salesforcetrainingatarrowelectronics caseanalysis 140622125845 phpapp01
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case analysis
Sales force training atarrow electronics Aashita Jain 081Aniruddh Choks
AnuRadhakrishAritrika Das 096KV Saurabh KaNikhil Saraf 124Paarmi Modi 12Saarini Bagga 1Surabhi Anand 1Vasundhara Adu
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Sales force
expectation
30 40 year old
No collegedegree/technical training
High energy
Highly aggressive
Monetary motivation
Relation based selling
Did their own thing difficult to inject new idea
Achieve sales goals and deliver goperformance
Manage the territory
Understand the customer strategy : Knoabout company, products in pipeline, dem
creation for the same , need analysis of coand supplier
Make cold calls
Overcome objections and persuad
Close the sale
profile
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Branch GeneralManager
Area SalesManager
(1-3)
MarketingManager
AdminManager
AdminPersonnel
Field Sales Reps (6-8) Sales & Mktg Reps (6-12)
Product Manager (3-6)
Earns $300 weekly Yearly Avg: $60k-$80k Max Earning: $150k-$200k
Yearly Avg: $35k-$75k Commission: 25% of GrossMargin
Yea Ma ComGro
Comm: 25% of Gross Margin Yearly Avg: $35k-$75k
Comm: 4%-5% of Gross Margin Yearly Avg: $40k-$50k
Structure Yearly Avg: $60k-$120k Commission: 35% of BranchOperating Profit
Sales force
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8/10/2019 Salesforcetrainingatarrowelectronics Caseanalysis 140622125845 Phpapp01
5/20Sales force
Problems
Lack of sales personnel
Hiring by and from competition
No employee loyalty
Sales were tied to personal relationships
Attrition of employees lead to losing customers
Sales people from competitors are hired for theirloyal customers
High Turnover Rate
ConNo Standard
Training
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8/10/2019 Salesforcetrainingatarrowelectronics Caseanalysis 140622125845 Phpapp01
6/20Sprouts Program
Hire students from college campuses and train them to sell the way modern salespeopleshould sell.
3 fold objective
Needed more salespeople
Only 300 people beforeSprouts started
Change the make-up ofthe salesforce
No quality in hiring fromcompetitor, people lowerdown in arrow had even
less rich backgrounds
Improve the cult
Move them t
managerial positiondue time
Brief
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Sell ing based on relat ionship Sel ling based on what thecustomer needs now and in the
near future
Selling parts selling solutions to customerbusiness problems
Personal relationship with buyer Relationship with the wholecustomer
Having relationships andproduct knowledge in tool kit
Well equipped tool kit withterritory management,
understanding strategy, makingcold calls, overcoming
objections, how to close saleetc.
Sprouts Program
Changes sought
Kind of peop
SELF STARTERS BUS
GOAL OR
PEOPLE SKILLS
NO TOP GPA
NEW 1st YEAR
Compensation
$18,500 $24,000
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8/20Sprouts Program
HIRING
Field office[6 months]
Warehouse[2 weeks]
Headquarters[1 week] He
Hire graduates right outof college to join thesales force through astructured interview
process
Taught about Arrowshistory and values,
basics of the industryand electronic
components
How to pick orders offshelves, track inventory,
operate systems
Exposing recruits to sales,customer support,
marketing, shipping, work
with FSR and SMRs, productmanagement assistance
Sales skill trai ning
Training period over;instated aspermanent
employees at fieldofficeSprouts training
process
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8/10/2019 Salesforcetrainingatarrowelectronics Caseanalysis 140622125845 Phpapp01
9/20Sprouts 2 0
Varied results across branches
Field organization didn't have time totrain people
Friction between Sprouts andmanagers
Programme needed to be moreformal
Why? IROC Idiots Right Out of College
Some of the managers just werent good trainers Sprouts had different expectations Sprouts given ROW (Rest of the World AccountNot wise as it required best selling skills ) Used as Clean up staff
HIRING Xerox facility[13 weeks]
Xerox facility[3 weeks]
Field office[13 weeks]
changes Create common bond: espirit de corps Like an MBA program Demanding workload Understanding of real time computer systems
process
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10/20Industry Training Ground
For better compensation: Sprouts who were in first year were offered guaranteed annual salary of $30,0by the competitors. And those in their second year and had their own sales territory (with a salary of $25000- $30,000) were offered $40,000 to $45,000
To move up the management ranks: Since sprouts were fresh out of college, their career advancemen
management positions was slow. However, other competitors recognised their management potential andSprouts were offered faster career growth
easons for employees to leave arrow after the sprouts program
Changes made: Results of the changeDeferred Compensation Program:A part of salary was given a commission rate and putto individual accounts, a percentage of which wasgiven out every quarter and at the end of two years.
This did not works as competitors wouldfor the deferred compensation that emwould lose by leaving Arrow
Non Compete Agreement:Employees were made to sign an agreement that theywould not leave to work for a competitor
Arrow continued to lose Sprouts as noncontracts had no legal binding in somsuch as California
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8/10/2019 Salesforcetrainingatarrowelectronics Caseanalysis 140622125845 Phpapp01
12/20questions
What are the merits and demeritsof introducing the pathwaysprogram?
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It is essential in order to counter the constantlyreducing sales force poolArrow has acquired four of the top ten distributorsand the size of company has increased whichwould need a uniform training programmeAlthough they had a sales force of 1000, their turnover was around 26 30%To attain competitive advantage and becomethe benchmark in salesforce in the industry bycreating a consistent talent pipelineSince the recruits are fresh out of college, it isessential to train and bring energy andprofessionalism
For A rigorous training pattern is making
most sought after sales people in theand hence being offered higher pay pa
and management ranks which in turnattrition Training was an additional cost to com According to Kaufman, its mo
to hire somebody from a competitor atthan to give somebody a 30% increasyour own company. [1985 figures
The compensation set by competitors whigh ($40,000), so an increase in
would require huge investment [1985 f It led to clashes between General M
and newly trained sales force duedifference in their ideologies whichinternal HR issues
Against
Possible solution
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8/10/2019 Salesforcetrainingatarrowelectronics Caseanalysis 140622125845 Phpapp01
14/20questions
What is the wayforward forPathways?
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15/20Possible solution
1. Recruitment
College on-campus recruitment
Inter-industry recruitment to break-free from theclutter of the industry
Scout for potential employees from within theindustry
Procedure for efficient recruitment : Hiring profile
Application scrutiny Interview
Psychological testing Reference check
Physical examination Job Offer
2. Training
Expand the scope of Pathways into a protraining program for employees in other ran
organisation. Theoretical frameworks
Scenario based Gamification
Voluntary quality circle
Sales 101 handbook
Recreational activities throughout the prheightened bonding and relaxation in a stress
environment
Two tier integrated program:
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16/20questions
What shouldArrow do to retainthe talent?
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17/20Possible solution
Differential Recruitment Process Hire from Ivy League and non-Ivy LeagueColleges Differential pay packages
Non-Ivy League graduates expected tostay for longer satisfied with pay and work
Staggered Training Module Avoid excess investment in short span oftime Step-wise Training Program spread overfirst 3 years of FSRs Careers Structure Training programs on basis of
performance
Increase Awards and Recognition Programsover the course of Training
Include Stock Units to employees
Fringe benefits like the following should be Compensation Medi-claim Recreational centers Campus/ hostels during training
Loans with reduced interest rates should be Educational, Home and Car loans
Sabbatical Leaves can be provided
Restructure Recruitment Training and Compensation
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18/20questions
Can we restructure thesales forceorganization?
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Giving Area Sales Managers a more focussed approach towards retainingclients by means of regular interactions
This will reduce Arrows dependence on FSRs as the only touch points for Customer Relationship Management
This will also de-risk Arrow from potential loss of Clients when FSRs leave
Possible solution
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Thank
You
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