Evaluation & appraisal of sales force..

Presented by :- Urvashi Baghel IITTM, Gwalior

Contents :-

Sales force & its importance for a company.Sales force performance.Performance evaluation- purpose & reason.Dimension of salesforce performance evaluation.Sales force performance evaluation processDeterminants of sales force performance.Criteria for the evaluation- qualitative & quantitativeEstablishing standardsMonitoring & feedback system.Conclusion.

Sales force & its importance :-

Sales force is the number of sales person employed by a company to :-

- promote its product .

- create customer.

- represent the company in the market.

- to generate profit for the company.

-to deal with customer query & so an..

Sales force performance :-

-work done by sales force.

-Impact of sales force onto the company ,on profit etc is the result of sales force performance.

Performance evaluation :-Evaluation is to measure the performance of sales persons.

A important process which enhances the way organization is managed & provides recommendation for further improvements.

It is a critical function.

It constitutes ‘comparing objectives with results.

Provide feedback.

Take steps to further improvement.

Setting objecti

ve

Actual work done

Comparing

actual work with

objectives set

feedback

Steps to

improve

Purposes :- It is vital for an organization to evaluate the performance of

sales force consistently & frequently, so that it would be able to close deal quickly & move to the next one.

To monitor the performance & ensure that it is in alignment with corporate goals & objectives.

To keep track on progress.

To take decision regarding compensation, promotion & transfer.

To determine the specific training & counselling needs of individual sales people & the overall sales force.

To provide information for effective human resource plan.

To identify criteria that that can be used to recruit & select sales people in the future.

To advise sales people of work expextations.

To motivate sales people.

To help sales people in setting career goal.

To enhance communication between sales person & sales manager.

To improve sales person performance.

Dimension of sales force performance evaluation :-

behavioral

results

professional development

profit

dimensions

Behavior:

Consists of criteria related to activities performed by individual salespeople.

• Sales calls, • customer complaints, • required reports submitted, • training meetings, • letters and calls

Professional Development:

• Assess improvements in certain characteristics of salespeople that are related to successful performance in the sales job

• Characteristics include - Attitude, product knowledge, initiative and aggressiveness, communication skills, ethical behavior

Results:

Salespeople measured objectively based on results such as – sales, market share, and accounts

A sales quota represents a reasonable sales objective for a territory, district, region, or zone

Some research shows that rewards for achieving results have a negative effect on performance and satisfaction

Profitability:

Salespeople have an impact on gross profits through the specific products they sell and/or through the prices they negotiate for final sale.

Salespeople affect net profits by the expenses they incur in generating sales.

Criteria Examples : Net profit dollars Gross margin per sale Return on investment Number of orders secured Selling expenses versus budget

Sales evaluation process:

Determinants of sales force performance:-

Changing dynamics of the market have increased the pressure on sales force.

Many studies were conducted to know the factor which will influence sales force performance.

They are : - internal factors - external factors

Internal factors External factorsMotivationSkill levelJob satisfactionRole perceptionPersonal factorsEgo driveempathy

Environmental factorsO9rganizational factors - communication & work flow - compensation systemSales management ffunction - sales force planning - forecasting - territory management - compensation - control

Criteria for sales force evaluation:-

Qualitative methods are :

-Personal observation by sales executives.-Merit rating-Customer opinion of salesmen.

Quantitative methods are :

-Analysis of sales record & reports.-Comparison of salesman’s performance with quota.-Ratio analysis.-Profit & loss statement.

Establishing standards :-

Carrying out the sales force performance evaluation process by using the outcome-based behavior-based professional development measure.

By establishing different types of goals & objectives. for ex.- increasing sales by 5% each year ovr the next five year.

By developing the sales plan. e.g. increase market share by 4%, reducing defections by 12% , increasing

the new customer base by 10% each year.- source: flying colours ltd.

By setting sales force performance standards

Allocate & efforts through sales quotas.

Salesperson

Monitoring & feedback system:- (360 degree feedback system)

Salesperson is evaluated by multiple raters.

It helps salespeople better understand their ability to add value to their organization and their customers

Internal Custo

mers

Evaluation

External Customers

Evalu

ation

Ones

elf

Evaluation

Sales ManagerEvaluation

Team M

embers

Evaluation

Conclusions :-1. Most evaluate on an annual basis

2. Most combine input and output criteria which are evaluated using quantitative and qualitative measures

3. When used, performance standards or quotas are set in collaboration with salespeople

4. Many assign weights to different objectives and incorporate territory data.

5. Most use multiple sources of information

6. Most are conducted by the field sales manager who supervises the salesperson

7. Most provide a written copy of the review and personal discussion.

8. Helps salespeople better understand their ability to add value to their organization and their customers

Thank you