Part One:

Strategic Planning

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 Sales Management: Shaping Future Sales Leaders

Introduction to
Sales Management
Chapter 1

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Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall.
Learning Objectives
Define strategy hierarchy and understand how sales and
marketing strategies affect overall strategy
Identify different types of selling strategies and how the
selling process varies
Describe the sales management process and
responsibilities and activities of sales managers

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 The Future for sales and sales force
management is pretty bright.
Many consumer believe the sales profession not a noble endeavor.
Business customers have a better appreciation for selling profession,
because these buyers rely on salespeople to bring them solutions to the
business problems that challenge them.
Product knowledge, technical expertise, and business acumen are all
required to satisfy customers' needs.
Sales positions are hardest to fill.
Sales consumes >20% of a firms revenue.
as a career opportunity, starting in sales is an excellent choice.
Many CEOs got their start in sales.
Sales mangers tends to earn more than their counterparts in other areas,
moreover, sales jobs will grow at much faster rate than other professions.

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 From Sales Rep to Sales Manager
Manager of people
Sales success is poor
predictor of success as
sales manager
Most successful sales
reps are eventually
pressured to make the
transition to sales mgmt
This is a decision that
must be carefully
analyzed because its not
an easy transition to go
from being a player to a
coach.

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What Being a Sales Manager Means

Coaching Coaching salespeople so they can improve

Developing strategies and delegating the

Developing responsibility for implementation to others

Figuring out how to motivate people, some who

Motivating are older than you

Convincing others in the organization that what is

Convincing right for the sales force is right for their
departments, too

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 What is Sales Management ?

Sales Management: is the activities required to lead, direct, or supervise

the personal selling efforts of an organization.

This textbook primary objective is to explain this function of managing

salespeople. And due to the importance of having a good strategy, this
textbook also discusses many of the day-to-day tasks that sales managers
do to further a firms strategy goals.

Isnt it important to study the selling process and selling skills?

Yes it is extremely important, because selling is the essence of Sales
Management science. Moreover, in marketing orientated companies sales
are seen to be part of the marketing concept.

So we will include two chapters from another textbook during our

discussion.
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 Important terms
What is the strategy ?

it is a plan designed to accomplish a mission.

What is the mission ?

It is a set of objectives.

- If your objective is to arrive at time to your 8 Oclock class, then what will be your
strategy to achieve this mission ( objective) ?

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Establishing the Parameters of the
Firms Strategy: The Mission Statement
Inspire the members of an organization
Give purpose to their actions
Guide their decision-making
Serve as a standard against which decisions
can be weighed
Once the missions objectives are set, strategy
can be created

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Sample Mission Statements
Everything we do is inspired by our
enduring mission:
Coca-Cola To Refresh the World . . . in body, mind, and spirit
To Inspire Moments of Optimism . . . through our
brands and our actions
To Create Value and Make a Difference . . .
everywhere we engage

The mission of Southwest Airlines is

dedication to the highest quality of
Southwest Customer Service delivered with a sense of
Airlines warmth, friendliness, individual pride, and
Company Spirit

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 The Strategy Hierarchy
Corporate Strategy encompasses plans and goals for
the entire organization
Address questions in a general sense, such as what
markets and sourcing options company should engage
Ex: hire sales force vs. use distributors
Ex: outsource mfg and focus internally on marketing
Business units create their plans to support corporate
strategy.
The flow of the strategy from the organizational level to
the units is called the Strategy Hierarchy.

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The Strategy Hierarchy

Corporate
Strategy

Marketing Strategy

Sales Strategy

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At the marketing level, planners have to answer the following
questions.

Markets What markets do we serve with what products?

What types of relationships do we form and with

Relationships whom?

What level of investment will be required, and

Investment how will we locate and allocate the needed
resources?

What are the detailed objectives and action

Objectives plans?

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What Markets Do We Serve with
What Products?
Find a sustainable competitive advantage

Need expertise, technology or a patent.

Sustainable competitive advantage is something that gives a company

an edge in the market overtime.

Competitive advantage : the results of a company matching a core

competency to opportunities it has discovered in the market.

Core competency: things a firm does extremely well, which sometime

give it an advantage over its competition.

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Product-Market Grid: achieving growth via
products and markets.

Examples : new countries,

new industries.

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 Product-Market Grid: achieving growth
via products and markets.
Note: the risk associated with diversification are far greater
than with other market expansion approaches, why?

Simply, because it requires developing both new products and

new market.

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What Types of Relationships Do We
Form and with Whom?
Strategic plan considers network of
relationships
Investors, potential investors, bankers
Suppliers
Personnel sources
Regulatory agencies
Relationship with customers is most
important.
Customers lifetime value is worth
more than the average single
purchase. (try to extend the
relationship as much as you can.)
A service advantage is often a
function of the quality of relationships
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 Customer Relationship Management
(CRM): Key Terms
CRM: identifying and grouping customers to best acquire, retain, and grow
customers
Sales and marketing teams are responsible for CRM
Customer acquisition strategy: plan to obtain new customers.
- can include marketing activities such as telephone prospecting and
attending trade shows to identify potential customers.
Customer retention strategy: plan designed to keep customers.
- might include making quarterly visits to current customers or inviting them
to technology shows to see the firms newest products.
Growth strategy: plan designed to increase sales to the same customers.
- these might include offering special discounts to customers when they
make larger purchases.

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 Global Sales Management:
Going Global to Achieve Growth
QuadReps expanding customers wanted local
Ellesmere Island Severnaya Zemlya
Arctic Ocean Arctic Ocean Franz Josef Land
Arctic Ocean
New Siberian Islands
Greenland (Den.) Svalbard (Nor.)
Banks Island Jan Mayen (Nor.) Novaya Zemlya Wrangel Island
Victoria Island Baffin Island

support in Singapore
U.S.A.

Canada
Iceland
Faroe Is. (Den.) Norway

Ireland
United Kingdom
Den.
Neth.
Sweden

Poland
Finland
Estonia
Latvia
Lithuania
Belarus
Russia 60
Aleutian Islands (USA)

Bel. Germany
Island of Newfoundland Czech. Ukraine Kuril Islands
Slovak.
Aus. Hung. Kazakhstan

QuadRep opened office in Singapore

Moldova Mongolia
France Switz. Slov.
Cro. Yugo.Romania
Bos. Georgia Uzbekistan
Bulgaria
North Atlantic Ocean Italy Mac.
Albania Armenia Azerbaijan
Kyrgyzstan
N. Korea
United States of America Portugal
Spain
Greece Turkey Turkmenistan Tajikistan
S. Korea Japan
North Pacific Ocean Tunisia Cyp. Leb. Syria Afghanistan North Pacific Ocean
Morocco Israel Iraq Iran China
Canary Islands (Sp.) Jordan
Kuwait Pakistan Nepal
Algeria Libya Bhu.
Egypt

Has since followed customers across the globe,

The Bahamas Qatar
Western Sahara (Mor.)
Mexico Cuba Bang. Taiwan
Hawaiian Islands Dominican Republic Saudi U. A. E.
Arabia India Myanmar (Burma)

Oman Laos
U. S. A. Jam.
Mauritania Mali
Belize Haiti Puerto Rico (US) Dominica
Niger Eritrea
Honduras Senegal Sudan Yemen Thailand Philippines
Guatemala Chad Vietnam
Barbados The Gambia Burkina Faso
El Salvador Nicaragua Cambodia
Andaman Islands (India)

opening offices in Malaysia, China, Taiwan,

Guinea-Bissau Guinea Benin Djibouti
Trinidad and Tobago Marshall Islands
Costa Rica Cte DIvoire Nigeria Sri Lanka Federated States of Micronesia
Venezuela Guyana Sierra Leone Ethiopia
Panama Suriname C. A. R. Brunei Guam (USA)
Maldives
French Guiana (Fr.) Liberia Cameroon
Ghana Togo Somalia Malaysia
Colombia Eq. Guinea Uganda
Singapore
Gabon Rwanda Kenya Kiribati
Ecuador

Thailand, the Philippines, and Mexico

Galapagos Islands (Ecuador) Sao Tome & Principe Indonesia
Zaire Burundi Papua New Guinea
Solomon Islands
Congo Tanzania Seychelles
Malawi
Peru
Brazil Angola
Zambia Mozambique
Bolivia Madagascar
Namibia Zimbabwe Fiji
French Polynesia (Fr.) New Caledonia
Botswana
Paraguay Mauritius Indian Ocean
Swaziland
Australia
South Africa
Lesotho
Uruguay
South Pacific Ocean Chile Argentina South Atlantic Ocean New Zealand

Tasmania
Falkland Islands (Islas Malvinas) (adm. by UK, claimed by Argentina)

les Crozet (France)

South Georgia (adm. by UK, claimed by Argentina)

Source: Charles Cohon, Vice President of Research

Antarctica
of Manufacturers Representatives Educational
Research Foundation. He can be reached through his Web site, www.cohon.com.
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Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall.
 Global Sales Management:
Going Global to Achieve Growth
Empire Technical Groups customers moved mfg and
Ellesmere Island Severnaya Zemlya
Arctic Ocean Arctic Ocean Franz Josef Land
Arctic Ocean
New Siberian Islands
Greenland (Den.) Svalbard (Nor.)
Banks Island Jan Mayen (Nor.) Novaya Zemlya Wrangel Island
Victoria Island Baffin Island

purchasing to AsiaU.S.A.

Canada
Iceland
Faroe Is. (Den.) Norway

United Kingdom
Den.
Sweden
Finland
Estonia
Latvia
Lithuania
Russia 60
Aleutian Islands (USA)
Ireland Neth. Belarus
Germany Poland
Bel.

ETG and several other companies formed a

Island of Newfoundland Czech. Ukraine Kuril Islands
Slovak.
Aus. Hung. Moldova Kazakhstan
France Switz. Slov. Mongolia
Cro. Yugo.Romania
Bos. Georgia Uzbekistan
Bulgaria
North Atlantic Ocean Italy Mac.
Albania Armenia Azerbaijan
Kyrgyzstan
N. Korea
United States of America Portugal
Spain
Greece Turkey Turkmenistan Tajikistan
S. Korea Japan
North Pacific Ocean

consortium and included Asian partners where

Tunisia Cyp. Leb. Syria
Iraq
Afghanistan
China North Pacific Ocean
Morocco Israel Iran
Canary Islands (Sp.) Jordan
Kuwait Pakistan Nepal
Algeria Libya Bhu.
The Bahamas Egypt
Western Sahara (Mor.) Qatar
Mexico Cuba Bang. Taiwan

Asia/Pacific resources were required

Hawaiian Islands Dominican Republic Saudi U. A. E.
Arabia India Myanmar (Burma)

Oman Laos
U. S. A. Jam.
Mauritania Mali
Belize Haiti Puerto Rico (US) Dominica
Niger Eritrea
Honduras Senegal Sudan Yemen Thailand Philippines
Guatemala Chad Vietnam
Barbados The Gambia Burkina Faso
El Salvador Nicaragua Cambodia
Guinea-Bissau Guinea Benin Djibouti Andaman Islands (India)
Trinidad and Tobago Marshall Islands
Costa Rica Cte DIvoire Nigeria Sri Lanka Federated States of Micronesia
Venezuela Guyana Sierra Leone Ethiopia
Panama Suriname C. A. R. Brunei Guam (USA)

Became opportunity to pursue contracts to build

Maldives
French Guiana (Fr.) Liberia Cameroon
Ghana Togo Somalia Malaysia
Colombia Eq. Guinea Uganda
Singapore
Gabon Rwanda Kenya Kiribati
Galapagos Islands (Ecuador) Ecuador Sao Tome & Principe Indonesia
Zaire Burundi Papua New Guinea
Solomon Islands
Congo Tanzania Seychelles

entire assemblies as well as just parts

Malawi
Peru
Brazil Angola
Zambia Mozambique
Bolivia Madagascar
Namibia Zimbabwe Fiji
French Polynesia (Fr.) New Caledonia
Botswana
Paraguay Mauritius Indian Ocean
Australia

Morphed into international design and assembly

Swaziland
South Africa
Lesotho
Uruguay
South Pacific Ocean Chile Argentina South Atlantic Ocean New Zealand

house, controlling manufacturing of complete Falkland Islands (Islas Malvinas) (adm. by UK, claimed by Argentina)

les Crozet (France)

Tasmania

assemblies, turning a $3 (part) sale to a $103 sale

South Georgia (adm. by UK, claimed by Argentina)

Source: Charles Cohon, Vice President of Research

Antarctica
of Manufacturers Representatives Educational
Research Foundation. He can be reached through his Web site, www.cohon.com.
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 What Level of Investment Will Be Required, and
How Will We Allocate the Needed Resources?
Money, human or social capital
Human capital : refers to the people that make up an organization.
Human capital decisions include:
Determining number of salespeople
What skills and experience they must have
What training they require
Other decisions include:
Whether to hire telephone prospectors or to outsource
Who handles customer service (a sales rep or a customer service rep).

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 What Level of Investment Will Be Required,
and How Will We Allocate the Needed
Resources?
Social capital: refers to the ties that a firm has with others, which can
also be drawn upon as a resource.
In other word, social capital is who owes you favor or who can be
asked a favor.
Look at the example on page 10.

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 What Are the Detailed Objectives and
Action Plans?
Remember that mission statements do not answer questions about
what to produce or markets we should serve.

Nor they answer questions about the firms objectives and plans.

These objectives and plans become more specific at the marketing

and sales strategies levels ( business unit strategies.)

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 What Are the Detailed Objectives and
Action Plans?
SMART format for establishing objectives
S pecific
Measurable
A chievable, yet challenging
R ealistic
T ime-based
-Milestones are important short-term objectives, can help mark a
companies progress toward achieving its objectives.
-They also can be used to also determine when the plan is off course so
that adjustments can be made.
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 What Are the Detailed Objectives and
Action Plans?
Moreover, a good strategic plan has a detailed action plans, or
steps, that will be taken in order to accomplish those objectives.
- who will undertake each activity?
- when the activity will occur?
At this point the firms strategy begins to involve salespeople and
sales process.

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Self-Assessment Library
Go to http://www.prenhall.com/sal/
Access code came with your book
Click the following
Assessments
I. What About Me
C. Motivation Insights
5. What Are My Course Performance Goals?

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Selling Approaches: grouping buyers
by how they make decisions.
Finish sale as quickly and as easily as possible
Key to success is making as many calls as possible to as
Transactional many people as possible.
Little thought is given to the lifetime value of customers.

Based on the friendship between the salesperson and the

Affiliative individual buyer. Example : if all products buyer
considering are the same, but post-sales service is
critical, then the buyer will be more inclined to purchase
from a friend who can be counted upon.
Identify and solve a clients problems
Problem Solving Also called needs-satisfaction selling or problem/solution
or Consultative selling.
Involves asking questions in order to determine customers
needs and then presnting solutions.
Business-to-business (B2B) concept
Enterprise Based on not only person-to-person relationships but on
company-to-company relationships
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 Enterprise Selling:
is a business-to-Business concept that reflect, at its best, a strategic
partnership between the buying and selling organization.

It is called enterprise selling because it is based on not only person-to-

person relationship but on company-to-company relationships.

For every customer there is salesperson; called account manager; that is

responsible on managing the relationship with a business customer.

When engaged in enterprise selling, a salesperson will, at times, utilize

affiliative selling, transactional selling, and consultative selling all within an
enterprise-level strategy.

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The Selling Approach: 8 Steps

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Prospecting
Prospecting involves identifying potential
customers for a particular product or service
A prospect is a MAD buyer
the Money to spend
the Authority to buy
the Desire to buy it

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Pre-Approach
During Pre-Approach, the salesperson tries to
learn everything he can about the account
Can take a significant amount of time

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Approach
Approach: salesperson asks buyer to commit to
a meeting
Opening statement must get buyers attention

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Needs Identification
Needs identification: salesperson confirms
prospect is MAD (Money, Authority, Desire)
Comprised of 3 elements

1
Questioning
2
Identification
3
Pre-commitment

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Presentation
Presentation: salesperson describes product
and how it meets buyers needs

Feature Evidence

Benefit Agreement

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Handling Objections
Objections: reasons a buyer offers to not buy
your product
Can occur at any time
Salesperson should find out root
of concern and resolve it

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Closing the Sale
Close: when salesperson asks buyer for the sale
Good close
Reinforce decision to buy
Confirm implementation schedule
Thank the buyer
Ask for referral

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Implementation/Follow-Up
Follow-Up: After delivery, ensure that the
customer has good experience with product
Training, service, policies and procedures

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Selling Process vs. Selling Approach
Selling Approach Selling Process

Transactional Prospecting

Affiliative

Consultative
Closing Presenting

Enterprise

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Sales Leaders

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Sales Executive

Devise sales plan to meet strategic objectives

Plan Develop general strategies that specify sales
approach

Determine type of sales force

Organize Create hiring and training policies and strategies

Communicate and roll out the plan

Implement Create the right culture
Choose a compensation model
Sales and customer satisfaction
Monitor Salesperson recruitment, selection, training
Take corrective action as necessary

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Field Sales Manager
Plans, organizes, implements, and monitors for
specific sales team
Salespeople report to Field Sales Manager
Primary responsibility is sales quota
Responsible for training and motivating
salespeople

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Sales Executive vs.
Sales Manager Duties
Activity Sales Executive Sales Manager
Set overall sales targets for Set quotas for each
Plan each product salesperson for each product

Decide what type of people to Interview and hire specific

Organize hire for sales positions people for sales positions

Identify each persons

Determine the compensation motivators and find ways to
Implement plan reward good performance for
each person

Track sales by region; take Observe each salespersons

corrective action such as actions in the field and offer
Monitor additional training if sales are suggestions for their
too low improvement

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Ethics in Sales Management:
Maintaining NCRs Ethical Sales Culture

We recognize that selling

only works when everything is
right for the customerwhen
we deliver value
Rick Makos
President, NCR-Canada

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Role Play: T&G Supply
Opportunity 1: T&G Supply
Provides maintenance, repair, and operations items to
manufacturers
Janitorial products, hardware products to fix machines,
and other common maintenance products
Opportunity 2: Columbia Leasing
Car rental and leasing company
Your job is to sell corporate contracts

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Role Play (continued): Action Steps
Break into pairs
Each person picks 1 company to play sales mgr
Think about issues that reflect a service-
dominant logic in each situation
Using other concepts discussed in the chapter,
identify three characteristics that you would want
each new salesperson to have
Take turns interviewing your partner for a sales
position

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Caselet 1.1:
Killebrew Manufacturing
Makes plastic patio products
Widow Francine took over company
Annual growth rate ~5% for past 20 years
Trying to grow company
10% introductory discount
Makes prices same as biggest competitor
Killebrew quality is much better
Problem: Few new accounts are reordering
Are salespeople too quick to sell price, not quality?

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Caselet 1.1 (continued):
What Would You Do?
Quality must be demonstrated and sold
What sales process or approach should Francine
consider?

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Caselet 1.2:
Mortons Ice House
Grill and microbrewery
Owner Sherry Morton hired Trey Denton to sell
franchises
Trey sold 12 franchises in 1 year
Corporate goal is to sell 200 franchises in next 2
yrs
Hired 5 salespeople for Trey to manage

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Caselet 1.2 (continued):
What Would You Do?
Problems
Salespeople calling on same prospects
Other prospects not being called on
Sold only 22 franchises in 6 months
2 salespeople quit
10 franchises want out of contracts
What should Sherry do?

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All rights reserved. No part of this publication may be reproduced, stored in
a retrieval system, or transmitted, in any form or by any means, electronic,
mechanical, photocopying, recording, or otherwise, without the prior written
permission of the publisher. Printed in the United States of America.