Major Cases in Sales Management - Essay Example

CASE III: United Cosmetics Inc: Creating a Staffing Program United Cosmetics Inc. is a national manufacturer and marketer of consumer goods sold to retail grocery stores. The current issue of the organization is that a sale is suffering due to constant hiring, training, and retaining of sales force. The Sales Managers are soending most of their time in these employment functions rather than concentrating on sales planning and goal achievement. Many territories sit idle for most part of the year, representing a huge loss of potential sales. Al, hired as Field Sales Employment Manager, is the management’s solution to these problems and has to propose an employment plan which will rid the company of these issues. The proposed Sales Plan is as Follows: 1. Having direct contacts with the PR Departments and Counseling Departments of All leading business Schools for direct on campus recruitment 2. Designing a proper online job portal having a registration system of people visiting the website 3. Conducting seminars and workshops every semester end in the leading business schools and leaving out pamphlets, visiting cards etc so that the interested candidates can get back 4. Designing of a proper induction training program in which one or two sales managers will provide them with a fifteen day comprehensive training covering all aspects of the requirements of their job including field training as well. The sales managers providing training will be rotated and in every induction training program there would be a separate sales manager who would be instructing the group. 5. Employment quotas for all leading business schools. The aim of this would be to make the career counseling sections of the business schools act like recruitment agencies for us. They will be provided a commission on per hire basis. A quota of 5 students per college would be kept for the top five colleges. This would ensure that we employ the best of the best. This objectives are time taking and will start providing results in two years, However, the immediate requirement of filling idle territories can be solved within six months through on campus recruitment. The rest of the strategies will start bearing fruit in five years. CASE IV Mead Envelope Company Mead envelope is a diversified business division of a large paper products company. For the past five years it has been steadily growing at 5-6% per annum. However, the recent market research shows that there is a market potential of growth up to 10-12% per annum. Considering this company has hired Hal Jones as the Vice President of sales to determine why the growth in sales does not match the potential. Based on the industry projections, the management has allocated a budget of US $ 106 million of Mead Envelopes. Currently, the sales force is lagging behind in achieving this target and the chances of achieving it seem bleak. To make the target possible, a higher level of sales effort is required by the sales force. Due to this a new compensation plan is required to give the sales force the right incentive plan to try harder to achieve results. The current compensation plan seems to be working well since the employee turnover is not an issue being faced by this organization. The employee compensation plan should include customer service representatives who are currently earning salary but no commission and fill up the loose gaps where the account executives can not target these clients due to overload of work or little business value of the account. Also, if sales are struck with a C rated client, it is a breakthrough and the individuals responsible for it should be rewarded. It is recommended that commission should be provided to customer service representatives. The field sales managers tend to focus more on their training roles rather than sales analysis and planning. For this purpose, it is recommended that a centralized training program should be conducted at the time of induction that would train the new executives in how to initiate sales. This would save the time of the field sales managers. Moreover, the sales targets should be made open to all territories. For example the individual targets of any business unit or territory should be communicated to the complete sales force. The reason for this is that they would always have their eyes on the end results and would have focused efforts. The account executives have currently a salary and commission structure which is in accordance with the industry standards. However, to encourage the account executives to increase their productivity it is proposed that the sales commission should be increased from 3% to 5%.A successful sales compensation plan reduces employee turnover, increases productivity, attracts new sales employees, and increases volume of sales. Compensation plans fail if the roles & targets are not well defined or if the compensation is not enough for the target achieved. In this particular case, it seems like the goals are not well defined and department does not know the big figure that they need to achieve. Another thing that is lacking is progress report meetings. Usually, in sales departments there are weekly if not daily meetings to discuss how much progress has been made towards the big figure by whom and what needs to be done. CASE V MSG Sporting Goods Company MSG is a New York based Sports goods company. The CEO, Hudson Mc. Donald believes there is immense sales potential but the company at present is not performing up to its maximum capabilities. The products are being sold through intensive sales strategy. Thus the success of the company depends largely on the sales force planning including compensation & rewards to maximize their productivity. A few observations about the current sales force strategy are: Sales force are relatively paid lower as compared to similar positions in the industry The sales people who have the guarantees are not producing the desired results from their territories Overworking of accounts in 75 mile radius while far off accounts are neglected The proposed plans are all very good. However, the comptroller plan has the flaw that it will have an effect of reducing monetary advantage to sales people who are already underpaid. The production managers’ proposal of increasing the per diem rate on weekdays and including Sundays is a very good idea since it would encourage the sales people to target clients in the far off radius of their residence. It would eventually lead to a better coverage of the target market. The consultants plan is also actionable. The only controversial issue in his plan is the suggestion to discontinue the present plans. The employees have been used to this structure and some of them have been here for quit a long time. Making incremental changes in a short span of time will increase the level of uncertainty which might lead to high employee turnover rate. The current plus point of the sales strategy of MSG is that even though sales force are underpaid, they do not skip jobs. This may be due to good work environment or stable conditions. In my view, MSG should use a combination of all proposals and expedite at MSG for a trial period and continue with it if it is successful .The current plans of yearly awards on basis of increase in percentage sales should be retained. Also, the guarantees, even though, controversial for the comptroller, should be retained. The reason for this is that it is an added incentive to sales people to acquire training and skills and upgrade themselves. The Production Managers proposal of increasing the per diem rate should also be considered. The consultant’s idea of ten percent improvement plan should be expedited. The question at this point is, how will MSG fund this additional expenditure?. For this, it is proposed that regular incomes should not be increased for the next two years .Piecemeal advantages and commissions should be given on sales. Read More