Work based assignment: Sales force management - Case study of a medium sized company operating in the German market
Work based assignment:
Sales force management
- Case study of a medium sized company
operating in the German market -
(Word-count: 10143 words)
Author : Matthias Schneider
Program : Diploma in Management Studies
Year of Program : 2003/2004
Table of Contents
Summary 4
.1 Terms of reference 4
.2 Summary 4
2 Introduction 5
2.1 Objectives, scope and structure of the report 5
2.2 Background of Studies 6
3 Relevant information and academic theories 6
3.1 Management 6
3.1.1 Definition of management and leadership 6
3.1.2 Human resource management 8
3.1.3 Management by objectives, Performance management and motivational theories 8
3.2 Marketing 10
3.2.1 Definition and development 10
3.2.2 Channels of distribution 12
3.3 Primary Research - The telephone interview 13
3.3.1 Objective and Method 13
3.3.2 Covering Letter (email) and questionnaire 15
3.3.3 Results and Summary 15
4 Analysis of the current situation of the company under review 17
4.1 Sales strategy, sales organisation and economic situation 17
4.1.1 The sales strategy 17
4.1.2 The organisation and structure of the sales force 18
4.1.3 The economic situation of the relevant market 19
4.2 Planning of the Sales organisation 22
4.2.1 The Planning Process 22
4.2.2 Planning of sales figures and activities 24
4.2.3 Budgeting of the sales organisation 24
4.3 Organisation 26
4.3.1 Recruitment and Training 26
4.3.2 Management and organisation of the selling process 27
4.3.3 IT-support of the selling process 29
4.4 Controlling, Monitoring and perfomance management 30
5 Conclusions and Recommendations 32
5.1 Internal and external strategic issues 32
5.1.1 Internal issues, business ethic and corporate responsibility 32
5.1.2 Environmental issues and environmental management 33
5.2 The Management process 35
5.2.1 Planning, budgeting and organisation 35
5.2.2 Controlling, Monitoring and performance management 37
5.2.3 IT support for the selling and management process 42
5.3 The importance of management and leadership in a sales organisation 43
6 Appendices 45
7 Bibliography 45
Summary
.1 Terms of reference
.2 Summary
The Subject of the following report is management of a sales force with focus on the management practices and available resources. The investigation is carried out on a medium sized company, located in Germany and operating in the construction sector. A short introduction of the company under review is given in the following chapter.
At the beginning of chapter 2 relevant information for the understanding of the Report is investigated and described. Furthermore primary research should give more information about the company and their practises concerning sales management. The main part is dealing firstly with the strategy of the sales organisation to sell their product via an exclusive mix between direct selling and franchise organisation and the geographical and hierarchical structure of the sales organisation. Followed by an analysis of the economic situation in Germany and the industry the company is operating in. The next chapter is analysing the management process and describes the management functions planning, organising and controlling in depth. As it turned out, the IT support is from extraordinary importance and is a crucial part of the dissatisfaction in the sales organisation.
As described in the analysis of the Report, dramatic changes took place in the last ten years and the company has already gone through a lot of changes but there are still a lot of opportunities to improve the performance of the sales force and the management. The recommendations and conclusions from my point of view are given in chapter 5. I am describing strategic issues the organisation faces now and in the short-term future before I give conclusions and recommendations regarding the management process in depth and finally I come back to the issue "management and leadership".
2 Introduction
2.1 Objectives, scope and structure of the report
A team of stars does not guarantee a star team. CHELSEA spent Roman Abramovich's first 111 million GBP on star players. But are stars really all that a winning team needs or does it depend on the companies' long-term performance, even survival, more on the unsung contributions of the "B players" than on star performers?1 In the article of The Times David Bolchover is discussing what the most important factor is to achieve success in management. Management especially sales management must engage the traditional management tasks of planning, implementing, and controlling activities to accomplish the organisation's goals. In addition, the sales manager has to hire, train, assign, motivate, evaluate, coach the sales force and has to use leadership skills to be successful. Another aspect a sales manager has to deal with, is the firm's politic and economic situation, competition and strategy.
Therefore the focus of this report lies on the traditional management task, how the company recruits, selects, trains, organises, supervises, motivates and evaluates their sales force. Furthermore it is a critical review of a company's sales strategy within a changing environment and the importance of leadership.
The objective is to give recommendations about the improvement of the sales force management but as well to improve the sales performance itself.
Regarding the structure of the Report I am going to give a short overview about the company which is covered in the following chapter 2.2 "Background of Studies" before I examine the relevant information in chapter 3 for a better understanding of the Report. In conformity with the objective of the report I am going to describe the sales strategy and structure in chapter 4 before I am analysing the economic situation in Germany and the industry the company is operating in, followed by the analysis of the existing selling and management process. In chapter 5 recommendations and conclusions are given about improvement of processes and systems.
2.2 Background of Studies
3 Relevant information and academic theories
3.1 Management
3.1.1 Definition of management and leadership
This essay, which deals with the complex subject of managing a Sales force does combine many different areas like management, in specific human resource management, marketing and finance. Due to the limited volume of this report I am only going to describe the most important information in context to the topic.
"Managing" or "Management" is certainly one of the most used terms in business with innumerable definitions and variations. One more traditional approach understands management as "the process of planning, organising, leading and controlling the efforts of organisation members and of using all organisational resources to achieve stated organisational goals"2 Fayol defined Management in terms of five functions:
> Planning - a course of action for the organisation to meet its goals
> Organising - to ensure the availability and co-ordination of the material and human resources of the organisation to put the plans into effect
> Commanding - to provide direction to employees
> Co-ordinating - to ensure that the resources and activities of the organisation work together to achieve the desired goals
> Controlling - to monitor the plans and ensure they are being achieved.3
"Leadership is different from management, but not for the reasons most people think. Leadership isn't mystical and mysterious. It has nothing to do with having "charisma" or other exotic personality traits. It is not the province of a chosen few. Nor is leadership necessarily better than management or a replacement for it. Rather, leadership and management are two distinctive and complementary systems of action. Each has its own function and characteristic activities. Both are necessary for success in an increasingly complex and volatile business environment."4 In my research I found an interesting article by John P. Kotter published in the Harvard Business Review about the difference between Management and Leadership and he defines that Management is about coping with complexity. Companies manage complexity first by planning and budgeting - setting targets or goals for the future (typically for the next month or year), establishing detailed steps for achieving those targets, and then allocating resources to accomplish those plans. Finally, management ensures plan accomplishment by controlling and problem solving. Leadership, by contrast, is about coping with emotional intelligence, vision and change. Achieving a vision requires motivating and inspiring - keeping people moving in the right direction, despite major obstacles to change, by appealing to basic but often untapped human needs, values, and emotions. 5
3.1.2 Human resource management
The human resource management (HRM) practices are crucial to develop sustainable competitive advantages, especially in Sales. Therefore a short explanation of the subject is given.
Although the term "human resource management" is only fifteen years old, there are various definitions of this term. As basis for this Report I chose the definition from Bratton, John/Gold, Jeffrey who see HRM as "A part of management process that specialises in the management of people in work organisations. Their definition emphasises that employees are critical to achieving sustainable competitive advantage, that human resource practices need to be integrated with the corporate strategy, and that human resource specialists help organisational controllers."6
Over time, two main directions came through: on the one hand there are believers in the "soft" version of HRM, which emphasizes on the importance of high commitment, workplace learning and enlightened leadership. On the other hand there are believers in the "hard" version of HRM, which emphasises on the calculation, quantitative and strategic management aspects of managing the workforce in a rational way.
3.1.3 Management by objectives, Performance management and motivational theories
"For decades the difficulty of motivating salespeople has been frustrating sales and marketing managers. (...) The more successful sales executives recognize that motivation is largely a result of a combination of effective recruiting practices, sensible pay plans, and good management."7 Traditional motivation theories like, Maslow, A. H 'Pyramid of Needs'8 or McGregor, D.: 'Theory X and Theory Y' 9 allow to understand basic concepts of motivation, but provide only limited answers to verify issues of performance improvement in today's business life. A recently published articel in the Harvard business review quotes: "Good leaders motivate people in a variety of ways. First, they always articulate the organization's vision in a manner that stresses the values of the audience they are addressing. This makes the work important to those individuals. Leaders also regularly involve people in deciding how to achieve the organization's vision (or the part most relevant to a particular individual). This gives people a sense of control. Another important motivational technique is to support employee efforts to realize the vision by providing coaching, feedback, and role modeling, thereby helping people grow professionally and enhancing their self-esteem. Finally, good leaders recognize and reward success, which not only gives people a sense of accomplishment but also makes them feel like they belong to an organization that cares about them. When all this is done, the work itself becomes intrinsically motivating."10
HRM uses various technologies to direct employees' behaviour towards objectives and tasks that deliver approved organisational performance. Many organisations try to frame these 'levers' within an overall performance management system, and attach incentives and rewards to the achievement of objectives and targets within this.11 These systems are e.g. based on management by objectives. Management by objectives (MBO) is seen as "A process whereby the superior and the subordinate managers of an organisation jointly identify its common goals, define each individual's major areas of responsibility in terms of the result expected of him and use this measures as guides for operating the unit and assessing the contribution of each of its members.12
The underlying basing of a system of MBO is:
> The setting of objectives and targets;
> Participation by individual managers in agreeing unit objectives and criteria of performance; and
> The continual review and appraisal of results.13
Bratton / Gold uses the following definition: A performance appraisal is an "analysis of an employee's capabilities and potential drawn from assessment data of past and current work behaviour and performance allowing decisions to be made in relation to propose - i.e. Human Resource Development needs."14
"The reason for performance review given in a survey by Phil Long (1986) are to:
> Assess training and development needs
> Help improve current performance
> Review past performance
> Assess future potential and promotability
> Assist career planning decisions set performance objectives
> Assess increases or new level in salary"15
3.2 Marketing
3.2.1 Definition and development
The significance of marketing, especially the marketing mix, for the daily business of the sales force has encouraged me to have a short look at the subject as the sales team is in direct contact with the customer and has to offer a product at a given price every day.
The term "marketing" is certainly a business term with the most and various definitions. As basis for this WBA I choose the definition of Kotler. He is one of the first people to recognise that marketing is a central business function. His major contribution to marketing and marketing management is to have analysed and defined the basic concepts and functions involved in the discipline.16 He sees Marketing as "a social and managerial process by which individuals and groups obtain what they need and want through creating, offering, and exchanging products of value with others".17 Dibb, Simking, Pride and Ferrell define Marketing as follows: Marketing consists of individual and organisational activities that facilitate and expedite satisfying exchange relationship in a dynamic environment through the creation, distribution, promotion and pricing of goods, services and ideas."18 However, they are indicating the following basic priorities of marketing19:
> Satisfying customers
> Identifying / maximising marketing opportunities
> Targeting the "right" customers
> Facilitating exchange relationships
> Staying ahead in dynamic environments
> Endeavoring to beat or pre-empt competitors
> Utilising resources / assets effectively
> Increasing market share
> Enhancing profitability
As mentioned above the marketing mix as well has an impact on the sales force. Kotler, Armstrong, Saunders and Wong define marketing mix as the "set of controllable tactical marketing tools that the firm plans to produce response it wants in the target market. [...] The many possibilities gather into four groups of variables known as the 'four Ps': product, price, place and promotion."20
3.2.2 Channels of distribution
"A channel of distribution is a group of individuals and organisations that direct the flow of products from producers to customers. Channels of Distribution make the products available at the right time, in the right place and in the right quantity.21 "Traditional channel strategies proceed directly from market segmentation. A company that is targeting a brand at, for instance, suburban women in their thirties, will rely on a certain channel to deliver its products and related service and sales activities. Another company will choose a different channel to appeal to affluent retirees. One ...
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3.2.2 Channels of distribution
"A channel of distribution is a group of individuals and organisations that direct the flow of products from producers to customers. Channels of Distribution make the products available at the right time, in the right place and in the right quantity.21 "Traditional channel strategies proceed directly from market segmentation. A company that is targeting a brand at, for instance, suburban women in their thirties, will rely on a certain channel to deliver its products and related service and sales activities. Another company will choose a different channel to appeal to affluent retirees. One common assumption is that people who share demographic characteristics tend to shop and buy in the same way, through the same, limited channels."22
Concerning the report two distribution channels are of extraordinary interest: direct selling and franchising. The economist defines direct selling as "the selling of products or services directly to customers without the use of intermediaries, such as wholesalers, retailers, or brokers. Methods of direct selling include mail order catalogues, door-to-door and telephone sales, and direct selling has increased with the growth of the Internet, which enables producers to make direct contact with potential customers.23
Franchising is "a contractual association between a manufacturer, wholesaler or service organisation (a franchiser) and independent businesspeople (franchisees) who buy the right to own and operate one or more units in the franchise system."24
Both distribution channels use strongly the methods of personal selling which is defined by Dibb/Simking/Pride/Ferrell as "Selling that involves informing customers and persuading them to purchase products through personal communication in an exchange situation."25
3.3 Primary Research - The telephone interview
3.3.1 Objective and Method
There are always many informal subjective, critical remarks regarding sales strategy and management style of the sales force made by company staff. As a matter of fact this information needs to be transformed into a more general shape. The task is to gather information, which has not been examined before and cannot be obtained from secondary sources such as books, newspapers and Internet sources, in this case primary research becomes necessary. As a result the objectives of this primary research are to receive an overview about the following subjects:
> The market situation
> The organisational strategy
> The selling process incl. electronic support
> The performance measurement system and appraisal
> Planning and reporting
> Ideas for improvement
"There are four principal methods of information gathering: face to face interview, telephone interview, mail survey and, sometimes forgotten, observation. There are no general rules which say that, in all cases, one method gives better coverage or better quality data while another method is cheaper or quicker. The effectiveness of each depends on several factors. The researcher has to identify the issues in each case, weight the pros and cons and then make a choice."26
"For management research to progress, it is important for researchers to assess the methods they employ. The impact of management studies depends upon the appropriateness and rigor of the research methods chosen. Design choices about instrumentation, data analysis, and construct validation, and more may affect the types of conclusions that are drawn."27
I chose the telephone interview as my method of primary research because of the advantages listed below:
> Interviewer's effect on the interview itself is reduced, though not eliminated
> Speedier turnaround
> Less costly, compared to other interview techniques like than face-to-face
> Computer aided interviewing improves quality and reduces turnaround time.28
In telephone interviews "the interviewer will contact people via a telephone call and ask the questions over the phone. [...] Once again, the interviewers will record the answers to the questions as they ask them over the phone"29. The respondents are going to be the six area sales managers. To give the interviewees the possibility to prepare for the interview and think about answers, I will call them first to check their willingness to take part and then make an appointment for the telephone interview. Afterwards, I will send them the questionnaires in advance via email. Due to the objective of the questionnaire, in essence to ask for their opinions, the questions will be of an open rather than closed nature. I will keep the questionnaire short to maintain interest and co-operation from the interviewees.
Regarding the evaluation of the answers it would not make sense to analyse frequencies, averages and variability, due to the actual objective and the small number of respondents. Therefore it is not necessary to prepare statistical tables and figures and evaluate the results according to statistical methods. It is more important to collate and summarise the outcome and implement it in the report.
3.3.2 Covering Letter (email) and questionnaire
3.3.3 Results and Summary
Five of the six area sales manager have been interviewed via telephone, oriented at a questionnaire (compare Appendix 1). The questionnaire had 4 parts:
I. Market situation
II. Sales strategy and process
III. Human resource management
IV. Planning and reporting
Regarding the first section "Market Situation" the interviewees assess united that the current market situation is still difficult and tense in the sector. There is still a price war and customer resistance. Whereby the question for expectations regarding the development of the actual market situation gave different results. Two interviewees said there will be no change, the other three interviewees said they expect a growth but only a minimal one, one interviewee expects as well more purchasing power and said it is up to the sales people to have success in every economic situation. Again united came the internet as a crucial change in customer behaviour. They all said that the internet will be more important in the future. One of the interviewees mentioned customer resistance again and another remarked the knowledge of customers. They are more informed and want to know more about technical details as 10 years ago.
At the beginning of the second part "Sales strategy and selling process" the interviewees described the sales strategy with the following adjectives: exclusive, high-price, direct selling, market and customer oriented, flexible. The question "if they had the chance to change the strategy, what would it be" did not bring interesting results. Three of them had no ideas and one of them mentioned again the internet. He said that the company should develop the homepage to give prospects the possibility to purchase via internet and furthermore he said that marketing should be more aggressive. The fifth interviewee remarked the selection strategy and that there are no potential high performers on the market and if there were, there would be no chance to get them.
Regarding the selling process the strengths were described as structured, organised and customer oriented and the weaknesses were no proper IT support, too dependent on the sales people, inflexible, bureaucratic. All of the interviewees are dissatisfied with the current IT support and defined the most important requirements as the availability of flexible reports to get an overview of how the sales force is spending their time, interfaces to Word to generate mailings and customer information, means to see the outstanding debts and the profitability of every customer.
The third part is dealing with recruitment, training and performance measurement. Firstly they should briefly describe these processes. I have used this information in the accessory part in chapter 3, therefore only a short description of the results: It turned out that the recruitment process is traditional via a job advertisement to assessment centres and job interviews and that there is a good support from the headquarter including organisation and pre selection. The training is very good, a lot of training is offered for different tasks and experiences. It turned out that for performance measurement standardised budget statements and sales reports are available but no further system is implemented. The interviewees use this information to check if there is a good or bad development regarding the forecast and if there is a gap, they meet the sales team to discuss the issue.
Finally in the part "Planning and reporting" I asked the interviewees to describe the structure and the process in place. This is as well a more traditional approach beginning with a sales meeting. It is up to the CEO to define the overall objectives for the following year before every sales manager meets their teams to fix the forecast regarding sales units, turnover and budget for the following year. Once this is fixed, several rounds of give-and-take take place until the forecast is finished. The next question, with the aim to find out more about the reporting structure led to the result that the sales managers receive a sales report with actual turnover and units in comparison to the previous year. The area sales manager works with the forecast and a financial budget statement, with information about the expenses, costs, profit and financial results; comparing it to the figures of the previous year. The result of the final question about further improvements for the planning and budgeting process showed, that currently an excel sheet is in use for the planning and budgeting and this is not user friendly and very time consuming. The sales managers said they would like to have a proper software which is calculating and cumulating all the figures automatically so not every single figure would have to be calculated manually. Regarding the reports, they are looking forward to have a system where they can get more flexible information. Flexible information is necessary as requirements of the sales managers are different, i.e. one of them needs the figure of turnover of one sales representative to manage him, another would use the number of outbound calls per day to manage his sales representative.
4 Analysis of the current situation of the company under review
4.1 Sales strategy, sales organisation and economic situation
4.1.1 The sales strategy
As already mentioned the company under review has been established for more than three decades in the construction sector and is based in Germany. The company's strategy is selling its high-tier products (doors and windows) via a direct selling30 and franchising structure that operates via more than 80 branches in the German speaking market.
The company's founders vision 30 years ago was to deliver an exclusive product with a premium service to high profile customers. Quality, service and security are still terms which determine the strategy of the company. Of course, changes took place over the years. The two main factors in the past, which are responsible for the company's recent changes in strategy especially in the sales division were: Firstly, there has been a change in leadership in 1996, which is affecting the company as a whole. The company's founder led the company in a very patriarchal and product oriented way for about 25 years, which had a very significant impact on marketing and human resources. After the change in leadership that introduced the founder's son as new CEO, the management style was changed, too. The new manager is trying to implement a new management philosophy. He is a believer in a form of management by objectives.
Additionally, as mentioned later, the market and competitor situation have changed dramatically. A decreasing market volume led to a decreasing turnover and profit for the company. These factors resulted in a more cost oriented thinking, especially for the sales department: Expensive marketing activities were reduced and more personal selling activities were expected in combination with a more performance oriented payment. Details are described in the latter part of the report.
These influences led to a current, more emergent strategy to maintain and extend the market leadership via an increasing market share in the following years to compensate the loss of turnover resulting from a decreasing market volume in the last years.
4.1.2 The organisation and structure of the sales force
Regarding the sales department there are two sales systems in use: Self-employed entrepreneurs in form of a franchise-system and sales branches owned by the company. The structure of the sales organisation defines the sales manager positioned at the top of the organization; followed by 6 areas in Germany who are led via area sales managers. They have full personal and financial responsibility for 6 to 10 branches. Each branch employs sales representatives and sales assistants. The main task of the sales representative is to sell the product range directly to the customer, person-to-person, away from regional sales branches. Products are sold primarily via in-home product demonstrations, parties and one-to-one selling. The sales assistants are responsible for the administration, the customer advisory in the branches and for telemarketing.
The company uses a territorial sales structure, which means that there is the sales manager, who is responsible for the whole sales force of the company, currently acting in Germany and Switzerland. The country again is divided into six areas or districts which consists of several branches. The area manager has the full financial and personal responsibility for his area. The branches are located in the outskirts of cities with a minimum size of usually 150.000 habitants. Depending on the market potential in the catchment area which is examined in a market analysis, a branch employs up to four sales representatives. The branches are owned by the company itself or by a franchisee. Every sales representative or franchisee has his own exclusive sales area, it is in his responsibility to develop business in this area.
4.1.3 The economic situation of the relevant market
Due to the fact that the company is generating 95% of the turnover in Germany, some economic indicators for the German market are implemented below. They display the development from the past up to the current situation in Germany:
Regarding the future prospects, the general economic trend in Germany (compare figure 2: Gross Domestic Product) is recovering and there should be a 1,5% growth in 2004. Certainly there is a correlation between a recovering general economic trend in Germany (compare figure 2: Gross Domestic Product) and the relevant market of the company (compare figure 7: Construction Index). Until now, the Inflation (compare figure 5: Consumer Price Index) and the unemployment rate (compare figure 3: Unemployment Rate) have not reacted on this positive trend of the general economic trend. Whereby the decreasing interest rates (compare Figure 4: Interest Rates), which is a important indicator for the construction sector had a positive impact on the construction sector since 2003 (see figures below).
In the construction sector, where the examined company is acting, the market volume decreased dramatically since 1999 until 2003. The newspapers published bad news on a daily basis, well known companies in the construction sector had to make employees redundant or even went into liquidation. The employment figures alone in the windows sector decreased from 83.000 people in 1993 to 37.000 in 2002. The sector faced an over-capacity of 39 percent in 2003 and therefore price pressure is extremely high.31
4.2 Planning of the Sales organisation
4.2.1 The Planning Process
Due to the report's focus on management I structured this analysis by the traditional approach of this term including the functions planning, organising and controlling.
To kick off the planning the company is refocusing in a yearly meeting in October with the members of the board the company the current year's performance and is discussing and defining the objectives for the following year. After the yearly meeting all managing directors take a look at their relevant divisional goals and meet their team. This happens in form of a sales meeting with all area sales managers to discuss the company's goal for the next year and the meaning for the sales division. The objectives will be broken down and discussed. For the sales managers there are two principal factors that have to be taken into consideration: Firstly, in a more strategic view due to the fact that the sales manager's responsibility is to manage an efficient and productive sales team ensuring sales volume, it is crucial e.g. to look into areas which have a bad market usage and could be developed with an additional sales representative. Another point to look at are employees with a weak performance, that has not been enhanced over the past and has been monitored in appraisals. Is there a need to replace them in mid term? Are people in my team that aim for change, either internally or externally? Secondly, there is the yearly planning and budgeting process, this means to look at sales figures, sales activities and budgets within the existing sales team.
The rough planning and budgeting process is displayed in the diagram below:
This process is understood by the company as an interactive process as figures and budgets are negotiated with the sales manager and the CEO and coordinated with other areas and divisions as displayed above.
4.2.2
Planning of sales figures and activities
The planning of the sales figures with the sales team is a central and difficult function of a sales manager due to the fact that the motivation really depends on this plan. If the plan is chosen too high or too low, it could lead to a demoralisation of the sales team or the sales representative respectively. The aim of this meeting is to determine the quantity of the sales units and turnover in different product divisions and to discuss the supporting sales activities (trade fairs, advertisements, ...) for the following year. These discussions are based on figures of the current and previous year like sales reports or activity reports (i.e. outcome of trade fairs). Once the sales figures and the regional activities are determined within the sales teams, the area sales manager has to value the quantity with an average selling price to determine the yearly planned turnover.
4.2.3 Budgeting of the sales organisation
After determining the planned sales figures it is important to plan the financial performance of the sales division. Therefore and for a better understanding I am going to describe the different budgets32 (Marketing, Personnel, ...) of a sales team on branch level.
4.2.3.1 Marketing budget
Coming from the planning of the sales figures and activities, it is necessary to monetarily evaluate these activities within a financial budget. Regional marketing activities are:
> Trade fairs
> Open days
> Advertising in regional newspapers
> Direct mailings
> Distribution of leaflets
4.2.3.2 Personnel budget
The personnel budget consists of the salary of the sales assistants, temporary workers and the sales representative; whereby his commission is calculated on base of the already planed turnover.
4.2.3.3 Administrative budget and other expenditures
In this budget the following positions are gathered:
> Leasing (cars, IT)
> Rent (showroom, stock)
> Insurance
> Telephone, fax
> Etc.
4.2.3.4
Overall budget statement of financial performance
All these positions lead to a budget statement of financial performance for the next year.
This overall budget statement is the basis for further discussions and negotiations with the CEO and sales manager. If the pre-tax operating result is negative, the sales team have to meet again with the area sales manager to discuss the possibility to improve the sales performance or to cut costs. Finally, in December of the current year, the budget should be accepted and adopted.
4.3 Organisation
4.3.1 Recruitment and Training
To recruit, the company uses the traditional way via employment agencies or placing an advertisement in the local papers. After collecting all the applications the personal department is doing the first selection and is passing the most appropriate applications on to the area sales manager. After that, every sales manager is initiating a telephone interview before the applicant is invited to a job interview. Four-Eyes-Principle at the job interview and the following assessment centres are established to make sure that the right employee with the right attitude is put on the right job. The chosen employees have to undergo certain training and coaching sessions before they get in touch with the client. To assure quality during this crucial time of the first contact with a client, training manuals, guidelines and ongoing coaching support the sales people in the field. For the more experienced sales people the training department established special training with the aim to improve their performance and motivate them in their daily work. Training like Sales Techniques II and III (this is the continuation of the basis training), Telephone Marketing for Professionals, Professional Technical Skills, Time Management, etc. are offered.
A training manager, who is member of staff, coordinates upcoming training requests with 4-5 self-employed trainers, who are contracted for a certain number of days per year.
4.3.2 Management and organisation of the selling process
Once the employees are confident with their roles after having training, they are able to focus on the selling process, which follows a certain routine. Milestones for the selling process are determined but it is one of the main tasks of the sales management to optimise it concerning efficiency and effectiveness. During this process the area sales manager and the company's training department support the sales team via ongoing coaching. The selling process is organised as follows:
4.3.2.1 Regional Marketing Activities
As the marketing activities have already been theoretically determined in the planning process, it is now crucial to implement, realise and organise them in harmony with the regional target market and the given marketing budget. It is the sales managers' responsibility to find the best mix of personal selling activities, like acquisition, trade fairs, ... or other promotional activities, like advertising, direct marketing, sponsorship, sales promotion, corporate identity, personal selling and public relations.
To manage the regional marketing activities monthly meetings of the sales team in coordination with the area sales manager take place. In these meetings responsibilities are discussed and handed over to the members of the team and to-do-lists are created. Of course a record of all tasks is written to be able to check the actual stage of every project and task.
4.3.2.2 Approach, Qualifying and Prospecting
Regional and national Marketing activities lead to prospects that are interested in the product. To follow up these contacts efficiently, addresses are now distributed to the responsible branch via data transmission, linked to the equivalent postal code.
After the addresses are won there is an interactive process between the personal contact from the sales representative and the telephone marketing activities from the sales assistant.
The prospects which are won through media activities without any personal contact should be contacted by a sales person 2 to 3 days after they received their information package. In this contact it is important to find out in which particular product the prospect is interested in and when the time of requirement is. When the time of requirement is in the next three months the target is to make an appointment for an advise at the customers home or in the regional show room. Is the time of requirement in 6 months for example, because it is a new building which does not exist yet the staff meeting the person should push the date forward further 3 months and then contact the person again.
Prospects gained through personal contact on trade fairs, acquisition or in the show room are questioned directly for the time of requirement. It is very important to give the prospect the right information at the correct time. During the whole process prospects are kept informed about changes in the product range and special offers via mailings.
This part of the selling process is supported by an existing database, which helps organising the administration of addresses. Unfortunately this database, which is described in more detail in the following chapter, does not support the management of the data, i.e. no statistics can be drawn out of it, like sales calls per day. Therefore the management has no means to get an overview of how the sales team spend their time.
4.3.2.3 Presentation, Demonstration, Agreement and Closing
Once an appointment for advise is agreed, 80% of these meetings take place at the prospect's house. During the appointment sales techniques and personality are key factors to finally sell the product.
This selling process results in an agreement with the customer in the specification of a product (measurement, colour, style...). This specification, which is literally a form, is the interface to the manufacturing department.
Again, as already mentioned in the previous chapter, the existing database does provide possibilities to combine prospects with appointments of advise or presentations but it does not provide information about success or related figures.
4.3.2.4 After sales and maintenance
After the product is installed, the sales representative visits the customer to make sure, that the customer is satisfied with the product and the service. Furthermore, the sales representative visits the customer on a bi-yearly basis, to assure long-term quality of the product by maintenance.
If there are any complaints a defined process, following the customer service guidelines, takes place. This process basically involves a written record of the complaint, which is forwarded to the headquarters, where a solution will be found and then will be forwarded to the customer.
To manage complaints the company uses reporting forms that have to be filled in manually by the sales representative and then have to be forwarded to the headquarter where they are handled. The issue that occurs here is, that the management does not receive reliable information about pending complaints, which would be very important regarding customer satisfaction and outstanding claims. To learn about pending complaints is a proactive approach of the management.
4.3.3 IT-support of the selling process
As the interview has shown above, there is a certain dissatisfaction regarding the available software. This is a reason for me to take a closer look at the matter.
The Partner Software was implemented in 1987 and is a customer relationship management software which is a special, tailored software for the company. Primarily it is an address database which is hosted at the headquarters' IT department and every night data transmission takes place: data derived out of national marketing activities are transferred to the responsible branch to follow up personal contacts and the other way round. A further task of the software is to optimise the work of the sales team. It is possible to store dates for every customer for the different steps of the sales process.
Unfortunately the Software does not support the management process yet, as already mentioned above. It is not possible to plan and report sales calls, reporting of expenses, entering orders, checking inventory and order status, generate direct mails, customising letters or envelopes. More about this in chapter 5: Recommendations.
4.4 Controlling, Monitoring and perfomance management
As the last task of the management process, after planning and organising, controlling is implemented to monitor the plans, reveal potential for improvement and ensure the plans are being achieved. Currently sales managers receive the following information to handle the task of controlling and monitoring:
I. Effectiveness control statements of Marketing activities
To receive information about success of marketing activities every sales team have the duty to provide the effectiveness control statements to display the costs, won prospects, sold units, generated turnover and finally profit.
These statements are used for future managerial decisions regarding marketing budgets and for necessary improvements, i.e. if a trade fair did not deliver the expected outcome, the manager has the option to compare it to the past or the company's average and to interpret the result, which could have different reasons, like motivation of the sales force, decreasing quality of the trade fair,...
II. Sales Report
The sales report looks like the following:
III. Budget statement
The sales report does not show the financial performance of the sales organsisation. This information can be found in the budget statement.
The sales report and the budget statement are provided on a monthly basis. It is now the responsibility of each single manager to cope with the bulk of information on paper: it is very time consuming, as already shown in the interview, to analyse the data and to interpret it. Due to the lack of ratios and indicators it is very hard for the single manager to bring the information on a broader level to allow a comparison on company level.
Furthermore the given information is the basis for the performance appraisals of the sales force, but there are no set time frames when appraisals have to be done; there are inconsistent standards how to carry out the appraisal itself and how to rate the employee's performance.
This lack of structure and inconsistency has, as shown in the interview, led to discussions between the management and front line staff about the objectivity, Insufficient time spent on evaluation and rising tension amongst employees, as no transparent rating system is in use.
5 Conclusions and Recommendations
5.1 Internal and external strategic issues
As mentioned at the beginning of the Report, dramatic changes took place in the last ten years and the company has already gone through a lot of changes but there are still a lot of opportunities to improve the performance of the sales force and the management. In the beginning of chapter 5 I am going to describe my point of view regarding strategic issues the organisation faces now and in the short-term future before I give conclusions and recommendations regarding the management process in depth and finally I come back to the issue management and leadership. Above all, the limited volume of the Report and the focus on the management process led to the situation that the recommendations and conclusions for the strategic issues cannot be examined in detail and further investigations have to be carried out, like i.e. development of an international expansions strategy.
5.1.1 Internal issues, business ethic and corporate responsibility
Unfortunately, as described above, the financial situation of the company is very tense due to environmental influences and potentially wrong decisions in the past. From my point of view there are not many options for the company: Massive changes have to be carried out as well because of the company' responsibility for their employees and the relationship with investors and financial institutions.
Reflecting the research and the analysis of this report some questions are inevitable:
> Is it still reasonable to sell this kind of products (doors) mainly via a direct selling organisation with own branches, compared to the competition that chose an indirect selling organisation?
> Is their still enough purchasing power in the high price niche market for doors the company covers?
> Are there possibilities to broaden (from doors only to i.e. burglary alarms, high quality mail boxes, winter gardens, etc.) the product portfolio to generate additional profit in the sales organisation?
> The high staff turnover especially in the sales force and in sales management is a strategic issue as well. Of course one reason could be the recruitment process and training but, as shown in the interview, another reason is the strict interpretation of management by objectives. Very often the sales team has not enough time to develop their business. The strict measurement via sales figures from the very beginning could result in too much pressure on the sales force and could end in notice.
Certainly a dramatic change of the sales strategy has to be examined thoroughly and cannot be covered in this report due to its focus on the management process and volume. Further investigations have to be done in more detail.
5.1.2 Environmental issues and environmental management
From my point of view there are some environmental issues the sales force and especially the sales management has to deal with. This chapter should display the opportunities and threats for the sales division oriented at a PEST analysis33:
> The EU extension and the ongoing process of globalisation. As mentioned above, 95% of the company's business is generated on the German speaking market which leads to a certain dependency on the development of this market. As well as the future prospects for the German market are positive, an expansion and internationalisation of the sales organisation would lead to more independence and additional turnover. I think it is necessary to develop a clear strategy for multinational management and expansion.
> Another aspect the sales force has to deal with is the increasing competitor situation caused by the globalisation and development of the market. Cut price imports and other competitors from Germany or abroad, which deliver good quality for a reasonable price are responsible for harder sales negotiations. There is not so much space for differentiation. From my point of view the service and the brand (image) will be the only mean in the future to differentiate the company from their competition.
> The changing buying behaviour. From my point of view lifestyle has already dramatically changed and will change in the next year with a big impact on the company's strategy. Single living, mobility, flexibility, free of obligations, led to a changing demand and a changing customer behaviour. In a recently published article of the Harvard business review the authors describe the change in customer behaviour appropriate as follows: "Just a few years ago, when typical retail shoppers went to a store and received advice on the size, style, or purpose of a product, they almost always bought the product right then and there. If they were looking for personalised service, they chose stores that offered it - and paid premium prices for it. If they were bargain hunters, they sought out no-frills shops. Whichever distribution channel they opted for, they stayed with it until the sale was made. Not anymore. Today's customers "channel surf" with abandon. They routinely avail themselves of the services of high-touch channels, only to buy the product at the end point of another, cheaper channel. (...)"34 Managers responsible for sales should discuss this issue and check possible distribution channels and the chance to generate additional turnover and profit. Another aspect of this issue is that the sales teams have to be trained in dealing with this situation. It is getting more important to find out if the prospect is really interested in buying or is only looking for information. This is important for the time management.
> Technological developments and regulations. As described above, there are developments which are important to be competitive in the future and the sales division has to consider all these requirements and developments in their sales process.
> Economic development. As described in the chapter about the economic situation there is a correlation between a recovering general economic trend in Germany (compare Gross Domestic Product) and the relevant market of the company (Construction index), both trends are positive and should have a positive impact.
5.2 The Management process
5.2.1 Planning, budgeting and organisation
5.2.1.1 Planning and budgeting
It is a great advantage that the planning and budgeting process is clearly defined. Furthermore the planning of the sales figures and activities is good structured.
As the interview displays, the sales managers think that planning and budgeting is important but the process is too time consuming. Starting four month before the next fiscal year and several rounds of give-and-take take a lot of time. This led to the question, if this process, as time consuming as it is, adds effectiveness and productivity of the sales team so that it can be justified. From my point of view it adds much value for the sales management but the process could be supported by a planning and budgeting software. Currently there is no proper planning and budgeting software in use. At the moment Microsoft Excel spreadsheets are used; no links are implemented to automate calculations, which leads to a high level of frustration of the sales manager.
Another important point is that the current budgeting procedure and volume is very much oriented on the last years' performance, although not taking into consideration any planned activities and strategy for the following years. Restrictive effect on flexibility, responsibility and changes. Sometimes possible additional business cannot be realised because the resources are already allocated an do not allow additional expenses.
From my own experience another problem could occur when the team thinks it can't meet the budget's sales targets: they convince customers to order goods now at a special price or by telling them they have every right to return the product. Another issue could occur the other way round: if the team thinks it will exceed its targets, it will press customers to accept delivery or to order in the next fiscal period, which leads to the delay of valuable cash flows.
Authors and commentators have proposed a variety of methods for "Better Budgeting" which should improve these disadvantages. Activity Based Budgeting (ABB), Zero Based Budgeting (ZBB), Rolling budgets and forecasts, Value Based Management. All these methods are claiming cost and time savings in the budgeting process and more accurate forecasts. The problem with each of these alternatives is that they effectively only involve re-engineering the traditional budgeting and planning process and do not address fundamental problems.35 Which method is the best for the company or if a mix of different methods is appropriate, has to be evaluated in further investigations. From my point of view it is important that the forecasts are regularly revised and continuously adapted to market conditions. The process should be supported through an appropriate information system integrated as well in a control system (compare chapter 5.2.3) that allows everyone in the company to see the same information at the same time.
5.2.1.2 Recruitment, Selection and Training
To implement an efficient and productive sales team and to realise the plan, recruiting, selection and training are critical for success. Employing the wrong salesperson in direct selling may result in low productivity and economic loss (salary, training and associated expenses) for the company if the new salesperson is leaving the company after a few months or is not a top performer.
From my point of view the "traditional" recruitment process is the least effective. In my opinion, based on the sales job's special characteristics, there is more than one way to select sales people. The company should use "networking" as a recruitment method due to the fact that it is more likely to attract low or average-performing sales people than high performing sales people via traditional recruitment advertisements. The high performers usually are employed and it is unlikely for them to respond to traditional job advertisements. Networking could provide the basis for future recruitment and is a highly effective and low-cost method. Hiring high performing sales people from competitor companies could be useful not only because they know the industry, but also the method of selling. They can add new ideas and the company can save training costs, too. Another opportunity is to adopt a sales trainee program to recruit potential candidates on a regular basis through colleges and universities. The advantage is that these candidates are very flexible and they can help to fill gaps in different areas. The company should not wait until they need a sales person, because it might be too late and could lead to loss of turnover.
Regarding the training, changes already have been made, which has a very positive outcome: as the interview displayed, the training gives new starters the possibility to gain confidence in their new tasks and more experienced employees a chance to develop their career and gain additional Know how. This support of course leads to a higher commitment and solidarity towards the company.
Choosing an appropriate strategy in hiring the right candidate and training could decrease the loss of sales and cost of recruitment and could have a positive impact on the staff turnover, motivation and productivity of the sales team.
5.2.1.3 The selling process
The thirty years of direct selling experience led to a clear structure and organisation of the selling process. For the management of the regional marketing activities a lot of data and documentation from the past is available. The only question is if it would not be more efficient to centralise the administrative work for this, which means an experienced person in the headquarter discusses with the regional newspapers or trade fair organisers, to support the sales team and give them more time for direct sales activities like sales calls or sales negotiations. As mentioned in chapter 5.2.2 the next two steps "Approach, Qualifying and Prospecting" and "Presentation, Demonstration, Agreement and Closing" are supported by an existing database, which helps to organise the administration of addresses. Unfortunately this database gives not enough information for the management on how the sales team is spending their time and with which success. The same issue exists for after sales and maintenance. Writing records and sending them via fax to the headquarter is very time consuming, i.e. a standardised email form would be more efficient. Due to the fact that this is an IT issue and all the topics (planning, organising and controlling) are connected, I cover the IT support in an extra chapter below.
5.2.2 Controlling, Monitoring and performance management
5.2.2.1 Performance management system
As already described in the analysis of the last task of the management process, monitoring and controlling the sales team and managers are receiving budget statements, sales reports and effectiveness control statements of marketing activities. Up to now there is no system in which way the sales organisation has to deal with such information. Currently the main use of this information is to check quickly if the sales team is in plan or not. If there is a gap, activities will be defined.
It is controversial that the company claims management by objective as their management style but no performance management system is in place, no time frames are set when appraisals have to be done; there are inconsistent standards how to carry out the appraisal itself and how to rate the employee's performance. As already mentioned, this lack of structure and inconsistency led to an ongoing discussion in the sales organisation and it is absolutely necessary to implement a new performance management system and train all employees how to use it.
The performance management system should have the objective to evaluate sales performance, to direct the allocation of resources and to adjust improvements towards strategic objectives. In literature different models are covering the structure of performance systems. The most appropriate model for this company, in my opinion, is the 'Performance Management Circle' by Bratton/ Gold36.
Figure 10: The Harvard Model (Bratton, John/Gold, Jeffrey: Human resource management, page 228).
I chose this model because it is suitable for the strongly performance oriented sales division but as well has the focus on ongoing process of support, coaching and training to monitor and improve the employee's performance and adjust expectations. To have success which such a system, it is necessary to develop corporate structures, establish policies and procedures for consistency in rating and a clear time frame when and in which timely intervals appraisals have to take place. One central question is what the performance indicators are and how it is possible to measure performance.
5.2.2.2 Performance Measurement System
To measure performance in direct selling, the focus is on the sales figures and the financial performance due to the fact that the objective of an sales organisation is to generate revenue and profit. But furthermore there should be a measurement of non financial performances.
I. Sales Performance
The already delivered statistics on sales figures from the headquarter gives basic information about the historical performance and the forecasted performance in comparison to the actual performance. This system gives enough information about the sales performance (units, turnover) but furthermore it should give information on how the sales force is spending their time and provide some ratios like turnover per sales talk. Because only if the management knows, how the sales team is spending their time, they can support them to improve their performance. Therefore the salespeople should document their time and activities. This can be done in different ways, i.e. a table (please see below) or via reports from an appropriate software.
This table should be analysed during the performance appraisal to find out how the sales people can spend their time more efficiently and effective or if is training with a special content is necessary. For example if a sales representative is behind his plan the sales manager can clarify questions like the following, quickly and more easily:
> Has he had enough sales talks?
> If not, why not?
> Has he called enough prospects to arrange appointments?
> Has he enough prospects?
> Has he acquired enough prospects for the future?
II. Financial Performance
The overall budget statement gives already detailed information about the financial performance of a sales team. But it is as well interesting for the appraisal due to the fact that only this statement brings up the profitability of a sales team or sales representative. From my own experience high performers often neglect their financial performance. For such sales people the sold unit and turnover are more important than the profitability. It helps nobody if he is selling very well with a bad margin. Therefore it is important to have a look at this at the monthly performance appraisal.
III. Non-financial Performance
Currently the sales force is measured only on the above figures. There is no system in place to measure performance areas like team capability or customer satsifaction. This could affect the performance of an employee as well. Therefore I would introduce such systems like a like multi source feedback (MSF)37 or behavior anchored rating scales (BARS)38 to evaluate the performance as well with such indicators. At the beginning it is important to identify such performance indicators which could influence success and outcomes. After that, subordinates, superior, customers, colleagues should be asked to give a feedback for the employee. This feedback should be discussed in the appraisal; i.e. the behavior of the sales representative towards colleagues and customers could lead to higher customer satisfaction or team spirit which ultimately leads to sustained sales growth. Finally sales growth directly supports the company's strategy and objectives to be the number one in the construction industry.
5.2.2.3 Implementation of a performance management system
The implementation should be part of a kick-off event due to the fact that the whole sales organisation is present and is receiving the information at the same time. After that, training is necessary for the sales manager to be able to deal with the system. The managers should be trained in conduct an appraisal, setting SMART objectives, evaluate the sales reports and budget statements and how to handle systems like the already mentioned multi source feedback (MSF) or behavior anchored rating scales (BARS) to overcome common rating errors, which is crucial for the success. They also have to learn to uncover training requirements for individual and career development and as well gain employee's agreement to performance objectives. The process should be supported via an appropriate information and control system that allows everyone in the company to see the same information at the same time. This IT system has to be an integrated part of the IT structure. In essence, the system should not be turned into a very complex system of measurement. It still should be described as simple, easy, clear, challenging and motivating. Taking into account Phil Long's Reasons for performance management (compare Chapter 3.3) an adequate performance management system should aim for the following:
> Review of the previous performance
> Mark and set of new performance objectives
> Discussion of training requirements and provision of required training
> Consideration of implementing a mentoring system for new starters
> Improve working conditions
> Look for ways to enrich jobs and increase job satisfaction
> Increase opportunities for career advancement
> Focus on the customer
5.2.3 IT support for the selling and management process
As already mentioned the IT support for sales management is not homogenous. There is no general system in place which covers all the different areas and supports the management in an efficient way. Currently planning is Excel based, after putting in the figures manually into a database, the sales report is generated from the AS400, the budget statements is based on an accounting software and there is no chance to get reports from the fifteen year old customer database. From my point of view it would be worthwhile to invest in software with interfaces to each other to get a homogenous IT structure.
At this stage of the report I specify the sales requirements for such a system but further investigations have to be done if such a software is available. Statements like the following support my opinion: "The new packages are all-singing, all-dancing and impressively quick. Many are web-based and therefore available to a wide range of people across the organisation, wherever they may be in the world. There is no doubt that these packages have improved the budget process for everyone."39
On today's market we can find several software packages, sold under names like customer relationship management (CRM) or sales management solutions software, most of them can be combined with accounting software or computer added manufacturing to transfer orders directly. No matter for which technical solution the company is voting, a new software should cover the following:
> Sales, marketing and order management -- Providing automated sales management reports on different hierarchical levels (orders, sales forecasts, sales calls, sales activities, forecast versus actual, ...); entering orders, checking inventory and order status, designing and managing sales territories and analyzing marketing and sales programs by such criteria as market, territory, product, customer type, price, and channel.
> Direct mail and fulfillment -- Merging, cleaning and maintaining mailing lists; tracking and forwarding leads; customizing letters, envelopes and labels.
> Telemarketing -- Merging, cleaning and maintaining calling lists; tracking and forwarding leads; ranking prospects and prompting scripts (sales, customer service, and support).
> Financial management -- Providing automated budget statements on different hierarchical levels. The system should include a few key variables and ratios, such as expenses, turnover, profit margin, forecast versus actual, actual versus average of the company, ... This means they can be compiled relatively easy and quick.
5.3 The importance of management and leadership in a sales organisation
"Part of the reason leadership has become so important in recent years is that the business world has become more competitive and more volatile. Faster technological change, greater international competition, the deregulation of markets, overcapacity in capital-intensive industries, an unstable oil cartel, raiders with junk bonds, and the
changing demographics of the workforce are among the many factors that have contributed to this shift. The net result is that doing what was done yesterday, or doing it 5% better, is no longer a formula for success. Major changes are more and more necessary to survive and compete effectively in this new environment. More change always demands more leadership."
Due to the focus of the report I dealt mainly with management-terms like strategy, structure and systems of the sales force. Certainly it is important to plan, organise and control systems, build structures and reporting relationships and recruit and select the right people. But as the quotation above mentioned, leadership is getting more an more important especially for sales due to the faster changing environment. Therefore I would finally come back to the softer fact: leadership. From my point of view the company currently neglects terms like vision, style, emotional intelligence, shared goals and underestimates the importance for the future success.
As already mentioned in chapter 3, leadership has something to do with emotional and social competence, empowerment and motivating people (versus Controlling and Problem Solving) of the sales force to react flexible to rapid changes in markets and technology.
From my point of view the focus on management led to a situation that managers are overeducated in management and undereducated in leadership. And if the sales force are willing to perform every day on the highest possible level depends mainly on the leadership skills of the subordinate. Currently is an ongoing discussion if these skills can be learned or if leaders are born. I represent the opinion that people certainly are born with a certain level of this skill but as well it is a result of life's experiences and learning. Therefore it is important to create a culture where the managers can try to take a risk, and learn from both triumphs and failures and furthermore offer "leadership training". From my point of view leadership and management are important in such a direct selling/franchise organisation. Leadership and management are responsible for the whole sales force to sell the products enthusiastically every day and to move motivated and empowered in the same direction.
6
Appendices
7
Bibliography
> Bolchover, D., The Times, 20 September 2003
> Bratton, J. & Gold, J., Human resource management, Theory and practice, 1999
> Companies 'straight-jacketed' by traditional annual budgets, 1 December 1997, Management Services, page 6, Vol. 41, No. 12
> Company description (Unternehmensdarstellung), (03/2003)
> Dibb, S., Simking, L., Pride, W.M. & Ferrell, O.C., Marketing Concepts and Strategies, 2001
Doyle, Stephen X & Shapiro, Benson P., What Counts Most in Motivating Your Sales Force?, 1 June 1980, Harvard Business Review page 133
> Dyson, J.R., Accounting for non-accounting students, Fourth Edition, 1997
> Fischer, L., Cover Feature - Budgeting - One step beyond. 5 March 2002, Accountancy, page 32
> Goleman, D., What Makes a Leader? (HBR Classic), Rutgers Grad School of Applied Professional Psychology, 1 January 2004, Harvard Business Review, page 82
> Hand out from the strategic management module from John Pike, 2004
> Hannagan, T., Management, Concepts & Practice, Second Edition, 1998
> Hendry, C., Woodward, S., Bradley, P. & Perkins, S., Performance and rewards: Cleaning out the stables, 1 January 2000, Human Resource Management Journal, page 46-62.
> Kotler, P., Marketing Management: Analysis, Planning, Implementation & Control, Eighth Ed., 1994
> Kotler, P., Armstarong, G., Saunders, J. & Wong, V., Principles of Marketing, The European Edition, 1996
> Kotter, J.P., What Leaders Really Do (Classic), Harvard University Graduate School of Business Administration, 1 December 2001, Harvard Business Review , page 85
> Marketing GUIDE 6 - Market Research; Pros and Cons in serious research. (5 of 14), 13 April 1989, Marketing, page 33
> Maslow, A. H., A Theory of Human Motivation, in: Psychological Review, page 50, 1943
> McGregor, D., The Human Side of Enterprise, New York - Toronto -London (McGraw-Hill), 1960
> Mescon, M.H., Albert, M. & Khed, F., Management: Individual and Organizational Effectiveness, 1985
> Mullins, L.J., Management and organisational behaviour, fourth edition, 1996
> Nunes, P.F. & Cespedes, F.V.,The Customer Has Escaped, Accenture's Institute for Strategic Change; Harvard University Graduate School of Business Administration , 1 November 2003, Harvard Business Review
Odiorne, G.S., Management by objectives, 1965, page 55-6
> Prentice, W.C.H., Understanding Leadership (HBR Classic), 1 January 2004, Harvard Business Review, page 102
> Scandura, T.A. & Williams, E.A., Research methodology in management: Current practices, trends, and implications for future research, 1 December 2000, Academy of Management Journal, page 1248-1264
> Student manual from the European College of Business and Management, 2003
> Stuttgarter Zeitung, Weru streicht Stellen, 18 March 2003
> www.bizhelp24.com, business encyclopedia
> www.economist.co.uk, business encyclopedia
David Bolchover, The Times, 20 September 2003
2 Mescon/Albert/Khed, page 8
3 Hannagan, page 11
4 Kotter, page 85
5 Kotter, page 85
6 Bratton/Gold, page 11.
7 Doyle/Shapiro, page 133
8 Maslow, page 50
9 McGregor, D.: The Human Side of Enterprise.
0 Kotter, page 85
1 Hendry/Woodward/Bradley/Perkins, page 54
2 Odiorne, G.S., page 55, Mullins, page 448
3 Mullins, p.447
4 Bratton/Gold, page 382.
5 Bratton/Gold, page 215
6 comparing www.economist.co.uk
7 Kotler, page 6
8 Dibb/Simking/Pride/Ferrell, page 5
9 comparing Dibb/Simking/Pride/Ferrell, page 7
20 Kotler/Armstrong/Saunders/Wong, page 96
21 Dibb/Simking/Pride/Ferrell, page 352
22 Nunes/Cespedes, The Customer Has Escaped, page 31
23 www.economist.co.uk
24 Kotler/Armstrong/Saunders/Wong, page 922
25 Dibb/Simking/Pride/Ferrell, page 465
26 Marketing GUIDE 6 - Market Research, page 33
27 Scandura/Williams, page 1248-1264
28 compare Marketing GUIDE 6 - Market Research, page 33
29 http://www.bizhelp24.com/marketing/questionnaire_personal_telephone_2.shtml
30 The selling of products or services directly to customers without the use of intermediaries, such as wholesalers, retailers, or brokers (www.economist.co.uk, business encyclopaedia).
31 Stuttgarter Zeitung, Weru streicht Stellen, 18 March 2003,
32 "Budget: A quantitative statement, for a defined period of time, which may include planned revenues, expenses, assets, liabilities and cash flows."32 Dyson, page 347
33 The PEST analysis evaluates the main environmental factors, which influence the organisation. It is more external and looks at the macro environment. The main factors which have to be evaluated in the PEST Analysis are: Political/lega, Economic, Socio-cultural, Technological (comparison hand-out, strategic management module, John Pike, 2004)
34 The Customer Has Escaped, 1 November 2003, page 31
35 Companies 'straight-jacketed' by traditional annual budgets, page 6
36 Bratton/Gold, Human resource management, page 228.
37 '360° Feedback. Feedback from a variety of sources for appraisal and development.' Bratton/Gold, Glossary.
38 'A performance appraisal technique with performance levels anchored by job related behaviors.' Bratton/Gold, Glossary.
39 Fischer, page 32
Sales force management
2