned an additional responsibility of supervision or a specialist supervisor can be appointed. A small company exercises supervision through its top executives or their assistants.
In a decentralized company, a branch manager or district manager undertakes the responsibility of supervision. In may be noted that field supervision is only one of the functions of the branch manager. He has to look after many other activities and so tends to neglect supervision.
Sales supervisors are mainly drawn from the field sales force. They do require a shade more than mere salesmanship. They should be able to act as a friend, philosopher and guide to the salespersons. They should be able to train the deficient persons. They should be able to serve the interests of both the management and the force. They should have good HR skills.
They should have an ability to deal with the problems faced in the field. They may be expected to do some selling themselves. In doing this, they act as role models to the salesmen.
This job is quite an onerous task and does not command commensurately high salary. But still many aspire to the supervisory positions which can be used as a launching pad for the higher level jobs.
Sales Person – Position of Salesman
Organisations, large or small, are into selling something or the other for their survival and growth. It may be a product (tooth paste, pen), service (courier, insurance) idea (travels) concept (obesity control), destination (Europe, US) or Person (Politician) Sales persons have various names. They are called Sales man, Sales woman, Sales boy, Sales girl, Sales representatives etc.
Robert N. Mc Murry in his famous article “The Mystique of Super Salesmanship” in Harvard Business Review classified a salesperson’s position in the following ways-
(i) Position where a Sales person’s job is predominantly to deliver a product.
(ii) Positions where a salesperson is predominantly an internal order taker i.e., the counter salesman.
(iii) Position where a sales person is predominantly an order taker but works in the field i.e., Eureka Forb’s Sales Executive.
(iv) Positions where a salesperson is not expected or permitted to take an order but is required to build good will for the company i.e., Medical Representatives.
(v) Positions where the emphasis is placed on technical knowledge i.e., Sales executives selling capital equipment is computers and components.
(vi) Positions which demand the creative sale of tangible goods i.e., vacuum cleaners, refrigerators.
(vii) Positions requiring the creative sale of intangible items like life health Insurance Policies, Education and Advertising.
The techniques of modern sales management and selling techniques were devised by John Henry Patterson, widely known as the father of modern sales management. The best sales techniques and sales appearances were demonstrated by him. Mr. Patterson assigned to his sales team exclusive sales territories and sales quotas for producing the best results. He also arranged frequent sales muting that served the double purpose of training and socializing.
To-day, the process of sales management has undergone numerous changes in form of strategy, practice, and technological adoption to achieve the desired goal. A salesperson is no longer an order taker or information provider, rather he is viewed as a consultant to the customers.
Due to non-personal form of business and increasing distances between the manufacturers and customers, sales organisations are not emphasizing more on quality consulting skills to solve the customer’s problem. The real sales activity is in retaining customers rather than just closing the sales.
Sales Person – Performance Evaluation
According to Peter Drucker, the justification for the existence of a business in society is two-fold viz. innovation and marketing. With growing competition and steady transition from the sellers’ market to the buyers’ market, marketing has become an increasingly important function and perhaps the main reason for the existence of an enterprise. This has no doubt made marketing both challenging and exciting.
According to Drucker, there is only one valid definition of business purpose, i.e., to create customer.
Any attempt towards the evaluation of marketing performance should therefore start with – how far the enterprise has been able to create, hold and attract customer. Theodore Leritt has described the means by which this customer-creating-attracting activity can be performed.
“People don’t buy product, they buy expectation of benefits and a product is not just the engineers say, but also what is implied by its design, its packaging, it channels of distribution, its price and quality including activities of its salesperson.”
Success in marketing through customer-creation is achieved by efficient management of the marketing-mix and consequently, all the P’s i.e., Product, price place promotion, etc. that go to form the marketing mix.
To manage their affairs, marketers have at their command all the resources and have optimised the results through efficient deployment of resources to produce the ultimate result of surplus or profit.
However, from the long range point of view, marketing performance evaluation should not be judged only by results of profit, but it is necessary to appraise the strategies and tactics. An evaluation of marketing performance should necessarily consider the aspect of how far the marketers with a strong consumer orientation are helping product design to meet customer’s diverse requirement.
When we see that no two cars of General Motors are exactly identical, we understand the need for meeting customer’s specific requirements even with the adoption of man production system.
Basic Criteria for Evaluation of Overall Marketing Performance:
(i) The most important criterion to measure the overall marketing performance is the market share. The operation Research Group (ORG) has developed computerised system of market analysis on a monthly basis for the pharmaceutical industry and a few other consumer goods industries in India covering all major products and showing size of the market as well as market share of each company’s products in each market segment.
(ii) Higher market share need not necessarily reflect in higher profits or improved ROI. Therefore second criterion of marketing performance evaluation is profit and ROI.
(iii) Other evaluation criteria is to see how far the organisation is geared to respond adequately and react quickly to the external stimulate, i.e., the changes continuously taking place in the market for which the organisation is able to develop suitable marketing strategies and tactics to tackle the effects of changes.
The classical Pyramid structure is mostly unsuitable in the present context of complex marketing operation. In order to avoid delay in decision, these should be too many levels in the organisation structure and the organisation should be a flat one.
(iv) There should be highly effective marketing management information and control system. Marketing information system should not be entirely statistics-oriented. Adequate importance should be attached to oral reports, personal observation and informal discussion, over and above statistical information.
It is to be noted that the creative marketing strategies and control action emanate mostly from such reports and discussion.
Evaluation of Salesman’s Performance:
(a) Concept and Importance:
Salesman is a commercial enterprise should be associated with certain specific qualities the most important among these are attitude, knowledge (of product, market and customers), habits and selling skills. Selling skills are again broadly determined by one’s ability of aggressiveness or submissiveness depending upon the situation.
Evaluation of Salesman’s performance would help the marketing manager or sales manager to evaluate the sales force and improve efficiency. It should help the manager in the task of creating, directing and stimulating a sales force to effectively respond to new challenges in the market situation.
However, a good performance evaluation system is useful for the following:
(i) Developing salesmanship as an inter-personal influence process.
(ii) Motivation of salesman and supervisory leadership.
(iii) Making decisions regarding selection, induction, training, award, promotion and transfer etc.
(iv) Identifying the need for continuous training and development or salesforce.
(v) Improving marketing aids, strategies and tools (i. e., working documents and demonstration materials etc.)
(vi) Determining and restructuring salesman’s territories and work assignments.
(vii) Improving sales planning, (i.e., planning call cycles, routes visits, job preparation, distribution centres)
(viii) Introducing sound compensation and incentive system supported by a rational evaluation scheme.
The concept of productivity of salesman is relevant in this context. A salesman is considered to be productivity only when the results achieved by him would not only offset the cost efforts expended on him by the company but also leave some surplus thereafter, which would satisfy the company’s predetermined norms of expectation from him.
These norms could be expressed in the form of certain productivity ratios, i.e., sales per salesman gross margin per salesman, etc. Cost should be looked upon as – Direct cost i.e., the compensation package including to equip the salesman to do his job and provide the necessary facilities and services to enable him to sell. Examples of such costs are travelling expenses, entertainment expenses, promotional literature, samples and other selling aids used by the salesman.
(b) Problems in Salesman’s Performance Evaluation:
Certain problems that are inherent in any salesman’s performance evaluation system, which might affect and distort the results of quantitative evaluation.
Some of these problems are enumerated below:
(i) Problem arising out of evaluation based on qualitative judgement vis-a-vis quantitative data.
In any qualitative judgement there is always the possibility of personal bias and subjective value judgement vitiating the evaluation.
(ii) Problem of comparison between salesman based on the results of evaluation. Such comparison would hardly be correct, since a great deal of human element is involved and different salesman have to work under different geographical and environmental peculiarities and constraints.
(iii) Problem of determining standard or benchmark. Evaluation should always be based on such predetermined standards of performance or norms.
(iv) Problem involved in determining the periodicity of evaluation. Evaluation based on short term results of salesman may be damaging whereas evaluation on the basis of long-term result may not be desirable, in case the results are not satisfactory. Besides, promotion, resignation and transfer of salesman create problems in deciding upon the periodicity of evaluation.
(c) Evaluation Parameters and Criteria:
The technique of salesman’s performance evaluation is called a “Z Score” or standard score. This is used to place different measures of performance on the same scale. Z-score provides a mode of examining salesman’s performance on specific dimension (i.e., volume and profitability).
Other criteria of evaluation of Salesman’s performance are oriented towards an evaluation of quantitative or financial in nature are as follows:
(i) Sales Achieved:
(1) Market Share
(2) Sales quantity (or volume)
(3) Sales value.
(1) Number of Calls
(2) Number of orders
(3) Value of orders booked
(4) Value of orders per call
(5) Ratio of order value booked to the total (batting average) value (Hit Ratio)
(iii) Financial Performance:
(1) Contribution and C/s ratio
(2) Direct selling expenses ratio
(3) Direct sales margin
(iv) Working Capital Management:
(1) Average inventory
(2) Average outstanding receivables
(3) Average working capital locked up
(v) Vital Performance Index:
(1) Marketing Return on Investment (ROI)
(1) New Product Performance
(2) Number of Accounts obtained
(3) Number of Accounts lost
(4) Number of customer complaints
(5) Information about competitor’s plans and strategies.
Sales Person – Methods of Motivating Salesmen
Methods of motivating salesmen may be grouped into two major types:
Method # 1. Financial Motivation:
It is the most important method of motivation. By providing higher salary, commission and other monetary incentives, the salesmen are motivated towards getting larger sales. Financial incentives include commission, profit sharing, traveling allowances, bonus, etc. Money is the major motivation for social prestige, status and higher standard of living. But the financial or monetary incentives become non-effective after a certain limit. As such, non- financial incentives have more motivating effects on the salesmen.
Method # 2. Non-Financial Motivation:
Monetary benefits are not everything for a person in his life. Although money is the source for the satisfaction of various physical and social ends, people need psychological satisfaction also, which can only be achieved through non-financial methods of motivation. Money cannot be an effective motivator where the non-financial motivators like participation, credit, promotion, liberal supervision, good behaviour, efficient leadership, responsibility, personal contacts, feeling of accomplishment, work satisfaction, etc. are present.
The non-financial methods of motivation may be categorized as:
i. Individual motivational methods, and
ii. Group motivational methods.
i. Individual Motivation Methods:
(a) Personal contacts with salesmen – Regular contacts by sales managers and the sales supervisor with salesmen from time to time, and appreciating their work, solving their problems and giving sufficient guidance in their efforts have motivating effect on the salesmen.
(b) Correspondence with salesmen – This is another important method. Correspondence helps to create a feeling of accomplishment, mutual understanding and self-confidence among the salesmen. Salesmen are praised for good work and solutions to their problems are attended through correspondence. This method of motivation is adopted where the salesmen are located at distant places from the Head Office.
(c) Promotion – Promotion gives higher responsibility and authority, in addition to moving further into the higher job. This will have a motivating effect as the salesmen feels satisfaction, through higher responsibility and good image among the fellowmen.
(d) Responsibility – This is the view of psychologists that development of a feeling of higher responsibility is an important motivator, when an employee is assigned with adequate responsibility in his work or he is assigned to do some important duties. The salesmen not only feels importance in his role, but also is self as an important ‘member’ of the organization.
(e) Opportunities for advancement – When a salesman gets adequate opportunity to develop his abilities and skills, through sound educational and training programmes, that will pave the way for advancement in his career.
(f) Feelings of accomplishment – If salesmen are motivated by beneficial motivating plans, they will have a feeling of accomplishment and satisfaction. This may be possible by providing them (i) freedom in their working, (ii) opportunity for creative activities, and (iii) freedom to choose from.
(g) Recognition and rewards – A good work done must be appreciated and due recognition be given to such facts. For a specific achievement, the salesmen should be suitably rewarded.
ii. Group Motivation Methods:
(a) Sales Conferences and Conventions:
These are important tools of motivations. Sales conferences and conventions are usually organized at regional, national and international levels.
Sales conferences are organized every year for achieving certain objectives, such as:
(i) To understand the behaviour pattern of each salesman
(ii) To provide for sales training
(iii) To hear the problems of salesmen and to find solutions to the problems
(iv) To introduce new products and services
(v) To give knowledge about changes that has been made in the organizational policies and plans.
(vi) To improve the effectiveness of controlling system, and
(vii) To make the salesmen aware about the new sales techniques.
(b) Sales Contests:
A sales contest is a special selling effort offering incentives in the form of prizes or awards to salesmen. In the words of Stiff and Cundiff, “A sales contest is a special selling campaign offering salesmen incentives in the form of prizes or awards beyond those regularly provided by the compensation plan.”
It is not essential that every salesmen should participate in the sales contest, but all are included to participate in the contest so that everyone may get an opportunity to prove his contest so that every one may get an opportunity to prove his superiority over the other. Although the main object of sales contest is the maximization of sales, it would, at the same time, motivate the salesmen for providing their superiority over the other salesmen, in addition to winning of prizes and awards.
(c) Periodicals for Salesmen:
The magazines and newsletters published by the organization are also good tools to motivate. Sales articles and the opinion of salesmen are usually published in such magazines. Their efforts and achievements are praised through the columns of such periodicals. This will be motivating effect on salesmen.
(d) Sales Literature for Salesmen:
Orientation literature, sales manuals and hand books, booklets, folders, etc. are distributed among the salesmen policies, programmes, work methods, achievements, etc. which are very helpful in their selling activities. Orientation literature is supplied to new and young salesmen to have a better idea about the company, its products, policies, etc.
Sales manuals and hand-books contains usually the selling process, sales techniques and sales presentation, solutions, to buyers problems, arraigning of sales tours, methods to deal with the customers, etc.
The book-lets and folders provide for the information about organization structure, products, sales promotion programmes, revised policies of the firm sales promotion programmes, revised policies of the firm, advertising, research and development programmes, etc. These have motivating effect on the salesmen.
This is another important method of group motivation. By this method, the opinion and suggestions of salesmen are invited for future planning, gives them participation in decision-making and formulation of sales plans. They are offered membership in various committees like sales promotion, advertising consumer complaints, budgets etc.
(f) Relations with Sales Supervisors:
Good relationship with their sales supervisors is also a good motivator. The supervisors play two-sided roles. On one side, they are immediate authority and representatives of the salesmen. The supervisors can motivate them by their lenient control, better advise, finding better solutions to their problems, goods behaviour and informal relationship. In addition to these, supervisors can give better guidance and interpretation of management policies, rules, objects and programmes.
(g) Motion Pictures for Salesmen:
This method of motivating salesmen is a new technique not widely used by the sales organizations. Small films containing information about the products, selling activities, customer behaviour, as well as of the organization are used to develop their knowledge about customer psychology, buying motives, methods to solve consumer problems, process of manufacturing, sales techniques, marketing strategy, etc. Salesmen are entertained through such techniques and these have motivating effect on the salesmen.
Motivating sales personnel is an important aspect of sales-force management. Sales personnel require additional motivation because of inherent nature of the sales job, role conflicts, the natural tendency toward apathy, and difficulties in building group identity, satisfactory job performances, development of deep understanding of motivational forces and process, effective leadership, tow-way communications and handling of relationships.
Sales Person – Salesmen Compensation
One of management’s major tasks is to formulate rules that will encourage salesmen to develop impersonal attitudes that are congruent with the goals assigned them. “Motivating” the salesman and providing him with “incentives” is the traditional way to phrase this issue. The brand manager is obviously concerned with the salesman’s motivation in the sense that the more motivated the salesman to exert effort, the more the brand manager is likely to benefit.
He has a specific area of interest, however. Feedback on the brand’s performance is especially helpful, and unless the incentive system provides for it, this feedback will be of an inferior quality.
Either through ignorance or lack of congruity between the individuals’ impersonal attitudes and his assigned goals, a subordinate will behave so as to optimize company goals only if policies are designed in such a way as to encourage him to do so. This is the theory behind compensation methods involving commissions—a salesman who is paid according to his volume of sales is presumed to try harder than if he were paid a straight salary.
The inducements-contribution relation, is the appropriate principle to use – To the extent that his inducements exceed his contributions he is likely to remain on the job instead of leaving the organization, as well as to try harder to increase his contributions.
Two separate aspects of the problem of compensation are to encourage the salesman to apply his effort as intensely as possible, and to persuade him to apply it in a particular direction. We ordinarily think of compensation as serving only the first role, while supervision serves the second. However, compensation can serve the second as well.
Now that computers are making cost data readily available, companies can be expected to begin to provide salesmen with data on each product’s profit margin in order to encourage them to sell the more profitable products. This practice has been initiated in at least one company and is being seriously considered in more.
In practice, there is a great variety of compensation methods.
They can be roughly classified into (1) Straight salary, (2) Part salary and part commission, and (3) Straight commission.
A number of surveys of company compensation systems suggest that about one fourth of the companies use the first method, one half use the second, and one fourth use the third.
Unfortunately, no satisfactory evidence is available to indicate which type of method is more effective under given conditions. It is argued that commission methods are more useful in cyclically depressed periods and that fixed-income methods are more effective in prosperity. The extent of non-selling duties that the salesman performs is probably important in determining compensation. For example, if a salesman does delivery and repair service, the emphasis should be on the straight-salary type.
Certain qualitative criteria have been found to be helpful in designing the compensation plan:
1. Income and Security:
By providing a minimum income the compensation plan can yield security to the salesman. It is generally felt that excessive fluctuation in earnings should be avoided.
The plan should contain in incentive element; but for it to be effective, it must be understood by the salesmen.
The plan should be designed to meet fluctuations in business conditions. Perhaps both minimum and maximum limits on earnings are essential.
The plan should be designed to provide an incentive to increase sales but at a cost no greater than competitor’s costs. Costs include payments to salesmen, travel, and other expenses, and the expenses of operating the compensation plan.
In order to contribute to morale, the plan should appear fair both to management and to the salesman.
Bharat Petroleum pays its salesmen a fixed salary on the grounds that commission system leads to friction among the salesmen. The salary in this case is determined by “merit ratings” and the “job title” assigned to each salesman. Social psychology suggests that one of the key determinants of the type of compensation method to use depends upon the extent to which the company’s salesmen constitute a “group” in a psychological sense.
If the members of the sales force work together intimately so that group norms tend to develop, a fixed salary or possibly a group bonus method is advisable. In this case, a commission system could create friction. If, on the other hand, the salesmen work individually and have limited contact with one another, a commission system could stimulate rivalry and greater effort. The group aspect, although important, is only one determinant to be weighed against the others that usually exist in a specific problem.
As in other personal-selling problems, a compensation method should be selected by experimenting, if possible, and using behavioural theory as an aid in formulating the hypotheses that are tested in the experiments. This would seem to be especially valid until more is known about the process of personal selling.