JOBS IN Sales Management
A. Introduction to Sales Management & jobs
Do they have adequate knowledge of the methods for analyzing their market, planning the optimum use of resources, and controlling and implementation?
Can they manage performance by leading, motivating, appraising and developing the team?
If not, they run the risk of making one of the two typical mistakes: either they confuse management with tyranny and create a demotivating, command-and-control, carrot-and-stick culture: or they abdicate from management altogether and simply become super-sellers. They tend to keep the biggest and most interesting deals for themselves while the team degenerates into anarchy.
He is a teacher, a trainer, and a coach.
He is a recruiter, an employer and a counselor.
He is a leader of his group and a follower and implementer of company policies, plans and programmes.
He is a communicator and a catalyst.
He is a planner and organizer.
He is a consolidator, directing and uniting the efforts of many towards the achievement of common goals.
He is a teammate, a referee and an umpire.
He is a developer and supporter of his people but at times he must also be an executioner.
He must handle the broken dreams of some and the good fortune of others, sharing in their disappointment as he shares in their happiness.
He is an instigator, an innovator and a creator of new ideas.
He is an over-achiever rising to the challenge of new forecasts each year.
He has the strength and courage to handle unanticipated difficulties and events.
He is an opportunist and a worthy adversary.
Yes, a sales manager is many things to many people.”
Planing
Organizing
Leading
Controlling
By the end of this session, you will be able to:
- Define tactical and strategic planning
- Carry out tactical planning for achieving sales targets for institutional sales
- Carry out tactical planning for achieving sales targets for channel sales
- Plan for windfall sales and low sales situations
Case Study
James Kent began his career in 1960 as a sales trainee with the Forest Products Division of the Owens-Illinois Glass Company. Through the years, James has progressed as a sales rep, national-account sales rep, sales manager, operations manager, and general manager. During this time the Forest Products Division was sold to Great Northern Nekoosa Corporation, which was recently acquired by Georgia-Pacific Corporation. Now, as general manager at Georgia-Pacific, James is actively involved in sales planning for the corrugated box plant and reorienting the entire sales organisation.
“Typically, the sales territory for a product like corrugated box comprises an area within a 3-mile radius of the plant. Information is then gathered from such sources as chambers of commerce, privately published industrial guides, and state or federal publications on virtually every manufacturing company within a given sales territory. Once the information on the manufacturing companies is accumulated, it is possible to project estimated corrugated box potential by utilising historical information that tells us typical corrugated usage for various SICs (standard industrial classifications). Categorising usage by SICs and using that historical information, we can come up with a relatively accurate forecast or market potential within a city, country, state, or other geographic area”. Mr. Kent was aware that totally correct market potentials are difficult to achieve at first: “However, at Georgia-Pacific we know there will be inaccuracies, but follow-up sales calls by local plant reps confirm or correct our estimated market potential”.
Once the potential and forecast was worked out, he defined a clear objective of growth in sale by 20 per cent in the current year. With this indicator clear to James, he went about strategising for this objective achievement. One of the major learning from his past experience had been that the growth objectives could only be met if a precise budget was made and kept. Industry precedents had shown him that profitability had been a question mark, and one of the major contributing factors was incorrect budgeting and/or non-adherence to the same.
After drawing up the budget, he moved on to defining territories. He also put across the total sales forecast into territorial slots for each sales person. He was of the view that the sales people would be absolutely focussed on target achievement if they knew how much was to be achieved. The target had been worked out for each territory along with the specific number of people that he was planning to recruit.
Kent planned to go over each existing sales person’s performance records to decide who would stay. The rest would have to be recruited afresh. He had also planned out an adequate sales training and behavioural training for each sales person.
With the right leadership skills which he prided himself with, he knew that the task was not difficult. The first test would come at the end of the quarter when he along with his supervisors would carry out a detailed analysis on the actual sales performance vis-Ã -vis the plan
Q. List down the various activities carried out by Mr. Kent after joining in as a Sales Manager.
Probable responses:
1. Mr. Kent was actively involved in sales planning for the corrugated box plant and reorienting the entire sales organisation.
2. He did long term and short term planning.
Derive
That these long term planning to meet numbers throughout the year, considering the risks involved, is known as Strategic Planning
The planning for weekly and quarterly plan to carry out activities to achieve outcome and focus on numbers is known as Tactical planning.
Strategic plan.
–A plan to meet numbers throughout the year and to carry out risk management.
Tactical plan.
–A weekly and quarterly plan to carry out activities to achieve outcome and focus on numbers.
To discuss the issues for Example - that James considered while doing strategical planning.
- He first studied that the sales territory for a product which, by his findings, comprises an area within a 3-mile radius of the plant.
- He then gathered Information from such sources as chambers of commerce, privately published industrial guides, and state or federal publications on virtually every manufacturing company within the given sales territory.
- Once the information on the manufacturing companies was accumulated, it was then possible to project estimated corrugated box potential by utilising historical information that tells us typical corrugated usage for various SICs (standard industrial classifications).
- By categorising usage by SICs and using that historical information, he then came up with a relatively accurate forecast or market potential within a city, country, state, or other geographic area
- He also took care of risks of inaccuracies.
- He defined a clear objective of growth as sale by 20 per cent in the current year.
- He combined the above with his learning from past experience that the growth objectives could only be met if a precise budget was made and kept.
Strategic Plan
Market Analysis
Competitive Analysis
Organisational Strengths - SWOT
Opportunity sensing and seizing
Account risk management
Q. To discuss the issues that James considered while doing Tactical planning
Probable responses:
-After drawing up the budget, he moved on to defining territories.
-He also put across the total sales forecast into territorial slots for each sales person. He was of the view that the sales people would be absolutely focussed on target achievement if they knew how much was to be achieved.
-He worked on the target for each territory along with the specific number of people that he was planning to recruit.
-Kent planned to go over each existing sales person’s performance records to decide who would stay. He decided that the rest would have to be recruited afresh.
-He had also planned out an adequate sales training and behavioral training for each sales person.
Later
At the end of the quarter, he along with his supervisors carried out a detailed analysis on the actual sales performance vis-Ã -vis the plan.
Tactical planning is divided in two phases:
- Key Account Management
- Distribution Management
- Planning the funnel
- Calculating conversion ratio
- Reducing contact to contract time
- Calculating cost of sales
- Adherence to sales process
Work out following exercise to own activities specifically the sales funnel:
Think as you are a sales force of an upcoming cosmetic company. The company is experiencing the growth rate of 15% and has introduced some new range of hair -care product. The company expects you to continue and help in increasing the growth and sales of the company.
Sales Funnel
- Prospect
- Suspect
- Approach
- Negotiate
- Closing
- Order
Tactical Plan – Distribution
- Coverage plan - country / city
- Coverage plan - channel members, their role and responsibility
- Coverage plan - outlet location
- Coverage plan - within outlet position
Key Measures
- Territory coverage - distributor appointment
- Consumer coverage - new outlet appointments
- Visibility - signages, banners, sales promotion
- Consumer offtake - numbers being sold
To reinforce the above learning, carry out the exercise:.
You are launching a new range of flavored mineral water in the country.
Then:
How will you go about planning for the same
If a product is priced at Rs. 30 for a 750 ml water, double that of normal mineral water and a distributor can service 7 districts
Then:
How many cities, towns, and districts do you need to cover to ensure that you meet your numbers?
What should be the profile of distributors?
What should be the profile of the retailers and how many retailers do you need to have?
How many sales people would you need to handle this?
What should be their targets?
What can be the various exceptions to the Stratergical and tactical Planning?
Probable responses:
These can be exceptions as windfalls or slowdowns
Exceptions
- Windfall
- Slowdown
Following examples.
- BPO sector boom in India.
- The Indian companies manufacturing the chemical gained substantially and registered record profits.
- Inspite of high manufacturing costs, low efficiency and low quality all companies registered growth over 70%.
- What will happen when the import restriction is done away with as per WTO agreement
Slowdown
- A leading tractor company in India was selling primarily to the agricultural belt. With new entrants coming in, their market share declined. After 3 years of fighting a continuously losing battle, the company decided to focus on new applications.
- They now have tieups with the construction companies, ports and airports on new usage of tractors.
Summary
- Strategic plan are plans to meet numbers throughout the year and to carry out risk management.
- Tactical plan are weekly and quarterly plan to carry out activities to achieve outcome and focus on numbers.
- Windfall are Good news. Might be due to some economic considerations. Do not let lethargy set into the system when the windfall happens.
- Slowdown are tough situations, but a reality. Focus on new markets and applications. Ensure high morale and retain the activity orientation. Think out of the box
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