sales organization structure and salesforce deployment
DESCRIPTION
Sales Organization Structure and Salesforce DeploymentTRANSCRIPT
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Module 4Module 4
Sales Organization Structure Sales Organization Structure
and Salesforce Deploymentand Salesforce Deployment
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Sales Organization ConceptsSales Organization ConceptsSpecialization
Degree to which salespeople and sales managers concentrate on specific sales or sales-support activities, specific products, and/or specific customers.
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Sales Organization ConceptsSales Organization ConceptsSalesforce Specialization
Continuum
GENERALISTSGENERALISTSAll selling
activities and all products to all
customers
SPECIALISTSSPECIALISTSCertain selling activities for
certain products for certain customers
Some specialization
of selling activities,
products, and/orcustomers
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Sales Organization ConceptsSales Organization ConceptsCentralization
Degree to which important decisions and tasks are performed at higher levels in the management hierarchy.
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Span of Control vs. Management LevelsSpan of Control vs. Management Levels
Span of Control
Flat Sales Organization Managem
ent LevelsDistrict
Sales Manager
District
Sales Manager
District
Sales Manager
District
Sales Manager
District
Sales Manager
National
Sales Manager
Span of Control
Tall Sales Organization
District
Sales Manager
District
Sales Manager
District
Sales Manager
District
Sales Manager
District
Sales Manager
District
Sales Manager
Regional
Sales Manager
Regional
Sales Manager
National
Sales Manager
District
Managem
ent Levels
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Line vs Staff PositionsLine vs Staff Positions
Sales Training Manager
Sales Training Manager
Salespeople
District Sales Manager
Regional Sales Manager
National Sales Manager
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GeneralizationGeneralization
CentralizationCentralization
Tall OrganizationsTall Organizations
SpecializationSpecialization
DecentralizationDecentralization
Flat OrganizationsFlat Organizations
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Selling Situations that Affect Selling Situations that Affect Specialization DecisionsSpecialization Decisions
Selling Effort vs. Selling Skill Environmental Characteristics
High uncertainty Low uncertainty
Customer Needs and Product Complexity
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Selling Situation ContingenciesSelling Situation Contingencies Customer and Product Determinants of
Salesforce Specialization
Customer Needs Similar
Customer Needs Different
SimpleProductOffering
ComplexRange ofProducts
Geography-Driven
Specialization
Product-Driven
Specialization
Market-Driven
Specialization
Product/Market-Driven
Specialization
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Geographic Sales OrganizationGeographic Sales Organization
Sales Training Mgr
Salespeople (100)
District Sales Mgrs (20)
Zone Sales Mgrs (4)
Eastern Regional Sales Mgr
Salespeople (100)
District Sales Mgrs (20)
Zone Sales Mgrs (4)
Western Regional Sales Mgr
National Sales Manager
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Product Sales OrganizationProduct Sales Organization
Salespeople (100)
District Sales Mgrs (10)
Office Equipment Sales Mgr
Salespeople (100)
District Sales Mgrs (10)
Office Supplies Mgr
National Sales Manager
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Market Sales OrganizationMarket Sales Organization
Sales Training Manager
Salespeople (50)
District Sales Mgrs (25)
Zone Sales Mgrs (4)
Commercial Accounts Sales Mgr
Salespeople (50)
District Sales Mgrs (10)
Government Account Sales Mgr
National Sales Manager
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Functional Sales OrganizationFunctional Sales Organization
Salespeople (160)
District Sales Managers (16)
Regional Sales Managers (4)
Field Sales Manager
Salespeople (40)
District Sales Managers (2)
Telemarketing Sales Manager
National Sales Manager
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Major AccountsMajor Accounts
Large accounts Complex needs
National AccountsNational Accounts Global AccountsGlobal Accounts
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Sales Organization StructuresSales Organization StructuresMajor Account Options
Assign Major Accounts to Salespeoplealong with Other Accounts
Assign Major Accounts to Sales Managers
Develop Major Account Salesforce
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Comparison of Comparison of Sales Organization StructuresSales Organization Structures
Organizational Structure Advantages DisadvantagesGeographic Low Cost
No Geographic Duplication No Customer Duplication Fewer Management Levels
Limited Specialization Lack of Management Control OverProduct or Customer Emphasis
Products
Product Salespeople BecomeExperts In Product Attributesand Applications
Management Control overSelling Effort Allocated to
High Cost Geographic Duplication Customer Duplication
Market Salespeople Develop BetterUnderstanding of UniqueCustomer Needs
Management Control OverSelling Effort Allocated toDifferent Markets
High Cost Geographic Duplication
Functional Efficiency in PerformingSelling Activities
Geographic DuplicationCustomer DuplicationNeed for Coordination
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Hybrid Sales Organization StructureHybrid Sales Organization Structure
Major AcctsSales Mgr
WesternSales Mgr
EasternSales Mgr
FieldSales Mgr
TelemarketingSales Mgr
Regular AcctsSales Mgr
Commercial Accts Sales Mgr
Office EquiptSales Mgr
Office SuppliesSales Mgr
Government Accts Sales Mgr
National Sales Manager
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Salesforce DeploymentSalesforce Deployment
Allocating selling effort Determining salesforce size Designing territories
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Interrelatedness of Salesforce Interrelatedness of Salesforce Deployment DecisionsDeployment Decisions
Allocation ofSelling Effort
SalesforceSize
TerritoryDesign
How much selling effort is needed to cover accounts and prospects adequately so that sales and profit objectives will be achieved?
How many salespeople are required to provide the desired amount of selling effort?
How should territories be designed and salespeople assigned to territories to ensure proper coverage of accounts and to provide each salesperson with a reasonable opportunity for success?
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Allocation of Selling EffortAllocation of Selling EffortAnalytical Approaches
Single Factor Model Portfolio Models Decision Models
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Allocation of Selling EffortAllocation 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 number of sales calls Effort allocation decisions are based on the
analysis of only one factor and differences among accounts in the same category are not considered in assigning sales call coverage
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Allocation of Selling EffortAllocation of Selling EffortSingle Factor Model Example
Market PotentialCategories
ABCD
Average Sales Calls toan Account Next Year
3224168
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Allocation of Selling EffortAllocation of Selling Effort Portfolio Models
Account Opportunity Competitive Position
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Allocation of Selling EffortAllocation of Selling Effort Portfolio Model Segments and Strategies
Competitive Position
Segment 1 Segment 2
Segment 4Segment 3
Strong WeakLo
wH
igh
Acc
ount
Opp
ortu
nity
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Allocation of Selling EffortAllocation of Selling Effort Decision Models
Simple Basic Concept - to allocate sales calls to accounts that promise the highest sales return from the sales calls Optimal number of calls in terms of sales
or profit maximization
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Sales Force SizeSales Force SizeKey Considerations
Sales Productivity Ratio of sales
generated to selling effort employed
Salesforce Turnover Costly Manage pipeline Cost Sales
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Sales Force SizeSales Force Size Analytical ToolsBreakdown Approach
Assumes an Accurate Sales Forecast Advantage
Easy to use Disadvantages
Conceptually weak; sales determine sales
Sales Force Size =Average Sales per Salesperson
Forecasted Sales
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Sales Force SizeSales Force Size Analytical ToolsBreakdown Approach
Sales Force Size =Average Sales per Salesperson
Forecasted Sales
= $50,000,000 / $2,000,000
= 25 salespeople
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Sales Force SizeSales Force Size Analytical ToolsWorkload Approach
Integrates the salesforce size with account effort allocation strategies
Advantages Easy to develop Sound conceptually
Total Selling Effort Needed
Avg Selling Effort per Salesperson
# of Salespeople =
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Sales Force SizeSales Force Size Analytical ToolsWorkload Approach
= 75 salespeople
37,500 sales calls needed
500 annual sales calls per salesperson =
Total Selling Effort Needed
Avg Selling Effort per Salesperson
# of Salespeople =
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Sales Force SizeSales Force Size Analytical Tools Incremental Approach
Advantage Quantifies the important relationships
between salesforce size, sales, and costs Disadvantages
Difficult to develop Requires historical data
Optimal # of Salespeople is where: Marginal Profit from Added Salesperson = Marginal Cost of That Salesperson
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Designing TerritoriesDesigning Territories
Territory - consists of whatever specific accounts are assigned to a specific salesperson Work unit for a salesperson
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Territory Design ProcedureTerritory Design Procedure
AnalyzePlanning
andControl UnitOpportunity
SelectPlanning
andControl
Unit
Form Initial
Territories
AssessTerritoryWorkload
FinalizeTerritoryDesign
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Assigning Salespeople to Assigning Salespeople to TerritoriesTerritories
Farmers or Hunters
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Using Technology Software to automate the process
Design potential territories Print maps Compare opportunity and work load Easy to make changes
Sales Territory Configurator Tactician TerrAlign
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""PeoplePeople" " ConsiderationsConsiderations