Thought for the Day
Value is not what you get,
Value is what you give
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How does a Sales Manager manage by support?
Can you answer these three questions?
- How does the role of Top Management differ from that of Middle Management, in Selling?
- Could market share of an Area Sales Manager slip only due to drop in market demand?
- They say: “what motivates you (as manager of your team) may not necessarily motivate others in your team”. What does this mean?
Can you solve the following three problems?
- Shankar & Vikas are Area Sales Managers working with M/s Sharp Dies. The Company makes dies & punches for SME Customers, and enjoys good reputation, thanks to a large All India Field Salesforce that’s assiduously worked hard & well in various markets over last 10 years.
Shankar & Vikas joined the company at the same time, were seen to be similarly promising, and both rose to become ASM in April 2013. Shankar works in South India and Vikas in North India. They were given territories with good and nearly equal potential. Their field sales teams comprise of an equal combination of experienced & fresh Sales Engineers.
Both territories progressed well during FY 2013-14. But during 2014-15, Shankar’s territory has been consistently posting lesser growth results than Vikas’ territory. So Joshi, the VP Sales is concerned. A thought has crossed his mind, if the cultural difference in North India and South India could account for this, but he quickly came to the conclusion that it cannot be so. Because he was looking at growth results for the given territory and there was nothing in the way two markets were behaving that was significantly different.
He decided to spend time in both territories carefully observing how Shankar & Vikas manage their interactions with their Sales Teams. He observed that every month,
- Shankar reviewed last month’s performance in a team meeting. He conducted the meeting brilliantly, gave the team very good, practical guidance for the next month. He then told them that he is leaving them to do their job in the field assuring them that he will work with them in the market as per the need.
- Vikas first studied last month’s performance of area by himself. He then carried out individual meetings with the Sales Engineers to draw up best possible targets for each differently. Then he would total individual targets to check if the total is satisfactory and go back to some of them for adjustments if any. He then told them that he is leaving them to do their job in the field assuring them that he will work with them in the market as per the need.
- Om Prakash is one of the 7 Sales Engineers in the Company. He has worked longest in the Company and is proud to contribute Rs 2.5 Cr annually to the 14 Cr branch sales – best in the team. His Sales Manager also gives him due recognition for this. The two of them share a good rapport and Manager is quite free to tell Om Prakash what he should do from time to time. Om Prakash finds this advice very insightful and helpful, therefore he likes it.
Recently the Manager told Om Prakash to watch out for a danger that his knowledge and skills may be out of date with the rapidly changing Customer profile in his area. The Manager suggested that he should review his Sales Impact vis-à-vis the resistance from Customers to place orders. Om Prakash did not understand but did not immediately react and is thinking what the Manager could have meant. What could it be?
- Smith & Johnson is an American firm providing top-of-the-line hardware for the Telecom Industry. Opening its India office a year ago, the firm recruited 5 well qualified Salespeople. Mahadevan is the Sales Manager reporting to John Bailey, a veteran from the UK division.
John spends a week every month in India, reviewing performance & plans ahead. He is quite sensitive to cultural differences and values Mahadevan’s experience in India and abroad. During one of the meetings in first few months, John was agitated that while two Salespeople were doing very well other three were not. He almost suggested replacing them one by one and soon enough. Mahadevan told him that he would rather not “give a pink slip” as easily as in the West. John asked: “On legal grounds or on moral grounds?”
Mahadevan replied: “Neither John. I am still thinking how to deal with those three Salespeople and may in fact need your help to work the plans that I have in mind. In general I am convinced that it will be impossible for me to ever have all five Salespeople smart and bright. Even if it were to happen for a while it could actually mean a big danger for me!” This made John remain still for a moment. He then asked Mahadevan to explain the later part of what he said. Mahadevan did and John said: “I now see what you mean. I never saw it that way. Thank you, Mahadevan.” What could Mahadevan would have explained?
Sales Management involves using resources provided by Top Management to achieve better results. There are 5 resources: Products, Pricing policy of the Company, Distribution infrastructure, Advertising and Sales Promotion, and last but not the least a team of Salespeople a Sales Manager works with. By leading these people well and by setting objectives for them, a Sales Manager is expected to realize maximum sales out of the potential opportunity in the assigned territory.
Changes in the market place can constantly make knowledge and skills of Salespeople out of date. The job of a Sales Manager is to simultaneously use the available resources well to achieve results of today, and develop these resources for results of tomorrow. This is a question of continuously assessing levels of knowledge, skills and attitudes of individuals in a sales team, rather than team as a whole; and working on it using the principles of Management by Objectives so as to help them work well in marketplace. This is well illustrated by the Mercuri Impact Training model below.
To translate this model into practice, a powerful Mercuri concept called The RAC Framework (Results-Activity-Competence) or the Plumbing Model can be very useful for a Sales Manager. It is explained in the following diagram.
A Sales Manager is reading the market information well - as a trend in real time, rather than after that change has become ‘data’ (dead information)
He or she is basing the product mix, Customer mix and Customer base targets on the basis of this information rather than reactively accepting whatever happens with respect to these as his or her results ..then, he or she is a proactive manager rather than a reactive manager.
This is good management, but it is only the first step in the right direction. Remember that one needs to achieve results not alone but through a team of resource entrusted to them - the Salespeople. Some of them could be well experienced but set-in-their-ways, some would be new, enthusiastic, highly able people, some whether new or old could be slow yet consistent and hardworking; and one or two may even be perceived to be problem children. Hence one needs to go beyond the first step taken as seen above.
A Sales Manager is going one step further and looking at how many total number of visits did each Salesperson make, how many of these were to which Customers, and what products were discussed in each of these visits.
And based on this data, tells his Salespeople how many visits should he or she make in the coming period, which Customers should he or she go to, and which products to focus on during these visits.
Then the Sales Manager is going one more step further but still may have many a crisis on hand, because these salespeople would be putting in efforts regardless of if they can do each activity well or not – just because the boss told them to do it. Some of their actions could as well end in disaster!
In addition, a Sales Manager is also analysing the abilities of each of his or her Salesperson – how well does he or she know the products, how systematically he or she keeps Customer information, is he or she up to date on competitor information, what are the levels of his or her selling skills.
And if the Sales Manager is drawing up the Salesperson’s development plan on critical gaps identified accordingly.
Then the Sales Manager is supporting the Salesperson to achieve sales results expected in an objective manner.
How deep one should go for each Salesperson depends on quality of his or her sales work and how self-managed is he or she is as far as quantity of his or her efforts are concerned, and whether the market environment is more or less favorable.
These things will change from person to person and for a given person from time to time. In other words.. a Sales Manager will have to plumb to the right depth in this model. Hence it is also called Plumbing Model
If all the Salespeople in the team require the Manager to plumb down to the full depth, he or she has a major challenge to individually develop all of them. In case all Salespeople are getting the best results and are equally good, either the results targets are low or the situation with respect to the team’s motivations would become unstable sooner or later.
Either of the two situations will not last long, and the Sales Manager will reach a stable situation with variety of individuals in the team. The RAC Framework helps a Sales Manager to break down his or her marketing plan in small bits that an individual in the team can understand (objectives) and then lead him or her by setting targets accordingly, and plumb to the right depth handholding as needed. This is the Mercuri way of Sales Leadership by Objectives and Support.
QUESTIONS FOR REFLECTION
- What methods do you use to obtain information about your markets?
- How structured is this procedure?
- What are your policies for the company’s future development?
- What decisions have you made regarding future Customer Mix?
- What decisions have you made regarding future Product Mix?
- Have the decisions been communicated to every level of the sales organisation?
- Does every level of the sales organisation know and understand why you have made these decisions?
- How is your policy towards the market place reflected in the objectives which are set for your sales team?
- What systems do you have for evaluating whether results correspond with your policies and objectives for customers and products?
- What specific objectives are given to your sales team regarding the direction of their activity ?
- How do you measure the activity of your sales team?
- What Plan of Development do you have for your sales team that they can successfully achieve their objectives?
- What decisions have been made to determine the main skill and knowledge areas required by your sales team to operate successfully in their market place?
- What systems do you have to constantly re-evaluate the levels of skills and knowledge in the sales team?