copyright © bruce ian rasmussen, 2006 a business manager's guide to improving sales...
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Copyright © Bruce Ian Rasmussen, 2006
A Business Manager's guide to improving sales effectiveness
Copyright © Bruce Ian Rasmussen, 2006
Sales Function Productivity Drivers
Sales Research- Market Understanding- Market Segmentation- Market Assessment- Market Prioritisation- Market Targeting
Investment & Organisation- Size- Structure- Deployment
- Product- Market- Activity
- Territory Alignment- Sales and Promotional Alignment- Inter Departmental Alignment
People- Selling Competencies- Recruiting- Training- Promotions- Coaching- Supervision- Motivation- Evaluation- Progression
Sales Systems- Compensation- Incentives- Benefits- Data Provision
- Lead Generation- Targeting
- Provision of Tools- Sales Methodologies- Sales Automation- CRM
- Provision of Process- Strategic Selling- Mentoring- Partnering- Consultative Selling
Copyright © Bruce Ian Rasmussen, 2006
Market driven organisation
• definition:
“demonstrates a superior ability to understand, attract and keep valuable
customers”
Copyright © Bruce Ian Rasmussen, 2006
Successful market driven organisations
• 3 key elements:
Customers
Collaborators
Competitors
Channels
Superior Ability to
Understand, Attract and
Keep Valuable
Customers
Configuration
- Focus on superior customer value
- Coherence of structures & systems
- Adaptability
Shared Knowledge
Base
Culture
is externally oriented
Capabilities- Market sensing- Market relating
- Strategic thinking
Copyright © Bruce Ian Rasmussen, 2006
Turbulent Times
• more supply and less differentiation• more global and less local• more competition and more collaboration• more relating and less transacting• more sense-and-respond and less make-
and-sell
Copyright © Bruce Ian Rasmussen, 2006
Services Marketing
“Making the Intangible Tangible”
Copyright © Bruce Ian Rasmussen, 2006
Marketing Services - Not Products
• Intangible performances
• Customer involvement in production
• People are part of the product
• Quality control more difficult
• Harder for customers to evaluate
• No inventory
• Importance of time factor
• Different distribution channels
Copyright © Bruce Ian Rasmussen, 2006
7 P’s of Services Marketing
Customers
Product (service)
Price
Promotion
Place & time
Participants Process
Physical Evidence
Copyright © Bruce Ian Rasmussen, 2006
Planning, Creating & Delivering Services
Corporate Objectives & Resources
Market opportunity Analysis
Strategic Service Concept Statement
Market Positioning Statement
Service Marketing Concept
Resource Allocation Analysis
Service Delivery Process
Service Operations Concept
Copyright © Bruce Ian Rasmussen, 2006
Value Propositions
“The value decade is upon us. If you can’t sell
top quality product at the world’s lowest
price, you’re going to be out of the game…
the best way to hold your customers is to
constantly figure out how to give them more
for less.”
- Jack Welch, Chairman, General Electric
Copyright © Bruce Ian Rasmussen, 2006
Components Of A Selling Organisation
Copyright © Bruce Ian Rasmussen, 2006
Components of a Selling Organisation
Copyright © Bruce Ian Rasmussen, 2006
Measurement - People and culture
• knowledge
• competencies
• skills
• attitudes
• behaviours
• motivation
Copyright © Bruce Ian Rasmussen, 2006
Measurement - People and culture
• salesperson success profile
• employee satisfaction
• turnover
• peer and subordinate reviews
• culture check
Copyright © Bruce Ian Rasmussen, 2006
Measurement - Sales force activity
• account planning• targeting• calls• reach• frequency
Copyright © Bruce Ian Rasmussen, 2006
Measurement - Sales force activity
• hours• coverage• maintenance• prospecting• needs assessment
Copyright © Bruce Ian Rasmussen, 2006
Measurement - Sales force activity
• demonstrations• proposals• evaluations• solutions• customer service• “selling, servicing,
admin, other checklist”
Copyright © Bruce Ian Rasmussen, 2006
Measurement - Customer results
• customer satisfaction
• customer retention• penetration• customer loyalty
Copyright © Bruce Ian Rasmussen, 2006
Measurement - Customer results
• repeat rates
• complaints
• returns
• message
memorability
Copyright © Bruce Ian Rasmussen, 2006
Measurement - Company results
• sales
• revenue
• profit
• orders
Copyright © Bruce Ian Rasmussen, 2006
Measurement - Company results
• collections• sales per rep• market share• value perception• brand equity
Copyright © Bruce Ian Rasmussen, 2006
Measurement - Importance and reliability
Measure Reliability
MeasureImportance
People & Culture
Sales Force Drivers
Customer Results
ActivityCompany Results
Copyright © Bruce Ian Rasmussen, 2006
Selected Drivers
Copyright © Bruce Ian Rasmussen, 2006
Sales Force Size
• size is independent of productivity• phased growth is rarely optimal
– increase when opportunity is realised– invest in the potential - role of market analysis
• gradual downsizing doesn’t work– morale– customers
• market deployment better than more resource
Copyright © Bruce Ian Rasmussen, 2006
Methods of sizing sales force
• “same as last year”• financial method
– based on revenue forecast– BUT sales force investment drives sales
• competition parity– does the competition know what it is
doing?
• market-based approach– identify target customers– segment target customers– segment coverage strategy– sales force sizing
Copyright © Bruce Ian Rasmussen, 2006
Best approach to sizing
1.use market-based method2.check with financial method3.do competitor check4.do target customer check
coverage, contact frequency, etc.
Copyright © Bruce Ian Rasmussen, 2006
Sales force structures
• generalist– Managable product line– Similar approach - all customers
• market-based– Better effectiveness through customer knowledge– Can conflict with product strategy
• product-based– Large, complex product line– Independent or integrated
• activity-based– Hunter/farmer– HO/local– product/finance– Goal on individual AND team
Copyright © Bruce Ian Rasmussen, 2006
Hiring
• skills that lead to sales success– Inate desire to serve– Strong work ethic– Integrity– Ability to put others at ease– Effective communication skills– Willingness to listen
• None of the above can be learnt!!
Copyright © Bruce Ian Rasmussen, 2006
Value of Hiring Tools
2 interviews - 14% link between interview prediction and job success
Ability composite test 53%Tryout 44%
Data on Resume 37%Reference check 26%
Experience 18%Interview 14%
Training and Experience rating 13%Academic Achievement 11%
Education 10%Interest 10%
Age -1%
Copyright © Bruce Ian Rasmussen, 2006
Best source for candidates
Referrals 48%Recruiters 31%
Competitors 10%College placement offices 9%
Newspaper ads 9%
Survey - Sales and Marketing Management magazine
Copyright © Bruce Ian Rasmussen, 2006
Training - required competencies
• knowledge
• ability/capability
• skills
Copyright © Bruce Ian Rasmussen, 2006
Training - knowledge
• product
• customer
• technology– Database, information management, tools, etc.
• company– Policy, values, culture, etc.
Copyright © Bruce Ian Rasmussen, 2006
Training - ability/capability
• customer and industry research
• customer profitability maximisation
• develop best selling process
• quantitative analysis
• problem solving
Copyright © Bruce Ian Rasmussen, 2006
Training - skills
• prospecting• needs identification• time management• territory management• listening• persuasion• presentation• negotiation• closing• account maintenance and expansion
Copyright © Bruce Ian Rasmussen, 2006
Training - program enhancement
• rapid prototyping works
• individualised training is better
• active learning is better
• training modules structured around the actual business problems are better
Copyright © Bruce Ian Rasmussen, 2006
Effectiveness/Efficiency tradeoff
Effectiveness
Efficiency
Self Study
ExternalSeminars
ClassroomParticipant
&observation
training
‘‘On-the-job’Training
Copyright © Bruce Ian Rasmussen, 2006
Motivation
• 5 universal motivators
– achievement– social affiliation– power– ego gratification– survival
Copyright © Bruce Ian Rasmussen, 2006
Motivating sales force productivity
• territory design• sales support• recruiting and promotions• training• compensation• recognition programs• coaching and supervision• communication• culture• company factors
Copyright © Bruce Ian Rasmussen, 2006
ROI on sales training…
2%
3%
17%
15%
19%
44%
0% 10% 20% 30% 40% 50%
More than 1 year
7-12 months
3-6 months
2 months
1 month
Less than 1 month
Half Life of Sales Training