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MARKETING AND SALES MANAGEMENT
CHECK POINT 93: THE SALES MANAGEMENT PROCESS (OVERVIEW)

Please Select Any Topic In Check Point 93 Below And Click

1. the connection between marketing and sales management
2. steps in the sales management process
3. Sales Planning And Budgeting
4. Sales Organization
5. sales force recruitment, selection, and training
6. personal selling
7. sales force compensation
8. Sales Force Management And Motivation
9. sales force allocation and sales quotas
10. sales force performance evaluation and control
11. why is sales management so important?
12. for serious business owners only
13. the latest information online
 

DO I NEED TO KNOW THIS CHECK POINT?

 

WELCOME TO CHECK POINT 93

TUTORIAL 1 General Management TUTORIAL 2 Human
Resources Management
TUTORIAL 3 Financial Management TUTORIAL 4 Operations Management TUTORIAL 5 Marketing
And Sales Management
1 6 11 16 21 26 31 36 41 46 51 56 61 66 71 76 81 86 91 96
2 7 12 17 22 27 32 37 42 47 52 57 62 67 72 77 82 87 92 97
3 8 13 18 23 28 33 38 43 48 53 58 63 68 73 78 83 88 93 98
4 9 14 19 24 29 34 39 44 49 54 59 64 69 74 79 84 89 94 99
5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95 100
 

HOW CAN YOU BENEFIT FROM CHECK POINT 93?

 
The main purpose of this check point is to provide you and your management team with a brief Sales Management Process Overview included in Tutorial 5 - Marketing And Sales Management which contains twenty check points.
 
In this check point you will be introduced to:
 
• The connection between marketing and sales management.
• The basic steps in the sales management process.
• Financial statements and financial performance evaluation.
• Sales planning and budgeting.
• Sales organization.
• Sales force recruitment, selection, and training.
• Personal selling.
• Sales force compensation.
• Sales force management and motivation.
• Sales force allocation and sales quotas.
• Sales force performance evaluation and control... and much more.
 

LEAN MANAGEMENT GUIDELINES FOR CHECK POINT 93

 
You and your management team should become familiar with the basic Lean Management principles, guidelines, and tools provided in this program and apply them appropriately to the content of this check point.
 
You and your team should adhere to basic lean management guidelines on a continuous basis:
 
Treat your customers as the most important part of your business.
Provide your customers with the best possible value of products and services.
Meet your customers' requirements with a positive energy on a timely basis.
Provide your customers with consistent and reliable after-sales service.
Treat your customers, employees, suppliers, and business associates with genuine respect.
Identify your company's operational weaknesses, non-value-added activities, and waste.
Implement the process of continuous improvements on organization-wide basis.
Eliminate or minimize your company's non-value-added activities and waste.
Streamline your company's operational processes and maximize overall flow efficiency.
Reduce your company's operational costs in all areas of business activities.
Maximize the quality at the source of all operational processes and activities.
Ensure regular evaluation of your employees' performance and required level of knowledge.
Implement fair compensation of your employees based on their overall performance.
Motivate your partners and employees to adhere to high ethical standards of behavior.
Maximize safety for your customers, employees, suppliers, and business associates.
Provide opportunities for a continuous professional growth of partners and employees.
Pay attention to "how" positive results are achieved and constantly try to improve them.
Cultivate long-term relationships with your customers, suppliers, employees, and business associates.

1. THE CONNECTION BETWEEN MARKETING AND SALES MANAGEMENT

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SALES MANAGEMENT

Business owners and sales managers must be fully familiar with all elements of sales management which represents one of the most critical functions in every business organization. Please remember that without sales there are NO customers, and without customers there is NO business!

The Sales Management is really all about how to sell products and services to prospective clients in the marketplace, while Marketing Management is all about how to identify markets and to approach prospective clients in the marketplace. Sales management is, in essence, a pro-active extension of marketing management and the connection between both functions is illustrated below.

THE COMMUNICATION MIX

Implementation of Marketing Mix Strategies related to products, pricing, promotion, and distribution represents a central part of a sound marketing plan. This plan requires further development of Promotional Strategy and control of the Communication Mix. The communication mix consists of five components illustrated below.

THE COMMUNICATION MIX COMPONENTS

Advertising

Personal
Selling

Sales
Promotion

Public
Relations

Direct
Marketing

 

WHERE DOES THE SALES PROCESS REALLY BEGIN?

One of the main elements of the Marketing Management Process is the Communication Mix, which is discussed in detail in this Tutorial.

Two main components of the communication mix, Personal Selling and Sales Promotion, create an underlying need for establishing a sales organization to meet the company's marketing objectives. This, in fact, is the main connection between marketing and sales management, and it represents the beginning of the Sales Management Process as described below.

THE MARKETING MANAGEMENT PROCESS

Implementation Of The Marketing Mix Strategies

     

Product
Strategies

 

Pricing
Strategies

 

Promotional
Strategies

 

Distribution
Strategies

           

Development And Control Of Communication Mix

Advertising

Personal
Selling

Sales
Promotion

Public
Relations

Direct
Marketing

 

 

 

   

Communication Mix is discussed in detail in Tutorial 5.

 

ADDITIONAL INFORMATION ONLINE

Sales Promotion By Jason Richea.
Personal Selling By Paul McGuckin.
Marketing Communication By Chris Fill, Oxford Learning Lab.
Public Relations, Sales Promotion, And Personal Selling By Melissa Brown.
Difference Between Personal Selling And Sales Promotion By I. Rodriguez, eHow.

2. STEPS IN THE SALES MANAGEMENT PROCESS

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THE SALES MANAGEMENT PROCESS

The Sales Management Process, established as the direct result of personal selling and sales promotion requirements, imposed by the marketing management process, entails a number of steps outlined below.

Business owners and sales managers must pay serious attention to the sales management process, because the company’s successful performance is totally dependent upon the cost-effective implementation of this process.

The latest trends in sales management indicate a high effectiveness of a Consultative Selling Approach, instead of trying to “hard-sell” products and services to customers the old-fashioned way. Thus, the entire sales management process should be developed on the basis of cultivating consultative selling approach to secure successful organization performance.

STEPS IN THE SALES MANAGEMENT PROCESS

Step 1: Preparation Of Sales Plans And Budgets.

Step 2: Building An Efficient Sales Organization.

Step 3: Sales Force Recruitment, Selection, And Training.

Step 4: Management Of Personal Selling Activities.

Step 5: Sales Force Compensation.

Step 6: Selection And Design Of Sales Territories.

Step 7:  Sales Force Management And Motivation.

Step 8: Sales Force Performance Evaluation And Control.


Each step in the sales management process is discussed next.

 

ADDITIONAL INFORMATION ONLINE

Sales Process Flow Chart By Victor Holman.
Sales Management Process By Richard Rodriguez.
Steps In The Sales Process By Townsend Wardlaw.
The 5 Step Sales Process By Jason Nazar, DocStocTV.
Best Way To Engage A Sales Manager In A Sales Process By Mark Hunter.

3. SALES PLANNING AND BUDGETING

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STEP 1: SALES PLANNING AND BUDGETING

The sales management process starts with the preparation of detailed Sales Plans and Sales Budgets for the forthcoming fiscal period.  These must be carefully prepared by the sales manager in accordance with the company's overall marketing objectives, strategies, and plans. 

Accurate sales plans and budgets provide the company with a key to effective guidance of the sales force and control of their performance.  Preparation of sales plans and sales budgets entails a certain number of activities outlined below.

SALES PLANNING AND BUDGETING ACTIVITIES

1.

Marketing and sales analysis of relevant markets for the company’s products or services.

2.

Evaluation of past sales related to the company’s products or services in various markets.

3.

Evaluation of the company’s competition in the marketplace regarding its existing and new products or services.

4.

Measurement of the sales potential of the company’s products or services in various markets.

5.

Sales forecasting of the company’ products or services for various markets.

6.

Development of sales strategies for various markets regarding the company’s current and new product or service ranges.

7.

Formulation of sales objectives for each product or service range in defined sales territories or markets.

8.

Determining sales force requirements for meeting the company’s marketing and sales objectives in defined sales territories or markets.

9.

Determining sales force composition for meeting the company’s overall marketing and sales objectives.

10.

Completion of the company’s sales budget.

Sales Planning And Budgeting is discussed in detail in Tutorial 5.

4. SALES ORGANIZATION

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STEP 2: SALES ORGANIZATION

Once the sales plans and budgets are approved by the business owner and the management team, the sales manager must begin, or continue with, the process of building an efficient Sales Organization

The prime purpose of a sales organization is to attain the company's marketing objectives by selling its products or services, and thus satisfy the customers’ needs. The process of building the sales organization entails a number of activities outlined below.

ACTIVITIES RELATED TO BUILDING A SALES ORGANIZATION

1.

Determining the tasks that must be performed to implement the sales plan.

2.

Classification of tasks and grouping them into related sets of activities on the basis of product, customer, or sales territory requirements.

3.

Assigning a set of activities to individual positions within the sales organization.

4.

Establishing supervision and reporting relationships between positions within the sales organization.

5.

Developing a specialized sales organizational structure in accordance with the overall sales plans and objectives.

Business owners and sales managers may consider several types of Sales Organization Specialization, depending upon the nature of the company’s products or services, markets in which the company wants to operate, and the types of customers in the marketplace. These options are summarized below.

TYPES OF SALES ORGANIZATIONAL SPECIALIZATION

• Geographic Specialization.

This type of sales organization is suitable for companies that offer their products or services in widespread geographic markets.

Product Or Service Specialization.

This type of sales organization is suitable for companies that offer specialized types of products or services in the marketplace.

• Customer Specialization.

This type of sales organization is suitable for companies that offer products or services to specific industries, types of customers, or markets.

• Functional Specialization.

This type of sales organization is suitable for companies that that offer relatively narrow product or service lines to non-segmented and geographically concentrated markets.

Sales Organization is discussed in detail in Tutorial 5.

5. SALES FORCE RECRUITMENT, SELECTION, AND TRAINING

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STEP 3: SALES FORCE RECRUITMENT, SELECTION, AND TRAINING

Sales Force Recruitment And Selection represents the next phase in the sales management process. This process entails a number of activities, which must be carried out by business owners and sales managers, as outlined below.

SALES FORCE RECRUITMENT AND SELECTION PROCESS ACTIVITIES

1.

Analysis of sales jobs in accordance with particular market requirements.

2.

Determining the qualifications and preparing job descriptions and job specifications for each sales position.

3.

Recruiting a pool of potentially suitable candidates.

4.

Selecting suitable sales people.

5.

Providing orientation to every new sales person.

 

THE SALES FORCE TRAINING PROCESS

Subsequent to their selection, all new employees must undergo a thorough sales training process. One of the prime objectives of Sales Force Training is to ensure effective implementation of personal selling techniques, and sound understanding of buying behavior in various markets, where the company conducts its business activities.

The sales force training process within a company may be accomplished by a variety of means, such as specialized in-house training programs, sales lectures and seminars, audiotapes, videotapes, one-on-one instructions, role playing, case studies, and self-study courses.

Sales Force Recruitment, Selection, And Training is discussed in detail in Tutorial 5.

6. PERSONAL SELLING

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STEP 4: PERSONAL SELLING

Effective management of Personal Selling activities represents the cornerstone of a successful sales department in every company. It is essential therefore that business owners and sales managers pay maximum attention to the development of professional skills by each member of their sales team.

STEPS IN THE PERSONAL SELLING PROCESS

1.

Understand the interaction between buyers and sellers.

2.

Locate and qualify potential customers.

3.

Develop a suitable approach to each potential customer.

4.

Analyze each potential customer’s specific requirements.

5.

Make a formal presentation to the potential customer.

6.

Overcome the potential customer’s objections.

7.

Convert the potential customer into a real customer, i.e. close the sale.

8.

Follow-up the sale with the customer.

 

IMPORTANCE OF UNDERSTANDING
THE BUYING BEHAVIOR AND THE PSCYCHOLOGY OF SELLING

Since personal selling is geared toward meeting the customers’ requirements, it is essential to understand their Buying Behavior and various reasons for making Buying Decisions. Moreover, it is very important for sales people to understand the Psychology Of Selling and the underlying dynamics during the Selling Process.

Sales people must also be prepared to undergo transformation from “regular sales people” to Sales Consultants and learn to approach their customers from the consulting point of view. Such transformation may produce substantially improved sales results and generate a higher level of company profitability.

Personal Selling is discussed in detail in Tutorial 5.

7. SALES FORCE COMPENSATION

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STEP 5: SALES FORCE COMPENSATION

The first step in the Sales Force Management And Motivation Process entails the development of an equitable compensation package for all sales employees. Sales Force Compensation represents, therefore, an essential element in the overall sales management process. 

Compensation is one of the most important factors that motivates every employee. It is essential, therefore, that business owners and sales managers design a suitable sales compensation plan which may consist of various elements, depending on the company’s specific requirements.

The prime purpose of a sales compensation plan is to ensure maximum motivation of the sales force to satisfy the customers' needs in the most efficient manner. The development of the sales compensation plan entails a number of steps outlined below.

STEPS IN THE SALES COMPENSATION DEVELOPMENT PROCESS

1.

Establish compensation objectives.

2.

Select compensation plans.

3.

Set appropriate pay level for sales people.

4.

Summarize sales expense account and employee benefits.

5.

Implement the sales compensation plan.

There are several Sales Compensation Plans, which can be used by business owners and sales managers and these plans are summarized below.

SALES COMPENSATION PLANS

Straight
Salary

Sales
Commission

Salary
Plus
Commission

Salary
Plus
Bonus

Salary Plus
Bonus Plus
Commission

Sales Force Compensation is discussed in detail in Tutorial 5.

8. SALES FORCE MANAGEMENT AND MOTIVATION

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STEP 6: SALES FORCE MANAGEMENT AND MOTIVATION

The next step in the Sales Force Management And Motivation Process requires evaluation of target markets selected by the company and Design Of Sales Territories.

The design of sales territories entails evaluation of several Sales Territory Planning Factors illustrated next.

SALES TERRITORY PLANNING FACTORS

Type Of
 Account

Marketing
Objectives

Workload
Allocation

Time
Allocation

Sales
Strategies

The selection and design of sales territories offers a number of options to the business owner and the sales manager. These options are based on four different Types Of Sales Territories presented below.

TYPES OF SALES TERRITORIES

     
Geographically-
Based
Sales
Territory
  Product-
Based
Sales
Territory
  Customer-
Based
Sales
Territory
  Combined
Sales
Territory
 

IMPORTANCE OF THE SALES TERRITORIES DESIGN

The design of sales territories is particularly significant because it will enable the business owner and the sales manager to develop a cost-effective method of servicing all target markets with the existing sales force.

Sales Force Management And Motivation is discussed in detail in Tutorial 5.

9. SALES FORCE ALLOCATION AND SALES QUOTAS

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STEP 7: SALES FORCE ALLOCATION AND SALES QUOTAS

An effective implementation of the Sales Force Management And Motivation process entails sub-dividing all sales territories in the most suitable manner and allocating them to individual sales people. The allocation of sales people to various sales territories is based upon specific Sales Force Allocation Factors outlined below.

SALES FORCE ALLOCATION FACTORS

1.

Number of sales people in the company at present.

2.

Past performance of each sales person.

3.

Company's specific needs and opportunities in the marketplace.

4.

Market potential in a particular sales territory.

5.

Experience and preferences of each sales person.

 

SALES QUOTAS

Subsequent to the sales force allocation, the sales manager must prepare Sales Quotas, or Sales Targets, in accordance with the company's sales budget and allocate them to each member of the sales team.

Sales people, in turn, will be expected to use their respective sales quotas in planning individual activities, designed to meet the company's overall sales objectives.

Sales Force Allocation and Sales Quotas are discussed in detail in Tutorial 5.

10. SALES FORCE PERFORMANCE EVALUATION AND CONTROL

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STEP 8: SALES FORCE PERFORMANCE EVALUATION AND CONTROL

Sales Force Performance Evaluation represents another important element in the sales management process. The sales manager is required to analyze and evaluate performance of the sales force, the level of sales achieved by various product or service groups in the marketplace, and the volume of sales generated by various customers.

Sales force performance evaluation entails a number of tasks outlined below.

SALES PERFORMANCE EVALUATION TASKS

1.

Preparing monthly sales reports.

2.

Analyzing sales performance results.

3.

Evaluating performance of individual sales people.

4.

Comparing actual results with the planned objectives and determining variances.

5.

Taking corrective action and adjusting the sales planning process.

 

SALES PERFORMANCE CONTROL

Finally, the Sales Performance Control will enable the sales manager to maintain constant control over sales force performance to ensure that customers receive all required products and services on time and in an acceptable condition.

Sales Performance Evaluation And Control is discussed in detail in Tutorial 5.

11. WHY IS SALES MANAGEMENT SO IMPORTANT?

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THE IMPORTANCE OF THE SALES MANAGEMENT PROCESS

The importance of the Sales Management Process cannot be underestimated. After all, with deterioration of sales, the company may potentially undergo the following cycle as illustrated below.

CONSEQUENCES OF NOT HAVING SALES

1.

No customers...

2.

No revenues....

3.

No profits...

4.

No continuity of the business cycle...

5.

No money to pay employees...

6.

No employees...

7.

No business...

8.

No company...

9.

No income...

10.

No money...

11.

Unhappy wife...

12.

Expensive divorce attorney...

13.

Boring therapy sessions...

14.

Hitting rock bottom...

15.

Discovering the Lean Business 2100 Management Program...

16.

Turning around in a positive direction...

17.

Starting new business and learning from the past experience...

18.

Making lots of sales....again...and again...

 

IMPORTANCE OF A CONTINUOUS SALES MANAGEMENT PROCESS

It is essential to ensure that the Sales Management Process is established, planned, and controlled in a professional manner to secure the success and continuity of the company.

All information pertaining to company sales performance must be collated on a continuous basis and used as feedback for future sales plans and budgets. This feedback will help business owners and sales managers to adjust the planning and budgeting process and ensure maximum flexibility of operational activities.

In addition, this information is instrumental in reviewing and modifying the overall marketing strategy, thus contributing to improved future organizational performance.

12. FOR SERIOUS BUSINESS OWNERS ONLY

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ARE YOU SERIOUS ABOUT YOUR BUSINESS TODAY?

Reprinted with permission.

13. THE LATEST INFORMATION ONLINE

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WOULD YOU LIKE TO LEARN MORE?

Would you like to learn how to improve your personal business management knowledge and maximize your business performance through Lean Business Club?

When you are ready:

1.

Learn about the Membership Benefits, join Lean Business Club, and never feel lonely at the top again.

2.

Complete the Membership Form, or the Student Membership Form, and receive your free first-year membership.

3.

Save up to 75% off the regular subscription rate for complete access to the Lean Business 2100 Management Program online.

If you are U.S. Veteran, your membership in Lean Business Club and complete access to the Lean Business 2100 Management Program online will be available to you free of charge for an unlimited period.

 

LESSON FOR TODAY:
Make Your Customers Number One -
And They Will Make You Number One!

Joe Griffith