sikkim manipal mba, mk0010 third semester mk0010

7/30/2019 Sikkim Manipal MBA, MK0010 Third Semester MK0010

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Name Manoj Kumar.H

Registration No 521132115

Learning Center Code 01524

Course MK-0010

Subject Sales, Distribution and Supply Chain

Management

Semester 3rd


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1. List the roles and responsibilities of a sales manager.

Responsibilities of Sales Personnel

Sales personnel

They are the people employed to sell the goods or services (mainly of an organisation). People whoare responsible for the sales of either a single product or the entire range of an organizations

products can be called sales personnel. Sales personnel normally report to a sales manager.

The job of sales personnel involves a number of responsibilities. It is the income producing division

of a business.

The salesperson is responsible for:

Providing profit contribution Creating a proper image for the company and its products/services

Achieving the sales targets of the organization Satisfying the customers and participating in marketing activities He/she is responsible to the customer and society for continuing growth of the organization.

He has multifarious activities, including setting goals and achieving them, building sales

organizations and managing them.

For example, in Eureka Forbes Pvt. Ltd. they called their sales force as sales champs (champions) as

they are responsible for the direct marketing of companys products and revenue generation.

Sales Manager: Role and Skills

The sales manager is the most important person in a sales organization so, all activities are based on

his functions and responsibilities.

Following are some of the principal duties of a sales manager:

Organising sales research, product research and such other research activities. Getting the best output from the sales force under him. Setting and controlling the targets, territories, sales experiences, distribution expenses, etc. Advising the company on various media, sales promotion schemes, etc. Monitoring the companys sales policies.1. List the roles and responsibilities of a sales manager.The sales manager is the most important person in a sales organization so, all activities are based

on his functions and responsibilities. Following are some of the principal duties of a sales

manager:

Organising sales research, product research and such other research activities.

Getting the best output from the sales force under him.

Setting and controlling the targets, territories, sales experiences, distribution expenses, etc.

Advising the company on various media, sales promotion schemes, etc.

Monitoring the companys sales policies.

1.4.1 Sales manager as sales coordinator

The sales manager performs the function of a coordinator and ensures that the other


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departments in the company are well informed of sales activities so that they can produce what

is required, when it is required and whether the same can be produced with the existing facilities

or it requires changes and so on.

The sales manager also carries out coordinating work with the distribution network.

1.4.2 Sales manager as controllerSales manager should act as per the objectives set by the organization and exercise control over

his staff so that they may look for advice and may give their best efforts to bring results. He

should analyze present condition of the firm, make plans for future and find ways to achieve

those plans.

1.4.3 Generating profits

Sales department is responsible for the sales of the products at the best available prices in the

given circumstances. Salesperson produce volume sales as per targets, and he sell the product at

a price which may generate profit for the company. After all it is positive financial results that

add position and power to the sales manager and bring credit to the sales department.

2. Compare and contrast the various types of sales organization structures.Types of Sales Organizations

Sales organization development refers to the formal, coordinating process of

communication, authority and responsibility for sales groups and individuals. An effectively

designed sales organization has a framework that enables the organization to serve its

customers. Once the sales people know what their responsibilities are and who they report

to, they can concentrate on doing their expected jobs to the best of their ability.

Thus, a sales manager must recognise and deal with some basic problems faced by

organizations, when developing his own sales organization. The sales organization structurecan be:

Line and staff components of organizations,

Formal and informal organizations,

Horizontal and vertical organizations,

Centralized and decentralized organizations

Line and staff components

Marketing organizations also feature line and staff components. A line function is a primary

activity and a staff function is a supporting activity. In a marketing organization, the selling

function is the line component whereas advertising, marketing research, marketing planning,

sales training and distributor relations are usually considered staff roles.

Although the use of the terms line and staff has been criticized in many quarters, the basic

premise behind them remains applicable to marketing organizations. A modern sales force

has to receive various types of support in order to accomplish its objectives. Advertising and

sales promotional support is needed to precondition the prospect to accept the

salespersons presentation; marketing research and sales planning are required because they

allow field representatives to concentrate their efforts on the largest potential markets; in-

house sales correspondents relieve the field force of activities that would distract them from

their basic efforts; and distribution, credit, and maintenance of personnel ensure that the

customer is satisfied with the purchase.


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Some firms operate with a simple line marketing organization. Here, a marketing

organization is simply the sales organization. This type of arrangement may be satisfactory

for small firms in basic industrial markets.

There are Several key aspects of a large-scale marketing organization. First, the ChiefMarketing Officer is typically called the Vice President for Marketing or Director of

Marketing, rather than Vice President of Sales. The title change is indicative of the persons

added responsibilities under a line and staff structure. The Vice President for Marketing is in

charge of more than just the field sales force. The line and staff organization indicates that

all marketing activities have been grouped together, suggesting that the basic tenets of the

marketing concept have been accepted.

Line and Staff Marketing Organization

Second, staff activities report to the line position that they support. Distributor relations,

sales planning, sales analysis and sales training are considered to be directly supportive ofthe field sales effort so these departments report to the General Sales Manager. By contrast,

marketing research and advertising are broader functions and they report to the Vice

President for Marketing.

Formal and informal organizations

Every firm has a formal and an informal organization. The formal organization is a fixed set of

rules of intra organization procedure and structure that of the management whereas the

informal organization is often developed from the informal relationships existing within the

organization. Also called the grapevine, informal organization is basically a communications

pattern that emerges to facilitate the operation of its formal counterpart. Most formalorganizations would be totally ineffective if it were not for a supportive informal

organization.

Informal communications pattern that might exist in a marketing organization. Actual

communications do not usually follow the formal organizational lines. This allows the formal

structure to operate efficiently.

Informal Communication System in a Marketing Organization

Consider the case of a field salesperson who is responsible for collecting certain competitive

information such as prices and trade discounts. If this information were forwarded through

the formal organization the data would be so backdated that it would be useless to the

management. The informal communication system, however, allows the information to be

transmitted directly to the director of marketing research. Similarly, consumer complaints

over delays in correcting billing errors can be mitigated when the district sales manager

directly contacts the head of accounts.

A Lengthy Formal Communications

The development of an effective sales organization requires that informal relationships and


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communication patterns be recognised as being equally useful in accomplishing sales

objectives. They should be encouraged to the extent that they improve organizational

efficiency.

Horizontal and vertical organizations

A sales force can have either a horizontal or a vertical organizational format. This

arrangement varies among companies even within the same industry.

A purely vertical sales organization would be similar to the structure represented. In this

structure, there are several layers of sales management all of which report vertically.

Vertical Sales Organization

The other extreme is a horizontal organization, shown in Figure 1.7. Here the number of

management levels is reduced appreciably, but the number of managers at any particular

level is increased. Instead of two or three district sales managers, there may be seven oreight.

The factor that determines whether a vertical or horizontal organizational structure should

be employed is the effective span

4. What are the motivational factors used to motivate sales team?

Motivation is internal to the particular person and the only factors that can truly motivate a

person lie within the person themselves. So why do we spend so much time talking about it?

Why do we devote so much time and effort trying to make motivation happen?

The answer is that although you cant control motivation, good leaders and coaches certainly

can affect and inspire motivation. They create conditions in which people want to be

motivated and therefore motivate themselves. When this occurs, we say the leader

motivates because he or she has helped to shape an environment in which individuals are

energized and motivated to achieve successful results. The strongest motivators for most

people are achievement and its opposite the avoidance of failure. People are never

motivated by failure itself, but for some competitive people, achievement for the purpose of

avoiding failure can be a stronger motivator than achievement for its own sake. The other

strong motivator is recognition. This occurs when someone achieves something and someone

else recognizes the accomplishment in some way.

There are many ways to motivate people and money is one of the most powerful. Nowhere is

this more the case than with sales people. However, there is a common fallacy about the

relationship between money and sales people. Many people (even some sales managers)

perceive that sales people are solely coin-operated, meaning that they are only motivated

by what their compensation plans pay them to do. This is a very limiting viewpoint when it

comes to how to motivate sales professionals. While it is true that the majority of successful

sales people are aggressive and competitive by nature and drive them-selves to succeed.

Often that aggressiveness gets confused by the perception that sales people only do what

they do because of the money.

People who design compensation plans and those who manage sales people would be wise

to understand that good sales people are motivated by the same characteristics of success as


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a good athlete achievement, an aversion to failure and recognition, including the money

that comes from those successes. Good salespeople are basically entrepreneurial in nature

and are willing to take risks if the potential rewards are sufficient and achievable.

The designer of a compensation plan must also be aware that many plans fail because the

company does not set high enough goals and objectives for those who want to achieve them.An effective plan is one that motivates salespeople to work enthusiastically toward the sales

and profit margin goals of the company. It helps them reach their highest potential and

provides them with a sense of security and a strong desire to make more money.

Furthermore, the compensation plan must be flexible, economically sound, have a

reasonable amount of challenge and be well administrated if it is to work in the long term.

Few companies are happy with their present sales compensation plan and more importantly

the lack of sales results they are presently experiencing.

That dissatisfaction often comes from the fact that the compensation combined with the way

sales people are managed doesnt take into account the whole sales person in terms ofwell-rounded motivation.

To determine what changes, if any are needed, several factors should be considered:

Does the compensation plan provide for growth in existing accounts as well as acquiringnew accounts? Studies show it is five times easier to gain more business in the customers

where you already have a relationship than to gain business in a new customer.

Is the compensation amount realistic in view of the companys price structure,competition, sales cycle, market share and present market conditions?

Does it encourage high volume at the expense of profit? Does it reward maximization of sales and profit margins for current as well as newcustomers? Do the salespeople earn the same as, less than, or more than their counterparts at other

companies, i.e. Is your compensation plan competitive? Successful sales people will often

move to where the opportunities to increase their income is regardless of the industry or

the product lines.

Does the plan encourage superior service to the customer such as the proper handling ofcomplaints as well as providing accurate and informative record keeping and reporting by

the sales rep?

Is the compensation plan limited to the outside sales organization or is it tied in someway to the internal sales organization? Well designed compensation plans encourage the

customer service people (inside sales) and the field sales people to work together as ateam.

Does the compensation plan align itself with and support the overall goals and objectivesof the company?

Does the compensation plan provide for stretch goals that encourage high performersto reach into a higher level of excellence and reward?

When salespeople are not adequately motivated by the compensation plan and goals and

objectives are not being met, the program probably needs redesigning.

There is no best way to compensate salespeople. The plan that works best depends upon the

company and market(s) they serve. There are some guidelines, however, for creating a plan:


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The design of a compensation plan should be a cooperative effort since it will also affectfinance, accounting, human resources, data and order processing, payroll and salary

administration. All of those areas should be consulted regarding the design, including top

management, sales management, a sampling of salespeople, and appropriate personnel

and consultants, if appropriate.

The design must be based clearly on company objectives. Therefore, the success of thepackage depends on how thoroughly the designers of the plan understand those

objectives and the sales effort required to reach them. Because of the diversity of

functions in sales operations, compensation plans must be tailored to meet the needs of

different kinds of sales people and their selling activities.

Some of the other factors that affect compensation include customer buying habits,planned promotions and advertising programs, plant capacity, pricing policies, territory

fluctuations and competition. Travel and entertainment expenses should also be

considered.

All of these factors must be recognized and dealt with when designing the compensation

program. But as stated earlier, the underlying factor that designers must consider is whether

the plan will motivate salespeople to reach and exceed company objectives. To this end,

objectives must be defined, markets must be identified, territories outlined and the overall

role of the sales force spelled out.

When company objectives have been defined, then designers must decide on an incentive

plan that will best motivate the sales force. Among various types of plans and variations are

the following:

The most basic plan is a straight salary. This works for sales organizations whose mainfunction is to service existing customers. But it does not motivate salespeople to buildnew sales dollars and their compensation wont motivate them to be concerned with the

profitability of their results.

The constant incentive is one in which salespeople are paid a commission or bonus fromthe first sales dollar. This can be in addition to a base salary or guaranteed draw, or it can

be a commission or bonus that is paid starting at a high achievement point.

With a progressive incentive, commission rates increase as sales increase to higher levels.This can be highly motivating; but can result in high compensation and some resentment

from some sales managers who may earn less than some of their sales people. Other

types of motivations can be tied in for the sales manager. However, if a sales

representative meets a high level of performance they should be compensatedaccordingly.

Monthly commission ceilings on earnings may be imposed on some incentive plans.Ceilings protect the company against windfall situations in which large sales and

earnings happen one time or in one month or seasonally with slow or low sales and

earnings in other months.

The use of ceilings should be used in these instances but be aware that if they are not

instituted correctly they can destroys incentive, enthusiasm and effort. If ceilings are set

too low salespeople may quit selling altogether once the ceiling is reached.


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A successful companys number one responsibility is to encourage (motivate) individuals to

achieve their potential in an environment that provides equal opportunity for success and

enrichment. A well thought out compensation plan is a good start.

Keep in mind however that motivating the sales force or the entire organization is about

more than just compensation. People become motivated when:

They know the overall objectives of the company, i.e. where are we going and how dowe plan to get there?

Each person knows how their particular job or responsibility fits in the overall objectives,i.e. How does what I do affect the overall objectives of the organization and whats in it

for me?

Each person has the necessary tools they need to get their job done. Tools include notonly material items like computers, software programs, sales reports and objective

setting, but they need to understand the overall strategic plan, the marketing plan and

the sales plan.

Keep in mind that the more educated and armed with the right tools and support systems,

with the right incentives and compensation plan, the more motivated the sales organization

will be.

sikkim manipal mba, mk0010 third semester mk0010

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