3rd lecture, week 8 “The evolution of the strategic sales organization”

Question 1

Why is is important to address an organization’s ability to manage customer relations? (OX, ch. 2, 2.1.)

Answer 1

Because the customer power and buyer concentration is escalating in many markets. This means that selling is increasing becoming a matter of satisfying the customer’s needs. The shift in power from buyer to supplier also includes a shift from headquarters to the field, meaning that the sales force can no longer passively accept and execute plans produced by corporate marketing (OX, ch.2 , 2.1.).

Question 2

What is the core responsibility of the strategic sales organization? (OX, ch. 2, 2.1.)

Answer 2

The core responsibility of the strategic sales organization is strategic customer management (OX, ch. 2, 2.1.)

Question 3

How has the customer relationship requirements changed with the shift of power from the seller to the buyer? (OX, ch. 2, 2.2.)

Answer 3

The shift of power from supplier to buyer has increased the demand for service, new types of relationships and greater added value by business to business customers (OX, ch. 2, 2.2.)

Question 4

What are the desires characteristics of a supplier relationship? (OX, ch. 2, 2.2.)

Answer 4

The salesperson to be:

• Personally accountable for the buyer’s desired results
• Able to understand the customer’s business
• be accessible, problem solving and deliver creative solutions to meet the needs of the customer.

(OX, ch. 2, 2.2.)

Question 5

Describe the old and new approach to sales tasks? (OX, ch. 2, 2.2.2)

Answer 5

Old approach:

• Getting new accounts
• Getting the order
• Pressuring the company to cut prices
• giving service to get sales
• managing all accounts in the same way
• selling to anyone

New approach:

• retaining existing accounts,
• becoming the preferred supplier
• pricing for profit
• understanding cost implication and managing each account for maximum long term profitability
• Concentrating on the high profit potential accounts

(OX, ch. 2, 2.2.2.)

Question 6

What causes the growing important of strategic sales capabilities? (OX, ch. 2, 2.2.3)

Answer 6

1. The complexity of Customer Relationships
2. Customer sophistication
3. Commoditization
4. Corporate Expenditure on Sales organizations

(OX, ch. 2).

Question 7

Name the three roles, that today’s salespeople often engage in (OX, ch. 3, 52)

Answer 7

• Competence deployment
• Competence modification
• Competence definition

(OX, ch. 3, 52).

Question 8

What is competence deployment? (OX, ch. 2, 52)

Answer 8

Competence deployment is activity designed to support the existing strategic plan. Sales people must conform to the formal strategic plan and implement established strategies and processes. Competence deployment is the most important role of sales people in organizations where the competition is stable. (OX, ch. 3, 52).

Question 9

What is competence modification? (OX, ch. 3, 52).

Answer 9

Competence modification refers to the fact that salespeople are often encouraged to engage in adaptive bheavior or emergent strategy. E.g. question exisiting strategy and respond to environmental challenges. Competence modification is the more important role of the sales person in cases where the organization faces changes in the product market and greater flexibility is needed and when the existing routines and the established strategy are no longer working. (OX, ch. 3, 52).

Question 10

What is competence definition? (OX, ch. 3, 52).

Answer 10

Competence definition is leaning and improveing, initating anonymous initiatives and experient and take risks. Competence definition is most important in organization that are unable to obtain a sustainable competitive advantage and constantly renews its strategies in order to temporarily differentiate from competitors (OX, ch. 3, 52).

Question 11

Which of the three roles are more important? (OX, ch, 3. 52).

Answer 11

It depends on the environmental conditions that the sales organization faces (OX, ch. 3).

Question 12

What are the common operational role of the sales person and are these responsibilities common to all sales people across organizations (OX, ch. 3)

Answer 12

The typical role of the salesperson focuses on the salesperson’s interactions with the customer and includes a range of activities such as customer retention, database management, building and maintaining customer relationships, problem solving and satisfying customer needs. These tasks are common to most sales people across organizations.

(OX, ch. 3).

Question 13

What are the secondary roles of the sales person? (OX, ch. 3)

Answer 13

Whereas the primary roles of the sales person are characteristic of almost all sales people, the secondary soles are likely to vary across individuals and organizations. The extent to which the salesperson participates in these forms of extra-role behavior is likely to vary depending upon the organization as well as the individual. While in some organizations the role of the saleperson may remain consistent with tradition perspective( Competency deployment as the main role), contemporary sales organizations have expanded the role to include additional competencies, making the sales job more difficult. These competencies include tasks and concerning strategic decision-making (competence definition and competence modification).

(OX, ch. 3, 54).

Question 14

How does the role expectations influence the job demands or difficulty of the job as perceived by the salesperson (OX, ch. 3, 55).

Answer 14

As the role expectations of sales people increases or as the operational role come to include more tasks (other than competency deployment) the perceived difficulty and demands of the salesperson increases (OX, ch. 3, 55).

Question 15

How is job demands defined? (OX, ch. 3, 55).

Answer 15

Job demands is defined that the extent to which the employee is required to work hard, work fast, has many activities to perform, has too little time to complete the activities etc. Job demand includes two dimensions:

Quantitative demands: The persons workload, how large the salespersons territory is, how much time does the salesperson have to complete activities? This dimension captures the overall degree of difficulty that the salesperson experiences.

Qualitative demands: Qualitative demands include the sales person’s perceptions of role ambiguity and role conflict. This dimension captures the extent to which the salesperson is conflicted about which of these activities is most important or which of his or her constituents needs should be met first. Role conflict and role ambiguity are both sources of salesperson job stress.

(OX, ch. 3, 55).

Question 16

Why is it important to study job demands in a sales context? (OX, ch. 3, 55).

Answer 16

It is particularly important to study job demands because the expanded role demands provide a guide for how to best manage or lead sales people under the expanded role demands.

(OX, ch. 3, 55-56).

Question 17

How do the roles of competence deployment, modification and definition relate to the relational exchanges between manager and salesperson? (OX, ch. 3, 56-57).

Answer 17

When engaging in competence definition, the salesperson initiates the process and explores new possibilities and experiment with new ideas, before the manager decides which ideas to champion and pursue. The direction of strategic exchange between manager and sales person thus originates with the salesperson, i.e. the sales person offers an idea or initiative to the manager.

When engaging in competence deployment, the salesperson receives his or her orders from the manager, and is then expected to implement and carry out the order. The objective of competency deployment is to effectively implement existing procedures, programs and strategy. The exchange of strategic information thus flows from the manager to the sales person unidirectionally.

Competence modification implies that the sales managers provides direction to the salesperson and the salesperson then adjusts the initial direction to respond to new information. Competence modification thus begins with a flow of strategic information from the manager to the salesperson and then it is balanced with the assessment of new environmental and customer information.

(OX, ch. 3, 57).

Question 18

Explain how the changing roles of salespeople and sales managers impact the system of exchanges between manager and sales person (OX, ch. 3, 58).

Answer 18

As the role expectations of salespeople change, so does the role of the sales manager. These shifting roles have consequences for the system of exchanges that exist between a manager and a sales person.

(OX, ch. 3, 58).

Question 19

What is the main difference between leaders and managers? (OX, ch. 3, 59).

Answer 19

Leaders change the way people think about what is desirable and necessary while managers are concerned with the day-to-day tasks and routines.

Question 20

What are the main aspects of sales leadership?

OX, ch. 3, 59

Answer 20

• Trait approaches
• Style approaches
• Contingency leadership
• Functional Team Leadership
• Shared team leadership
• Flexible team leadership

(OX, ch. 3, 59).

Question 21

What does leadership research on trait approaches focus on? (OX, ch 3, 59).

Answer 21

The personality traits and characteristics of existing leaders. Mainly concerned with identifying the set of characteristics that distinguish the leader from followers. (applies the general belief that leaders are born, not made)

Research has found that extraversion, self-esteem, creativity and openness to experience strongly correlate with leader effectiveness and leader emergence (the extent to which an individual is viewed as a leader by others)

(OX, ch. 3, 59-60).

Question 22

What does leadership research on style approaches focus on? (OX, ch 3, 59).

Answer 22

The style approach to leadership research is mainly concerned with the behaviors of leaders. This approach provides some practical guidelines regarding the behaviors that are likely to result in effective leadership. . In other words, it emphasizes the trainability dimension of leadership.

Literature distinguishes between the “consideration” style, in which the leader cares about the employee as a person and the Initiating structure style, in which the leader clearly defined the schedule and tasks and requirement of his employees. Whereas the first style often leads to enhanced employee satisfaction, but decreased performance, the initiating structure style is associated with poor satisfaction but higher group performance.

(OX, ch. 3, 60).

Question 23

What does leadership research on contingency approaches focus on? (OX, ch 3, 60).

Answer 23

This approach stresses the importance of matching the leader’s style to the situation and tasks and hand, the complexity of the environment and the characteristics of the individual employee (OX, ch.3, 60)

Question 24

What does leadership research on functional team and flexible team leadership approaches focus on? (OX, ch 3, 61).

Answer 24

• The functional team leadership approach points to a distinct set of activities that a sales manager should perform to achieve success.

The flexible team leadership approach relies on the idea that leaders who are socially flexible are better to respond to changes .These leaders interpret the demands and requirements specific to a given organizational problem and tailor responses quickly.

(OX, ch. 3, 61).

Question 25

What does leadership research on shared team leadership or dispersed team leadership focus on? (OX, ch 3, 61).

Answer 25

According to this approach, the successful leader is one who is able to develop leadership capacity in others. The formal leader becomes more of a facilitator within the group as leadership activity is dispersed across committed team members. Dispersed or shared team leadership offers a better way to nurture the exchange relationship between the manager and the salesperson so that the salesperson can achieve success in the team structure and also effectively balance the multiple role suggested earlier. In order to facilitate a dispersed leadership approach, the sales manager’s key tasks must move beyond those suggested in prior leadership theory. Leader must do more than just teach, monitor, inspire and motivate. Perhaps most importantly, contemporary sales managers must build commitment and confidence, remove obstacles, create opportunities and be part fo the team.

(OX, ch. 3, 63).

Question 26

What is configuration theory? (OX, ch. 3, 64).

Answer 26

Configuration theory suggests that for each set of strategic characteristics there exists an ideal set of organizational characteristics that yields the best outcome. (OX, ch. 3, 64).

Question 27

What is the distinction between process control, output controls and clan controls? (OX, ch. 3, 65).

Answer 27

Process controls involves the use of formal rules and written policies and hierarchical authority. Using process controls decreases the likelihood of opportunistic behavior.

Output control helps a salesperson reduce uncertainty as they are rewarded for the achievement of objective performance goals.

Clan control allow for an increased tolerance of ambiguity.

(OX, ch. 3, 65).

Question 28

What is “command mode” in the leadership framework? (OX, ch. 3, 66-67).

Answer 28

In this mode, a powerful leader maintains tight control over the sales force. The objective of the sales for is to effectively implement strategies that are delivered from higher up in the hierarchy. Within this mode, the role expectation of sales people is limited to competence deployment. In other words, the main role of salespeople is to take orders from management and the main role of management is to give orders and provide direction. The exchange of information in unidirectional flowing from management to the sales force and the main typer of strategic sales force control used is process control (OX, ch. 3, 66).

Question 29

What is the “coach mode” in the leadership framework? (OX, ch. 3, 67-68).

Answer 29

The coach mode strategy is more interactive and so is the exchange between the manager and the salesperson. The sales manager provides a general direction or vision for the sales force to follow, and the role of the salesperson is to engage in competence modification. That is, the salesperson is required to respond to challenges and modify tactics accordingly. The emphasis is on learning rather than strict implementation of strategy. The role of the sales manager is to motivate and inspire. Output controls are applied to align the interest of the sales person and the organization in the absence of formal roles and procedures. Clan control also promotes the shared values necessary to increase the likelihood that the saleperson makes choices that will benefit the organization.

(OX, ch. 3, 67).

Question 30

What is the “sponsor mode” in the leadership framework? (OX, ch. 3, 67-68).

Answer 30

The sponsor mode reflects a leadership process that supports a dispersed leadership perspective. Strategy is influenced by autonomous strategic behaviors across all organizational members and not just formal leaders. Sales people are able to provide ideas and initiatives that shape the organization’s strategic agenda.
Clan controls that alogn the salesperosn and the organization’s goals will be well suited to dispersed leadership and competence definition.

(OX, ch. 3, 68).

Question 31

When is sales leadership most effective? (OX, ch. 3, 68).

Answer 31

Sales leadership effectiveness and sales force effectives are related to the fit between leadership styles, salesperson roles, sales manager roles, control and identification. Thud, a given leadership approach is not superior to another in and of itself. Instead, it is the holistic fit between leadership and the other relevant characteristics that drives superior performance.

Question 32

Define sales organization effectiveness (OX, ch. 4, 79).

Answer 32

Sales organization effectiveness is a summary evaluation of the performance of the sales organization. Sales organization effectiveness is important because it indicates the contribution of the sales organization to the performance fo the firm. Assessment of sales effectiveness may be based on sales, market share, customer satisfaction, profit contribution and other metrics relative to competence and internal objectives.

(OX, ch. 4, 79).

Question 33

What impact does the changing roles of the sales force have on organizational effectiveness? (OX, ch. 4, 79).

Answer 33

The changing role of the sales force is having a major impact on the determinants of sales organization effectiveness. Perhaps most importantly, achieving effectiveness has become a much mor complex and demanding process compared to the traditional sales organization.