Day 2 Flashcards
Defining Salesforce DeploymentA two steps process
- How much SELLING EFFORT is needed to cover accounts and prospects adequately so that sales and profit objectives will be achieved?
ALLOCATION OF SELLING EFFORT - How many SALESPEOPLE are required to provide the desired amount of selling effort?
SALESFORCE SIZE
+3. How should territories be designed to ensure proper coverage of accounts and to provide each salesperson with a resonable opportunity for success?
TERROTORY DESIGN
what is Account Opportunity ?
- an account’s need for and ability to purchase the firm’s products
what is Competitive Position ?
- the strength of the relationship between the firm and an account
Allocation of Selling effort -> Single factor models
Easy to develop and use; low analytical rigor
Accounts classified into categories based on one factor, such as market potential
All accounts in the same category are assigned the same selling effort (e.g. number of sales calls)
Allocation of Selling effort -> Portfolio models
! Account Opportunity - an account’s need for and ability to purchase the firm’s products
! Competitive Position - the strength of the relationship between the firm and an account
Allocation of Selling effort -> decision models
- Simple Basic Concept =
to allocate sales calls to accounts that promise the highest sales return from the sales calls - Maximizing the revenue for any given number of sales calls
- Increase the sales calls (selling effort) until marginal costs equal marginal returns
!ignore the human factor, techonology based
Sales Force Size: Key Considerations
Sales Productivity
- Ration of Outputs to Inputs
- Sales Growth as a Result of Adding Salespeople is Curvilinear
- Diminishing Marginal Returns
Salesforce Turnover
- Usually Very Costly
- Should be Anticipated and Managed
Organizational Strategy
- Growth Targets
- Selling Costs
- Market Share
name 3 Analytical Tools for Salesforce size
- Breakdown approach (forecasted sales/avg sales per person)
- Workload approach (total effort needed/avg effort per person
- Incremental approach (marginal cost vs marg profit)
How to calculate turnover?
For any given time frame (e.g., month quarter, year), divide the number of salespeople leaving their jobs (e.g., terminated, quit, promoted) by the total number of salespeople employed at the mid-point of the time frame.
Territory design. What is a territory?
Territories consist of whatever specific accounts are assigned to a specific salesperson. The territory can be viewed as the work unit for a salesperson. Often a geographic area = accounts within that area
Territory Design: Considerations
Trading area, Present effort, recommended effort
Territory Design Procedure
- select planning & control unit
- analyze planning & control unit opportunity
- form initial territories
- assess territory workload
- finalize territory design
2 approaches to forecasting
Top-Down vs. Bottom-Up Forecasting
top-down forecasting
Forecast made at the business unit level then broken down by zone, region, district, territory, and account forecast.
bottom-up forecasting
Forecast made at the “front-line” level and then aggregated up the levels of the organization
3 Company Forecasting Methods
- moving averages
- exponential soothing
- decomposition methods
Moving Averages forecasting
Uses historical averages to forecast future sales
Averages are calculated using a predetermined number of previous periods (e.g., two-year moving average; four-year moving average)
Exponential Smoothing forecasting
Weighted moving average
Usually most recent period is weighted heavier
Decomposition Methods forecasting
Breakdown historical sales data into four components (trend, cycle, seasonal, erratic)
Evaluate the components and then reincorporate to create forecast
What kind of Bottom-up approaches do you know?
Survey buyer intentions
- Survey buyers purchasing intentions
- Aggregate
Jury of executive opinion
- Executives or other experts estimate sales at the account level
- Estimates are averaged or otherwise agreed upon to generate forecast
Delphi (A form of jury of executive opinion)
- “jury” is anonymous and estimates are redistributed for revision
- “jury” review and revise estimates until consensus is reached
Sales force composite
- Salespeople create forecasts for the accounts and territories
- Forecasts are aggregated
Forecasts provide the basis for all of the following sales management decisions except …
a designing territories. b evaluating prospective accounts. c determining sales compensation levels. d evaluating salesperson performance. e planning integrative meetings.
e planning integrative meetings.
The best possible level of industry sales in a given geographic area for a specific time period is the definition for
a market forecast. b sales potential. c salesperson quotas. d market potential. e sales forecast.
d market potential.
The best possible level of firm sales in a given geographic area for a specific time period is the definition for…
a market forecast. b sales potential. c salesperson quotas. d market potential. e sales forecast.
b sales potential.
This forecasting approach begins by the development of company forecasts by individuals at the business unit level:
a bottom-up approach. b salesforce composite method. c top-down approach. d naive approach. e survey of buying intentions.
c top-down approach.
__________ develops a company forecast by calculating the average company sales for previous years.
a Moving averages b Exponential smoothing c Decomposition methods d Breakdown methods e Delphi methods
a Moving averages
The forecasting technique that involves a panel of managers each submitting an anonymous forecast for an account which are summarized into a report and then sent to each panel member is the…
a executive decomposition method. b Delphi method. c executive decision method. d top-down approach. e jury of executive opinion method.
b Delphi method.
Top 5 factors in selling
Listening Skills (active listening) Follow-up Skills Ability to adapt sales style form situation to situation Tenacity- sticking with a task Well organized
