SAUDER SCHOOL OF BUSINESS UNIVERSITY OF BRITISH COLUMBIA BAMA 580A: SALES FORCE MANAGEMENT (SWING 209) Office: HA 651 HA 664

Transcription

1 SAUDER SCHOOL OF BUSINESS UNIVERSITY OF BRITISH COLUMBIA BAMA 580A: SALES FORCE MANAGEMENT (SWING 209) Professor Pradeep Bhardwaj Area Assistant: Andrea Gutierrez Office: HA 651 HA 664 Office Hours: By Appointment Class: Fri 9:00AM 12:30PM COURSE DESCRIPTION AND OBJECTIVES The purpose of this course is to provide the background and analytical skills necessary to help place you at the forefront of the effective management of the Sales Function in an organization. The course will be focused on sales force management. In one of the class sessions we will have a Personal Selling Workshop where students will get an opportunity to role play selling situations. However, going beyond Personal Selling, this course is designed for anyone who will, at some point in his/her career, manage sales people, or will be a general manager in a company in which sales force is an integral part of the marketing mix. The course takes both a strategic and a tactical perspective. Strategic issues include: What part does the sales force play in the company s go-to-market strategy? What is the best size for the sales force? How should the sales force be organized? What is the best way to allocate the sales force resources? Tactical issues include: What are the effective approaches to selling? How do we motivate the field sales force? How do we compensate the sales force? What are the effective ways for evaluating performance? How do we align sales territories? Course Materials 1. Course Reader. 2. Class slides will be available on the Blackboard and copies will be distributed in class. COURSE ORGANIZATION The sections below discuss the mechanics of the course in detail. Study Groups Students will need to form study groups early in the period. Ideally, groups should be composed of four members. No group may have more than five members. Class Format Class activity is divided among lectures, case discussions, and, guest speakers. Lecture/Discussions. Approximately half of the class time will follow a lecture format. These sessions are devoted to the presentation and discussion of theories, concepts, analytical techniques, and empirical findings useful for sales force management.

2 Case discussions. The assigned case studies have been selected to fit the objectives of the course. All students are expected to come to class ready to discuss each case, regardless of whether or not a written assignment has been prepared. Students may be called upon at any time (a.k.a. cold called) to provide specific recommendations and analysis. At a minimum, you should be able to (i) state clearly what management should do and (ii) provide a specific, logically consistent rationale for your recommendations. Even if you do not contribute to a specific case discussion by speaking, make sure that you are comfortable with what you would have done in the management situation described in the case and why. Personal Selling Workshop. In one of the class sessions we will cover the personal selling process. Various types of questions that help in investigating a selling situation will be discussed. Students will work in teams to role play a selling situation that will be provided. Role play is not acting. We will focus on the content of the interaction that you will have with a prospective, role playing, client. Written Case Analyses One group written case analysis is assigned for the course. Hard copy versions of the case analyses are due at the beginning of class on the day the case is discussed. Write-ups should be double spaced, on one side of the page only, submitted without report covers, and stapled once in the upper left hand corner. Please leave adequate top, bottom, and side margins to allow me to make comments. No late papers will be accepted. I will provide further specific details on the format of the write-up in a hand-out, including length limitations on the papers. Please make sure that you consult this handout before preparing the written case analyses. Course Project Options You have the option to conduct a sales force immersion project or a research essay project. Both projects are team based. The sales force immersion project will have three steps: 1. Sales force selection: A selling organization needs to be selected for the study. You can include the company that you work for, the company that you plan to work for, or a company that you formerly worked for. Each group is asked to submit a short description, by April 30, of the sales force that they plan to study. 2. Sales force issue assessment and sales force driver identification: Critical sales force issues, challenges and concerns, and important sales force drivers are identified in this step. Define the critical productivity issues faced by the sales force (e.g., sales targets are not getting met, not enough new accounts, customer satisfaction is low, not enough calls, not calling on the right accounts, salespeople are not motivated, too much turnover, the selling process needs to change due to customer consolidation, increased competition, etc.). For every critical productivity issue identify those sales force productivity drivers that are most likely to affect the productivity issue. Consider developing a competency-impact inventory on the set of salient productivity drivers. Pick two to three productivity drivers for improvement. 3. Sales force enhancement recommendation: Write a 3000 words paper describing how your chosen drivers can be improved and indicate the impact that this will have on your initial sales force productivity issues. The paper is due on May 28 th by 1:00PM. The research essay is also a team based exercise. Below are some examples. 2

3 1. Describe the go-to-market strategies of 3-4 companies. Pick one of your companies and discuss how its go-to-market strategy can be improved by benchmarking against the other 2-3 companies in your set and/or in terms of what you know to be the best practices for this decision. Describe how these 3-4 companies structure their sales force. Pick one company and recommend how the sales force structure can be improved. 2. Describe the compensation plan for 3-4 companies. Describe how these firms evaluate the performance of their sale force. Describe the territory-level goal setting for these firms. Pick one sales force and discuss how its compensation plan, goal setting, and performance evaluation can be improved. The research essay should be no more than 3000 words. The paper is due on May 28 th by 1:00PM Laptop Policy Laptop computers may not be connected to the network while class is in session unless I expressly permit it. Laptops may be used to take notes during lectures. They are to remain closed during case discussions unless I expressly permit use to access spreadsheet analyses. 3

4 Basis for Grading Each student's overall course grade will be based upon the following: Class Participation 30% Written Case Analysis 25% Course Project 45% There will be no mid-term or final examination. Grading Class Participation. Grading class participation is necessarily subjective. Some of my criteria for evaluating effective class participation include: 1. Is the participant prepared? Do comments show evidence of analysis of the case? Do comments add to our understanding of the situation? Does the participant go beyond simple repetition of case facts, adding analysis and conclusions? Do comments show an understanding of theories, concepts, and analytical tools presented in class lectures or reading materials? 2. Is the participant a good listener? Are the points made relevant to the discussion? Are they linked to the comments of others? Is the participant willing to interact with other class members? 3. Is the participant an effective communicator? Are concepts presented in a concise and convincing fashion? Your grade for class participation is not simply a function of the amount of "air time" you take up. In general, I will evaluate you on how well you respond to my questions and on how effectively you take into account the comments and analyses of your classmates. In situations where multiple students have raised their hands to speak, I will try to call on the student with the least cumulative air time to that date. This procedure, carried out over the course of the quarter, should help to ensure that everyone who is well prepared and wants to contribute will have the opportunity to do so. Please note: Regular attendance in class is expected and a course requirement. Absences exceeding 1 class session will begin to seriously affect a student's participation grade. A very high absentee rate may result in a failing grade for class participation and the course as a whole. Students failing to achieve a passing grade for class participation may fail the course as a whole, regardless of their performance on written work. 4

5 BAMA 580A: Sales Management Schedule of Class Sessions Period 3 (2011) Session Topic Case Assignment Date Session 1 Course Introduction Precise Software Role of Sales force in the Go-to- Market strategy Session 2 Personal Selling Workshop Project Desc Session 3 Sales force Assessment and Sizing Designing Sales Territories Session 4 Guest Speaker Case Discussion Syntex Case GW Session 5 Conjoint for Purchase Manager Analysis ENSR International Motivating Sales Force Note: GW indicates a group written assignment is due. Project Desc: Project Topic Descriptions due. 5

6 CASE PREPARATION QUESTIONS (A) PRECISE SOFTWARE SOLUTION Precise Software Solution is a small software developer with one niche product and an idea for another, bigger value proposition. The bulk of their current sales come from Precise/SQL a product that ensures that database applications run efficiently and effectively. The product provides the database administrator (DBA) with important information about how the database is working, whether it is working and what might be improved. The new product, Precise Insight, has a much broader target. It has the potential to impact the entire IT operation and potentially the business itself. The management team needs to decide first and foremost when to introduce the product. They must also determine how they go to market. Their current sales force is positioned and trained to serve the DBA. DISCUSSION QUESTIONS: 1. Should the company launch the product in time for Oracle Open World? 2. What is the SQL experience? What are the benefits delivered by the SQL product? Why aren t the salespeople able to convince the DBA to pay more for Precise? 3. Should Insight be handed over to the current sales people or should an entirely new sales force be created? (B) SYNTEX LABS Syntex Labs has evolved over the years and now has a blockbuster drug, Naprosyn that is prescribed by the PCPs. The company does have drugs that physicians from other specialties prescribe. Detailing to the physicians is the way to pass product information. However, the company is not sure if it is expanding the sales force by the right number each year and if the allocation of these sales reps is optimal. To answer this question the company has hired a consultant. The consultant has done some quantitative analyses using a drug and a specialty model. Syntex now needs to decide how best to expand its sales force and by hiring how many new reps. DISCUSSION QUESTIONS: 1. Try to understand how the parameters of the ADBUDG model were estimated and what is the practical implication of each? 2. Evaluate the number of sales reps that Syntex should assign to each drug? a. How much do profits go up relative to current profits? 6

7 3. Suppose that Syntex was constrained to keep the same number of sales reps they currently have (433), how should they optimally reassign these current reps? How much do profits increase from the current situation? What do you think of optimal allocation to Synalar and Nasalide? 4. Do a similar analysis for the specialties. 5. What do your results imply about organizing the Syntex sales force? 6. What should Robert Nelson recommend to the board in terms of sales force expansion policy? How quickly would you expand the sales force? (C) ENSR INTERNATIONAL ENSR is an environmental consulting firm headquartered in Westford, MA. Its services cut across seven different service lines and 60 different technical disciplines. A subset of the consultants is responsible for selling the firm s services. In this role, they are referred to as seller-doers. While moderately successful, the firm s management is dissatisfied with its performance. In particular, they feel that they should be getting a bigger piece of their client s budgets. Management is considering three options to address the problem: (i) create a dedicated sales force, (ii) change the compensation plan, or (iii) initiate a key account program. DISCUSSION QUESTIONS: 1. Describe the vendor selection process in the environmental consulting industry. Who influences the purchase decision? What are the main criteria influencing vendor selection? 2. What is the nature of ENSR s customer base? 3. What is ENSR s current sales approach? What is the compensation plan? What determines the success of a seller-doer? 4. What specific challenges does ENSR face regarding utilization of its consultants? 5. What are the arguments for and against the three proposed solutions? Which do you favor and why? USEFUL READINGS 1. Mayer and Greenberg, What Makes a Good Salesman, Harvard Business Review, Jul-Aug, Colletti and Fiss, The Ultimately Accountable Job: Leading Today s Sales Organization, Harvard Business Review, Jul-Aug, Anderson, Narus, and van Rossum, Customer Value Propositions in Business Markets, Harvard Business Review, March, Lay, Hewlin, and Moore, In a Downturn, Provoke your Customers, Harvard Business Review, March,