Sales Management Effectiveness (3)

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Sales Management
Pharm. Tunde Oyeniran

Last time, we looked at objectives of sales management which were listed as:

  • Achieving, managing and increasing sales volume
  • Contributing to company profits
  • Long-term growth of an organization.

We expanded on these and ended with a list of the functional responsibilities of the sales managers. In this edition, we will discuss the key roles and responsibilities in some details for proper understanding of the practitioners. But before we get on with this, please note these two points:

Sales management impacts greatly on financial results. The bottom-line comes from records of sales and cost of goods sold to arrive at gross profit. Gross profit minus expenses gives the net income. Sales management by being effective is in a position to affect sales, gross margin and expenses; and thereby net income.

Sales contribute a great deal to achieve optimum relationship amongst three factors – sales, gross profit and expenses. Companies, especially publicly quoted companies, know that final accounts are used by the board, shareholders and outsiders, especially the investing public, to judge a business.

Now, to the key functional responsibilities. In many respects, sales team management has been a neglected element of management training, yet the sales manager’s responsibility—managing the entire interface with the customer—is probably the most critical of all, in terms of ultimate success for the organisation. Because it is a very complex role, we will look at those aspects that are the province of sales management alone.

People management

The most obvious, and crucial, role of any sales manager is managing the sales professionals. The ideal pharmaceutical sales manager must have the following qualities:

(i) Desire to be a manager

(ii) Ability to lead and motivate others

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(iii) Good organizing and planning skills

(iv) Capabilities of control and administration

(v) Full understanding of the implications of finance

(vi) Skills to recruit, train, motivate, and develop those who will form part of the team

(vii) Good understanding of the demand-generation process

It is significant that, in common with those others, this list lacks any direct reference to marketing skills. On the other hand, it is even more significant for its emphasis on people management, which accounts for five out of the six main categories. To be successful, sales managers must inspire teamwork and cooperation while motivating salespeople to achieve their own peak performance.

Recruitment

The recruitment process is probably the single most important task for sales management, yet it is often the most neglected. The first requirement for successful recruitment is that it must be taken seriously by being given the resources, including sales management time, that it deserves. This is a particularly difficult process where sales personnel are concerned because quality sales skills are all-important. Yet there are relatively few good sales professionals, and considerably more mediocre ones, who hamper their performance even more by an unnecessary (and often enthusiastic) commitment to the stereotype. The success of a sales team is therefore almost entirely dependent on the number of high-
quality sales personnel who can be recruited.

Recruitment can be broken down into a number of stages:

(i) Generation of prospects

(ii) Creation of a shortlist

(iii) Final selection and

(iv) Persuasion.

Recruitment is also a sales process; the candidate will be buying an organization just as much as a customer, and for him or her it is a very important decision. Therefore, the whole recruitment process should entail continuously selling the organization and the job.

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Marketing and Branding for Pharmaceuticals (2)

Motivation and compensation

Even the above-average salesperson rarely works at more than 60 percent of capacity. This problem is very different from that of “managing” teams of non-sales employees, for a number of reasons, including (i) lack of daily direct contact (ii) complexity of role and (iii) entrepreneurship.

Financial compensation is one of the key motivators for employees in all cultures. However, successful sales programmes make use of a wide variety of motivators. The sales manager will want to adapt the incentive structure to best meet local desires, regulations, and situations. When it comes to compensation, there are three modes: (i) salary/fixed income only (ii) commission on sales only and (iii) a mix of the first two.

The commission takes many names/descriptions: incentive, payment incentive, product incentive, market-development incentive etc. The management will need to find the right balance that works in its exact circumstances.

Leadership

Personal characteristics—in particular, leadership qualities — of the sales manager are probably the most important motivator. Some qualities that make an effective leader are enthusiasm, courage, self-confidence, integrity, fairness, interest, and a sense of humour. Charisma, ability to delegate, and communication ability are also often mentioned. Others are technical competence, executive presence, influencing capability and emotional intelligence.

Control

Sales control is critical in sales management. Planning and control go hand-in-hand. Sales objectives are reviewed to examine where we stand today, how we travelled up to this point, where we are headed to, and how to reach there. Sales plans are examined along with the policies and procedures.

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Sales Management Effectiveness

There is one further complication – time. The sales manager has to manage this process by controlling the interim stages without the measure of the final result by which to judge the effectiveness of these actions. But sales management does have, in the final outcome (the sales itself), the ultimate measure of performance. The performance of sales personnel, more than that of almost any other employee, can be measured with some degree of accuracy—at least in the long term.

Elements of control include setting up performance standards. The actual performance measurement, comparison of planned versus actual result versus the standards set and finally, determination of corrective actions.

The salesperson’s performance is typically measured by numbers, and in particular by sales volumes. These numbers may be compared with (i) past sales (ii) performance of other sales personnel and (iii) sales targets.

In practice, many other judgments are qualitative. The sales manager judges his or her subordinates on the basis of what they seem to be doing and how they are doing it. Non-financial items include coverage, growth, marketing activities, customer growth, etc.

Marketing management

In the pharmaceutical industry, the sales manager is responsible for all marketing activities. When your core product is ethical products, it becomes extremely difficult, if not impossible, to separate sales personnel from marketing personnel, since personal selling is the standard mode to selling and awareness creation/demand-generation

Tunde Oyeniran B Pharm, MBA, a sales/marketing strategist, selling/sales management trainer and personal sales coach, is the Lead Consultant, Ekini White Tulip Consulting Limited, Lagos. We deliver training, recruitment and field force management Solutions .Feedback. Channels 080-2960-6103 (SMS/WhatsApp) /ekiniwhitetuliptraining@gmail.com or check out https://fb.me/EkiniWhiteTulipConsulting

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