Final Flashcards
Sales Structure
Need it to execute sales strategies
- Need to be fair and realistic to sales people
Horizontal Sales Structure
self-managed
Silos - not good for communication or organization
How to assign roles
transactional vs consultative
Transactional Role
hunters - try to hunt # of sales
Consultative Role
Farmer - Try to grow accounts
Adv to specialized teams
- Salespeople focus on strengths
- Recruitment is straightforward
- Incentives and track metrics
Dis to specialized teams
- Hierarchy
- Client may feel abandoned
- Knowledge may be lost/misunderstandings
Adv to hybrid role
- Strong long-term relationship management
- Bond with clients based on trust
- Customized incentives
Disadv to hybrid roles
- Few agents can perform both functions
- Conflicting responsibilities
- Complex incentives
Independent Sales Agents
- Paid on commission basis
- Variable cost for company
- Can become a problem when sales volume is up, they cost too much. Start own sales force.
Territories Objectives
- Ensure good coverage
- Improve customer relations
- Reduce sales cost
- Optimize market
Sales velocity reflects
How quickly salespeople earn money for the company
Win Rate
New contract / Initial meetings * 100
Negotiation success rate
New Contracts / Negotiations *100
How to calculate who serves best hybrid role?
take each ratio add the percentages then divide by the total and compare each others
Talley method
No. days worked - No. days other workloads = # days available for visits
Total territory demand / # days available for visits = # representatives required
Leading metrics
how to get to outcome
Lagging metrics
outcome
What influences performance?
goals and motivation
- Salespeoples goals do not always align with company goals
How do companies forecast?
- Models consider error
- Regression models (better estimation)
Behavior-Based Control System
- Emphasize monitoring and directing sales process
- Evaluated based on activities and behaviors (# client meetings, adhering sales protocols)
- Compensation often fixed with bonuses
Adv to behavior based control
leads to consistent sales practices and improved long-term customer relationships
Challenges to behavior based control
May be perceived as micromanagement and can stifle creativity and autonomy
Outcome-Based Control Systems
- Emphasized results or outcomes of sales process
- Evaluated on measurable results
Adv to outcome-based
Encourages high performance and rewards results, fosters competitive environment
Challenges to outcome-based control
Can lead to short-term thinking and neglect of customer relationships
Ideal compensation plan
- Offers compensation and rewards consistent with team members needs
- Rewards realistic level of effort and results fairly and equitably
- Clearly understood in terms of what needs to be accomplished
- Cost-effective, competitive, and relatively stable over time
- Aligned with company goals
Fixed income Pros
- Income security and stability
- Increased loyalty and satisfaction
- Allows for focus on variety of activities
- Emphasis on customer service
- As sales increase expenses decrease
- Simple, lower administration cost
- Greater sales team flexibility
- Sales people more open with “tricks”
Cons fixed income
- Less incentive for effort
- Must wait for next salary review period
- Fixed costs for the company
Pros to variable income
- Performance incentive
- Encourages indiv. to adopt right reflexes
- Flexibility
- Variable expenses based on sales
Disadv. to variable income
- Harder to convince sales reps to perform certain less profitable tasks
- Salespeople priority is to sell more versus interest of company / customer
- May encourage ethical breaches
Spiffs (Sales performance Incentive Fund)
- Short-term reward that sales reps receive for meeting assigned goals and objectives.
Non financial rewards
- Social benefits
- Recognition
- Training
- Various memberships
- Stocks
Benefits of non-financial program
- Relatively inexpensive
- Can make the difference in attracting the right candidates
- Helps regain good salespeople
- Creates and nurtures a sense of belonging within the company
Diadv. of Non-Financial program
- May lose its impact if program is not publicized
- Encourages unethical practices (stocks)
Sales Recruiting
Has to be successful from beginning
Intra-navigation
Knowing which people to call/knock when looking for something
Onboarding
- In-person is better than online
Sales-Training
Curve: 8-11 days
- people learn differently
- Process requires planning
- Difference between young and older
Sales development
Focuses on the broader ongoing growth and career progression of salespeople
Quiet Quitting
Doing the minimum requirements of one’s job and putting in no more time, effort or enthusiasm than absolutely necessary
Role of coaching
- Conveyer of reality - provides honest, constructive feedback to help understand current performance and areas of improvement
- Change facilitator - Guides employees towards improvement and future growth. Involves focusing on development rather than judgment
- Empowerer - Empowers employees by involving them in the process, making them active participants in their career development.
Color sheet
Blue sheet (coaches draft) - coach drafts observations, feedback, and initial thoughts. Contains strengths, afi’s, and development recommendations.
Yellow Sheet (employees input) - Self-assessment form completed by the employee, focuses on contributions, aspirations, and areas they want to grow in
Color sheet takeaways
coaches act like therapists
Easier to work with strengths
2 Unethical methods
salespeople
- timing games
- ratcheting - barely hitting quota to avoid raising quota
