Part V SALES FORCE ACTIVITIES Chapter 9 Leadership

Part V SALES FORCE ACTIVITIES Chapter 9: Leadership

Leadership Overview gs we Po ing Us e ang h C Situa tiona fo al n ctio nsa etin i nag a M Tr an s Tra T m ea g in ld i Bu Me C ng Effective Sales Management Leadership les g hin oac g Sa Intuition din en Visio n tan ru ers ng nd ent werm ce Co lf-u r Empo lue Va Se rm at io na l l

Leading Versus Managing Managers Leaders Administer Innovate Maintain Develop Control Inspire Ask How and When Ask What and Why Short-term View Long-term View Accept the Status Quo Challenge the Status Quo Do Things Right Do the Right Things

Personal vs. Organizational Needs Personal Goals Organizational Goals Want a feeling of power Control sales force costs Seek personal pleasure Meet sales & profit objectives Desire job security Meet customer retention goals Meet new challenges Meet administrative requirements High pay Increased “share of the customer”

Leadership Skills Intuition Value Congruence Empowerment Leadership skills Self-understanding Vision

“HAVING A LITTLE CHAT” “Jennifer, I thought we’d have a little chat. I don’t get the pleasure of just talking with you very often. I guess we just tend to spend most of our time on our problems. Good people like you tend to be taken for granted. This is your sixth year with us, right? I wanted to let you know that it has been a pleasure working with you over that time. Incidentally, I was a little surprised to hear that some of your customer reports have been incomplete. Some of the clerks have even had to call some of your people in order to fill in the missing information. “I told them that you’re probably so busy out there getting us so much business that you’re tired when it comes to the reports. But it would save us time and money if you could be more complete. I’m sure you’ll take better care of this in the future. That’s what gives me so much pleasure in dealing with pros like you. See a problem. Fix it. No big deal. Anyway, I know you’ll take care of it.

“CUSTOMER ABUSE” One day in the office, you overhear one of your salespeople being loudly abusive to a customer over the phone. Right after he slams the phone down, you mention: “That was a pretty heated exchange. Sounds to me as if you lost it. ” “Well, she’s a pain. She’s always complaining about one thing or the other, none of which is important and often not true. On top of it all, she’s rude. ” “I thought you were pretty rough, telling her that if she doesn’t like how her orders are handled, she can take her business elsewhere. ” “She won’t. ” “That’s not the point. We don’t get nasty with customers. Next time that happens, and you start getting hot, I want you to tell the customer that you’ll look into the problem and get back to him. Hang up. Cool down. Find out what you need to know. And then call back. Do you understand? I don’t ever want to hear a conversation like that again. ”

Sales Manager Power Expertise Power –The belief that a person has valuable knowledge or skills in a given area. –“I respect her knowledge and good judgment because she is well trained. ” Referent Power –Perceived attractiveness of one party to another. –(i. e. , friendship, perceived similarity, etc. ) Legitimate Power –The designated right to the leader.

Sales Manager Power Reward Power –Ability for the manager to reward the other person for a designated action. Coercive Power –Belief that one party can remove rewards and provide punishment to affect behavior. • Leads to compliance due to fear of punishment.

Which power biases are in evidence in the following statements from a sales manager to a salesperson? n “If you come through with the Holiday Inn account, I guarantee you will be the next person promoted. ” n “Don’t ask me why -- just do it, please. ” n “You have always been one of my favorites, and I am depending on you to hit it big in the new territory. As a personal favor, will you accept the transfer? ” n “There are some logistics of the situation that will not allow me to accept your proposal. I will be glad to lay out the details if you wish. ” n “If you don’t improve your sales volume by the end of the year, your friends are going to be asking you how you liked being a sales rep. for us. ”

ASSERTIVNESS STEPS Describe what you see going on: n “We agreed you’d make 16 calls per week. You’re averaging 11. ” Describe how you feel about what is going on: n “I’m puzzled, I can’t tell from your reports what you’re doing. I’m frustrated because each time we have this talk you say you will live up to your end of the agreement. ”

ASSERTIVNESS STEPS Be precise in the change you want n “One more time. I expect you to do what we’ve agreed on: an average of 16 calls per week. ” Mention the benefit of the change to the other person n “Living up to our agreement is the only way I can give you a good appraisal. And you can’t afford more than one bad or mediocre appraisal

RESPONSIVNESS STEPS What does the other person see going on? n “Yes, I know I’m not making the 16 calls. ” How does the person feel about it? n I’m upset. In fact, I’m furious. We’ve been having all sorts of delivery and installation problems. It seems I spend half my time on the phone with the plant straightening out problems. I’ve called you, but you always seem tied up. ”

RESPONSIVNESS STEPS What change does the other person desire in you? n “I don’t call you unless the problem is very serious. So I would like you to get back to me when I’ve got a problem that I think it serious enough to bother you with. ” What are the benefits of the change for the other person? n “There at least two. I produce better, because I have time. And the company has better customer relations, because I know that other people in the field have also experienced my kind of problem. ”

CHANGE MANAGEMENT PROCESS n Assessment - examination of the customer environment in which the company operates. n Redesign - initiatives based on three interrelated tasks: - Customer orientation - know customer buying process. - Sales strategy - deployment of sales resources and buyer segmentation. - Selling processes - determined by the segment of buyer. n Measurement - determine the indicators of successful change. n Sales Support Programs - programs to support and reward implementation of the change program. n Implementation Strategies - pilot test programs.

How Change Oriented are You? Instructions: To find out to what degree you like change, use the following scale in responding to the following eighteen statements. There is no right or wrong answer. Rather, the intent is to help you explore your attitudes toward change. SA A ? D SD = = Strongly Agree = Undecided = Disagree Strongly Disagree

How Change Oriented are You? 1. I try new ideas and new approaches to problems. SA A ? D SD 2. I take things or situations apart to find out how they work. SA A ? D SD 3. I can be counted on by my friends to find a new use for existing methods. SA A ? D SD 4. Among my friends, I’m usually the first person to try out a new idea. SA A ? D SD 5. I demonstrate originality. SA A ? D SD 6. I like to work on a problem that has caused others great difficulty. SA A ? D SD

How Change Oriented are You? 7. I plan on developing contacts with experts in my field located in different companies or departments. SA A ? D SD 8. I plan on budgeting my time and money for the pursuit of novel ideas. SA A ? D SD 9. I make comments at meetings on new ways of doing things. SA A ? D SD 10. If my friends were asked, they would say I’m a wit. SA A ? D SD 11. I seldom stick to the rules or follow protocol. SA A ? D SD 12. I discourage formal meetings to discuss things. SA A ? D SD

How Change Oriented are You? 13. I usually support a friend’s suggestion on new ways to do things. SA A ? D SD 14. I probably will not turn down ambiguous job assignments. SA A ? D SD 15. People who depart from the accepted organizational routine should not be punished. SA A ? D SD 16. I hope to be know for the quantity of my work rather than the quality of my work when starting a new project. SA A ? D SD 17. I must be able to find enough variety of experience on my job or I will leave it. SA A ? D SD 18. I am going to leave a job that doesn’t challenge me. SA A ? D SD

How Change Oriented are You? Scoring: Give yourself the following points for each circled response. SA = 5 points A = 4 points ? = 3 points D = 2 points SD = 1 point Interpretation: Total your scores for all responses. The higher the score, the more willing you are to be innovative and welcome change. A score of 72 or greater is high; a score of 45 or less is low. Innovative people like to create change; non-innovators have a tendency to maintain status quo.

Transformational vs. Transactional Leadership Transformation Leadership Transactional Leadership Appeal to higher ideals and moral values Appeal to self interest “Transform” people by increasing awareness and acceptance of organization’s goals Emphasizing fairness by relying on rewards and punishment to maintain control Creates a compelling vision for the organization Emphasizes day-to-day operations

Transformational Vs. Transactional Leadership Attributes Transactional Transformational Sales manager’s source of power Rank, position Character, competence Manager supervision Important Less important Coaching emphasis Evaluation of results Development of salesperson skills Salesperson reaction Compliance Commitment Time frame Short term results Longer term development and results Emphasis of rewards Pay, promotion, etc. Pride, self-esteem, etc. Where change occurs Salesperson behavior Salesperson attitudes, commitment, values Where “leadership” found Sales manager’s behaviors Salesperson’s heart

Four Leadership Styles Supportive Behavior High Low Supporting Selling Delegating Telling Directive Behavior High

Leadership Factors in Sales Management Sales Manager SKILLS § Empowerment § Intuition § Self-understanding § Vision § Value Congruence § § § Sales Team Activities Interaction Norms Sentiments POWER § Legitimate § Reward § Coercive § Referent § Expert Salesperson’s Behavior § § § Salesperson Professional maturity Needs Goals Relationship with manager STYLES § Directing § Coaching § Supporting § Delegating § § Situation Task structure Time pressure External system

“Jose Guerrilla” You are the boss with the title, rank, experience, and all the accountability that comes with the job. You have the feeling that your salespeople are not following many of your orders. You wonder if you are becoming paranoid. Although you are the formal leader, an informal leader has emerged. It’s Jose Guerrilla. Deliberately or not, he has become influential, even playing amore dominant role than you. Jose is one of your top salespeople, but is behaving like an underground rebel. The group’s overall performance is quickly dropping. Is there a connection? You must correct the situation soon. You do not want to lose Jose, he is a valuable salesperson, besides you really like Jose. Ground rule #1, you have got to turn the situation around. Why did an informal leader emerge? How do you handle Jose? What can you do to prevent this from reoccurring?

DECISION OPTIONS “Jose Guerrilla” 1. Get the group together and remind them that you are the boss. Tell them like it or not the ignoring of your orders must and will stop. 2. Take Jose aside and tell him you “appreciate” the “help” in managing the group. Tell Jose that by pulling together, you can make the situation work out right for everyone. 3. Let nature take its course. Sit back and let Jose make a big mistake that will cause him to lose favor with the group. 4. Take time to get to know Jose. When you know his career objectives you will probably find that he is not after your job. Use Jose to make your communications between yourself and the group more efficient. 5. Talk to each member of the sales team separately. Let them know that you know what is going on and that it is tantamount to insubordination.

PROS & CONS “Jose Guerrilla” 6. Appeals to the authoritarian manager but disregards the possibility that the problem is that your interpersonal communication skills are to blame. 7. Jose may not admit to being the guerrilla, but if he does and accepts the bribe that you offer, the possibility that another member of the group will assume the role cannot be ruled out. 8. Highly risky and puts your rear in the frying pan as well as Jose’s. 9. Jose could become a valuable link between you and your team and possibly help you define interpersonal problems and help you suggest possible solutions. 10. This solution might work with an unschooled or unskilled labor force but not with the highly productive members of your sales team.

Effectiveness in Selling New Ideas or Programs Are the Following Statements True or False? 1. You should try to sell an idea to the "natural" leaders first. 2. Thoroughly explaining the reasons for a change will invariably turn resistance into cooperation. 3. Getting to know your people well is one of the best ways to obtain control over their resistance to change.

Effectiveness in Selling New Ideas or Programs Are the Following Statements True or False? (Continued) 4. It's usually better to hold a meeting to address the entire sales force about a change that will affect them. 5. You should inform your sales force as far in advance as possible about changes that will affect them. 6. When you propose a program or an idea, you are unlikely to encounter resistance except on the most important issues involved.

COACHING Situation Prior to Sales Call Important Points 1. Who is being called on? 2. What happened last time? 3. Objective of call? 4. Objections may arise? 5. How to handle objections? 6. Who are key players? 7. Developmental points last call?

COACHING Situation Important Points During the sales call 1. Let salesperson control the call. 2. Answer necessary questions briefly. After the sales call 1. Ask for self-evaluations. 2. Reinforce positive. 3. Suggest effective responses. 4. Keep records.

Additional Suggestions for Coaching Salespeople 1. Instead of criticizing, tell salespeople what you like about their performance. 2. Help salespeople improve by giving them “how to” advice. 3. Insist that salespeople evaluate themselves in order to develop their evaluative abilities regarding their own work habits and performance. 4. Ask questions to ensure the salesperson is actively involved.

Additional Suggestions for Coaching Salespeople 5. Make the most of resources that are available to you, such as special training materials and so on. 6. An agreement between you and the salesperson should be arrived at regarding corrective actions to be taken. 7. Keep records of specific standards of performance, including how performance will be measured and by what date. 8. The salesperson should be shown these records when they are written to avoid any misunderstandings.

Factors Affecting Sales Team Effectiveness Individual Team Members Buying Center Relationships Intra-Company Relationships Company Strategy Market Environment Sales Team Effectiveness

Sales Managers’ Rankings of the Causes of Plateauing Among Salespeople Overall Mostly Women Commission Only No clear career path 1 2 4 Not managed adequately 2 4 1 Bored 3 3 5 Burned out 4 1 2 Economic needs met 5 7 3 Discouraged with company 6 5 6 Overlooked for promotion 7 6 8 Lack of ability 8 9 7 Avoid risk of management job 9 10 8 10 Reluctance to be transferred

“Hot Shot” When asked the question, “Are you a winner? ” Hot Shot answers, “Well, how did you know? ” When dealing with this type of personality it is best to keep a cool head. Although she is a top salesperson, meeting or beating quotas, she is clearly a victim of tunnel vision. High productivity is a great asset to have in an employee, but she believes that this asset alone is reason for a managerial position. Hot Shot has heard an incorrect rumor that a district sales manager position is opening and believes that she deserves the job. She shows no tact in letting everyone know her feelings. History has shown that although she is an excellent salesperson, she is quite a loner. In your opinion she isn’t ready for a job with the responsibilities of a district sales manager. You have a reputation of being fair and rewarding outstanding achievements.

“Hot Shot” There is not need to change your style now, but you have just received a letter from Hot Shot. She is very direct and states, “I have worked long and hard for this company and have always been the top salesperson. I have no complaints at all about salary, or the commission and bonus plans. I want you to recognize that I feel I am totally ready for a sales manager’s job, the next one that opens up. It is important for me to tell you that if this company cannot use my talents, I have only one choice to make. What say? ” The letter enrages you but you realize that you cannot fire her or give her a job that does not even exist. In fact it is your job to keep her selfesteem and energy as a salesperson intact since your job depends on the productivity of your sales force. Your boss wants to know exactly how you are going to handle this one.

DECISION OPTIONS “Hot Shot” 1. Make a sincere promise to Hot Shot that she will get the next manager's spot that opens. 2. To give Hot Shot more recognition you send her and her husband to the national sales convention with the company picking up the tab. 3. Do not let the other salespeople think you give into ultimatums. You consider the letter as a letter of resignation and let Hot Shot go. 4. Make special managerial training available to the sales group. Tell Hot Shot that when an opening becomes available her excellent sales record along with the techniques learned in the course will place her among the top applicants.

PROS & CONS “Hot Shot” 1. Hot Shot has every reason to take your promise seriously a problem that arises if at the time a position opens you think another member of the sales team is better suited for the job. 2. Some will consider this “industry bribery”. Hot Shot could construe this to be an insult since she clearly stated that she was happy with the money and benefits she was already receiving.

PROS & CONS “Hot Shot” 3. A good sales manager is as hard to find if not harder to find than a good sales representative. If you allow Hot Shot to leave, one of your competitors will doubtless hire her immediately, leaving you with a stronger competitor and a weaker sales team. 4. Probably the best choice. You explain to Hot Shot that the criterions used to choose the next sales manager will include: sales record, group interaction, and effort put forth in seminars, workshops, home study, and night courses.

Termination Suggestions § Establish a paper trail. § Reasons for termination should be specifically spelled out. § When possible, offer an attractive severance package and outplacement services. § The firing session should be brief. § When should you fire an employee, at the beginning or the end of the week?

Table 9 -2: Women in Sales: Percentages by Industry Percent of Women In Sales Force Banking Business services Chemicals 24. 7 30. 3 9. 1 Communications 34. 7 Educational services 50. 4 Electronics 19. 6 Food products 28. 5 Health services 45. 1 Insurance 27. 4 Miscellaneous manufacturing 17. 6 Office equipment 24. 1 Printing/publishing 38. 9 Retail 20. 0 Rubber/plastics 17. 7 Transportation equipment 23. 9 Wholesale (consumer) 19. 5 Average 24. 3

Harassment Suggestions 1. Conduct yourself professionally. 2. Dress appropriately. 3. Be cautious when drinking at business functions. 4. Don’t listen to sob stories. 5. Avoid being alone when possible. 6. Use independent transportation. 7. Trust your instincts.