chapter 13 motivation & training1 sales management chapter 13 motivation and training

Chapter 13 Motivation & Training 1

Sales Management

Chapter 13Motivation and Training


Outline:

• Certain motivation theories in selling

• Apply motivation in practice• Set sales targets and quotas• Organize suitable sales training

programs and evaluate the usefulness


Creating and maintaining well-motivated salesforce is not easy.

In some industries, salespersons would easily suffer from low morale and confidence because rejections may greatly outnumber successes, I.e. insurance, investment consultant, road-shows products etc.

Motivation is an essential method to keep up working effectively. One of the roles of sales manager is to motivate salesforce, or provide the circumstances that will encourage salesforce to motivate themselves.

Motivation


1. Maslow’s hierarchy of needshttp://www.ship.edu/~cgboeree/maslow.html

Motivational TheoriesMotivational Theories


Maslow’s hierarchy of needs

Physiological Needs needs for oxygen, food, water, and a relatively constant body temperature. They are the strongest needs because if a person were deprived of all needs, the physiological ones would come first in the person's search for satisfaction.

Safety Needs When all physiological needs are satisfied, the needs for security can become active. Adults have little awareness of their security needs except in times of emergency or periods of disorganization in the social structure. Children often display the signs of insecurity and the need to be safe.

Needs of Love, Affection and Belongingness When the needs for safety and for physiological well-being are satisfied, the next class of needs for love, affection and belongingness can emerge. Maslow assumes people seek to overcome feelings of loneliness, involves giving / receiving love, affection and the sense of belonging.

Needs for Esteem When the first three needs are satisfied, the needs for esteem can become dominant. These involve needs for both self-esteem and for the esteem a person gets from others. Humans have a need for a stable, firmly based, high level of self-respect, and respect from others. When these needs are satisfied, the person feels self-confident and valuable as a person in the world. When these needs are frustrated, the person feels inferior, weak, helpless and worthless.

Needs for Self-Actualization The needs for self-actualization is a person's need to be and do that which the person was "born to do." "A musician must make music, an artist must paint, and a poet must write." These needs make themselves felt in signs of restlessness. The person feels on edge, tense, lacking something, in short, restless.


•A satisfied need is not a motivator of behavior. Therefore a salesperson who already receives a more than adequate level of salary, additional payments may have no effect on motivation•A motivator for one salesperson may not be effective with another, so different salespeople will have different combinations of needs•Effective motivation results from an accurate assessment of the needs of the individual salespeople under the manager’s supervision•E.g. - motivated by building their confidence. - How to motivate salesperson who’s great need for esteem but working

performance is not good?—By announcing his/her poor sales performance to colleagues in a sales meeting

How’s Maslow’s theory related to selling in practice?


2. Frederick2. Frederick Herzberg’s Dual Factor Herzberg’s Dual Factor (Motivation-Hygiene) TheoryTheory

Job satisfaction motivator includes:•achievement •recognition •work itself •responsibility •advancement

•This theory has substantially contributed to the understanding of motivation at work, particularly extended Maslow’s theory to the work situation and highly the importance of job content factors.`•There are two types of motivators, one type which results in satisfaction with the job (the motivators ), and the other which merely prevents dissatisfaction (the hygienes).

Dissatisfaction hygiene includes:•company policy/administration •working conditions •supervision •interpersonal relations •money •status •security



2. Herzberg’s Dual Factor Theory 2. Herzberg’s Dual Factor Theory (Motivation-Hygiene Theory )


Hygiene, if applied effectively, can at best prevent dissatisfaction: if applied poorly, can result in negative feelings about the job.

It is argued that salary should not be regarded as hygiene factor as salespersons are largely motivated by the high commission. However, Herzberg believed that high commission was a motivator through therecognition it gave to sales achievement.

Herzberg believed that the degree of responsibility (authority to grant credit or discount, handling complaints etc) is highly related to the higher sales success.


3. Vroom’s expectancy theory3. Vroom’s expectancy theory


Assumes that a person’s motivation to put effort depends on his expectation for success

Expectancy: relationship between effort and performance. e.g. increase effort -> higher performance

Instrumentality: relationship between performance and reward. E.g. higher performance -> promotion

Valence: a value placed upon a particular reward. E.g. promotion may be highly valued by some salespeople but not others.


4. Adam’s inequity theory4. Adam’s inequity theory


Feelings of inequity (unfairness) can arise when one’s effort or performance on the job is greater than the reward. Salespeople who feel they contribute more than others expect to receive greater rewards.

Monetary rewardsWorkloadPromotionDegree of recognitionTargetsTasks

• The greater the inequities the salesperson perceive(feeling unfair), the lower the motivation•Therefore sales managers must monitor their salesforce to detect any feelings of unfairness.


5. Likert’s sales management theory5. Likert’s sales management theory


The hypotheses that the sales managers’ behaviour will affect the behaviour of the salespeople. I.e. high performance sales team usually had sales managers who had high performance goals.

The management style such as close communication between salesforce and the managers, usually has a better outcome/productive than a monopolistic management style.


Motivation in practice --- Motivation factorsMotivation in practice --- Motivation factors


Financial incentives

Commission may motivate salespeople through providing a direct reward for extra effort (Vroom) and by giving recognition for achievement (Herzberg)

salary + commissions: provides a level of security plus higher earning for higher sales

Straight commission : earnings entirely depend on achievement

Commission systems: - commission basecommission base e.g. sales revenue/profit - commission ratecommission rate. E.g. % of all sales - starting point for commissionstarting point for commission e.g. at some

predetermined sales levelCommission can also comprise a given % of sales per salesperson/ group or %

of sales revenue in excess of a sales quota (or other combination)

Some companies introduce higher rates commission on higher-profit items (harder to sell). So commissions not only stimulate/motivate salesperson greater effort but also direct salespeople towards products particularly want to sell.




PromotionMerit-base promotional system can be a motivator.

The best salesperson may not necessary be the best sales manager. Because the skills required of a sales manager are wider than those of a salesperson. A sales manager must be able to analyze, control, motivate and train salesforce.

If the promotion is based on sales performance, try to consider a dual promotional route: managerial career sequence + reward outstanding sales success.

e.g Salesperson -> Senior salesperson -> Account Executive -> Assistant Sales Manager

other related position: key holder, shop manager, assistant area manager, area manager etc.




Sales ContestsEncourage a higher level of sales Increase the sales of a slow-moving product or reward the generation of new customers

Rules:-must appeal the competitive spirit of salespeople and to their needs for achievement / recognition. E.g. financial incentives, promotions-Must be fair-Must be attainable

Limitation:-Cheating may occur.-Different cultural ideas and expectation



Sales targets or quotasMust be fair

Must be attainable and challenging

Targets or quotas needed to consistent to company objectives

Usually linked with financial incentives

Sales managers needed to know the tactics of determining the targets according to the individual ability and the market situation.



Meeting between manager and salespeopleMeeting is a very good opportunity to motivate salesforce in person.

Meeting allows sales manager to understand the personality, needs and problems of each salesperson

Allow sales manager to understand the motivation and demotivation factor of salesperson. Sometimes manager and salesperson may have different perspective

e.g.motivators: salesperson: fringe benefits

manager: competition/ incentive based target setting demotivators: Salesperson: lack of advancement, security, long working hrs

manager: supervisory relations and personal problems Meeting can serve as evaluation and training program and to improve sales technique and confidenceGroup meeting can motivate, according to Likert, a manager’s open style of meeting can encourage sales to discuss and share views and problem, which lead to a greater sense of group loyalty and improved performance.Meeting allows opportunity for performance feedback where weaknesses are identified and recognition for good work is given


TrainingTraining

Training can be carried out in two forms:

Training new salespeople:

1. Training programmes

2. New salesperson works with an experienced salesperson and being observed how selling is done.

Even an experienced salesperson also need to be trained periodically to refresh and further enhance selling skills and knowledge.


TrainingTraining

1.1.Skill developmentSkill development

One of the main objective of conducting training course is to develop selling skills of salesperson.

New salesperson has to go through four stages in training:

1.Unconsciously unable--- Trainee doesn't think about skills2.Consciously unable---Trained reads about skills but can’t carry

them out in practice3.Consciously able---Trainee is reasonably proficient in skills but

has difficulty putting them all into practice4.Unconsciously able---Trainee can automatically perform the

task without thinking about it


TrainingTraining

1.1.Skill developmentSkill development

A successful training programme takes the trainee to the final stage (unconsciously able) when he/she can perform all of the skills at once and has the ability to control the selling situation.

E.g. a new salesperson is trained to be competent when he/she can open an interview, identify customers needs, presentation and handle objections in a natural manner, and close the sale at right time with right technique.


TrainingTraining

2.2. Components of a training programmeComponents of a training programme

1st categories: The company’s objective, history, policiese.g. what’s the flow of work, how’s the compensation system, how salesperson

are evaluated etc.

2nd categories:Product knowledge, competitors and their productse.g. how the products are made, product quality and reliability, product features

and what benefits they bring to the consumer. Knowing the difference of the products between competitors products and company’s products.

3rd categories: Selling procedure and techniquese.g. Selling preparation, selling procedures, how to deal with objections,

concession, negotiation etc. (chapter 4, 5)


3.3. MethodsMethods• Lecture

Useful in giving information and principles, communication and discussion. Use visual aid such as distributing notes, PowerPoint, transparencies etc.

2. Films Useful supplement to the lecture in giving information, showing how a skill

should be performed by demonstrating how the principles can be applied in a real selling situation. Stage of consciously unable

3. Role playingMove the trainee to the stage of being consciously able. Allows the trainee

to learn by his/her own successes and failure in a buyer-seller situation. Feedback from other members and trainer is valuable. Trainee can also learn from other group member’s performance. Playback allows trainee to see the situation through the eye of a third person so problems are more easily recognized and accepted.

4. Case StudyAppropriate for developing analytical skills. Trainees are asked to analyze

situations, identify problem and make recommendations.


3.3. MethodsMethods

5. On job trainingAl l the previous training should be reinforced by the on job training. The

experience gained by real-life selling situation with the evaluation and feedback provided by the sales manager enable the trainee moves to the final stage of learning skills--unconsciously able. The trainee should be able to do things automatically.

Sometimes salesperson loses an order in the job training, e.g. argue with customer and unpleasant situation created. Sales manager should step in and handle the case in advance to avoid further dampened relationship with customer. Then sales person should do the assessment and review regarding the case with the trainee again. Manager can first ask the trainee to relate any aspects of the sales which

could be improved upon to see if the trainee can realize that he/she has a weakness. Then the manager can suggest methods to overcome the problem.


4.4. Evaluation of the trainingEvaluation of the training

Generally the effectiveness of the training course are evaluated by:

Change in sales net volumeNumber in new accounts/customers gainedNumber of old accounts lostAbility improvementGained in reputation of improved services or image.

chapter 13 motivation & training1 sales management chapter 13 motivation and training

Documents

physiological needs

security needs

safety needs

class of needs

strongest needs

motivation slide

motivation training3

motivation training6