07/06/10 1

By :

Prof. Amit Kumar

07/06/10 2

“A student pursuing management education from IILM-

Graduate School of Management, for example may find

himself or herself placed in a firm as a Sales Manager.

Our goal is to prepare the student for the exciting

challenges related to leading sales organizations in

today’s hyper-competitive global economy”.

IILM-GSM

Importance of this course

Selling & Sales Management

07/06/10

IILM-GSM

Selling & Sales Management

07/06/10

Contents

• Sales Force Evaluation Process

• Measures of Performance– Quantitative Measures of Performance

– Qualitative Measures of Performance

• Salesperson Evaluation Matrix

IILM-GSM

Selling & Sales Management Sales Force Evaluation

07/06/10

Sales Force Evaluation Process

Sales Force evaluation is the comparison of sales force objectives with results.

• It begins with the setting of sales force objectives…

IILM-GSM

Selling & Sales Management Sales Force Evaluation

07/06/10

Sales Force Evaluation Process

Sales Force evaluation is the comparison of sales force objectives with results.

• It begins with the setting of sales force objectives which may be financial, such as sales revenues, profits and expenses, market-oriented or customer-based.

• Then sales strategy must be decide to show how the objectives are to be achieved.

• Next performance standards should be set

• Results are then measured and compared with standards.

• At last, action taken to improve performance.

IILM-GSM

Selling & Sales Management Sales Force Evaluation

07/06/10

Sales Force Evaluation Process

IILM-GSM

Selling & Sales Management Sales Force Evaluation

Set Sales force Objectives including:RevenuesProfit ContributionCustomer SatisfactionCustomer ServiceExpenses

Set Performance Standards for:CompanyRegionsProductsSalespeopleAccounts

Determine Sales Strategy

Measure results & compare with standards

Action Taken to Improve Performance

07/06/10

Measures of Performance

1. Quantitative Measures of Performance

2. Qualitative Measures of Performance

IILM-GSM

Selling & Sales Management Sales Force Evaluation

07/06/10

Quantitative Measures of Performance

Assessment using Quantitative Performance measures

falls into two groups:• Specific output measures for individual salespeople

– Sales Revenue Achieved

– Profit Generated

– Sales Per Active / Potential Account

– No of Orders / Number of New Customers

• Specific input measures for individual salespeople – No of Calls Made

– Calls Per Active Account

– No of Calls on Prospects

– Calls per Potential Account

IILM-GSM

Selling & Sales Management Sales Force Evaluation

07/06/10

Quantitative Measures of Performance

Assessment using Quantitative Performance measures

falls into two groups:• Specific output measures for individual salespeople

• Specific input measures for individual salespeople

• By combining output and input measures a number of hybrid ratios can be determined. Example:– Strike Rate ( No of Orders / No of Quotations )– Sales Revenue per Call Ratio– Prospecting Success Ratio – Average Profit Contribution per Order (Profit Generated / No of

Orders)– Order Call Ratio

IILM-GSM

Selling & Sales Management Sales Force Evaluation

07/06/10

Quantitative Measures of Performance

All these ratios help to answer the following questions:

• Is the salesperson achieving a satisfactory level of sales?

• Is sales success reflected in profit achievements?

• Is salesperson devoting sufficient time to prospecting?

• Is time spent prospecting being rewarded by orders?

• Are calls being reflected in sales success?

• Does the salesperson appear to be making a satisfactory number of calls per week?

IILM-GSM

Selling & Sales Management Sales Force Evaluation

07/06/10

Qualitative Measures of Performance

The usual dimensions of Qualitative Measures:

1. Sales Skills• Handling the opening and developing rapport, Quality of sales

presentation, ability to overcome objections, ability to close

2. Customer Relationships

3. Self-Organization• Prepare Calls, Organize Unproductive Traveling, Conduct self-

analysis of performance in order to improve weaknesses

4. Product Knowledge• Relative Strengths and Weaknesses between his or her own and

competitive offerings

5. Co-operation and Attitudes towards company & its products• Respond to the objectives determined by management in order to

improve performance, e.g. increase prospecting rate.

IILM-GSM

Selling & Sales Management Sales Force Evaluation

07/06/10

Sales Force Evaluation Matrix

IILM-GSM

Selling & Sales Management Sales Force Evaluation

- Praise- Reward- Promote

- Limited Praise- Guide- Train

- Discuss- Train- Punish- Remove

- Limited Praise- Advice- Educate

Average

Bad

Good

Good Average Bad

Quantitatively Measured Results

Qua

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Mea

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