Sales Management - Teamwork, Leadership, and Technology 6th Ed. Instructor's Manual

CONTENTS
Page
Section I: Course Organization and Teaching Methods
To The Instructor.........................................................................................9
Professor Futrell Online10
Salesperson Information Sheet..11
Shadow Bonus Project...12
Sales Diary Bonus Project.13
Section II: Chapter Lecture Notes..................................................................................15
Part One: Introduction to Sales Management
Chapter 1 Sales Management: Its Nature, Rewards, and Responsibilities....................17
Chapter 2 Social, Ethical, and Legal Responsibilities of Sales Personnel......................19
Part Two: Planning the Sales Teams Efforts
Chapter 3 Building Relationships through Strategic Planning.......................................22
Chapter 4 The Market-Driven Sales Organization.........................................................25
Chapter 5 Forecasting Market Demand and Sales Budgets............................................27
Chapter 6 Design and Size of Sales Territories..............................................................29
Chapter 7 Sales Objectives and Quotas..........................................................................31
Part Three: Staffing the Sales Team
Chapter 8 Planning for and Recruiting Successful Salespeople.....................................34
Chapter 9 Selection, Placement, and Socialization of Successful People......................36
Part Four: Training the Sales Team
Chapter 10 The Management of Sales Training and Development..................................37
Chapter 11 Contents of the Sales Training Program: Sales Knowledge and the
Selling Process.......41
Part Five: Directing the Sales Team
Chapter 12 Motivating Salespeople Toward High Performance......................................45
Chapter 13 Compensation for High Performance.............................................................48

Chapter 14 Leading the Sales Team.................................................................................52
Part Six:
Controlling the Sales Team
Chapter 15 Analysis of Sales and Marketing Costs..........................................................55

Chapter 16 Evaluation of Salespeoples Performance......................................................57
Section III:Comments on Management Application Questions..................................61
Chapter 1........................................................................................................................63
Chapter 2........................................................................................................................64
Chapter 3............................................................................................................................67
Chapter 4........................................................................................................................68
Chapter 5........................................................................................................................69
Chapter 6........................................................................................................................72
Chapter 7........................................................................................................................73
Chapter 8........................................................................................................................75
Chapter 9........................................................................................................................76
Chapter 10......................................................................................................................77
Chapter 11......................................................................................................................79
Chapter 12......................................................................................................................80
Chapter 13......................................................................................................................81
Chapter 14......................................................................................................................84
Chapter 15......................................................................................................................85
Chapter 16......................................................................................................................86
Section IV:Comments on Ethical Dilemmas.............................................................89
Section V: End of Chapter Case Analysis...............................................................103
1.1
1.2
2.1
2.2
3.1
4.1
4.2
5.1
6.1
6.2
7.1
7.2
8.1
The Wilson Company: Is the Sales Managers Job Really for Me?.................105
Nabisco: What They Didnt Teach Us in Sales Class.......................................105
Mississippi Leasing, Inc.: Is This Legal?......................................................107
Illinois Office Machines, Inc.: How Should You Handle Competition.............107
Alabama Wholesalers, Inc.: Plans Dont Always Work!..................................108
Alaska Office Supplies: Everyone Is Part of the Sales Team....................108
Reynolds & Reynolds: Team Selling.....................................................109
Florida Computer Sales: What Info Is Needed?.................................................109
Arizona Electrical, Inc.: Is the Information Important?.....................................110
Sally Malones District: Development of an Account Segmentation Plan........110
Arkansas Fishing Company: Are Quotas Accurate?.....................................112
Harrell Manufacturing: Elimination of Sales Budgets and Quotas................112
Connecticut Candy Wholesalers: An Unusual Cause of Turnover....................113
8.2
9.1
9.2
9.3
10.1
10.2
10.3
11.1
11.2
12.1
12.2
13.1
13.2
14.1
14.2
14.3
14.4
15.1
15.2
16.1
16.2
R. J. Reynolds: Selecting the Best Sales Team..................................................113

Delaware Fire Arms: Is This the Correct Person?.....116
Bob Johnson: Searching for a Sales Job...........................................................116
Martin, Inc.: The First Woman Is Hired118
Georgia Auto Supply: Does Training Work?.....................................................120
Toys and More, Inc.: Development of a Sales Training Program..........................120
The Telecommunications Corporation: Trainings Impact on Performance......124
Hawaiian Novelties: Did You Make the Correct Choice?.................................127
Tasters Club: Development of Sales Presentation................................................128
Idaho Bakery Supplies: How Can You Motivate This Salesperson?.............129
Teletronic Electronics: The First Woman Is Hired?..........................................129
Illinois Satellite: Selling Your Top Salesperson................................................134
ComputerBytes, Inc.: Should It Use a Draw Compensation Plan?....................134
Indiana Restaurant Equipment & Sales: What to Do with the Guerilla......135
R. J. Reynolds Tobacco Company: Beyond Field Sales...The Home Office.....135
Ohio Biotech, Inc.: Night Work and Travel Have to Stop.................................137
C&D Foods, Inc: Leadership: Who Is Best for the Job?138
Iowa Farm Supplies: Plans and Data Go Together............................................140
Executive Office Supplies: Determining ROI....................................................140
Michigan Security System: Promote Me or Else!..............................................141
The Dunn Corporation: What Should Be Done with a Low performer?...........142
Section VI: End of Textbook Salesforce Experiential Exercises..145

Sales Team Building....147
Sell Yourself on a Job Interview..151
What's Your StyleSenser, Intuitor, Thinker, Feeler? ..157
Your Sales Aptitude.157
Section VII: End of Textbook Experiential Salesforce Technology..167
Sales World Wide Web Directory...169
Internet Exercises.169
ACT!--Goldmine..169
Section VIII: End of Textbook Comprehensive Case Analysis.....................171
Guidelines For Using Cases...173
Instuctors Please Read this Caution Note..174
Case 1
Case 2
Case 3
Case 4
Case 5
Case 6
Zenith Computer Terminals, Inc. (A): Development of a Total Business Plan175

Zenith Computer Terminals, Inc. (B): Strategic Business Plans FailSales Decline..179
Zenith Computer Terminals, Inc. (C): Redesigning Sales Territories...182
Zenith Computer Terminals, Inc. (D): Setting Quotas Facing Decreasing Sales..185
Wallis Office Products: Defining New Sales Roles..189
Briggs Industrial Supply Company: Determining Who and How Many to Hire..193
Case 7 Briggs Industrial Supply Company (B): Creating Recruitment and Selection
Procedures ...200
Case 8 United Cosmetics, Inc.: Creating a Staffing Program...203
Case 9 Farm Machinery For America: The Selection of a Salesperson....205
Case 10 Mead Envelope Company: Is a New Compensation Plan Needed?..219
Case 11 McDonald Sporting Goods Company: Determining the Best Compensation
Program.225
Case 12 Burditt Chemical Corporation: Analysis of Sales and Marketing Costs..231
Case 13 Deer Tractor: Analyzing Sales Data.233
Section IX: Test Bank237
Section X: Transparency Masters467
SECTION I
COURSE ORGANIZATION
AND
TEACHING METHODS
To the Instructor
Thank you for choosing Sales Management to use in your class! It has taken years to bring
you the textbook and the accompanying materials. The material has been class tested numerous
times in both academic and executive development classes. Students, salespeople, and sales
managers have found the material to be educational, enjoyable, practical, and real-world.
We have used this textbook with my different groups, such as undergraduates, graduates,
organizations, in-house training, and Executive MBA programs. Primarily it is used for the
undergraduate sales management course.
The instructor's manual was designed to assist instructors as much as possible in teaching
the sales management course. It has been particularly written for those who have either never
taught the course or not taught the course very often. It will also be a big help to the instructor
looking for a different textbook to use for a change of pace
As you will see, an enormous amount of time and effort was expended to provide you
valuable assistance. Having been in sales with Colgate, Upjohn, and Ayerst Laboratories for eight
years, plus having taught the course over 30 times, I still welcome all the help I can get from time to
time. So I know how much an instructor's manual can aid you. I sincerely hope it is a help to you!
A Caution Note: It is very challenging--if not impossible--to develop an Instructors
Manual error-free. Our team has worked very hard to provide you accurate information. However,
please double-check the information. For example, we used a spell checker; it came with my PC, it
plainly marks four my revue, mistakes I cannot sea, Ive run this poem threw it, Im sure your please
too no, its letter perfect in its weigh, my checker tolled me sew.
Special recognition goes to Crystal Goodman for her hard work on this IM. Her attention to
detail helps make this the best Instructor's Manual accompanying the text in its six editions. Finally,
I would like to thank Professor Tom Pritchett, Kennesaw State University, and Betty M. Prichett for
developing an excellent test bank for you. These questions have been class tested. I can create any
50 multiple-choice question test and my students average 76 to 83 on it.
Please contact me at: TAMU--Marketing Department, College Station, TX 77843-4112,
(409) 845-5861 (o), (409) 862-2811 (fax), E-mail: c-futrell@tamu.edu, web page: http://futrellwww.tamu.edu, or the TAMU Lowry May's School of Business web page: http://business.tamu.edu.
Professor Futrell Online!

Beginning in the Fall 1997 I went "Online" with both my personal selling and sales management
courses. While time consuming to set up the Web site, technology is allowing us to do a much
better job of interacting with our students. Students like this "student contact system."
You are invited to visit my Web site at either http://futrell-www.tamu.edu or
http://www.tamu.edu/cba. Occasionally it is down for repair, so e-mail me if you have trouble
getting into the site. My e-mail is c-futrell@tamu.edu.
What follows is a brief overview of my student contact system. You should know that over the
years we have increased enrollments to the largest in the world--as far as I know. We have 800
to 900 students take the courses each year. My individual section size averages 100 students
each. Students enroll in one of two lecture sections and one of six labs. The labs are where
students do their "Sell Yourself on a Job Interview" video role-plays. My sections are for
business majors only.
On the Web site you can go to Classes, and then Marketing 436.
Student Contact System
Students come to the main page for the course and click on "Important -- REGISTER." They
register their student and e-mail numbers. I have them sign a release that it is OK to post their
grades using their student numbers. You could assign each student a password. Registering
helps insure the numbers are inputted correctly. With a digital camera you can also have a nice
picture of each student appear on their grade page. Go to "grades," and input a single "9." This
should show you an example of the grade page.
Students receive all grades Online. Using a group e-mail for each section, I routinely e-mail
such things as when grades are posted on the web and announcements, such as a reminder of a
test, assignment due soon, sales jobs, guest lecturer, etc.
We are continually improving this student contact system and our teaching procedures using
technology. Please contact me any time to see what works or what we are experimenting with
today.
Web Sites for Sales Management and Personal Selling
Please look at both courses' Web site. Also, click on the book covers to allow you or your
students to prints out such things as a complete chapter outline of each book and example test
questions. I also have the URL's of hundreds of organizations having the largest sales forces in
America. Look under Sales hotlinks, Sales Forces.
10
Salesperson Information Sheet

Personal Selling Course
Name:___________________________
Student number:___________________________
When will you graduate?_________
Permanent address:_________________________
Local address:__________________
________________________________
________________________________________
Telephone number:________________________
Telephone number:_____________
E-mail:_________________________________
Major:_______________________
I give Professor Futrell permission to use my

full nine digit student identification number
when posting grades.
Signed:__________________________________
Overall grade point:____________

Grade point in major:___________
School activities:_____________________________________________________________
_____________________________________________________________________________
Are you presently working? __Yes__No
What work experience have you had?____________________________________________
Are you interested in a sales career?_____Yes_____No______Maybe
If yes or maybe, what type of sales job are you interested in?_________________________
Other information you would like to share with me________________________________
What grade do you have to make in this class?_____A_____B_____C_____D. Why?
What are topics you want covered in this course?___________________________________
If yes, where?_____________________________
11
_____________________________________________________________________________
12
Shadow's Bonus Project --Working With Salespeople

In the past, students have benefited from going on sales calls with salespeople. It is the best way to relate
what we do in this course to salespeople's jobs. If you would like to work with a sales person this
semester and write a paper based on the experience, you can earn up to 50 "bonus" points. If you earn the
maximum amount of points, it is like earning an additional 50 points on a test. Here is how the project
will be graded:
50 points for 3 sales calls with a salesperson.
40 points for 2 sales calls with a salesperson.
30 points for 1 call with a salesperson.
You will create a typed paper which is graded on (A) neatness, (B) how well you prepare the paper and
(C) how well you write up the answers to these questions:
1.
Salesperson's name, calling card. Letter from salesperson on company letterhead stationary
stating that you actually worked with the person and the number of customers seen.
2.
Brief background on:

A.
Company
B.
Products sold and to whom
C.
Salesperson
3.
What does it take to be successful in sales?
4.
Description of initial product knowledge, getting product knowledge and selling skills training.
5.
How do you prepare for a sales call?
6.
How do you prepare for a sales presentation?
7.
Does nonverbal communication play a part in sales?
8.
What's the best way to start a presentation?
9.
What's involved in giving a good presentation?
10.
How do you handle objections?
11.
What's the best way to ask for the order?
13
Sales Diary Bonus Project

As a second option, you may chose to keep a sales diary of selling encounters that you have with
salespeople in a variety of jobs. For this project, we are defining a salesperson as anyone who
interfaces with customers and influences a monetary transaction.
The object of this project is to be alert to selling tactics that are prevalent everywhere! If you
elect to keep a diary this semester, you can earn up to 50 bonus points. If you earn the maximum
points, the 50 points will be added as if you earned 50 additional points on the exam.
You will submit a written report based on a sales diary you are to keep from September 30November 15. In this diary, you should document your sales encounters. For each encounter,
you must record factual information (where, when, nature of, and reason for encounter) and your
assessment of each salesperson and his/her use of the selling techniques discussed in class and in
your textbook. Submit your diary along with your written report.
In your report, write about the worst encounter as documented in your diary. Try to determine if
it was due to the salesperson (e.g., Just not motivated), or the organizations training (or lack
thereof). Be creative, seek out other salespeople in the organization, and ascertain whether there
are any patterns in their use of sales techniques. If in fact, they have used sales techniques,
provide examples of their techniques and label the techniques used by the salesperson. Make
specific recommendations as to how the salesperson could have made his/her presentation better,
and/or how the organization can improve its sales training. Describe the problem(s) based on the
diary input and present a logical plan for improvement. Be selective and focus on the most
critical aspects of the encounter. You will be limited to eight typewritten pages (double-spaced,
one-inch margins).
Criteria for grading your report include how effectively you incorporate concepts from the text
and lectures into your paper, your ability to diagnose probable causes of the problems and
suggest appropriate solutions. Remember that you are the sales consultant! Grading will also
include how you organize and write your paper -- neatness will count!!!
The following are examples of questions that should be addressed in your paper (this is the
minimum that should be included):
Background
1.
Salespersons name, calling card, organization the salesperson works for, type of sales
job, and products sold. Did you buy?
2.
Nonverbal - what image did the salesperson(s) project? Were they dressed appropriately?
Did they appear courteous and helpful? Did they appear motivated? How would you
classify the salespersons personality style? A Thinker? Intuitor? Feeler? Sensor?
14
15
SECTION II
CHAPTER
LECTURE NOTES
16
17
CHAPTER 1
SALES MANAGEMENT: IT'S NATURE, REWARDS, AND RESPONSIBILITIES
LECTURE OUTLINE
I.
WHAT IS SALES MANAGEMENT?
II.
THE FIVE FUNCTIONS OF SALES MANAGERS

A.
Planning
B.
Staffing
C.
Training
D.
Leading
E.
Controlling
III.
SALES PERFORMANCE
IV.
MAJOR PARTS OF AN ORGANIZATIONAL SYSTEM
V.
TYPES OF SALES MANAGERS

A.
Vertical Differences
B.
Horizontal Differences
VI.
HOW DOES ONE BECOME A SALES MANAGER?
VII.
SALES MANAGEMENT SKILLS

A.
Conceptual And Decision Skills
B.
People Skills
C.
Technical Skills
18
VIII.
IX.
PROMOTION FROM SALESPERSON TO SALES MANAGER

A.
Perspectives Change
B.
Goals Change
C.
Responsibilities Change
D.
Satisfaction Changes
E.
Job Skill Requirements Change
F.
Relationships Change
WHAT IS IT LIKE TO BE A SALES MANAGER?

A.
First-Line Sales Management
B.
The Promotion Experience

1.
Phase 1-Immobilization
2.
Phase 2-Minimization or denial of change
3.
Phase 3-Depression
4.
Phase 4-Acceptance of reality
5.
Phase 5-Testing
6.
Phase 6-Search for meanings
7.
Phase 7-Internalization
C.
Problems New Managers Experience
D.
Making A Successful Transition To Management
E.
Technology Sales Personnel Use
XII.
LEARNING TO BE A SALES MANAGER
XIII.
THE BOTTOM LINE
19
CHAPTER 2
SOCIAL, ETHICAL AND LEGAL RESPONSIBILITIES OF SALES PERSONNEL
LECTURE OUTLINE
I.
MANAGEMENT'S SOCIAL RESPONSIBILITIES

A.
Organizational Stakeholders
B.
An Organization's Main Responsibilities
C.
II.
III.
IV.
1.
Economic responsibilities
2.
Legal responsibilities
3.
Ethical responsibilities
4.
Discretionary responsibilities
How To Demonstrate Social Responsibility
WHAT INFLUENCES ETHICAL BEHAVIOR?

A.
The Individual's Role
B.
The Organization's Role
MANAGEMENT'S ETHICAL RESPONSIBILITIES

A.
What Is Ethical Behavior?
B.
What Is An Ethical Dilemma?
ETHICS IN DEALING WITH SALESPEOPLE

A.
Levels Of Sales Pressure
B.
Decisions Affecting Territory
C.
To Tell The Truth?
D.
The Ill Salesperson
E.
Employee Rights
20
1.
Termination-at-will
2.
Privacy
3.
Sexual harassment
a.
4.
V.
VI.
Reasons for respecting employee rights
SALESPEOPLE'S ETHICS IN DEALING WITH THEIR EMPLOYERS

A.
Misusing Company Assets
B.
Moonlighting
C.
Cheating
D.
Affecting Fellow Salespeople
E.
Technology Theft
ETHICS IN DEALING WITH CUSTOMERS

A.
Bribes Or Gifts
B.
Misrepresentation
1.
What the law says

a.
VIII.
Handling sexual harassment
An example
C.
Price Discrimination
D.
Tie-In Sales
E.
Exclusive Dealership
F.
Reciprocity
G.
Sales Restrictions
MANAGING SALES ETHICS

A.
Follow The Leader
21
IX.
B.
Leader Selection Is Important
C.
Establish A Code Of Ethics
D.
Create Ethical Structures
E.
Encourage Whistle-Blowing
F.
Create An Ethical Sales Climate
G.
Establish Control Systems
THE BOTTOM LINE
22
CHAPTER 3
BUILDING RELATIONSHIPS THROUGH STRATEGIC PLANNING
LECTURE OUTLINE
I.
II.
IMPORTANCE OF CORPORATE PLANNING

A.
Strategic Planning
B.
Tactical And Operational Planning
C.
Establishing A Mission And Vision
WHAT IS MARKETING?
A.
III.
IV.
Definition of Marketing
MARKETINGS IMPORTANCE IN THE FIRM

A.
Marketing Generates Sales
B.
Marketing Provides Quality Service
ESSENTIALS OF A FIRMS MARKETING EFFORT

A.
Product: Its More Than You Might Think
B.
Services Are Products

1.
Intangibility
2.
Inseparability
3.
Heterogeneity
4.
Perishability And Fluctuating Demand
5.
A Tough Sell
C.
Price: Its Important To Success
D.
Distribution: It Has To Be Available

1.
Distribution moves products to customers
23
2.
VII.
Distribution uses resellers
E.
Promotion: People Have To Be Told
F.
The Goal Of A Marketing Mix
RELATIONSHIP MARKETING
A.
LEVELS OF RELATIONSHIP MARKETING
VIII.
TECHNOLOGY BUILDS RELATIONSHIPS AND PARTNERS
IX.
RELATIONSHIP MARKETING AND THE SALES FORCE
X.
A.
Personal Selling Builds Relationships
B.
Salespeople Generate Revenue
C.
Salespeople Provide Service
D.
Salespeople Implement Relationship Marketing
STRATEGIC PLANNING AND THE SALES MANAGEMENT PROCESS

A.
Planning A Sales Strategy
B.
The Development of Sales Strategies
C.
1.
The present situation
2.
Preparation of the multiyear strategic plan
3.
Financial planning is a part of the sales strategy
Setting Next Years Sales Plan

1.
Establish key objectives
2.
Compare present with future
3.
Allow field managers to participate
4.
Develop the budget
5.
Establish progress checkpoints
24
D.
XII.
6.
Formalize your plan
7.
Convert plans into individual objectives
Sales Objectives Direct Other Activities
THE BOTTOM LINE
25
CHAPTER 4
THE MARKET-DRIVEN SALES ORGANIZATION
LECTURE OUTLINE
I.
FACTORS INFLUENCING ORGANIZATIONAL DESIGN AND STRUCTURE
II.
MARKETING AND MARKETS

A.
III.
Salespeople Work In Two Markets
SALES JOBS ARE VARIED AND CAN BE CLASSIFIED

A.
Application Of The Sales Job Classifications

1.
Order Takers
2.
Order getters
a.
B.
IV.
V.
True Salespeople Are Hard To Find
THE SALESPERSON'S JOB ACTIVITIES AS A TERRITORIAL MANAGER

A.
Provides Solutions To Customer's Problems
B.
Provides Services To Customers
C.
Sells To Current And New Customers
D.
Helps Customers Resell Products To Their Customers
E.
Helps Customers Use Products After Purchase
F.
Builds Goodwill With Customers
G.
Provides Company With Market Information
SALES ORGANIZATIONAL DESIGN

A.
VI.
Order getters build relationships
Purposes And Importance Of Job Design
SALES ORGANIZATIONAL STRUCTURE
26
VIII.
IX.
X.
A.
The Line Organization
B.
Specialized Design
1.
Functional specialization
2.
Staff positions with line authority
3.
Geographical specialization
4.
Product specialization
5.
Customer specialization
6.
Combination of design elements
C.
Organizing For Selling To International Customers
D.
Organizing For Selling To Major Customers
NEW FORMS OF ORGANIZATIONS

A.
Strategic Alliances
B.
Team-Based Organizations
COORDINATION AND TECHNOLOGY

A.
International Coordination
B.
Coordination Provides Customer Service
THE BOTTOM LINE
27
CHAPTER 5
FORECASTING MARKET DEMAND AND SALES BUDGETS
LECTURE OUTLINE
I.
MANAGING SALES INFORMATION
II.
FORECASTING MARKET DEMAND
III.
USES OF SALES FORECASTS
IV.
THE FORECASTING PROCESS

A.
V.
The Breakdown And Buildup Forecasting Categories
SALES FORECASTING METHODS

A.
Survey Forecasting Methods

1.
Executive opinion
a.
3.
Sales force composite

a.
B.
Delphi method
Should salespeople be paid bonuses for accurate forecasts?
4.
Users expectations
5.
Build-to-order
Mathematical Forecasting Methods

1.
Test markets
2.
Time series projections

a.
Naive method
b.
Moving average
c.
Exponential smoothing
d.
Trend projections
28
e.
VI.
THE TOP BRASS APPROVES THE FINAL FORECAST

A.
VII.
The Need To Overcome "Computerphobia"
THE SALES MANAGER'S BUDGET

A.
VIII.
Regression analysis
Budget Purposes
1.
Planning
2.
Coordination
3.
Control
B.
Sales Force Budgeting Methods
C.
Forecasted Budget For Sales Regions
D.
Budgets Should Be Flexible
THE BOTTOM LINE
29
CHAPTER 6
DESIGN AND SIZE OF SALES TERRITORIES
LECTURE OUTLINE
I.
WHAT IS A SALES TERRITORY?

A.
Who Is Responsible For Territorial Development?

1.
B.
II.
Why Establish Sales Territories?

a.
To obtain thorough coverage of the market
b.
To establish a salesperson's responsibility
c.
To evaluate performance
d.
To improve customer relations
e.
To reduce sales expense
f.
To allow better matching of salesperson to customer
g.
To benefit salespeople and the company
Why Sales Territories May Not Be Developed
FACTORS TO CONSIDER IN DESIGNING SALES TERRITORIES

A.
Select Basic Control Units
B.
Analyze Salespeople's Work Loads
C.
1.
Nature of the job
2.
Intensity of market coverage
3.
Type of products sold
Determine Basic Territories

1.
Forecast sales and determine sales potentials
2.
Determine sales volume needed for each territory
30
3.
a.
Breakdown approach
b.
Equalized workload
c.
Incremental method
4.
Tentatively establish territories
5.
Determine number of accounts for each territory
6.
Finalize and draw boundary lines
D.
Assign To Territories
E.
Customer Contact Plan
F.
1.
Carefully planning routes
2.
Using the telephone for territorial coverage
Evaluation And Revision Of Sales Territories

1.
III.
Determine number of territories
Revising sales territories
THE SALES TERRITORY IS A BUSINESS

A.
The Right Salesperson Pays Off
B.
Open Sales Territories
IV.
USING COMPUTERS TO DESIGN TERRITORIES
V.
THE BOTTOM LINE
31
CHAPTER 7
SALES OBJECTIVES AND QUOTAS
LECTURE OUTLINE
I.
WHAT IS A QUOTA?
II.
WHY ARE QUOTAS IMPORTANT?
III.
A.
Quotas Provide Performance Targets
B.
Quotas Provide Standards
C.
Quotas Provide Control
D.
Quotas Provide Change Of Direction
E.
Quotas Are Motivational
TYPES OF QUOTAS
A.
Sales Volume Quotas

1.
B.
Profit Quotas
1.
IV.
Breakdown total sales volume
The two types of profit quotas
C.
Expense Quotas
D.
Activity Quotas
E.
Customer Satisfaction
F.
Quota Combinations
METHODS FOR SETTING SALES QUOTAS

A.
Quotas Based On Forecasts And Potentials
B.
Quotas Based On Forecasts Only
C.
Quotas Based On Past Experience
32
V.
VI.
D.
Quotas Based On Executive Judgments
E.
Quotas Salespeople Set
F.
Quotas Related To Compensation
EXAMPLES OF SETTING SALES QUOTAS

A.
How Restaurant Supply Corporation Sets Quotas
B.
How General Mills Sets Quotas
SBO SETS FUTURE TARGETS

A.
Treating The Territory As A Business
B.
Managing Each Account

1.
Build the stars
2.
Harvest the cash cows
3.
Fix your problems
4.
Dogs
C.
Managing Each Call
D.
Managing Oneself
VII.
BASIC LEVELS OF INDIVIDUAL OBJECTIVES
VIII.
THE PROCEDURES OF SETTING OBJECTIVES AND QUOTAS WITH

SALESPEOPLE
IX.
A.
Prepare The Way
B.
Schedule Conferences With Each Salesperson
C.
Prepare A Written Summary Of Goals Agreed On
D.
Optional Group Meetings To Share Objectives
A GOOD OBJECTIVE AND QUOTA PLAN IS SMART
33
X.
SELLING BY OBJECTIVE PROCEDURES

A.
The Basic Process Is A Two-Way Approach
XI.
THE SALES TERRITORY IS WHERE QUOTAS ARE MADE
XII.
THE BOTTOM LINE
34
CHAPTER 8
PLANNING FOR AND RECRUITING SUCCESSFUL SALESPEOPLE
LECTURE OUTLINE
I.
WHAT IS SALES HUMAN RESOURCE MANAGEMENT?
II.
PEOPLE PLANNING
A.
More Effective And Efficient Use Of Human Resources

1.
B.
C.
Interview to territory time line
Improved Performance Of The Sales Force

1.
Whats a salesperson worth?
2.
Goal: Hire Above Average Performers
Who Does The Planning?
III.
PEOPLE FORECAST
IV.
DETERMINING TYPE OF PERSON FOR THE JOB

A.
V.
The Job Analysis Is Important
JOB DESCRIPTIONS AND SPECIFICATIONS FOR SUCCESSFUL PEOPLE

A.
What Are Job Specifications For Successful Salespeople?
B.
Profiling The Successful Candidate

1.
The American Computer Supply Corporations Profile
VI.
RECRUITMENT'S PURPOSE
VII.
LEGAL INFLUENCES
A.
VIII.
What Recruiting Information Can Be Collected?
RECRUITMENT OF SALESPEOPLE
A.
How Many Recruits Does It Take?
35
B.
IX.
Who Does The Recruiting?
SOURCES OF RECRUITS--WHERE ARE THEY FOUND?

A.
B.
C.
Internal sources
1.
Current employees
2.
Promotions
3.
Transfers
External sources
1.
Walk-ins
2.
Public employment agencies
3.
Private employment agencies
4.
Radio and television
5.
Newspaper advertisements
6.
Telephone-in advertisements
7.
The Internet
8.
Internships
9.
Colleges And Universities
10.
Competitors
Realistic job previews help both company and recruits
X.
THE QUALIFIED APPLICANT POOL
XI
RECRUITMENT EVALUATION
XII.
THE BOTTOM LINE
36
CHAPTER 9
SELECTION, PLACEMENT, AND SOCIALIZATION OF
SUCCESSFUL SALESPEOPLE
LECTURE OUTLINE
I.
II.
III.
SELECTION AND PLACEMENT OF SUCCESSFUL SALES PERSONNEL

A.
Is Selection The Most Important Element In Fielding A Sales Force?
B.
Purposes And Importance Of Selection And Placement
C.
Factors Influencing Selection And Placement
PREDICTORS FOR SELECTION DECISIONS

A.
What Are Predictors?
B.
Sources For Collecting Information
C.
Is The Information Job-Related?
THE SELECTION PROCESS

A.
The Job Application Bank

1.
B.
Information typically collected
The Personal Interview--A One-On-One Selling Situation

1.
Criticisms of interviewing
2.
Types of interviews
a.
The stress interview
3.
Nonverbal cues in interviews
4.
Interviewing phases
a.
Interview preparation
b.
Opening the interview
37
5.
C.
IV.
c.
The interview
d.
Ending the interview
e.
Post-interview
Interview guidelines
Tests
1.
Employment tests
2.
Polygraph test
3.
Testing problems
3.
Establishing a testing program
D.
Assessment Centers
E.
Employment References
F.
Physical Examinations
EVALUATING SELECTION AND PLACEMENT DECISIONS

A.
People May Reject The Offer! Why?
V.
THE SOCIALIZATION OF SALES PERSONNEL
VI.
THE BOTTOM LINE
38
CHAPTER 10
THE MANAGEMENT OF SALES TRAINING AND DEVELOPMENT
LECTURE OUTLINE
I.
WHAT IS SALES TRAINING?
II.
REENGINEERING TRAINING
A.
Change Brings About Training Reengineering
III.
PURPOSES OF SALES TRAINING
IV.
A SALES TRAINING MODEL
V.
PHASE ONE: PLANNING FOR SALES TRAINING
VI.
A.
Organizational Analysis
B.
Operational Analysis
C.
Sales Personnel Analysis
D.
Customer Analysis
E.
Making The Needs Assessment
F.
Sources Of Information For Determining Training Needs
PHASE TWO: ORGANIZING FOR SALES TRAINING

A.
Technology-Based Training Methods

1.
Interactive multimedia training
2.
Electronic performance support systems
3.
High tech customer service
4.
Distance Learning
B.
Role-Playing
C.
On-The-Job Training
39
D.
Training Learning Curves

1.
E.
F.
Where Does Training Take Place?

1.
Centralized training
2.
Decentralized training
When Does Training Occur?

1.
VII.
IX.
Sales meetings
PHASE THREE: STAFFING FOR SALES TRAINING

A.
VIII.
Plateaus
Who Is Involved In Training?

1.
Corporate staff trainers
2.
Sales force personnel
3.
Outside training specialists
PHASE FOUR: DIRECTING THE SALES TRAINING EFFORT

A.
Training Culture
B.
Support From The Top
C.
Leadership
PHASE FIVE: SALES TRAINING EVALUATION

A.
Steps In The Evaluation

1.
2.
What should be measured?

a.
Components to measure
b.
Groups to evaluate
c.
Items to measure
What should be the information collection method?
40
X.
3.
What should be the measurement methods?
4.
Analysis, conclusions, and recommendations
THE BOTTOM LINE
41
CHAPTER 11
CONTENTS OF THE SALES TRAINING PROGRAM:
SALES KNOWLEDGE AND THE SELLING PROCESS
LECTURE OUTLINE
I.
LEARNING IS A LIFE-LONG JOURNEY
II.
SHOULD IT BE CALLED TRAINING OR EDUCATION?
III.
RELATIONSHIP OF TRAINING TO LEARNING

A.
On-The-Job Behavior
1.
IV.
V.
Operational and behavioral information
SALES KNOWLEDGE DEVELOPMENT

A.
Company Knowledge
B.
The Sales Role
C.
Product knowledge
D.
Prices
E.
Advertising And Sales Promotion
F.
Channels Of Distribution
G.
Customers
H.
Competition, Industry, And Economy
J.
Territorial Management Skills
KNOWLEDGE OF TECHNOLOGY
A.
Sales And Customer Service Enhancement
B.
Personal Productivity
1.
Contact management
42
C.
D.
2.
Calendar management
3.
Automated sales plans, tactics, and ticklers
4.
Geographic information systems
5.
Computer-based presentations
Communications With Customers And Employer

1.
Word processing
2.
Electronic mail
3.
Fax capabilities and support
Customer Order Processing And Service Support

1.
VI.
E.
E-Commerce and the Sales Force
F.
Global Technology
SALES SKILLS DEVELOPMENT

A.
VII.
Salespeoples mobile offices
Persuasive Communications
THE SELLING PROCESS

A.
Prospecting Finds Customers

1.
B.
Referrals are popular

a.
Leads
b.
Referrals
c.
Orphans
d.
Customers
Preapproach Is Precall Planning

1.
Determining a sales call objective
43
C.
D.
2.
Developing a customer profile
3.
Developing a customer benefit plan
4.
Developing the sales presentation
The Approach--Opening The Sales Presentation

1.
The first impression is critical to success
2.
Approach techniques are numerous

a.
Introductory approach
b.
Product approach
c.
Customer benefit approach
d.
Curiosity approach
Making A Great Presentation

1.
The sales presentation mix
2.
Salespeople, managers and trainers prepare presentation mix
3.
Sales presentation methods
4.
a.
Stimulus - response method
b.
Formula method
c.
Need-satisfaction method
Technology can help make the sale
E.
The Trial Close
F.
Objections Are Salespeople's Friends

1.
Types of objections
2.
Techniques for meeting questions

a.
Postponing objections
44
G.
H.
b.
Boomerang
c.
Asking questions
The Close
1.
Difficulties with closing
2.
Closing techniques
a.
The compliment
b.
The summary
c.
Minor decision
d.
Assumptive
Follow-Up And Service Quality Are Critical
VIII.
RESEARCH REINFORCES CHAPTER'S SALES SUCCESS STRATEGIES
IX.
ADAPTING TO GLOBAL MARKETS
X.
THE BOTTOM LINE
45
CHAPTER 12
MOTIVATING SALESPEOPLE TOWARD HIGH PERFORMANCE
LECTURE OUTLINE
I.
MOTIVATION AT EBBY HALLIDAY REALTORS
II.
UNDERSTAND WHAT MOTIVATION IS ALL ABOUT

A.
III.
The Sales Motivation Mix
DEVELOP A SALES CULTURE

A.
Implementation Of Sales Culture

1.
Ceremonies and rites
2.
Stories
3.
Symbols
4.
Language
IV.
KNOW SALESPEOPLE'S BASIC NEEDS
V.
WHAT'S IN IT FOR ME?

A.
What Is The Probability Of Success?
B.
Will I Be Rewarded For Success?
C.
Are The Rewards Worth It?
C.
1.
Expectancy example
2.
Managerial implications of expectancy theory

a.
Increase expectancies
b.
Make performance instrumental toward positive outcomes
c.
Identify positively valent outcomes
Are The Rewards Fair?
46
D.
VI.
VIII.
Job satisfaction and work attitudes
2.
Voluntary turnover
The Dynamics Of The Model
GET TO KNOW THE PERSONAL SIDE OF YOUR SALESPERSONS!

A.
Understand The Salesperson's Motivational Behavior
B.
Match People's Motives With Incentives They Value

1.
Everyone values money
2.
Motivate the team
MOTIVATIONAL COACHING IS NEEDED FOR HIGH-PERFORMANCE RESULTS

A.
IX.
1.
A SALESPERSON'S BEHAVIORAL MODEL

A.
VII.
How To Facilitate Equity
Salespeople Have Boundary Positions

1.
Role ambiguity can influence performance
2.
Role conflict also influences performance
BE REALISTIC ABOUT MOTIVATING SALESPEOPLE!

A.
Techniques Will Help Get The Job Done

1.
Teach teamwork
2.
Empower
3.
Communicate
4.
Hear
5.
Notice
6.
Initiate Integrity
7.
Query
47
X.
8.
Unify
9.
Exalt
10.
Set standards
THE BOTTOM LINE
48
CHAPTER 13
COMPENSATION FOR HIGH PERFORMANCE
LECTURE OUTLINE
I.
COMPENSATION AT INGERSOLL-RAND
II.
COMPENSATION IS MORE THAN MONEY

A.
III.
Purposes Of Compensation
1.
Connect individual with organization
2.
Influence work behavior
3.
Organizational choice
4.
Influence satisfaction
5.
Feedback
6.
Reinforcement
DESIGNING A COMPENSATION PROGRAM

A.
Determine Sales Force And Compensation Objectives
B.
Determine Major Compensation Factors

1.
Wage level
2.
Wage structure
3.
Individual wage
4.
Administration procedures
49
C.
Implement Long- And Short-Range Compensation Programs

1.
Communicate compensation policy
D.
Relate Rewards To Performance
E.
Measurement Of Performance
F.
Appraisal And Recycling
IV.
PERFORMANCE-BASED PAY: PREREQUISITES AND OBSTACLES
V.
TYPES PF COMPENSATION PLANS

A.
B.
C.
Straight Salary
1.
Advantages to the salesperson
2.
Disadvantages of the straight salary plan
3.
When to use straight salary plans
Straight Commission Plans

1.
Drawing accounts
2.
Advantages of straight commission plans
3.
Disadvantages of the commission plan
4.
When to use straight commission plans
Combination Salary Plans

1.
What is the split?
2.
How to calculate
3.
a.
Set an upper limit
b.
Consider profitable products
Who should participate?

a.
Split credit
50
b.
Support people
4.
Salary administration
5.
When to pay
a.
Salary and commission
b.
Bonus: individual or group
6.
Sales contests
7.
When to use a combination salary plan
VI.
THE MANAGER'S COMPENSATION
VII.
SALES FORCE EXPENSES

A.
Types Of Expense Plans

1.
Company pays all expenses
2.
Salesperson pays all expenses
3.
Partial payment of expenses
VIII.
FRINGE BENEFITS
IX.
THE TOTAL COMPENSATION PACKAGE
X.
FACTORS TO CONSIDER WHEN DEVELOPING A NEW PLAN

A.
XI.
Information To Collect
1.
Competitors' plans
2.
Product profitability
3.
Sales force activities
DEVELOPING AND INTRODUCING A NEW PLAN

A.
Pretest The Plan
B.
Sell The Plan To The Sales Force
51
C.
XII.
Constantly Evaluate The Plan
THE BOTTOM LINE
52
CHAPTER 14
LEADING THE SALES TEAM
LECTURE OUTLINE
I.
THE NATURE OF LEADERSHIP

A.
Leaders Versus Managers
B.
Characteristics Of The Visionary Leader
II.
AN INTEGRATIVE SALES MANAGER'S MODEL OF LEADERSHIP
III.
THE SALES MANAGER

A.
Personality Characteristics
B.
Needs And Motives
C.
Power
D.
IV.
1.
Legitimate power
2.
Reward power
3.
Coercive power
4.
Expert power
5.
Referent power
6.
The use of power
Past experience and reinforcement
THE SALES MANAGERS BEHAVIOR AND ACTIVITIES

A.
Behavior Influences Salespeople

1.
Style 1: Tells
2.
Style 2: Persuades
3.
Style 3: Participates
53
4.
B.
Activities Influence Salespeople

1.
2.
3.
V.
Style 4: Delegates
The supervision activity

a.
Indirect supervisory methods
b.
Direct supervisory methods
The coaching activity

a.
Presession analysis and planning
b.
The Joint sales call
c.
Postcall discussions
d.
Summary and critique
The counseling activity

a.
Some counseling principles
b.
Three categories of problems
c.
Possible counseling approaches
d.
Types of counseling
THE SALESPERSON
A.
Personality Characteristics
B.
Needs and Motives
C.
Performance Level
1.
Performance level 1 - (low, low)
2.
Performance level 2 - (low, high)
3.
Performance level 3 - (high, low)
4.
Performance level 4 - (high, high)
54
5.
VI.
VII.
Experienced salesperson also needs leadership
D.
Past experience
E.
Leadership Style Selection Requires Power
THE SALE GROUP

A.
Characteristics
B.
Expectations
C.
Norms
D.
Sales Culture
THE SITUATION
A.
The Task Faced
B.
The Organizational Factors
The Problem Faced
D.
The Time Pressures
VIII.
THE SALESPERSONS BEHAVIOR
IX.
THE BOTTOM LINE
55
CHAPTER 15
ANALYSIS OF SALES AND MARKETING COSTS
LECTURE OUTLINE
I.
MARKETING AUDIT
A.
Sales Force Audit

1.
B.
Directing The Marketing Effort

1.
II.
Iceberg principle
NET SALES VOLUME ANALYSIS

A.
B.
III.
The 80/20 principle
What Is Sales Analysis?

1.
Accumulation of sales analysis information
2.
Uses of sales analysis
Analyzing Sales Volume

1.
Sales by region: district
2.
Sales by salesperson
3.
Sales by customer classifications
4.
Sales by product
MARKETING COST ANALYSIS

A.
What Is Marketing Cost Analysis?
B.
Uses Of Marketing Cost Analysis
C.
Objectives Of Marketing Cost Analysis
D.
Assigning Marketing Costs
E.
Methods For Determining Profitability
56
IV.
F.
Techniques Of Cost Analysis
G.
Return On Investment
H.
Increasing Productivity
J.
Problems in cost analysis
K.
Variance Analysis
THE BOTTOM LINE
57
CHAPTER 16
EVALUATION OF SALESPEOPLE'S PERFORMANCE
LECTURE OUTLINE
I.
PERFORMANCE APPRAISAL AT J & J
II.
PERFORMANCE APPRAISAL--WHAT ARE THEY?

A.
The Purposes And Importance Of Performance Appraisals
B.
Evaluate And Develop For Motivation To Higher Performance
IV.
PERFORMANCE APPRAISAL'S RELATIONSHIP TO BEHAVIOR
V.
PERFORMANCE APPRAISAL PROCESSES AND PROCEDURES

A.
Who Should Evaluate Salespeople?
B.
When Should Salespeople Be Evaluated?
C.
Are The Performance Criteria Appropriate?

1.
2.
D.
Guidelines for performance criteria

a.
Measurable
b.
Practical
c.
Relevant
d.
Discriminating
e.
Stable
Development of performance criteria

a.
Quantitative performance criteria
b.
Qualitative performance criteria
Performance Evaluation Forms For Gathering Information

1.
Graphic appraisal scales
58
E.
2.
Descriptive statements
3.
Management by objectives
4.
Behaviorally anchored rating scales
5.
360-Degree feedback
Influences On Performance Appraisals Accuracy

1.
New sales managers
2.
False performance results
3.
Personalities enter in
a.
Central tendency errors
b.
Different evaluation standards
c.
The halo effect
d.
Recent performance error
4.
The manager's attitudes
5.
Salespeople's expectations
V.
THE LEGAL ASPECTS OF PERFORMANCE APPRAISALS
VI.
RULES TO PERFORMANCE APPRAISALS
VII.
A.
Be Objective
B.
Set Goals And Standards
C.
Be Honest
D.
Be Consistent
E.
Use Proper Documentation
F.
Follow Company Policy
CONDUCTING THE APPRAISAL SESSION
59
VIII.
A.
Be Prepared
B.
Be Positive
C.
Review Performance
D.
Finalize The Performance Evaluation
E.
Summarize The Total Performance Evaluation
D.
Evaluate The Evaluation System
VII.
YOU HAVE ALMOST FINISHED THIS TEXTBOOK
IX.
THE BOTTOM LINE
60
61
SECTION III
COMMENTS ON MANAGEMENT
APPLICATION QUESTION
62
63
COMMENTS ON MANAGEMENT APPLICATION QUESTIONS

CHAPTER 1
SALES MANAGEMENT: ITS NATURE, REWARDS, AND RESPONSIBILITIES
1.
The five functions of sales managers are:
Planning: Building a profitable customer-oriented sales team.
Staffing: Hiring the right people to sell and lead.
Training: Educating sales personnel to satisfy customers.
Leading: Guiding average people at above average levels.
Controlling: Evaluating the past to guide the future.
Ignoring any of these functions can hinder the productivity of a business. All of these
functions are essential to the success and growth of a company.
2.
Becoming a sales manager begins with an entry-level position in sales. This usually
consists of a training period, followed by an assignment to a sales territory. Over a period
of a few years, a salesperson can earn status and financial awards as well as contacting
more important clients. After obtaining a senior sales position, a person can then move
into a lower-level management position. Companies usually hire salespeople with the
potential to eventually move into management.
Strategic or top managers are at the top of the hierarchy and are responsible for the entire
organization. Tactical or middle managers work at the middle levels of an organization
and are responsible for major groups, such as zone and regional sales leaders.
Operational or first-line managers are directly responsible for sales of goods and services,
as well as supervising non-management employees of the company. Managers can also
be divided horizontally. Many firms have different divisions such as consumer,
industrial, and institutional divisions each with their own sales force and management
hierarchy.
3.
The following are major areas of change to make the transition from salesperson to sales
manager:
Perspective: Think of the sales team and the company rather than personal sales.
Goals: Company goals and objectives rather than personal goals.
Responsibilities: Depend on others doing the work through the sales manager's
supervision.
64
Satisfaction: Learning to be satisfied by watching others succeed in selling rather

than actually doing the selling.
Skill Requirements: Must learn new skills such as delegating, motivating, directing,
and training.
Relationships: New relationships with former peers, other managers and a new
supervisor must be developed.
4.
A first-line sales manager is the link between upper-level management and the sales
force. Their primary responsibility is the application of rules and procedures to achieve
efficient sales, profits, and customer service, and to motivate subordinates to achieve
the goals of the company as determined by upper-level managers.
5.
Today, companies are enmeshed with foreign competitors, suppliers, and customers.
American companies must compete globally to establish themselves in the worldwide
market share. Common markets are reducing trade barriers while also increasing global
competition. This is forcing sellers to think on an international scale.
6.
Some common problems experienced by sales managers are lack of preparation for the
job, the need to step into the job and function effectively immediately, and the lack of an
immediate peer group in their new position.
CHAPTER 2
SOCIAL, ETHICAL, AND LEGAL RESPONSIBILITIES OF SALES PERSONNEL
1.
If you feel these actions fall within our definition, then each of the three situations are
socially responsible actions. They can be viewed as contributing to the welfare of
employees.
Yes, managers feel business ethics can be improved. They face ethical situations such as:
2.
How much pressure should be place on salespeople to sell?

Telling people they are good salespeople but not management material.
The rights of the employees to such things as privacy and access to employment
records, a smoke-free work environment, and freedom from sexual harassment at
their job.
While most students will probably want to answer that they would be most affected by
their individual moral development, this may be an idealistic exaggeration. As pointed
out by the text, most managers have not advanced beyond the conventional level where
one feels that good behavior is living up to what is expected by others and the social
65
system. Many are still on the pre-conventional level and would act in accordance with their own
self-interest. Persons on both of these levels would probably go ahead and inflate their
expense account if they felt it was ethically wrong.
3.
This question was designed to stimulate student discussion. It leads to an examination of

the underlying nature of ethics and an appreciation that unethical decisions tend to exploit
or take advantage of others. When the manager confronts a true ethical dilemma, either
choice may result in harm to others. Students are often able to provide examples of
situations in which someone is hurt either way. Typically, the most ethically responsible
choice is the one that does the least damage.
4.
Sales puffery is statements that are viewed as opinions and are not of a factual nature.
Misrepresentation includes claims or promises about a product's inherent capabilities.
There are a number of ways listed in the text of how to avoid costly mistakes between the
two. Extensive product knowledge on the part of the salesperson and educating the
customer as to the product's capabilities and limitations are among the most important
items to remember.
5.
For an organization to succeed--such as at Lincoln Electric--its managers must define

goals and specify activity that will help the organization achieve them. In the pursuit of
its strategies and goals, managers must make choices. In a noncompetitive world, all
stakeholders might be considered equal. In a capitalistic economy, the manager's
responsibility is to define which stakeholders are most valued. This does not mean that
low-ranking stakeholders will be exploited; it simply means that some stakeholders are
more instrumental in helping the organization attain its goals. Indeed, the definition of
ethical behavior is that organizations should treat individuals equally except when
differences are relevant to goals and tasks. The treatment of individuals should not be
capricious, but should help the organization accomplish its goals. To expect
organizations to treat all stakeholders equally is not reasonable.
6.
A code of ethics combined with an ethics committee does tend to be more effective than
leadership. The code of ethics communicates to everyone within the organization the
boundaries within which they should behave and the values for which the organization
stands. An ethics committee provides an outlet through which questionable activities can
be surfaced and discussed, and hence provides guidance to organization members. The
code of ethics and ethics committee are an effective way to define and communicate the
organization's values both inside and outside the organization. Such an arrangement
formalizes and clarifies ethics. It is not subject to interpretation. However, leadership
can also achieve much. Of course, the ideal is to use both methods.
66
7. a. In dealing with such a sensitive personal issue, the manager must remember that although
the salesperson has revealed their condition to the manager, he may not want it revealed
to the entire organization. Requesting that he keep the manager updated on his condition
is being supportive, as opposed to transferring him to an area where he can work alone,
which is ostracizing him for his condition. However, consulting a human resource officer
is advisable in order to stay within company policies (if there are any) and legal courses
of action.
b. In deciding among these, a manager must realize the implications upon the working
attitudes among the staff. Laying off workers for reasons other than poor performance, or
merely suggesting they leave the organization may demonstrate a lack of loyalty on the
part of management. However, privately presenting this option to them in a nonthreatening way would be direct and honest.
c. To answer this question, the students must determine to what extent the employee should
be expected to perform. If they feel that the employee should be given a certain amount
of leeway during these times, then not passing blame on to the employee may be
acceptable. However, if the manager has confronted her about her performance, then it
may be time to seek support from a supervisor.
d. Because the new supervisor has not lied to the reader, the students must be encouraged
to differentiate personal feelings from professional work problem. Even if this does not
affect their answer, the student must remember that this person has not negatively
impacted their job as a direct result of this lie. Consulting a human resources officer or
confronting the person about their false claims would deal with the problem
satisfactorily, however, the student may not feel compelled to say anything at all.
e. Any personnel who knows about unethical behavior and does not further corrective
action is potentially at risk if that behavior were to become public. However,
contacting the oversight commission or taking the matter public may be unnecessary if
the company is truly working to correct the problem.
f. Although many people would not find using material of this sort objectionable, students
must remember that acceptance of behavior like this could possibly be indicative of a
larger management problem. Mainly the students would need to examine the point at
which they would draw a line between industry competition and going too far to beat a
competitor.
67
CHAPTER 3
BUILDING RELATIONSHIPS THROUGH STRATEGIC PLANNING
1.
There are three different types of planning within management:
Strategic planning: Involves making decisions about the organizations long-term

goals and activities that an individual, group, work unit, or organization will pursue in
the future, and the use of resources to obtain them.
Tactical planning: Translates broad strategic goals and plans into specific goals and
plans relevant to a definite portion of the organization, often a functional area such as
marketing, or human resources.
Operational planning: Identifies the specific procedures and processes required at
lower levels of the organization
These three types of planning represent different levels of planning. Goals and plans
become more specific and involve shorter periods of time as planning moves from the
strategic level to the operational level.
2.
The salesman should be reminded of the 6 P's. "Proper prior planning prevents poor
performance." Planning is essential to increasing productivity of the organization,
including the sales force.
3.
Personal selling is a part of marketing. Sales people are in direct communication with a
companys customers. Because they talk directly with the customer, they are able to
customize their sales presentations to the individual needs of specific people and
organizations. This is an essential element of any organizations marketing mix. The
main functions of personal selling are to generate revenue and to provide service to help
satisfy customers. These build relationships and are the keys to success in todays
competitive marketplace.
4.
The following are the four elements of a firms marketing mix:
Product: Refers to both goods and services, as well as their tangible and intangible
attributes, such as packaging, brand, and the reputation of the seller.
Price: Refers to the value or worth of a product that attracts the buyer to exchange
money or something of value for the product.
Distribution or place: Refers to the channel structure used to transfer products from
an organization to its customers. It is important to have the product available to
customers in a convenient and accessible location.
Promotion: Increases company sales by communicating product information to
potential customers via personal selling, advertising, publicity, and sales promotion.
68
5.
Building a relationship with a customer creates customer loyalty. Relationship marketing

is based on the idea that important customers need continuous attention. This form of
selling creates a long-term, collaborative relationship with the customer allowing the
company to sell to the customer now and in the future. To build relationships with
customers and organizations, salespeople must take a customer-oriented approach to
selling. They should contact the customer after the first sale to ensure satisfaction with
the product or service and take care of problems when the customer is unhappy.
CHAPTER 4
THE MARKET-DRIVEN SALES ORGANIZATION
1.
Marketing involves planning and executing a conception, pricing, promotion and

distribution of ideas, goods and services to create exchanges that satisfy individual and
organizational objectives. The two types of markets are consumer and business.
2.
The salespeople in categories 6 and 7 are "order-getters." They have a much more
difficult selling task and prove to be much more valuable to the business. They are true
salespeople and usually earn more than their counter-part, the "order taker."
3.
A salesperson as a territory manager must:
Provide solutions to customers' problems

Provide services to customers
Sell to current and new customers
Help customers resell products
Help customers use products after purchase
Build goodwill with customers
Provide the company with market information
When properly used these seven functions produce successful sales performance.
4.
Organizational design is the formal, coordinated process of communication, authority and

responsibility for sales groups and individuals. It enables salespeople to know their
responsibilities and whom they report to, this lets them concentrate on their job.
5.
There are four main types of specialization:
Functional Specialization: Allows firms to develop departments with special

expertise. Minnetonka Inc., the company that markets Softsoap, has a narrow product
line and they emphasize marketing over research, so they would probably have a
marketing department and a production department. This would be organization by
functional specialization.
69
Geographical Specialization: This would be useful in the company that does business
in a number of locations. Oil companies that have refineries around the country
might be organized this way, or a paper producing firm such as Boise-Cascade.
Product Specialization: There are a number of reasons why a firm might organize
around a product. If it is a very technical product, or distributed through different
channels are two reasons.
Customer Specialization: If the needs of different customer groups are very different,
a firm might organize to serve these customer-specific needs.
6.
The key reason is that these accounts may represent a disproportionate amount of sales.
They may be 20% of the customers, but represent 80% of the sales.
7.
Coordination is the quality of collaboration across groups. If two divisions are working
in conjunction with one another, they are more responsive to customer needs and more
aware of the activities which affect those needs.
8. A one-man-show organization is a type of line organization. The responsibilities of the

key personnel can become too cumbersome for one person, and often some aspect of
their job suffers. It is also problematic to have too much information located within one
job, making it difficult to replace a person who leaves the firm. By spreading out the
responsibilities of the firm, an organization can devote the proper time and energy to
important tasks.
9.
Order getters are more proactive in their approach to sales than order takers. By
building relationships and using more sophisticated sales techniques, they respond more
readily to customer needs. The order taker, on the other hand, only has the ability to
make price distinctions for the customers.
CHAPTER 5
FORECASTING MARKET DEMAND AND SALES BUDGETS
1.
Decision support people, like Dan McKee, help a sales manager have timely, accurate,
and adequate information to help them make decisions. They help with forecasts and
budgets by projecting sales and giving information that allows the sales manager to focus
on establishing strategic plans to achieve organizational goals.
2.
The break down method starts with a broad general environment forecast, which is
broken down to a forecast for the industry and so on until you get to the individual
product. The build-up method starts with estimated sales for a small area, such as a
product, a product line, or a small set of customers. These then keep getting added
together until you get to a company sales forecast. They will probably not give the same
figures for a sales forecast at any given level of the firm. Hopefully, if a firm did both
kinds of sales forecasting, the difference between the forecasts would be manageable, or
they might point out the need for more intensive research to achieve a better forecast.
70
3.
Method
Strengths
Executive Opinion
Experienced executives have a

good "feel" for the market. Can
check other methods. When
product is new. When sales
volume and market are stable
and well defined. When risk of
error is low.
They are in direct contact with
the customer. It is inexpensive
and can be obtained fairly
quickly.
Very good for a limited
customer base, i.e., purchasers
of airliners.
Sales Force Composite
User's Expectations
4.
Weaknesses
Relies on personal views. No
way of weighing individual
opinions. May take up too
much time (Delphi Method).
Dominant individuals may
influence other members.
May be optimistic or
pessimistic. May be receiving
unreliable data about intentions
to buy.
Difficult to predict future
buying habits
Naive Method
$1,100,000
1,100,000
1,025,000
$1,180,488 for next year's sales.
Moving Average Method

$ 975,000
1,025,000
1,100,000
$3,100,000 / 3 = $1,033,333 for next year's sales.
Trend Projection: Least Squares
A least squares by hand is possible given these few data points. Below are the tables and
equations necessary to achieve the equation for the regression line. The sales figures
have been restated in thousands and the years in numerical sequence for ease of
computations. The basic equation for a regression line determined by the least squares
method is:
Y = a + Bx, where:
Y = sales (in thousands)
X = year for those sales
a = Y intercept (not a meaningful number)
b = slope of the line
71
Y
750
825
895
975
1,025
1,100
5,570
X
1
2
3
4
5
6
21
Y = 928.3
X = 3.5
Y2
562,500
680,625
801,025
950,625
1,050,625
1,210,000
5,255,400
X2
1
4
9
16
25
36
91
YX
750
1,650
2,685
3,900
5,125
6,600
20,710
b = S YX - nYX
i=1
= 20,710 - 6(928.3) (3.5) = 1215.7 = 69.5
n
91 - 6(12.25)
17.5
2
2
S X - n(X)
i=1
a = Y - bX = 928.3 - 69.5(3.5) = 928.3 - 243.25 = 685.05
Y = 685.05 + 69.5(X)
Next Year's Sales = 658.05 + 69.5(7) = $1,171,550
They all have their own assumptions about what will continue into the future and they
will to give you the same answer.
5.
The sales budget is used to plan, coordinate, and control. The budget helps sales
managers in planning how to meet their objectives. The budget helps coordinate the
activities between functional units. The budget helps control the way funds are used. It
gives a yardstick for the managers to compare how they are doing.
6. A. (3) Market test. The buyer survey doesn't indicate how buying intentions may change
according to variable economic conditions. The industry forecast depends upon the
availability of production and sale statistics from associations or government sources, but
these figures are often not readily available, detailed, or specific enough. The market test
can also determine the effectiveness of different marketing programs.
B. (2) Past sales figures. The industry forecast is dependent upon the gathering of diverse
production statistics. Past sales figures are readily available and can simply be multiplied
by an average percentage sales increase to produce a reasonably reliable forecast.
C. (3) Sales force survey. Market and buyer surveys, properly conducted, admit a relatively
constant margin of error. Even though salespeople may have special information that is
not available at higher levels, the salesperson may be optimistic or pessimistic by nature,
affecting his or her forecast accordingly.
72
D. (1) Buyer survey. Statistical correlation analysis is overly sophisticated for your needs.
Sales force opinion may not reflect the broader business or economic trends. A buyer
survey would be the logical means of forecasting sales, since future sales depend largely
upon the intentions of buyers.
E. (2) Trend and cycle analysis. Statistical correlation analysis requires critical judgment
and should be done by qualified specialists. The market index method doesn't take into
consideration the relative strength of the particular forces that influence seasonal sales.
Trend and cycle analysis can be used for long-range forecasts--and for short-term
forecasts when cyclic or seasonal patterns are clearly defined.
CHAPTER 6
DESIGN AND SIZE OF SALES TERRITORIES
1.
A sales territory is a group of customers or a geographic area assigned to a salesperson.

(See the chapter reasons why or why not to establish sales territories.)
2.
When designing sales territories, organizations:
3.
Select a basic control unit

Analyze the work load
Determine the basic territories
Assign salespeople to territories
Use the customer contact plan
Evaluate and revise if needed
The six steps to consider when organizing a firm's basic territories are:
Forecast sales and potentials

Determine volume needed for each territory
Determine the number of territories
Tentatively establish territories
Determine number of accounts for each territory
Finalize and draw boundary lines
To complete step 4, tentatively establishing territories, you can use the breakdown
approach, the equalized workload, or the incremental method.
4.
50,000 total yearly calls = 35.7 or 36 salespeople are needed.

1,400 calls per salesperson
5.
These methods should not give the same results. Below are tables showing the work
necessary to determine each.
73
Equalized Workload Method

Customer
Type
A
B
C
Call
Frequency
2 per month
1 per month
1 per quarter
Number of
Accounts
300
700
1100
Calls per Year

7200
8400
1100
20,000
Salesperson Sales Calls 10 X 5 days a week = 50

X 50 weeks
= 2500
Number of
Sales
Salespeople Increase
8
9
10
$75,000
$67,000
$37,500
Incremental Method
Direct
Costs
COGS
$25,000
$25,000
$25,000
$45,000
$40,500
-$22,000
Net profit
Contribution
=
=
=
=
$ 5,000
$ 2,000
<$10,000>
Nine salespeople should be in this district.

6.
The first step would be to locate the salesperson's accounts on a map, using different
colors for different size accounts. Look for natural sections of the territory that contain
about the same number of the largest accounts. See if the accounts fall into a discernible
pattern, such as a cloverleaf, a circle, or a straight line. Suggest things such as, getting up
early and traveling to the most distant account and working back to the salesperson's
base. Working with the salesperson, an effective sales route should be able to be
developed that will keep travel time to a minimum and thereby increase the time
available for selling.
7.
Sales costs are still on the rise, and the phone may help to cut costs. For a list of
appropriate applications, see this section in the text.
CHAPTER 7
SALES OBJECTIVES AND QUOTAS
1.
Jim Mobley appears to do a very good job in setting and communicating sales quotas for
his people. A computer assists in setting quotas, but changes within territories are taken
into consideration. These quotas are communicated to each salesperson in private.
74
2.
Quotas perform the following functions:
3.
Performance Targets: These give direction and goals for the sales force to attain.
Standards: This is a measurement against which the salesperson's performance can be
compared.
Control: They help direct the salesperson's activities and can be used as an indirect
supervisory technique.
Change of Direction: Salespeople's quotas may help to change the emphasis placed
upon the sales of certain products.
This is not a particularly well-stated quota. It is lacks measurability (increase sales). For
instance, how much is necessary, one dollar or one million dollars? The qualitative areas
lack measurability as well (more effective sales calls, improved customer relations, better
communication skills). However, it does have a time frame (next quarter).
A better quota might be stated as "Our objective is to increase sales 5 percent over last
year's sales for the territory next quarter. We plan to do this through increasing our sales
calls by 5 calls a week, checking the customer's stock levels for them and spending an
additional 15 minutes per sales call to plan the call more thoroughly."
4.
All of these companies could use any or all of the quotas discussed in the book. The
main quota(s) would be:
A.
B.
C.
D.
General Mills -- sales volume and activity quotas.

Xerox -- sales volume and activity quotas.
Beecham's Aqua-Fresh -- sales volume and activity quotas.
Fritos -- sales volume and activity quotas.
The main activity quota used is "the number of daily sales calls."
5.
Look at the differences:

Western District
Sales
Cost of sales
Gross margin
Expenses
Net profit
Sales-net profit ratio
Eastern District
$10,634,000
- 8,507,200
2,126,800
- 140,000
1,986,800
18.6%
$10,380,000
- 8,304,000
2,076,000
- 152,000
1,924,000
18.5%
Difference
$254,000
- 203,200
50,800
+ 12,000
2,800
Eastern's sales are lower, yet expenses are higher and profits lower. At first one might
conclude that because the "sales-net profit ratio" is almost the same, there is no real
difference. However, you need to check out sales and expense differences.
75
6.
Fahey is doing much better than Jackson and especially Bush.

A. Fahey
B. Jackson
C. Bush
Sales Quota
Actual Sales
Difference
Performance
Index
$1,000,000
750,000
1,200,000
$1,100,000
720,000
1,050,000
$100,000
30,000
150,000
110.0
96.0
87.5
(Actual Sales/Quota) X 100

7.
It is impossible to tell very much here. Their manager will have to work with them
several times to see what is really happening.
A. Jackson
B. Johnson
C. Sager
# of Calls
# of Orders
1,200
1,400
1,600
333
700
600
Actual
Sales
$6,000,000
6,046,000
11,000,000
Order-Average
Call Ratio
Size Order
27.7%
50.0
37.5
$18,018
8,637
18,333
CHAPTER 8
PLANNING FOR AND RECRUITING SUCCESSFUL SALESPEOPLE
1.
Planning and forecasting the sales force's short and long term personnel requirements,
and analyzing the sales jobs to determine the knowledge, skills, and abilities that are
needed. These allow for more effective and efficient use of human resources and
improved performance of the sales force.
2.
Job descriptions are formal, written statements describing the requirements and
responsibilities of a specific position. Job specifications are the personnel qualifications
deemed necessary by the organization for the successful performance of the job, such as
skills, education, and abilities.
3.
Recruiting for sales personnel and professional sports players are very similar. Each
individual is important to the success of their team. Success profiles would be developed
in a similar fashion for both groups looking at such things as physical characteristics and
sources to recruit.
4.
The characteristics could be identified as follows: (1) Aggressiveness Member of a

sports team or intramural; Observe in the interview; Leader in a fraternity/sorority or
club; Eye contact/body language (2) Perceptiveness Maturity level during interview;
Answers well, no rambling; Plays off your questions during interview, looks for what you
want; Discipline present (3) Intelligence Test scores; Role-plays well (4) High Energy
Level Ability to do more than one thing (i.e., school plus a job or sports); Observe in
76
interview; observe on day in field (5) Tenacity History of sticking things through to the
end; not a quitter; Sports area - never a starter, but stuck with the team; Proud of
accomplishments.
5.
Internal factors:
Sales Human Resource Planning: This will determine what jobs need to be filled
and where the firm should look for the recruits to fill them.
Job Design and Analysis: This will determine what the design of the jobs will be
like and the necessary qualifications of applicants to fill these jobs.
External Factors:
Legal Influences: Government regulations will influence such things as EEO
programs and compensation.
Labor Market Influences: This will affect how much you might have to pay a
new hire, or how big a pool of applicants you might have that have the proper
qualifications for the job.
6.
The following are the number of people needed and the timeframe necessary to complete
the tasks:
Hire
Offer Jobs
Interview
Applicants
2 people
4 people
40 people
60 people
1 week
1 week
2 weeks
2 weeks
This firm should have at least 60 applicants to start the process with, and it will take 6
weeks to find the two salespeople.
7.
The sales force is the way the firm generates revenues. It is important that a firm should
recruit the best people possible for this vital area of the firm.
CHAPTER 9
SELECTION, PLACEMENT, AND SOCIALIZATION OF
SUCCESSFUL SALESPEOPLE
1.
A recruiter is a matchmaker. They are trying to match the characteristics and demands of
the job and the organization with the personalities, interests and preferences of the
applicants. A good match will benefit both parties and have a long run commitment from
each.
2.
Each one of the areas gives the recruiter different kinds of information about the
applicant. Information about SKA's will help the recruiter determine what level of SKA's
the applicant could bring with him into the job, information about PIP's may help the
recruiter to match the person to a job that he would like, information from the other
category may give information about how much experience or leadership ability the
77
applicant has, and the last category gives information about such things as possession of a
car and/or drivers license.
3.
The first step is the application blank. The information that is obtained will normally
include the applicant's education and work experience. Other information may be
collected if it is related to job qualifications.
4. Positive:
Allows a face-to-face selling for both the company and the applicant.
Helps to determine if there is a match between the applicant and the firm.
Helps to see if there is a match between the potential salesperson and the
manager.
Helps to determine what the benefits of the job will be.

Negative:
Too many interviewers are untrained.
Non-verbal cues may sway an interviewers judgment.
Interviewing is very subjective.
Information obtained in an interview may be interpreted incorrectly.

5.
Just as a poorly planned sales call has a lower chance of making a sale, a poorly planned
interview will have a lower chance of getting a recruit. The interview is a sales call that
is selling the company and the position it has to offer. A well-planned interview will help
make sure that the important questions are asked of the applicants and the important
questions of the applicants are answered.
6.
It is how the salespeople learn about the roles they have in the firm, the basic goals of the
organization, acceptable behavior patterns, etc. It is how salespeople get started correctly
and positively on the job.
CHAPTER 10
THE MANAGEMENT OF SALES TRAINING AND DEVELOPMENT
1.
Training costs should be thought of as an investment in a more productive revenueproducing area of the firm. A well-trained sales force should be more productive and
generate more sales for the firm. An expense is something that the firm gets no return on.
But the training of the sales force is an investment that will return more than its costs
through higher sales from a better-equipped sales force.
2.
Planning is the first phase of sales training. The planning phase is when the needs of the
sales force are assessed, setting objectives to satisfy those needs, and determining how to
evaluate whether the training has accomplished those objectives.
78
3.
The on-the-job (OTJ) training would have the highest degree of trainee participation.
The discussion method would have the lowest. OTJ training would probably work well
for a new employee, a discussion method might work well for a national sales meeting
that is introducing a new product.
4.
See the discussion in the text for this question.
5.
6.
Advantages
Disadvantages
Centralized:
Good facilities. Establishes

some espirit de corp through
meeting other salespeople
Training is standardized
Trainees can concentrate on
learning because they are
away from their territories.
Decentralized:
Can be done anywhere.

Costs are lower. Sessions
are shorter.
Expensive. Salespeople may

come unprepared. Sales
could be lost because salespeople are out of their
territories.
Branch manager may not be

a good trainer. Facilities may
not be as good as in a central location.
The three basic sources of sales trainers are:
Corporate Staff: Their main duties are to identify the training needs of the sales force
and develop programs to meet those needs. They may assist in the actual training.
Sales Force: They bring years of experience and knowledge into the training
situation. Salespeople can relate to them quickly because they are in the field.
Outside Specialists: These may be specialists in a certain area and may possess
expertise that the company couldn't afford to develop on its own.
7.
The culture of a firm helps to define what is important for the employees. If the
employees see that sales training is important, through the culture of the organization,
then they are more likely to actively participate and use the tools that sales training
supplies them with.
8.
Evaluation of sales training determines whether the firm is getting a return on its
investment in the training. The first stage in the process of evaluation is to determine
what should be collected on those areas that are being measured. How this information is
measured is the next step, and then analyzing the data collected drawing conclusions, and
making recommendations is the last step.
79
CHAPTER 11
CONTENTS OF THE SALES TRAINING PROGRAM:
SALES KNOWLEDGE, TECHNOLOGY, AND THE SELLING PROCESS
1.
A salesperson who views the training they have received as worthwhile and helpful will
use it on the job, be receptive to further training, and will have a positive attitude toward
training. If they don't view it as worthwhile, they will not use it in their job and will
develop a negative attitude toward further training.
2.
Operational information is necessary to do the job of selling. It is the "how-to" of getting

forms filled out, expenses reimbursed, new product information and new procedures.
These are used extensively and quickly become a habit for the salesperson. Behavioral
training tries to change how people do their job of selling. This can be especially
difficult for a veteran salesperson. Since the job of selling is difficult to monitor,
salespeople may not readily accept changes in behavior.
3.
The selling process will really only work properly if the salesperson is able to
communicate persuasively. Sales will still occur even if the salesperson is not persuasive,
but this will happen in spite of the salesperson. A person who is persuasive will also be
more effective by using the selling process to focus the conversation on achieving the
specific goal of a sale.
4.
Does the person want and need my services or products? If the answer is no, there is
little reason to believe that the person will become a customer.
Does the person have the financial resources, including credit, to pay? If the answer is
no, there is no reason to believe that the person can afford to buy your product even if
they want it.
Can a good approach be made? If the answer is no, it is unlikely that the salesperson
would ever be able to get to the presentation stage.
5.
The customer benefit plan contains the information that is used for the sales presentation.
It can be viewed as a four-step process:
6.
Select the features, advantages, and benefits of your product to present.

Develop the marketing plan.
Develop the business proposition.
Develop a suggested purchase order based upon the customer benefit plan.
Good approaches should 1) capture the attention of the prospect, 2) stimulate interest,
and 3) provide a smooth transition into the presentation. Without the attention of the
prospect, the sales presentation would be wasted; an interested buyer will pay closer
attention to the sales presentation; a smooth transition will make the sales presentation
easier to present to the buyer.
80
7.
Shoe-care products being sold to supermarkets. The buyers for this area are pressured for
time, the unit price on the products is low, this product is usually purchased infrequently,
and can be reordered through a catalog. This kind of product could use a stimulusresponse presentation.
A computer system to an accounting firm. This product is expensive, the needs are going
to vary by user, there would be many questions that need to be answered and the
salesperson would need to be able to show how the product would benefit their firm. A
need satisfaction presentation would probably be appropriate here.
8.
A trial close is used to check the mood of the buyer, to see how the presentation is going.
The close is bringing the selling presentation to a conclusion.
9.
Objections show that the buyer is at least interested in the product. Objections that are
brought out by the salesperson can be dealt with, and if the objection can be overcome, a
sale is more likely to occur.
10.
Follow-up and service on the sale will create goodwill that will help to create more sales.
The sale is only the beginning of a working relationship that needs to be established. It is
up to these salespeople to do such things as making sure that the product is satisfying the
customer's needs, following up on any commitments that were made, handling your
customer's complaints, and showing your customer your appreciation.
CHAPTER 12
MOTIVATING SALESPEOPLE TOWARD HIGH PERFORMANCE
1.
Ebby Halliday seems to use intrinsic rewards for her sales associates. She selects people
that are internally motivated, creates an environment that allows them to succeed, and has
created a culture that stimulates selling through being a member of the "team." These are
all intrinsic rewards for the sales associates.
2.
Motivation is "the arousal, intensity, direction, and persistence of effort directed toward
job tasks over a period of time." Sales managers need to understand how to motivate
salespeople to get them to perform the activities necessary to get the job done. Sales
managers have to learn how to use motivation because that is a tool that the manager
must use to get his or her job accomplished, through the efforts of the sales force.
3.
Extrinsic rewards or outcomes come from the salesperson's environment. They are
rewards that are bestowed upon the salesperson for doing the job. These include things
like compensation incentives, selling awards, and recognition from the organization.
Intrinsic rewards come from the performance of the task itself. Essentially these are
rewards that the salesperson gives himself. These are things like feelings of
accomplishment and self-worth. The environment can help make them possible, but
cannot give them or take them away.
81
4.
Not only can a sales manager develop a selling culture, he or she must develop a selling
culture. They might develop a selling culture through helping their salespeople to
establish positive perceptions about themselves and their jobs, that performance is
required to be on the team, that salespeople should cooperate with each other and take
pride in their group but still remain competitive. Sales managers are watched for signs on
what it takes to succeed. The selling culture could be passed on to new salespeople
through ceremonies and rites, stories, symbols, and language that all support the value of
selling the company's products.
5.
Expectancy theory is based on the assumption that salespeople have expectancies about
what they should receive from their employer as a result of their work efforts. As people
realize the outcomes or consequences of their actions, they develop beliefs about how just
or fair those outcomes are. Equity theory, on the other hand, says that a salesperson
develops a ratio of job "inputs" to "outcomes." This ratio is compared with the
salesperson's perceptions of the ratios of other salespeople in the sales district, the region,
and outside the organization.
6.
Past experiences plus environmental, organizational, and personal factors combine to

affect how motivated the salesperson is. This motivation level will affect their
performance level. Performance determines the rewards that will be received.
Performance will also affect the satisfaction that the salesperson experiences from the job
and will either lead to a job search or feed back into the motivation to work.
7.
This is a great discussion to help students relate to the expectancy motivational model
used in this chapter and the leadership chapter. You might discuss the model as it applies
to sales and then have the class discuss the model used in this chapter and the leadership
chapter.
8.
A boundary position places the salesperson between the company and the customer. The
salesperson has to keep both the needs of the customer and the needs of the company in
mind. This can lead to problems through role conflict and ambiguity that is associated
with the selling position.
CHAPTER 13
COMPENSATION FOR HIGH PERFORMANCE
1.
The company, economy and market had all changed since the initial compensation
program was put into place at Ingersoll-Rand. The company began stressing higher
levels of service over longer time periods. The initial compensation program didn't
promote this. There was nothing really wrong with the old program. It just no longer fit
with the company direction.
82
2.
Financial rewards, career advancement, and recognition. Financial rewards are the best
way to motivate salespeople, through such things as influencing work behavior,
satisfaction, feedback and reinforcement.
3.
The most critical factor is making sure that the rewards built into the compensation
package relate to performance. The salespeople must perceive a close relationship
between performance and pay for it to be a strong motivator. It can be difficult, though,
to link rewards to job performance.
4.
Straight salary allows the organization the most control over salespeople. Straight
commission provides the maximum incentive for people to sell. A case can be made,
though, for a combination plan (part salary, part bonus) as being the best total motivator.
5.
PLAN A
Salesperson
10%
Commission
12%
Commission
Herndon
MacLean
Menon
Baker
Hand
Zank
Smith
$25,000
25,000
19,000
25,000
22,500
25,000
25,000
$6,000
240
PLAN B
Salesperson
Herndon
MacLean
Menon
Baker
Hand
Zank
Smith
Salary
4,800
9,000
7,200
5%
Commission
$10,000
10,000
10,000
10,000
10,000
10,000
10,000
$15,000
13,500
9,500
14,500
11,250
16,250
15,500
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Total
$31,000
25,240
19,000
29,800
22,500
34,000
32,200
$193,740
Total
$25,000
23,500
19,500
24,500
21,250
26,250
25,500
$165,500
PLAN C
Salesperson
Herndon
MacLean
Menon
Baker
Hand
Zank
Smith
Salary
$25,000
25,000
25,000
25,000
25,000
25,000
25,000
4%
Commission
$2,000
800
1,600
3,000
2,400
Total
$27,000
25,800
25,000
26,600
25,000
28,000
27,400
$184,800
Plan A is the most expensive, Plan B the least expensive. However, monetary costs are
not the only consideration. The company will have greater control over the sales force
with Plan C and the company needs to decide how much service each customer needs and
which plan will best support that service level.
6. A sales bonus is money that is earned over a longer period of time, typically a year. A sales
contest will usually have a shorter time frame. A bonus may also be given on a nonproductivity basis, such as tenure or present salary, but a contest is always based on
productivity.
7.
Compensation Plan
Company pays all
expenses
Advantages
Gives salesperson freedom from concerns
about money. Handling
of expenses is simple
and easy. Geographical
differences will not be
an issue.
Disadvantages
Salesperson will not
try to economize.
Salesperson may be
able to make money
on it.
Salesperson pays
all expenses
Simple for the company.

Gives the salesperson a
feeling of being on their
own.
Salespeople must keep

accurate records. Less
concern about their
activities. Salespeople
may try to economize.
Partial payment
Easier to project and

budget selling expenses.
Salespeople know their
expense limits.
Management less likely
to question expenses.
More control over the
salesperson's expenses.
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Inflexible. Requires
time to administer.
May not reimburse
all expenses necessary
for the job. Geographical differences may
not be considered.
8.
The total compensation package includes, not just the pay a salesperson receives, but the
fringe benefits that are associated with the job. By putting a dollar figure on fringe
benefits like vacations, health insurance, and life insurance, the sales manager is able to
offer a better looking compensation package to the employer.
9.
As the contribution to the organization's revenue and profits by the sales force increases,
they need to be compensated for it by their incentive salary. A sales force that is doing
the marketing of the company, such as finding the developing leads, turning leads into
customers, and using their selling skills to generate revenue, needs to be compensated for
it. A sales force that is more of a customer service team does not do as much actual
selling and does not need as much incentive pay.
CHAPTER 14
LEADING THE SALES TEAM
1.
A sales manager can acquire organization-based powers (legitimate, reward and coercive)
and individual-based powers (expert and referent). It is important for the sales manager
to have both of these power bases. The individual-based powers are important to have so
that your salespeople respect the person, the organization-based powers are important so
that salespeople respect the position.
2.
See the text for a good discussion of the four styles of Tells, Persuades, Participates, and
Delegates.
3.
It does make a difference whether it is a new recruit or a veteran saleswoman. For a new
recruit a participative leadership would be best because the person would probably be
low on ability but high on motivation. For the veteran saleswoman a delegation
leadership style should work well because she has high ability and high motivation.
4.
The sales group will also influence the choice of leadership style. This would include the
characteristics of the group, the expectation of the group, the internal norms of the sales
group, and the culture that exists in the sales group.
5.
A manager needs to know people on both a personal and business level. Some managers
only want to know people on a business level. Yet people's personal life is such an
influence on their work life its important to know the "whole" person.
6.
The text states that if the personal life of an employee is not affecting their performance,
it should not be a consideration for the sales manager. However, the likelihood of a drug
habit not affecting performance eventually is minimal. Drug habits can take their toll on
a persons personal life, which will, at some point, spill over into the workplace.
7.
Some companies treat older salespeople poorly and would fire this person. I feel the
manager should thoroughly look into this and do everything possible to give this person
chances to improve and be successful.
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CHAPTER 15
ANALYSIS OF SALES AND MARKETING COSTS
1. The marketing audit evaluates the total marketing operation, but a sales force audit only
evaluates the sales force. They are similar in that they are both a systematic, unbiased
review of their respective systems as a whole. They both look at the six factors of
objectives, policies, organization, methods, procedures, and personnel.
2.
The primary reasons are as follows:
You need the product because it helps out your product line, it makes your offerings
complete.
It increases the contribution margin from your area.
The customer's image of other product offerings would be affected.
It helps to spread fixed costs over a larger sales volume.
3.
They are similar in that true figures or problems may be covered up or overshadowed.
Sales of your products may be up, but due to only a small portion of your product line
(80/20). Sales performance of your team may be down, but due to only a few
unproductive areas or salespeople (iceberg).
4.
It is a detailed examination of a company's sales data where information about the

company's sales are classified and compared several ways to aid the sales manager in
making decisions. It is useful in detecting strengths and weaknesses in the sales effort.
5.
Level of Sales Analysis
Type of Information
Total Company
How the company is doing in the marketplace. Are

sales increasing or decreasing over time? Compare this
to the industry sales and determine whether the
company market share is increasing or decreasing.
Region-District
How each region is doing in comparison to their quota

or expected sales for the company. Best expressed as
dollar deviations not percentages. Identifies low
performing region, district or territory.
Salesperson
Breaks down information of the territory or district into

sales deviations by salesperson. Identifies low
performing salespeople.
6.
It is an analysis of those costs that affect sales volume. It is used to try and determine the
profitability of different segment operations. It is used to try and maximize the
company's profitability.
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7.
The full cost approach takes all variable and fixed costs and allocates them to each
market segment. The profit for each segment is determined by taking net sales then
subtracting the cost of goods sold and all operating expenses (controllable and
uncontrollable) to arrive at net profit for the segment. The contribution margin approach
separates costs according to controllability. Only those costs that are controllable by the
segment are subtracted from net sales. This gives the contribution that the segment
would give to cover those uncontrollable costs.
8.
Price Variance = (standard price - actual price) * actual work units

Quantity Variance = (budgeted work units - actual work units) * standard price
Price variance measures how much you varied your price in the selling of your products,
quantity variance measures how much the quantity varied at your normal selling price.
CHAPTER 16
EVALUATION OF SALESPEOPLE'S PERFORMANCE
1.
The performance appraisal is important because it gives the salespeople feedback on how
they are doing and what they can do to improve. It is important to both the salespeople to
find out how they are doing and the sales manager, to help shape the behavior of the
salespeople. It is important that both actively participate or the performance appraisal
can degenerate into a yearly meeting where nothing is accomplished.
2.
A performance appraisal will deal with either evaluative or developmental issues. An

evaluative appraisal deals with how you have done the job in the past and how you will
be rewarded or reprimanded for your past behavior. A developmental appraisal deals
with how you can improve future behavior. Setting goals, motivating, and training are all
aspects of developing a salesperson.
3.
The primary evaluator should be the salesperson's immediate supervisor. This person has
direct knowledge of the salesperson; they probably have worked with the salesperson in a
selling situation.
4.
Performance criteria are standards against which the salespeople are measured. They
should be used to evaluate how salespeople are performing different aspects of their jobs
and identify areas where they need to change or improve their performance and also areas
where they should be recognized for doing a good job.
5.
Performance criteria can be either quantitative or qualitative. Quantitative are very

objective measures of the results that the salesperson has achieved. Qualitative are
subjective measures of how a salesperson does his job of selling. The qualitative
measures will help to explain the quantitative measures. For example, a salesperson's
sales are down in the last quarter because that salesperson was going through a divorce
and didn't spend an appropriate amount of time preparing for her sales calls.
87
6.
See the discussion in the text for the different influences of the relationship between sales
managers and salespeople and their effects on the performance appraisal.
88
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SECTION IV
COMMENTS ON
ETHICAL DILEMMAS
90
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SALES MANAGEMENT IN ACTION: ETHICAL DILEMMAS

CHAPTER 1: WHO MADE THE SALE?
WHAT DO YOU DO?
A.
Do nothing. Avoid conflict. Let Brian receive credit for the sale.
This option is an example of pre-conventional behavior. It is clearly selfish on your part
simply to ignore the wrongful situation because you would rather avoid conflict. As a
sales manager, there will be times when some conflict is unavoidable. However, you
must impress upon Brian the fact that filling out the order form did not earn him a $2,000
commission when Steve spent several hours working with the client, making
presentations, negotiating price, and truly "making the sale." In the long run, this option
is good for no one: not you, the company, Steve, or even Brian. (Worst Option)
B.
Split the commission in half by placing Steve's name and Brian's name in the blank to be
fair to both individuals.
This option is one that is likely to be chosen by a number of people simply because it is a
sort of compromise. Since both individuals did help the client, you could probably justify
giving each of them some commission. However, realistically, though Brian did carry
out the final steps in the sales process, he did little else but fill in blanks on a form. He
did not "sell" the client anything. Letting Brian take half the credit (and half the
commission!) for this sale is not the best option. (Median Option)
C.
Place Steve's name in the blank. When Steve returns, instruct him to help Brian with his
paperwork for an hour in return for the time Brian spent away from customers while
helping Steve.
This option is by far the most ethical choice. Steve worked hard with this client and
rightfully earned the commission for this sale. Though Brian did devote an hour of his
time to fill out the customer's order form, he really did not "sell" the client anything.
Steve, however, probably does owe Brian an hour of paperwork time, but certainly not a
$1,000 commission. (Best Option)
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CHAPTER 2: IT'S JUST WHAT I NEED!

WHAT DO YOU DO?
A.
Duplicate copies for each of your salespeople and yourself.
Duplication of licensed software is illegal and ethically wrong. By producing copies of

this software for yourself, you would be acting only to improve your own sales
performance rating without regard to the software creator's rights. Duplication of licensed
software programs is a form of theft. (Worst Option)
B.
Thank Jim, but decline his offer to copy or use the disk.
By declining Jim's offer, you are acting in an ethical manner. You realize that both
copying software, or using a software package that you did not purchase or have legal
access to, is wrong. (Best Option)
C.
Ask Jim if you can simply use the disk from time to time. Since you are not actually
copying the software, you are not breaking the law, but you can still use the software
whenever you want.
This form of action clearly illustrates conventional moral behavior. You are acting just
above the law. Though you avoid getting into legal difficulties, you are still trying to find
ways around the law. A good example is not actually copying software but using
someone's copy. Though such action is not technically illegal, it is nonetheless somewhat
questionable. (Median Option)
CHAPTER 3: IT'S ALL RIGHT TO DO OVERSEAS
WHAT DO YOU DO?

A.
Let your price stand without the donation.

Letting your price stand without the donation constitutes ethical behavior in that you
refuse to engage in what is essentially bribery. (Good Option)
B.
Decrease your price by $10,000.

If you decreased your price by $10,000 in response to a request for a bribe, you would be
acting on a conventional level of moral development. You would not technically be
breaking the law, but you would not be acting at the highest ethical level. (Poor Option)
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C.
Make the $10,000 donation.

Bribing the company president (even though the bribe is termed a "donation") is legally
and ethically wrong. Honest business practices here or abroad do not allow the bribing of
company executives. (Worst Option)
D.
Withdraw the bid.

Withdrawing the bid is the most ethical option presented to you. Not only do you refuse
to engage in unethical behavior yourself, but you do not tolerate such behavior from the
firms with which you do business. (Best Option)
CHAPTER 4: THE REORGANIZATION CREATES LAYOFFS
WHAT DO YOU DO?

A.
I would say nothing. However, I would start looking for another job as soon as possible.
I would also take all of my vacation and sick leave before December 15.
This option clearly illustrates a pre-conventional level of behavior. You are looking out
for yourself by making certain that you will have a job and your benefits intact. (Worst
Option)
B.
Informally notify your managers to tell their people that if they have another job
opportunity--take it!
In this situation, you feel the management is treating employees unfairly. Though you
know top management would not approve, you feel that you have a moral obligation to
inform employees of the possibility that their jobs might be in jeopardy. (Best Option)
C.
Continue to do your best in your work and do not let the upcoming layoffs worry you.
Things will work out.
Here you follow the rules. You do not divulge the information to the employees and you
do your job as expected. (Median Option)
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CHAPTER 5: LET'S BUY IT!

WHAT DO YOU DO?
A.
Select Quantron, Inc. Personal contacts are better for the company than formal bids and
company regulations. Enjoy the party.
You know choosing Quantron's bid will put you over budget and you know you can
obtain an almost identical product from Kentucky Electronics at a more reasonable cost.
Most likely, the distance of the company would not ordinarily affect your decision.
Therefore, you are probably acting on the idea of wanting to do business with your boss'
friend simply because he is your boss' friend and you don't want to "make waves." Such
action is of questionable ethical nature. (Worst Option)
B.
Pass the bids to the head of purchasing. Selecting Quantron, Inc. violates regulations,
and Kentucky Electronics should be given a chance to compete.
Here, you choose to pass the decision to your supervisor. Such action is clearly within
company policy. However, though you certainly have done nothing wrong, you haven't
done what is "right," either. (Median Option)
C.
Try to persuade George to change his mind. Point out that he is using personal
favoritism as his decision criterion. It's your responsibility to do the right thing because
your are responsible for this project.
In this situation, you are clearly being ethical in your decision making. You have chosen
the alternative that you believe is right and are willing to stand behind it by sharing your
views with your boss. (Best Option)
CHAPTER 6: IS IT TOO EARLY TO TELL?
WHAT DO YOU DO?

A.
Share the information, since no warnings were given. Besides, he works for the same
company and he would do the same.
Since you are not technically breaking any rules (since no warnings about confidentiality
were given), you share the information. Such action constitutes conventional behavior in
that you try to conform to the expectations of others, in this case, your friend. You are
more concerned with whether the action broke the rules than if the action is "right" or
"wrong." (Median Option)
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B.
Find out why he wants to know, or needs to know, before deciding what to do. If he
wants the information badly enough, and you give it to him, then he'd owe you a favor.
This option is a clear example of preconventional behavior. Divulging private
information for personal gain is clearly unethical. (Worst Option)
C.
Treat the meeting as confidential and refuse to discuss it with the district manager, even
if it jeopardizes your friendship.
By treating the information as confidential even though you were not specifically told to
do so illustrates an internal set of ethics which you follow whether or not particular rules
governing this type of behavior are presented to you. This is an example of principled
moral action. (Best Option)
CHAPTER 7: HAVE YOU LOST THE SALE?
WHAT DO YOU DO?

A.
Compare the two offers for the buyer and ask her to cancel the signed contract.
Even though you know that your offer is the best one, asking the buyer to cancel a signed
contract is wrong. Not only is such an action unethical, it could also cost you the
customer's business in the future. (Worst Option)
B.
Tell her about your proposal but do not suggest she cancel the signed contract.
Here, you are acting in the best interest of your company, your customer, and yourself.
By not asking your client to cancel her contract and sign your contract, you have
maintained the client's trust. Asking her to void the contract, on the other hand, would
have been highly unethical. However, it is important that you take the time to explain to
your client the proposal which you were prepared to present. That way, perhaps your
client will keep your company in mind the next time the firm needs your products. Then,
both her company and your company can benefit. (Best Option)
C.
Say nothing. Keep your cool--act professional. Otherwise, you will lose the customer
forever. Accept the loss in a gracious and courteous manner.
By saying nothing about the signed contract, you are acting in a professional manner.
You are following the rules and employing conventional behavior. (Median Option)
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CHAPTER 8: SHOULD I GO AGAINST THE COMMANDER?

WHAT DO YOU DO?
A.
B.
Give Juan an "exceptional" performance rating, even if it makes your friend and boss
look bad and upsets him.
The most ethical course of action for you in this situation is to give Juan the exceptional
rating he deserves and to stand behind your assessment of his performance. (Best Option)
Compromise and reduce performance rating to "good."
Many individuals would be tempted to take this course of action which is clearly
unethical. This way, you could please your boss and still not really "hurt" Juan.
However, you would be hurting Juan. Measures of his performance should be recorded
accurately; he is an asset to the company. Being concerned about whether or not your
boss will like your rating is selfish, and is an example of preconventional moral
behavior. (Worst Option)
C.
Give Juan an "exceptional" rating but tell him to keep it confidential.

There is nothing "wrong" with this option since you are following all the rules. However,
the fact that you would rather not "stand behind" your performance evaluation of Juan is
less than what would constitute principled moral behavior. (Median Option)
CHAPTER 9: TERMINATING A SUCCESSFUL SALESPERSON
WHAT DO YOU DO?

A.
Go along with policy because your own performance review is coming up soon.
This option illustrates a form of preconventional behavior. Here, you are acting only to
impress your boss and serve your own interests. (Worst Option)
B.
Refuse to recommend any employee be fired as they are all performing above company
standards.
Since each employee is performing well above quota, out of the fairness to the employee,
he or she should be given a chance to improve before being "run off." Also, it is probably
not in the best interest of the company to immediately "run off" that individual. Rather, it
is more costly for the company to continue to interview new candidates and train new
hires than to advise current employees and help them improve performance. (Best Option)
C.
Do your job. Doing your job requires that you recommend two people be fired. Its best
for the company.
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This option is one that is likely to be chosen by the majority of people. You do as your
company expects in order to be a good employee. However, with this particular option, it
is uncertain whether recommending two people be eliminated is really best. In other
words, you may have chosen this option because management told you it was the "right"
thing to do, not necessarily because you believe it is the right thing to do. (Median Option)
CHAPTER 10: THIS TEST IS A PIECE OF CAKE!
WHAT DO YOU DO?
A.
Do nothing. The directors of the training program should have developed another test.
Such action is clearly unethical. Due to the nature of your former position, you had
access to materials that none of the other managers had available to them. If the director
of the training program knew you had access to the test, you know she would not
approve; this test is too important. Your action (or lack of action) would be considered
preconventional moral behavior. (Worst Option)
B.
Ask the training instructor to come out in the hall and explain to her that you have the
test. Ask her what you should do.
By admitting fact that you have used the test as a practice test, you are exhibiting
ethically sound behavior. However, the fact that you are not willing to take a stand as to
what you believe should be done (i.e., take a different test) and instead simply ask your
supervisor's opinion, makes this option a form of conventional moral behavior. (Median
Option)
C.
You respectfully refuse the test on the grounds that your scores would not fairly reflect
your performance as related to the performance of others. Politely request that you be
given a different test.
Here, you admit that you had the test and respectfully present your views on the
appropriate course of action to take. Since you know that you shouldn't take the test in
fairness to yourself and others, you tell the supervisor what you believe is the most
ethical option. (Best Option)
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CHAPTER 11: NOW WHAT?

WHAT DO YOU DO?
A.
Say, "No, I really didn't have anything to do with the program," -- knowing that the
director won't check-- today she leaves on maternity leave and it is rumored that she is
likely to stay home permanently with her new baby.
This option illustrates preconventional moral development in that you are acting in your
own best interests even if that involves lying and what could be considered cheating.
(Worst Option)
B.
Say, "Yes I did. Also, I should tell you that the test you gave me was exactly like the one I
had in my files and used to study. I think that I should be given another test."
In this case, you are answering in the most ethical way of the three options. Not only do
you answer the class director's question truthfully, but you also volunteer the information
that you believe the director should know. (Best Option)
C.
Say, "I did work with that program some." But mention nothing about the fact that you
have a copy of the test.
Here, you really did not do anything "wrong." You told the truth and it is not your fault
that the trainers did not change the test. Besides, they had no way of knowing that you
had a copy of the test and used it to study. You did learn the material. However, at the
same time, this option is not quite "right," either. Your knowledge of this is evidenced
by: 1) not telling the trainer that you had the test when she asked about your affiliation
with the corporate sales training office, and 2) intentionally missing one question on the
test. (Median Option)
CHAPTER 12: SHOULD I OR SHOULDN'T I?
WHAT DO YOU DO?

A.
Only give a two-week notice. After all, that's all that is required of you by company
policy.
By simply giving a two-week notice you are following the rules. You are not doing
anything technically "wrong." However, you are not acting in a completely ethical
manner either, especially considering the fact that you will be exposed to confidential
information. (Median Option)
B.
Don't give notice until the day before you begin work for the new company. Since you
know your boss will ask you to leave that day, you will get two weeks' pay even after you
start work at your new job.
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Here, you are considering only what you want. You are not positive that your boss will
ask you to leave the day you resign. It is possible that he could ask you to work another
two weeks. By giving no notice, you could be putting your boss in a tight situation.
(Worst Option)
C.
Resign immediately on the grounds that you can no longer act in your employer's best
interest.
This option is by far the most ethical choice. Here, you are considering not only your
own needs, but what is in the best interest of your employer as well. You have made an
ethical decision in that you know your continuing employment in the firm is actually
more of a threat to the organization (considering your exposure to confidential
information) than a benefit. (Best Option)
CHAPTER 13: HEALTH CARE BENEFITS DON'T COVER THIS
WHAT DO YOU DO?

A.
Do your job and follow the policies as given to you. You shouldn't really involve yourself
in your employee's personal lives anyway.
Using this alternative, you are choosing the "formal" method of handling this problem.
You are fulfilling your obligation as an employee of your company. (Median Option)
B.
Cover for him and see that he gets paid for the 15 days. The company can afford it.
This option is a tough call. On one hand, you know that the employee will suffer if not
paid. On the other hand, he did not earn the money for additional sick leave. Therefore,
you would essentially be stealing from the company and indirectly involving the ill
employee in an unethical situation if you paid him for the extra two weeks. (Worst Option)
C.
Don't cover for him but try to help him out some other way.
You have chosen the best option available to you. You refuse to falsify records so that
the employee will be paid, but you are still concerned about his welfare. Perhaps you can
obtain approval to pay him for this time as vacation pay, or perhaps take up a collection
for him at your office. Emotional support can help as well. Though this option is not
ideal, it illustrates a principled level of behavior. (Best Option)
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CHAPTER 14: PERSONAL PROBLEMS AFFECT WORK

WHAT DO YOU DO?
A.
Fire Al immediately. Keeping him on is simply too risky. You know you could lose your
job if he doesn't clean up his act.
Here you are clearly acting out of concern for yourself. You are not considering Al's
welfare, nor are you considering the welfare of the company, which will be damaged by
the loss of an employee who has worked there for 30 years. This action is an example of
preconventional behavior. (Worst Option)
B.
Follow the formal procedures set forth by your company for employees who are not
meeting their expected sales quotas. Write him up and require him to attend a special
"remedial" sales training class.
This option is a form of conventional moral behavior in that you do just what is expected
of you. Here, you are following the rules by writing Al up and having him attend special
remedial sales training classes. However, you know that his problems have little to do
with a lack of sales training (with 30 years' experience) and more to do with his problems
with alcohol. Therefore, even though you are following the rules, you know this solution
really won't help the situation. (Median Option)
C.
Force Al to get help by making his joining a rehabilitation program a necessary

requirement for keeping his job. Require Al also to report to you daily regarding his sales
progress.
With this option, you are trying to do the best you can for everyone involved in this
difficult situation. You are trying to help Al, and in turn, the company, by keeping a
valued employee. You also realize that by choosing this option, you are committing
more of your own time and effort. However, you have chosen to do so out of a sense of
ethical responsibility. (Best Option)
CHAPTER 15: JURY DUTY OR VACATION?
WHAT DO YOU DO?

A.
Do nothing. Though you know what he did was wrong, he has been working very hard,
often 60 hours a week. He has earned a rest. But subtly let him know that you're aware
of what he did and imply if it happens again he will be disciplined.
Here you are acting at a preconventional moral development level. You know what the
employee did was unethical, but you are trying to rationalize his wrongdoings so that you
will not have to discipline him. In this sense, you are acting out of selfishness and are not
considering the welfare of your company. You are also not being fair to the other honest
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employees. Essentially, you are condoning employees taking compensation time not
entitled to them-- an action which could be considered a form of theft. (Worst Option)
B.
Discipline him by taking the time away from vacation or sick days.
This action is one that would involve a formal course of disciplinary action. Therefore, it
is a form of conventional behavior. (Median Option)
C.
Immediately fire the salesperson as an indication that you absolutely will not tolerate
dishonesty in any form from your employees.
This form of action may seem very harsh at first glance. However, an employee's taking
compensation time not entitled to him or her is a form of theft. This option is reasonable,
justified, and ethically sound. Again, such action not only punishes this employee, but
sends a message to others that dishonesty in any form will not be tolerated. Therefore,
this option is likely to benefit the company in the long run. (Best Option)
CHAPTER 16: SHOULD YOU BE A WHISTLE-BLOWER?
WHAT DO YOU DO?

A.
Do nothing. You can't afford to compromise your position at the company.

Here, you are looking out for yourself. Though letting this situation continue is harmful
both to patients and the reputation of the company, you are only concerned about keeping
your own job. (Worst Option)
B.
Anonymously report to the appropriate government agency.

By choosing this option, you are attempting to remedy the problem. You are also
upholding moral and legal laws by reporting such misconduct to the proper authorities.
(Median Option)
C.
Make an appointment to discuss the situation with the company president. If he does not
agree to immediately rectify the situation, resign your position and contact the proper
authorities.
Discussing the situation with the company president shows your dedication to the
resolution of the problem. This action also illustrates your personal commitment to your
internal code of ethics by refusing to work for a firm whose top management condones
illegal activities. You also recognize the importance of informing the proper authorities
who have the time and resources to handle the problem correctly. (Best Option)
102
103
SECTION V
END OF CHAPTER CASE ANALYSES
104
105
CASE 1-1
The Wilson Company: Is a Sales Manager's Job Really for Me?
All students want to move into management. Yet, they really only think of
the positive aspects (money) of rising up the corporate ladder. This case
introduces them to the personal sacrifices that have to be made to be
successful as a sales manager.
Questions for Discussion:
1. Compare Joy's present job to what you think her previous job as a
salesperson might have been. How are they similar? How are they different?
Joy's position as regional sales director is similar to her previous job as
salesperson in that both are people-oriented. In the job as salesperson, she
would have met with clients, traveled, and dealt with many people face-toface. As a salesperson, however, she was in control of her own time. Her
present job involves working through other people, and she must cope with
many problems. The job is fragmented and involves communicating and
negotiating. Thus, the managerial position is much broader in scope and
contains many more day-to-day problems and interruptions.
2. What managerial skills are depicted in the case?
important for Joy to possess? Why?
Which skill is most
Human and conceptual skills are most important in Joy's present job-especially human skills. She works with subordinates, peers, and superiors-all requiring good human skills.
3. Why do you think Joy may be disenchanted with her present job?
The disenchantment may result from unrealistic expectations about the
sales director's job. Many people who have excellent technical skills and
succeed at a technical job expect to continue performing the same tasks
when they become managers. But as one moves up the management
hierarchy, the various management functions become more important, and
they require human and conceptual rather than technical skills. People who
succeed as managers enjoy the opportunity to perform these functions and
display these skills. For Joy, the greatest frustration seems to be her inability
to control her own time and the need to work through other people, many of
whom may disagree with what she is trying to accomplish. Thus, the key
management issues become persistence and frequent negotiations.
CASE 1-2
106
Nabisco: What They Didn't Teach Us in Sales Class

This case was written to illustrate the day-to-day realities of becoming a
salesperson. It is a very real case and one with which any seasoned
salesperson will identify...especially "missionary" or "factory-rep" salespeople
who call on retail accounts. The training program described in the case is
typical of those used in similar industries such as tobacco, candy, over-thecounter drug products, frozen foods, baby food, canned goods, and paper
products. Turnover among salespeople in these industries is higher than
most other selling jobs, and the work itself is hard. Retailers see so many
salespeople that they become tough buyers to deal with on a regular basis.
Those that are trained in selling to retail accounts, assuming that they last
through one or two years, become some of the best salespeople anywhere.
It has been said that "salespeople who can sell to retail stores can sell to
anyone."
Rick Lester, the new salesperson in the case, is struggling to adjust to the
real world. It is true that he had made an "A" in Sales 461 in college, but
neither the textbook nor his professor discussed the feelings of low status
and vulnerability that he now faces. He must overcome these feelings or get
out of selling to retail accounts. Rick is the one who must adjust, not the
system. It is true that Mr. Brown can be helpful in this situation, but it would
not be in anyone's best interest to "talk him into staying on the job."
Students typically offer two main groups of thought. Undergraduates most
often suggest that Mr. Brown should not have said, "Buy a raincoat," and
that Mr. Brown had not adequately prepared Rick Lester to perform his job.
Many undergraduates agree that Rick should quit this job and find another
one that is better.
Graduate students, on the other hand, most often suggest that Mr. Brown
had hired an "incompetent" salesperson. Some recommend that Rick's
resignation be accepted and that he should be replaced with a better
applicant.
Both of these positions have good and weak reasoning behind them. It is
true that Rick is young and inexperienced. But his feelings are real and they
need to be addressed by Mr. Brown. In the end, however he must decide on
whether he is willing to pay the price--that is, stick with the job until his skills
and ability allow him to deal with the practical world of selling.
Rick cannot be called "incompetent" at this point. He is the type of person
that applies for similar selling jobs today--average or slightly above, and relatively
inexperienced. The fact is that many selling jobs go unfilled around college campuses. The top
students with strong academic credentials and work experience oftentimes do
107
not apply for selling positions. Any good sales manager will tell you that he
or she has problems finding top people to recruit.
1. Should Rick Lester "turn in his keys?"
Probably not...at this point. All jobs are challenging at first. He needs to talk
with Mr. Brown and others who sell to learn that all jobs have their bad
points. He needs patience and determination to see him through the
learning stage. To make a change at this time will be setting a pattern for
the future.
108
CASE 2-1
Mississippi Leasing, Inc.: Is This Legal?
In essence, the sales manager was seeking reciprocity. The contemplated deal is clearly
unethical. In some cases, such a deal may be even unlawful. Companies aware of their legal and
ethical responsibilities protect themselves and their employees from unnecessary exposure. For
example, IBM marketing representatives are urged to follow the specific steps set forth in IBMs
Business Conduct Guidelines--a policy-based code of ethics--which states: You may not do
business with a supplier of goods or services. Reasonable? Yes. Important? Absolutely.
The students must remember that their career and the future of their company depends on
creating values that last. This objective depends on making decisions we can live with tomorrow,
not on what we might get away with today.
CASE 2-2
Illinois Office Machines, Inc.: How Should You Handle Competition?
Dealing with unfair competition represents a double challenge. On one hand you want to get the
order; on the other you want to stop the competitor's unfair practices. In this case your prospect
is using every bit of information to play one competitor against the other to obtain the best deal.
What do you do when the fight for business is getting dirty?
1. Is there an ethical conflict? Would you try to reverse your prospect's decision? Why?
First, take notes when you hear a customer's reports about unfair comments made by your
competitor. Turn the information over to your sales manager or legal department. Your role is
not to pass judgment on the case, but to collect the evidence.
Second, do not "knock" the competition, but let the competition knock itself out. It's virtually
impossible to build a lasting and profitable business by risking customer trust and confidence on
every single deal. Should your customer find out that the operating cost figures were nothing but
lies, company X would not be able to sell a single office machine to the medical center in the
future.
Reputable companies believe in the lasting power of honesty. Their policies and guidelines
reinforce that message to every salesperson. For example, Xerox representatives are bound by
ethical guidelines that state: " . . . make no disparaging statements, directly or by any kind of
inference or innuendo, about competitors and their products and services--even if you believe
them to be true."
IBM tells its marketing reps: "It has long been the company's policy to provide customers the
best possible products and services. Sell them on their merits, not by disparaging competitors,
109
their products or services." These guidelines are tough, but fair. They were drafted with the
reputation.
The absence of ethical guidelines will always create the illusion of safety, yet these illusions are
short lived. Over 200 years ago, Thomas Paine wrote about the unethical actions of Great
Britain: "A long habit of not thinking a thing wrong gives it the superficial appearance of being
right." History proves that appearances are deceiving. It also proves that without ethical
conduct, freedom is unsafe.
CASE 3-1
Alabama Wholesalers, Inc.: Plans Dont Always Work!
On the positive side, total sales did go over the quarters original plan. Unfortunately, expenses
also were higher than anticipated. Why didnt the manager notice that the program was going
over budget? Was there a lack of up-to-the-minute data? Did the manager get data on actual
expenses versus budgeted expenses too late to take action? Did the staff adequately collect
information, maintain current records, and analyze and report information back to the manager
on a timely basis? Was there a cover-up?
Whatever the cause, the manager will have to make sure it doesnt happen again. In this case, the
manager must correct his own failure. These actions might prevent the sales group from going
over budget again. The manager will have to make the rounds of the field offices and have
private talks with each salesperson without sounding accusatory. Instead, the sales manager
should be inquisitive (He/she is seeking information, not culprits). The sales manager has a very
important lesson to learn and the teachers in the incident should be your salespeople. The
manager should congratulate each salesperson for trying to make the program successful. In a
mature and businesslike way, the manager must show each rep the final expense and sales data
for his or her territory, and ask them to communicate their initial reactions and their continuing
feelings about the programs details. What did they really think of the whole idea? The sales
manager should listen closely and responsively, making certain not to squelch or argue with a
single point that each of them makes. He or she is there to learn. Later, the manager should
discuss the findings, conclusions, and recommendations about monitoring and controlling future
budgets with his or her boss.
CASE 4-1
Alaska Office Supplies: Everyone Is Part of the Sales Team
Sales organizations often are so large that salespeople feel they are all alone out in the field. It is
me against them--them being the home office.
Salespeople are trained to take care of their customers. They know its much easier to keep a
customer than get a new one. Tyrone feels he is taking care of business. The angry signals
probably tell you its time to go out and work with Tyrone. Top-producers like Tyrone want to be
recognized constantly for their accomplishments. They feel the entire organization should focus
on them and their customers. Their attitude says, if someone cant help, then stay out of their
110
way. However, Tyrone knows something you do not. Maybe, the organization is providing poor
service to other customers of Tyrone. You need to find out!
CASE 4-2
Reynolds & Reynolds: Team Selling
1. How is the effectiveness of team selling demonstrated by the Reynolds team, and what are
some of the disadvantages to this method in this particular case?
Bob Sherman and Tim ONeill each exhibited classic personal selling skills: solution selling,
translating potential benefits of the sale into P&L impact for the customer, performing a
business analysis to ensure the solution fits the customer, good questioning and listening
skills, etc. However, the sale was really driven by the teaming of Bob and Tim, and to a lesser
degree by Chuck Wiltgen.
The Reynolds case clearly illustrates the power of team selling. However, the teaming was
largely informal (e.g., executed on an ad hoc basis and based on long-standing working
relationships between sellers). Although no information is provided on selling costs, the
Reynolds team selling model is higher cost (e.g., just consider the cost of Tim's time as a sales
manager not to mention his travel costs). To truly succeed with team selling (or the more
formal Account Management), sales effectiveness must increase faster than rising costs.
Unfortunately, most sales organizations lack the metric to accurately track sales effectiveness.
2. How did the Reynolds team successfully execute the following critical roles in sales: client
access, client education/persuasion, and fulfillment?
Client access. Bob made the initial cold call, demonstrated his commitment and began to
build trust with the customer, Carol Bemis.
Client education/persuasion. Bob and Tim played well off one another; although
persuasive, their overall tone was consultative.
Fulfillment. Chuck was clearly positioned as the implementation guy, giving the
customer confidence that Reynolds would actually deliver what was promised.
Source: David Fritz, "Anatomy of a Sale: The expert's view," Selling Power (January/February 1999): 84.
CASE 5-1
Florida Computer Sales: What Info Is Needed?
Florida Computer Sales found it difficult to control new and used inventories, accounting
records, taxes, customer profiles, sales forecasts, etc. The solution was a computer, but
management would not tolerate printouts they could not believe. Two senior managers took
responsibility for acquiring a computer and developing appropriate procedures. Implementation
took time but was carefully done. Soon, monthly reports were ready within three days. The data
identified high-profit items so that they could be quickly restocked. It also eliminated mass
purchases of low-priced items that failed to sell well. Suddenly, salespeople had orderly orders,
111
and the records on available stock were accurate and item location was correct. They also could
see what to pay for trade-in equipment. The computer system allowed everyone more control,
causing managers to ask how they ever survived without it.
CASE 6-1
Arizona Electrical, Inc.: Is the Information Important?
Without anger, resentment, or threats, the manager should ask Joe to describe how he feels about
the reports--asking him to share his ideas for correcting the situation. Maybe Joe doesnt believe
the required reports contribute meaningfully. Maybe he feels they take him away from what he
understands and does well: selling. The burden clearly is on the manager to improve
communications with the entire sales group, so theyll know how each report fits into the
operation. Just because the group has always done the reports doesnt mean everyone
understands why they have to be done at all, much less done on time. The manager should make
two promises: (1) to reevaluate all the reports and forms with an eye to reduction and
simplification, and (2) not only will the manager read the reports, but he/she will provide
feedback to both individuals and groups to verify that the information is actually put to good use.
In addition, the manager should also help all sales reps understand the system, including how and
why it works, so that everybody will work with the system instead of against it.
CASE 6-2
Sally Malone's District: Development of an Account Segmentation Plan
1.
Develop a table showing a salesperson's call cycle using the given call frequency patterns.
This table shows how the call cycles for this example (territory) will be made up.
Call Cycles
Account
Classification
A
B
C
D
E
Number of calls
Number of
Cycle
Accounts 1
10
20
45
12
10
Cycle
2
1-10
1-10
1-15
1-3
1-2
40
1-10
1-20
16-30
4-6
3-4
40
112
Cycle
3
1-10
1-10
31-45
7-9
5-6
40
Cycle
4
1-10
11-20
1-15
10-12
7-8
40
Cycle
5
1-10
1-10
16-30
1-3
9-10
40
Exhibit 1
Summary of Sales and Percentage by State
State
Alabama
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
Florida
Georgia
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
00.5
03.0
00.5
19.0
08.5
00.0
00.0
03.5
01.0
00.5
02.5
02.0
00.5
00.5
00.0
02.0
00.5
00.0
00.0
04.0
01.0
00.5
01.0
00.5
$
47,500
285,000
47,500
1,805,000
807,500
0
0
332,500
95,000
47,500
237,500
190,000
47,500
47,500
0
190,000
47,500
0
0
380,000
95,000
47,500
95,000
47,500
State
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
W. Virginia
Wisconsin
Wyoming
00.5
00.5
0.0
02.5
02.0
10.0
01.0
00.5
02.0
01.0
05.0
03.0
01.0
00.0
00.5
00.0
08.0
05.0
00.0
00.0
05.0
00.0
00.5
00.5
47,500
47,500
0
237,500
190,000
950,000
95,000
47,500
190,000
95,000
475,000
285,000
95,000
0
47,500
0
760,000
475,000
0
0
475,000
0
47,500
47,500
Percentages rounded to nearest half percent.

2. Discuss why this should be done.
It may be seen from this schedule that all A accounts are called on in every cycle, the first ten B
accounts in cycles 1 and 3, and the second ten B accounts in cycles 2 and 4. Since the cycles are
of two weeks' duration, these accounts will be called on every four weeks according to the call
frequency shown. By definition, it takes one cycle to call on all A accounts (two weeks), two
cycles for all B accounts (four weeks), three cycles for all C accounts (six weeks), four cycles for
all D accounts (eight weeks), and five cycles for all E accounts (ten weeks).
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CASE 7-1
Arkansas Fishing Company: Are Quotas Accurate?
In this case, the manager must look at all of his options. The manager could 1) become a dictator
telling Carl how it really is and to shape up or shut up, 2) organize the group to confront
him, 3) report him to the boss, or 4) assume Carl isnt aware of the affect he has on other people.
In order to lessen the risk of turning off Carls highly productive sales energy, option four would
be the best one to try first. The manager should choose an appropriate time when working with
Carl in his territory to discuss his behavior without anger or threats. The manager should explain
to Carl that he perceives a serious conflict within the group, which is caused by his poor
relationships with the others. Then, the manager should let him know that the entire sales group
values his contributions to the groups performance and productivity. However, Carl and the
others must resolve the conflicts between them and improve the interpersonal situation
dramatically so that the group can continue to grow and develop as a team.
Together, Carl and his manager can work to resolve the conflict so that nobody loses and nobody
is embarrassed. The manager should tell Carl directly that he can learn to enhance his
effectiveness. In addition, Carls boss can help him to understand that during all problem-solving
discussions, each person must listen to the viewpoints of others and respect their rights to open
expression. The manager should propose a personal, informal contract between Carl and
himself. In the future, Carls manager should let him know, by tipping him off in private, when
others feel he is coming across too strongly and upsetting the other members of the group.
The manager must explain to Carl the importance of his quotas and the quotas for the rest of the
group, as well as work toward getting Carl to agree upon supporting the groups objectives and
quotas. If he has something positive to say, the manager should encourage him to say it. The
manager should also ask him to not openly criticize sales plans during group meetings. He
should discuss these concerns with his manager after the meeting.
CASE 7-2
Harrell Manufacturing: Elimination of Sales Budgets and Quotas
Question for Discussion:
1. Discuss the advantages and disadvantages of quotas in relation to Harrells views on not using
quotas:
This question is designed to facilitate a class discussion. Some key points to cover are:
Sales quotas dry up the greatest source of profits: incremental sales.
Sales quotas instill a corporate culture of just getting by.
Elimination of sales quotas encourages salespeople to sell as much as possible.
Sales quotas encourage mediocrity and penalize high performance. (Salespeople dont want
to exceed their quotas by too much because it would be difficult to top in the following year).
114
CASE 8-1
An Unusual Case of Turnover: Connecticut Candy Wholesalers
It is entirely possible that some of the fault lies with the manager. The manager apparently had
confidence in James and left him to his own devices. However, most subordinates want to know
where they stand. High achievers need and want recognition from the boss. Some will even go
to strange, exaggerated lengths to get it. Is James a loner, or just lonely?
He is dedicated to his work and his job. It is possible that the manager didnt recognize how
dedicated James is to him as his boss. What harm would have resulted from the manager saying
publicly how highly he regards James performance? Great good can come from such a public
expression toward each individual who performs well.
James and the manager have developed a new contract, and he will probably feel extramotivated. If youve read this far, let me know and Ill send the first three people who contact
me ten dollars. The manager may even discover that James is capable of still greater
achievement.
What about the manager? Resolving this situation would probably significantly enhanced the
managers own self-esteem and the esteem of his subordinates, peers, and superiors.
CASE 8-2
R.J. Reynolds: Selecting the Best Sales Team
This case is useful in the classroom because it shows how salespeople are typically recruited by
many large firms. It also highlights a few of the difficulties that sales managers face in finding
good sales representatives. The case brings out some differences (or idiosyncrasies) in recruiting
philosophies held by sales managers. In addition, the case supports several concepts covered in
the text material.
The questions asked are fairly straightforward. Answers sought deal with common sense
practices found in sales in the consumer goods industry. The only point that seems to bring out
strong feelings and classroom debate in the matter of Joe followingor not followingthe
suggestion to recruit at small colleges and universities. In this matter, the case authors come
down on the side of following Mr. Wilsons advice. Joe Miller needs to win the confidence and
support of his new Division Manager. His best course is to listen and learn, not to change his
boss behavior or teach an old dog new tricks.
115

1. Discuss the strengths and weaknesses of the present staffing process traditionally used by the
company.
The company guidelines suggested in the case were:
A. The use of the new assistant division manager to find several applicants that could be
screened and referred to the division manager and regional sales manager for employment.
B. Desirable applicant qualities of holding a college degree in marketing or business, a proven
record of hard work, achievement-oriented, self-confident, and a positive outlook on life.
C. Asking applicants only work-related questions.
Apparently, the company gives each division sales manager a good deal of latitude in deciding
where and how applicants will be located. All of the qualities sought appear to be desirable and
coincide with ideas in the literature.
A question should be raised about sending the new ADM on recruiting assignments without some
on-the-job training. Students have many complaints about recruiters. ADM Miller needs to
observe Mr. Wilson interviewing so that he can learn what to ask and what not to ask. There are
many legal dangers present when a new manager interviews applicants.
2. Discuss Mr. Wilsons personal recruiting philosophy. Is it good or bad?
Mr. Wilsons ideas about recruiting involve:
A. Recruiting from colleges in rural areas.
B. The importance of hard work, appreciation of money, character, good communication skills,
motivation, and persistence.
C. The initiative to contact the interviewer after the interview.
D. A good mix of women and minorities.
E. Married applicants from the local area.
F. Women with children, and perhaps a husband that is locally employed.
Several of Mr. Wilsons ideas are sound, based on the material included in the text and in the
sales management literature. These ideas are the importance of hard work, appreciation of
money, character, good communication skills, motivation, and persistence, and a good mix of
women and minorities.
Some of the other ideas that could be relevant, if based on a systematic analysis of the current
successful sales force are recruiting from colleges in rural areas, married applicants from the
local area, women with children, and perhaps a husband that is locally employed, and the
initiative to contact the interviewer after the interview. However, it is possible that some of the
qualities that Mr. Wilson feels are important are not bona fide occupational qualifications, and
therefore, could be a problem if used as a basis for discrimination. Some of these preferred
qualities raise legal questions.
116
3. What alternative sources of applicants are available?

Colleges and universities are an excellent source of college-trained applicants. It would seem
desirable, however, to use a mix of applicant sources.
Some sales managers in the packaged goods industry have experienced problems in employing
only college-trained individuals. Salespeople with degrees oftentimes expect higher pay and
promotion opportunities. All salespeople cannot become managers. This can lead to
disenchantment, high costs, and a higher turnover than desirable. Sometimes it is better to
employ a mix of persons with experience, and college degrees rather than employing only
persons with college degrees. A major factor is industry standards. There are many internal and
external sources cited in the text. Leads from present successful employees should not be
overlooked. Internships are also becoming more important and are being used by more and more
firms.
4. Discuss the lesson that Joe learned while he was a teenager and how it might apply in the present
situation.
One of the most important lessons to be learned in this case deals with the posture that a new
employee or one in a learning situation assumes. Joe Miller is in this position and would be wise
to learn first how Mr. Wilson does things before thinking too much and making suggestions that
are not wanted.
If Joe supports and learns from Mr. Wilson, they will become friends. Mr. Wilsons
recommendations to the company will chart the course of Joe Millers future. Everyone must
prove himself or herself before becoming a team member. After a few months on the job and the
establishment of more rapport, Joe can slowly start to become more creative. He can then show
his ideas and make a few suggestions. When he becomes a DM, he can do things his way.
5. How would you go about accomplishing Joes current recruiting assignment?
It would probably be good for Joe Miller to ask Mr. Wilson if he would consider going to two or
three schools together. This would not show a weakness on Joes part. It would show common
sense and a desire to learn new skills.
More importantly, Joe is in no position to design a new recruiting plan. Doing things the way
Mr. Wilson wants them to be done is good advice. Questioning the way things have been done
over the years, and offering advice to the seasoned sales manager is no way to begin a training
relationship.
This case was written by Gerald Crawford, Ph.D., Professor of Marketing and Eminent Scholar
School of Business, University of North Alabama; Keith Absher, Ph.D., Professor of
MarketingSchool of Business, University of North Alabama; and Tom F. Griffin, Ph.D.,
Lowder-Weil Eminent ScholarInformation Systems/Decision Sciences Department, School of
Business, Auburn University at Montgomery.
117
CASE 9-1
Delaware Firearms: Is This the Correct Person?
The manager should be pretty sure of the problem. But does Andre fully recognize the
seriousness of his shortcomings? Does he really understand how he has been confusing and
misdirecting salespeople? Andre claims to understand, now that his supervisor has explained it.
Okay then. At company expense, Andre should be enrolled in seminars and workshops on
Successful Oral Communications and Writing to Be Understood. Because the problem isnt
at all unusual, many organizations sponsor or support such programs. Also, Andre should fax
memos to his supervisor before he sends them to his salespeople, so that his supervisor may
critique them on their effectiveness. The supervisor should also attend his monthly sales
meetings and participate in the presentation of important information. The supervisor should
help make Andre successfulafter all, thats his job! It is too early to know if the supervisor
selected the wrong person for the district managers job. Andres boss should give him the
benefit of the doubt, plus all the help, support, and encouragement he can.
CASE 9-2
Bob Johnson: Searching for a Sales Job
This case is especially interesting to college seniors because it addresses a topic that almost all of
them are presently concerned withgetting a good job. This case creates interest and debate
about an individuals goals, levels of security and opportunities desired by different graduates.
And last, the case provides insight into the practical difficulties of getting a job and adjusting to
the day-to-day problems that field salespeople face.
1. What should be the primary basis for job selection?
There is no best answer to this question. Because of differing needs, students will typically seek
one or more of the following goals: a) job security, b) salary security, c) low rejection, d) high
earnings potential, e) opportunities for advancement, or f) training provided. The key indicator
for each student is the order in which goals are ranked as more important.
Most undergraduate students will select job security or salary security because they are unsure of
their ability to make a decent living in the selling field. They lack confidence and this is
normal. Only after getting selling experience do most young people realize that selling can be
learned and that most of them can make a very good living as a salesperson.
Students that rank high earnings potential and opportunities for advancement as most important
are more self-assured and confident in their own abilities. They will usually succeed if they can
take the abuse that most salespeople are exposed to each day.
118
Students that rank training opportunities as most important are more farsighted and likely to
succeed in the long run. This is what Bob Johnsons father had in mind when he gave his son
advice about selecting a job. Firms invest tremendous sums of money in training young people.
This should be a major factor in the selection of one job over another.
2. Discuss the negative aspects of each job.
The best way to examine this topic is to break down the typical concerns of students and to rate
each company on the basis of each variable for each job. An example of this process is shown in
the following matrix. This system provides an excellent basis for discussion.
Job Security
Salary Security
Rejection
Earnings Potential
Advancement Opportunities
Training Program
Farmers
B
C
D
A
B
B
Nabisco
A
A
C
B
A
B
Muro
C
B
B
A
A
A
(Where A=excellent, B=good, C=fair, D=poor).

Farmers Insurance has a good training program and offers the potential or high commission
earnings over time. Job security with the firm and industry appears favorable. Constant rejection
in the insurance industry is a problem for many young people, however.
Nabisco is a blue chip firm that offers job and earnings security. It has a high market share and
a bright future. The training program is also good and has excellent opportunities for personal
growth because of its size.
Muro is an excellent smaller company offering high pay and good training in an industry that is
undergoing change at the present time.
3. Which training program is the best? Why?
All three positions are with medium-sized to large firms and involve good training programs.
Nabisco uses a good deal of on-the-job training with division or assistant division managers
while Farmers invests more in video and self-paced reading targeted at overcoming rejection.
Muro appears to invest more resources into sophisticated training at a centralized location. Their
training gets into technical aspects of their products and involves role-playing exercises.
Muro appears to invest more money into each sales representative. Overall this program appears
to be better. Although turnover figures are not mentioned, it is likely that Muro is more selective
in hiring sales representatives and probably has lower turnover rates.
4. Which job would be most interesting for you?
The answer to this question depends entirely on students' interests, their backgrounds and the
confidence they have in their ability to sell. In classroom testing, Nabisco usually is considered
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to be more popular because it seems to provide more security. Muro is popular because of the
high pay and low expected rejection.
5. What job do you think Bob Johnson will take, if offered?
Bob comes from a family of salespeople and likely has confidence that selling is a viable
occupation with great opportunity to earn a very good living. He also has high grades and good
references from an outstanding university (Vanderbilt). He is no average student.
Because of his analytical mind and his rational approach to finding a job, he will probably select
the Muro job if it is offered to him. Furthermore, he understands the importance of good
training, like that offered by Muro.
This case was written by Gerald Crawford, Ph.D., Professor of Marketing and Eminent Scholar,
School of Business, University of North Alabama.
CASE 9-3
Martin, Inc.: The First Woman Is Hired
This case is both interesting to teach and discuss, and quite realistic in terms of problems that
sales managers face while trying to hire and train more women. The case was intentionally
developed to lead students to "jump to conclusions" about the pending relationship between the
new salesperson and her sales manager.
At first reading, many undergraduate students may offer the opinion that Nancy is coming on
strong and Mike is probably going to "take the bait." After a second reading, however, it should
be apparent that Nancy is not coming on strong. She is a professional person and is handling
things the same way that any sales trainee would likely handle them. Mike, by the same token, is
having some adjustment problems, but has not done anything or thought anything out of the
ordinary.
1. How would you describe the situation? What actions would you take?
Mike would be very wise not to become intimately involved with Nancy. Their involvement has
been in the minds of the reader thus far. This would be a good point for the professor to discuss
the dangers of sexual involvement with employees, customers, or anyone related to the business.
A manager that does get involved this way loses power to control his managerial environment.
Persons that one has been involved with invariably use the past to get special treatment or favors.
The other employees will suspect what is going on and they will resent it. This is a sure way to
fail.
In addition, an affair with someone in the business environment is a bad mark on a manager's
personnel record. It can destroy a career. This would also be a good time to mention three other
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problem areas that are a sure-fire road to failure: (1) drinking or drug use on company time, (2)
getting company money mixed in with personal money, and (3) falsification of company reports.
Mike should try to get things straightened out at home. Sometimes husbands and wives do not
like their spouse to work too closely with a member of the opposite sex. This has been a problem
with police, firefighters, and other career fields. Mike would be wise when he gets home to
assure his wife that things certainly weren't very exciting. He might even be smart to make
things sound more boring than they really were. In either case, Mike should be patient but let his
wife know that he does not have a choice in the matter--he must hire and work with women. His
job depends on it. He must assure her that he will do the right thing. She should accept Mike's
word in the long run if he uses good judgment.
Of course, this situation works both ways. Regardless of whether the spouse is a man or woman
or whether the sales manager is a man or woman, it is becoming necessary to work together
without sexual overtones. Mike would be wise to think of Nancy as another salesperson and not
a "good-looking female."
The office problem should be watched. It is not uncommon for men or women to quietly resent
an accomplished newcomer. Of course, Nancy can earn their respect if she plays her cards right.
If she is unable to do this in a reasonable amount of time, it may be necessary for Mike to discuss
the situation with the secretaries.
Some students may bring up the company pressure to hire more women, especially when they
are not as qualified as male applicants. Affirmative action programs have proven to be quite
controversial in sales management. These programs are designed to insure that racial minorities
and women are not discriminated against in organizations.
Prior to 1964, most employers were free to hire persons or groups of persons based on their own
criteria. Title VII of the Civil Rights Act of 1964 made it unlawful for an employer "to fail to
refuse to hire or to discharge any individual or otherwise to discriminate against any individual
with respect to his compensation, terms, conditions, or privileges of employment, because of
such individual's race, color, religion, sex, or national origin."
This act was amended in 1972 by The Equal Employment Opportunity Act. It regulated hiring
practices of employees having 15 or more persons and granted the Equal Opportunity
Commission enforcement powers. The commission was empowered to bring civil actions in
federal courts against employers. The EEOC can require firms to develop an Affirmative Action
Program which generally forces an employer to "identify and analyze problem areas in minority
employment and to provide in detail for specific steps to guarantee equal opportunities keyed to
the problems and needs of members of minority groups, including the development of specific
goals and time tables for the prompt achievement of full and equal employment." (See Sec. 703,
Title VII, Civil Rights Act of 1964, and U.S. Equal Opportunity Commission, Affirmative Action
and Equal Opportunity--A Guidebook for Employers, Vol. II: Washington, DC; Equal
Employment Opportunity Commission, 1973, pp. 40-44.)
Most large firms have developed an Affirmative Action Program. It is likely that Martin, Inc., is
in the process of achieving this end and has determined that more women must be employed.
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This is the justification for hiring Nancy who was qualified, but not as qualified as two male
applicants.
Related to the above problem is the question of what can be asked and should not be asked of the
applicant during the interview. In regard to Nancy's voluntary indication that she "was not
interested in marriage and children for several years," it is not acceptable to ask questions which
are dependent on the sex of the applicant. The only exception is where a "bona fide occupational
qualification is reasonably necessary to the normal operation, motif, culture, or atmosphere of
that particular business or enterprise." (See EEOC Compliance Manual: Washington, DC;
Bureau of National Affairs, October 28, 1975.)
CASE 10-1
Georgia Auto Supply: Does Training Work?
It should not be the managers style to damage the pride or self-esteem of his or her people. So,
the manager should use his selling skills on Brad. He should have a private conversation with
him. Although the manager often holds private conversations with Brad, this one should be a bit
different. Let him do most of the talking. The manager should guide the dialogue by asking him
to review several accounts, some of which he acquired and developed, some of which he lost or
dropped. The manager should be careful not to act like a parent talking to a child.
The manager should be an active listenerone who gives undivided attention to the speaker and
does not interrupt with negative commentsBrad will appreciate the time that the manager has
given to him. He will probably talk openly about the lost accounts. Then the manager will have
the chance to probe deeply into the reasons why they got away. They can then discuss what
Brad might do to prevent more failures and increase his hit or close rate. They will have a
two-way conversation, each person transmitting and receiving ideas. This discussion will take
time, but Brad is worth it.
The manager should get Brad to discuss his sales training programswhat he likes and dislikes
about them. He should find out if Brad feels the sales skills he is being taught are worthwhile to
him. The manager should encourage him to give training a chance, and try it on his next 10 sales
calls. The manager should tell Brad to let him know how it works. He should continue to work
with Brad to improve his closings. Above all, the manager should keep an open mindmaybe
its the training that needs to be changed!
CASE 10-2
Toys and More: Development of a Sales Training Program
Toys and More is a relatively young company (9 years old) in the consumer products industry.
Specifically, they sell small toys and novelty items to variety stores and small food retail
convenience stores. Their sales force size has increased from two salesmen to forty-five
salesmen. There has been no sales training during this period. James New was given the
responsibility of developing sales training programs for the National and Regional meeting to be
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held in January and March respectively. Also, some type of organizational arrangement should
be developed to facilitate their programs due to Toys and More's rapid growth.
The primary learning objective is the formulation of effective training programs including site
selection, cost analysis, and basic programming. Important questions to answer are:
1. What type of training program will be most beneficial to the current sales force?
2. What type of organizational alignment should be used by Toys and More to facilitate control
of the training?
3. Where will the national and regional meetings be held?
4. What will the costs of these meetings be?
5. What should the major objective of the national meeting be? The regional meetings?
NOTE: Have students see the special February issue of Sales and Marketing Management of
selling cost.
Analysis of Alternatives
1. Conduct highly unstructured programs that involve discussion and a minimum amount of
lecturing.
A. Advantages
1. It would allow the salespeople and their spouses to have a good time.
2. The pressures of selling could be forgotten and better sales force camaraderie could
be developed.
B. Disadvantages
1. Why use this type of meeting when it has not been used before and your company is
continuing to grow? You might just bore the salespeople.
2. You might get little benefit from it in relation to the costs incurred.
2. Conduct a highly specialized and structured sales training program using guest lecturers and
new training techniques.
A. Advantages
1. You would be giving your sales force every chance to become more efficient.
B. Disadvantages
1. You stand the chance of boring your older salespeople who think they know enough
about selling.
2. Outside lecturers must be very dynamic and amusing to be effective.
3. Use some combination of structured and unstructured sales meeting.
A. Advantages
1. This will allow the spouses to also enjoy a good time, which is very important.
2. Learning might be better accomplished when interspersed with other activities.
B. Disadvantages
1. A lot more planning and coordination is required to make this successful.
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Assumptions:
1.
2.
3.
4.
5.
6.
Ralph New will allow the spouses to come only to the national meeting.
The majority of salespeople are older and more experienced.
Regional sales offices are present in Dallas, Texas and Atlanta, Georgia.
Toys and More needs a better organizational structure.
An outside training specialist should be hired for the regional meetings.
The regional meetings will be successive weekends in March so Ralph New and the training
specialist can attend both meetings.

1. With you assuming the role of James New and using the "Model of Sales Training" in the
chapter, develop a sales training program for the following:
A. The national meeting.
B. The regional meeting.
C. Model of Sales Training.
1. Planning Phase.
a. Organizational Analysis.
i. Their objective is to continue their controlled sales expansion (10% a year).
ii. An effective training program can help accomplish this objective.
b. Operational Analysis.
i. Development of a "job description" is essential to the initial phase of training;
hiring the right people.
ii. "Job specifications" (specific qualifications) can then be determined for the given
jobs.
c. Salesperson Analysis.
i. The training needs of the sales force are now determined.
ii. These needs can be obtained from working with the salespeople and questioning
them on how the company can help them reach their personal and job goals.
2. Organizing and Staffing Phase
Determination of the training media, methods, materials, and locations needs to be dealt
with. The national meeting will be in January, and the regional meetings on March 19
(Southwest Region) and March 26 (Southern Region).
a. Sales Training Methods.
i. The training objectives will be: (a) to develop a sense of sales force unity, (b) to
better educate the sales force, and (c) to aid in organizational coordination.
ii. The national meeting will not use an experienced trainer while the regional
meetings will.
iii. It must be recognized that the training needs of experienced and new salespeople
will be different and their training should take this into account.
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iv. The standard training materials will be used to present information on the
company, competitors and their products, and special selling techniques. This
will primarily take place at regional meetings.
v. The costs per trainee can be developed based upon current data founded in Sales
and Marketing Management magazine.
vi. In addition to the classroom training at the regional meetings, on-the-job training
will continue to be encouraged.
b. Where Does the Training Take Place?
i. The company will use a variation of centralized training. Due to their geographic
dispersion, the expense of a strict centralized training program has been ruled out.
Instead, the training will be centralized regionally (on consecutive weeks) and
thus allowing the training specialist and Mr. New to attend both programs.
ii. The meeting would be held in their market. For example, the national meeting
will be in New Orleans, Louisiana, and the regional meetings in Dallas, Texas and
Atlanta, Georgia.
c. When Does the Training Take Place?
i. The national sales meeting will be held each January.
ii. The regional sales meetings will only be held in low sales periods or if a very
serious problem arises.
3. Directing and Controlling Phases.
a. Top management is providing the direction for this program in hopes of adding to the
sales force's effectiveness and profitability. Their support is vital to the program's
success.
b. The attainment of the before-mentioned objectives will be measured by the control
procedure. After the programs have been initiated, a look at the sales results might
also provide a crude determination of their success.
Summaries of the National and Regional Meetings:
1. National Meeting:
A. The first day's activities included a speech by Ralph New, introduction of the new
organizational structure, lunch (3 hours to allow husbands and wives to eat where they
wish), a brief speech by James New, then Henry Haynes, and guest speaker. A cocktail
party and dinner followed in the evening.
B. The second day included a morning meeting for the salespeople only, lunch, and an
afternoon adjournment.
C. The actual schedule of events was much the same as above except there was more
emphasis on training.
2.
Regional Meetings:
A. The meeting began on Friday p.m. with the regional sales managers reviewing sales
statistics and a question and answer session with the sales trainer. Dinner and cocktails
followed that night.
B. The next morning, the sales trainer began his training with special emphasis on refresher
training. After lunch, a discussion concerning sales situations was held.
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C. The actual regional meeting was conducted by James and Ralph New. They were
unsuccessful in their training attempt.
Toys and More hopes to both improve organizational coordination and sales force efficiency
through their sales meetings and training programs. First, a sense of camaraderie will be
developed at the national meeting, then the salespeople will become better educated at the
regional meetings.
CASE 10-3
The Telecommunications Corporation: Training's Impact on Performance
The Telecommunications Corporation (TC), a leading manufacturer of telecommunications
equipment, produces and markets the sophisticated machinery. Telecommunications allows for
the transmittal of information to various geographic locations by computer via normal telephone
channels. Information can be transmitted and received in a matter of seconds. The company
held a strong market position. Recently, however, its share has been declining while competitors
have maintained or experienced a share increase. A task force was created and assigned the
responsibility to find the causes of the decline. The task force's findings indicated that individual
accounts were meeting corporate goals. The problem existed in a decline in the major accounts
in which integrated units were sold. Numerous factors attributing to this decline were
discovered. The primary reason was inadequate sales training to effectively sell the integrated
system. Various other problems were found that augmented the decline in major accounts.
Included among these problems were present interviewers, selling strategy, unrealistic sales
quotas, and poorly designed sales territories. Specific objectives are:
1. The "primary" objective of the case is to emphasize the importance of an effective sales
training program. It reveals the effects of an inadequate training program without specific,
detailed objectives and definite purpose and the resulting problems that may arise. It
emphasizes that a training program plays an integral role in obtaining not only marketing
objectives but corporate goals as well.
2. The case reveals that a properly constructed and implemented sales training program can
help remedy or eliminate sales force management problem areas such as low product sales,
poor morale, and turnover.
TC must determine how to make its existing sales force more efficient in selling the integrated
system so as to increase major account sales while maintaining the individual account sales level
in hopes of strengthening its market position.
TC should analyze and evaluate other problems in order to make sound decisions on the
following:
1.
2.
3.
4.
The replacement of present interviewers.

Properly determined sales quotas.
Redesigning sales territories.
Ways to decrease turnover.
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5. Selling strategy revision.

6. Change in compensation of guide a balanced selling effort.
Alternatives:
1. Increase the selling effort directed toward major accounts and less toward individual
accounts.
2. Split the existing sales force into two distinct entities, one to cover the individual accounts
and the other to cover major accounts. Those covering major accounts will go through a
centralized training program designed to meet both sales force executive objectives and
corporate expectations concerning the major accounts as well.
NOTE:
The case does not give enough information to determine of the sales force should be
split, such as budget, number of salespeople, number of customers and major
customers. However, key account salespeople is an alternative.
Assumptions:
1. TC's integrated system is competitive with other integrated systems. This competitiveness
includes product functions and features, efficiency and price. (The case states competitive
products have caught up to TC.)
2. The present sales force has some degree of telecommunications knowledge and has the
ability to sell telecommunications equipment. In addition to this, the existing sales force is
capable of learning new technical knowledge and skills.
3. The task force findings are correct.
NOTE:
Either alternative can be correct. The following information supports splitting the
sales force. It can also be used to support alternative 1.
TC's top sales executives should divide the existing sales force into two separate divisions. One
will service the individual accounts and the other two will service the major accounts. Those
representatives handling the major accounts will undergo a centralized training program designed
specifically for integrated systems selling. The size of each group should be determined
carefully as to adequately service each respective account. Selection of those who will receive
the centralized training program will be dependent upon two factors. The first is the number of
years of experience in selling telecommunications products. Those having more experience will
be considered better qualified. The second criteria is the past selling record of integrated systems
for each particular sales representative. The representatives not chosen will represent those
individual accounts left vacant by the revision, in addition to servicing their own existing
accounts. Both the major account representatives and the individual account representatives will
report to their respective field managers.
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All major account representatives should be sent to a centralized training program. There are
distinct advantages for the use of a centralized sales training program for major account
representatives. These advantages include:
1.
2.
3.
4.
Instruction can be more professional, complete, and concentrated.

Teaching aids are better organized.
Product information is more accurate and understandable.
The representatives are able to meet the executives they work with.
The major disadvantage to a centralized program is cost. However, "failure to provide good
training can have a direct negative impact on the profit and loss statement well in excess of the
short-term positive effect of the money saved on training."
What TC's existing sales training program lacks are detailed specific objectives. In planning the
centralized training program, the initial step is to determine what the program is trying to
accomplish. Objectives must provide the results that are in line with TC's corporate goal of
increased major account sales.
There are three objectives that the newly established centralized program must accomplish for
TC.
1. The first is to provide extensive product knowledge about the integrated systems and to learn
its various uses.
2. Second, to teach the salespeople adequate knowledge about TC's competitor's product lines.
The advantage of this instruction is that a sales representative can design a presentation
emphasizing the advantages of his product over its competitors.
3. Last, instruction is needed in the proper techniques of selling integrated systems. TC sales
executives must also realize that selling involves more than just getting an order. Selling also
involves the sales representative doing numerous customer services before and after the sale.
A "major account" sales presentation should be developed which includes a demonstration to
the customer using company-collected information on customer cost advantages using the
TC system.
TC must decide who shall provide the instruction that can best meet the stated objectives. The
three main sources of sales trainers are: (1) line executives, (2) staff personnel, and (3) outside
specialists. For TC's purposes, the use of senior sales representatives who have proven
themselves in integrated system selling should be used. Typically, not only do senior sales
representatives have knowledge of their product as well as their competitors, but also possess the
necessary selling skills required for integrated systems.
Other problems:
Recruiting. A variety of other problems exist within TC's present sales force. For one, the
interviewers, who also do the hiring, are not experienced in hiring telecommunications
personnel. To remedy this situation, initial screening of applicants should be done by TC's field
managers. The final hiring decision should be made by sales executives. The newly hired
applicant will initially undergo decentralized training for individual accounts only, conducted by
128
their field manager. An advantage of using a field manager as a trainer is that he can train an
individual to meet the specific needs of present and potential accounts within his respective
territory. Eventually, after the sales representative meets a specific quota of individual unit sales,
he then can receive centralized training.
Training Organization. Potential and current customers should be analyzed to reevaluate present
territories. In doing so, at least three factors must be considered when designing a territory: (1)
workload, (2) potential, and (3) current sales. Workload should be given major emphasis in
establishing major account territories. Integrated systems characteristically involve a greater
personal selling effort and more time than do individual account sales. Accounts need to be
segmented into major accounts, then large, medium, and small accounts.
Quotas. Realistic quotas that meet corporate goals can be determined for each territory. Quotas
can be determined by previous sales data, careful territory analysis, and other objective data. In
the establishment of major account quotas, consideration should be given as to the amount of
time needed to sell an integrated system.
Compensation. A change is needed in compensation to reach a proper balance on:
A. Short-term sales (presenting emphasizing).
B. New customer sales (presenting emphasizing).
C. Existing customer sales (not presenting doing). For example, could increase commission
rates and/or develop sales contests.
The "major account" salespeople should be rewarded for leasing sales. At first, they might be
placed on a salary plus commission. Thus, customers could have a "trial run" before making a
large dollar commitment. Commissions might be paid as ling as customer leases equipment,
rather than a "one-time" sales commission.
Proper recruiting, and redesigning sales territories, quotas, and compensation should reduce
turnover. It should also increase performance. Training can be used to teach salespeople how to
sell major accounts and integrated systems, plus educate them on their competition.
CASE 11-1
Hawaiian Novelties: Did You Make the Correct Choice?
Sales trainers also need trainingjust as salespeople do. Sales trainers should be experts on all
topics in the textbook. Too often, a person is brought into a new job on the basis of outstanding
performance in a previous one. Certainly youve heard veteran sales or marketing managers
comment sadly, Ive taken many good salespeople out of the field and made lousy managers out
of them!
Whats the problem here? Carole seems a bit lost--mystified by the process of organizing sales
training programs. She appears unable to steer in such a way as to assure that she will meet the
training goals. It is her managers job to show her how to get on the right track.
129
Call it management by objectives, or results-oriented time management, or self-discipline.

The vital thing is that Carole needs help, and her manager is well equipped to provide specific
and constructive help. It is her bosss job to make her successful, beginning with a discussion of
time management.
Sales personnel must be experts on their products and proficient in selling skills. Sales
knowledge and sales skills are the main topics of all training programs. For specific topics to
cover, she should ask the sales managers and salespeople. She should spend two or three days of
each week working in the field with salespeople and find out whats working and whats not.
When she finds people doing things well, she should have them conduct training sessions.
Training is expensive. Its benefits must outweigh its costs.
CASE 11-2
Taster's Club: Development of a Sales Presentation
Dick Shoemaker, a salesperson for Taster's Club Coffee, has to decide what information he has
available to help him make a sales presentation to a major account. The basic case objective is to
have the student analyze both account information and product information in preparing an
effective sales presentation.
1. To whom should Dick make his presentation?
Dick should make the sales presentation to not only John Barringer, the person in charge of sales
promotion, but also to Fred Acosta, the coffee buyer, and Doug Hendricks, the merchandising
manager. It would be best if Dick could get all three together at one time, but if that is impossible,
then a sales presentation may have to be made to each one. John is important because he is the
primary decision-maker on what promotions should be run, but Fred and Doug are friends of Dick
and they are certainly influences on the decision that John would make.
2. Develop a sales presentation outline showing the key facts about both the account and the
product that would be useful in making the sale.
A. Account Information
1. Sales of Taster's Club up 14%, while overall volume was only up 7%.
2. Use of displays in stores.
a. Account has not used Taster's Club display in over a year.
b. Display is supplied at no cost to retailer.
c. Display only uses 2.4 square feet.
1. Should do sales volume of $239.40 per sq. ft. in a week.
2. Should do profit of $31.20 per sq. ft. in a week.
3. Display in each store should increase sales of ground coffee to 600 cases for the
week of the promotion.
d. Displays have generated up to a 64% increase versus average volume of coffee.
e. Inventory turnover for the display should only be 1 week.
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B. Product Information.
1. Coffee is purchased on 30-day terms instead of 10-day for most other items.
2. 50 coupon is coming out in Sunday paper, display would back it up.
CASE 12-1
Idaho Bakery Supplies: How Can You Motivate This Salesperson?
We all have a need for affiliation and identification. Its especially strong among salespeople,
whose work in the field affords relatively little contact with their peers or superiors in the home
office. How do field salespeople satisfy this need?
Some do it by concentrating on selling during the day and doing their thing at night, on
weekends, or holidays. They join business or professional clubs and associations. They might
participate in other societal activities, such as fund raising for nonprofit associations or joining
hobby clubs. There they may find people they like and who like them. In these situations,
salespeople meet with others under friendly, comfortable, risk-free circumstances.
Geographical separation can make it difficult for the field salesperson to affiliate or identify with
the company or boss. Thats quite natural. But some cope with the situation more successfully
than others do. In the example we are discussing, Jackie has created a small circle, a private
society. Personal need is overriding the companys need and the needs of the manager.
Now that the manager has recognized the symptoms, analyzed the problem, and confirmed
his/her conclusions through personal observation, its time to discuss with Jackie the need to
foster better relationships with other accounts in an effort in to improve sales volume. The best
time to attempt such a discussion would generally be during a trip into the field.
Jackies manager should express admiration for her fine relationships with her three regulars,
from which the company benefits. The manager should suggest applying the same social skills
to other accounts. This part of the discussion clearly defines the problem and the objective.
Jackies boss must show her how these suggestions will help her improve her performance and
generate more sales.
CASE 12-2
Teletronic Electronics: The First Woman is Hired
Teletronic Electronics (TE) is a distributor of several thousand small electronic parts. Chris
White, a middle-aged man who has been with the company for 22 years, is New Orleans' district
sales manager currently responsible for nine salesmen.
Recently, TE has hired a young, intelligent, personable, highly-motivated woman with the
experience in the electronic distribution field. Her sales trainers at TE felt she has great potential
with the company. TE corporate management is interested in moving women into the
organization and up to management positions. She is assigned to Chris' region and immediately
conflicts arise.
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Chris is dissatisfied with her unconventional selling methods and threatened by her successes.
He seeks to control and thus stifle her creativity by demanding she follow a more conventional
pattern. He has limited her expenses, tried to discourage her from taking evening courses, and
rejected her suggestions for company improvement. Her actions have been aimed at personal
and organizational success and not purposely antagonistic toward Chris.
The tensions climax when the regional sales manager calls to congratulate Judy on one of her
suggestions that Chris had not even bothered to read. In his anger, he calls for a meeting with
Judy. How should he, versus how will he, handle the sales meeting? Specific objectives are:
1. Illustrate a generation gap between the older manager and younger saleswoman.
2. To suggest effective tools for the traditional sales managers in handling creative, aggressive
new sales representatives.
3. Allow for discussion on management and leadership styles. Leadership styles are discussed
in Chapter 15.
Several decisions to be made are:
1.
2.
3.
4.
5.
6.
7.
To offer Judy an ultimatum; conform to Chris' standards or leave TE.

Whether or not to re-educate Chris in more democratic, flexible management styles.
Define standard expenses that TE will pay.
To develop a system for dealing with salespersons' suggestions.
To develop a set of guidelines explicitly stating acceptable and unacceptable selling methods.
How and if to deal with Judy's incident with the intoxicated buyer.
To establish a supportive company policy regarding continued education in related business
fields and possible financial funding.
Alternatives:
1. To deal with the conflict by openly discussing and evaluating the situation and reaching a
mutually acceptable agreement whenever possible.
A. Advantages
1. Judy will have greater respect for Chris.
2. Chris will gain a better understanding of the personal motivation of the "new breed"
of salespeople that will aid him on other interactions.
3. Chris will no longer feel the need to stifle the achievement-orientation of his young
sales representatives.
4. Judy will gain a greater insight into Chris' motivation and try to modify her selling
methods without 100% conformity.
5. They can develop a set of guidelines, mutually acceptable, that allow "certain
liberties" while still adhering to a set of code of behaviors.
6. Chris could link Judy's promotion into management with a certain degree of
conformity, thus motivating Judy to impose her own controls, an MBO approach.
B. Disadvantages
1. In view of Chris' personality, relinquishing the required degree of control may be
impossible.
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2. The two may be too committed to their prospective course of action and so inflexible that
such an interaction would not only be useless but created further ill will.
2. Chris could offer Judy an ultimatum where she either conforms to his standard or leaves the
organization.
A. Advantages
1. This would be the easiest course of action and most personally satisfying for Chris.
2. Chris would maintain a highly controlled and traditional sales force.
3. Judy will very definitely learn what she can and cannot do as a salesperson under
Chris.
B. Disadvantages
1. He will create greater ill will between Judy and himself.
2. If she stays and conforms, her productivity may decrease and her morale will be
greatly lowered.
3. The company will lose out on Judy's insightful, helpful suggestions as Chris will have
stifled her creativity.
4. Judy may be forced to quit and TE will lose a very productive saleswoman.
3. Chris can vent his anger but offer no ultimatum and let the situation continue as is.
A. Advantages
1. He does not force Judy into quitting.
2. He vents some anger and frustration which may make him somewhat better able to
deal with the situation.
3. Judy may find ways to work around Chris so that her style is not impeded.
B.
Disadvantages
1. The situation is not likely to change and Chris is no closer to a means of resolving the
conflict.
2. Judy may become frustrated and quit.
Assumptions That Can Be Made:
1. Judy's actions and attitudes are not purposely antagonistic to Chris.
2. Judy has not employed unethical or illegal sales methods to achieve such a high sales
volume.
3. TE upper management encourages innovative and creative sales practices.
4. Upper management does not judge Chris by the conservativeness of his sales force.
5. This problem is indicative of Chris' management style and work ethic and is not merely an
isolated event.
6. The fact that Judy is a woman is much less of an issue than her being a young, aggressive and
an untraditional sales representative.
1. Why is Chris behaving this way?
Chris may be described as a very conservative, extremely traditional, bureaucratic, unimaginative
and inflexible sales manager. He has evolved a set way of selling and managing over his 22
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years of employment at TE and feels that he knows best how to handle work situations. He is
unreceptive to new ideas and unconventional sales representatives and/or sales methods.
Chris is acting according to his own set of values and his personal work ethic. He sees Judy's
actions as a threat to the company's image and direct threat to him. Instead of encouraging Judy
and using her success as an example of his skill as a manager, he is stifling her creativity so that
he "doesn't look bad" being upstaged by a newcomer and/or female.
Another problem is that he just does not understand and/or know how to deal with the "new
breed" of salespeople. He can neither relate to nor control the creative, informal sales methods
used and, as a result, is frustrated and feels out of place, especially when they are so successful.
His reaction in anger and emotion is typical of this frustration at suddenly losing some of his
control.
2. Why is Judy behaving this way?
Judy could not conform to Chris' standards and still be the successful representative that she is;
their styles are too diverse. Judy is acting in accordance with her personal set of values and work
ethic, using her judgment as to the most effective means of making a sale and for personal
success.
She is highly creative, intelligent, and motivated. If she sees an opportunity for improvement
and/or sales success, then she takes advantage of it. Judy is an example of the competent "new
breed" of sales representative that sends a cold chill through Chris' spine. Her actions are not out
of spite or retribution as motivates many of Chris' actions, but rather out of a sense of "this is the
logical way to go." When Judy's plan for realigning sales territories is thwarted by Chris, her
strong belief in herself compels her to seek gratification from a higher source.
3. What will Chris do at the meeting? Is it the right thing to do?
Chris will probably act in extreme anger--shouting, berating, and giving ultimatums. He will not
be open to input from Judy and use the meeting to vent his anger and frustration. His sole
purpose will be to humble Judy and to intimidate her.
This domineering, uncontrolled and unnecessary show of power and control is probably the
worst means of handling this situation.
4. Ideally, what should Chris do?
He should be rational, totally calm, and open to feedback during their meeting. He should
present Judy with aspects of her job behaviors that he feels uncomfortable with and ask for her
input and justification of these actions. He must try to be flexible and responsible to her ideas
and new methods. There is strength in his admitting sources of irritation and trying to resolve the
conflict rather than smothering it by threats and ultimatums. This type of communication
between him and Judy would open the way for compromise and possible solutions to their
problem.
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The basic conflict in this case stems from differences in values and attitudes toward tradition and
dogma, work ethic, and change between the older, more tradition-oriented managers and what
has been labeled the "new breed" of salespeople.
Leaders (Chris) must constantly seek a balance between the need for order and consistency and
the need for growth, improvement, and change. Unfortunately, Chris has not established this
balance and has been hiding behind TE policies to frustrate, alienate, and stifle Judy. Rather than
viewing her as an asset to the firm, he fears her and the changes she represents as a personal
threat and liability to the company.
Achievers such as Judy are the future of the company and, if well managed, will reflect credit on
their managers. Chris should reevaluate his current management style.
Chris should schedule a meeting with Judy when he can deal with the situation calmly and
rationally. He should use the meeting to vent mutual grievances in a constructive, open manner.
This exchange should be the basis for compromise and building a new, successful working
agreement.
Chris should:
1. Re-examine his own motives for controlling;
2. Become educated in alternative management styles;
3. Develop a Theory-Y-type management style and allow employees to exercise self-discipline
and self-control;
4. Clearly state sales force objectives and define broadly acceptable paths and corporate policies
regarding goal attainment;
5. Implement a management-by-objective plan for his sales force to foster their initiative and
creativity;
6. Follow a participative supervision style;
7. Seek to provide direction and guidance to sales personnel rather than total control.
Judy should:
1. Deal within established company guidelines as much as possible;
2. Show Chris how her successes can also be viewed as his successes;
3. Try to avoid being in a position that directly threatens Chris, i.e., going over his head in the
organization;
4. Submit future suggestions for company improvements through accepted channels;
5. Be patient;
6. Leave and seek a more flexible job opportunity if changes do not occur within TE.
TE management should:
1. Establish a "suggestion" system which goes close to the top to try and avoid the problem
discussed in this case;
2. Offer a means to teach managers the skills and attitudes necessary for effective management
and coping with change;
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3. Evaluate the effectiveness of all managers and transfer the effective managers to other
positions.
Today, more than 50% of our population is under 25. With the ever increasing influx of young
people in the work force, bringing with them new ideas and new ways of doing things, it is
increasingly important for managers to develop skills to deal with change.
There exists very little experimental evidence currently available to help solve this type of case
problem. Most of the views currently held on the "best ways" to manage arise from executive
opinion and empirical study. Literature does exist on different management styles but again,
little scientific evidence supports the conclusions of the authors.
CASE 13-1
Illinois Satellite: Selling Your Top Salesperson
The manager should call a special meeting with Lisa and all of her colleagues and use this
session as an opportunity to describe 1) the situation that existed before the change had been put
into effect, 2) the need for making the change, 3) what options were open when the manager
planned the change, 4) the pros and cons of each option, 5) the logic that led to the option that the
manager and the group are now implementing.
The manager should even go so far as to describe the weaknesses or disadvantages of the change.
He or she must explain that when the pros and cons are weighed, the new program offers enough
benefits to justify this action. The manager should give everyone at the meeting, especially Lisa,
all the time they need to discuss openly and candidly any doubts or questions they might have.
This is a real test of the managers ability to communicate with the group.
CASE 13-2
Computer Bytes, Inc.: Should We Use a Draw Compensation Plan?
This is designed as a discussion case. Have students read it before class. The class can discuss
the different compensation programs using this company as an example.
1. Should Computer Bytes use a draw compensation program? Why?
As the book says, a commission plan is a good one for the small and/or new company which
doesn't have the money to support a sales force. The commission plan discussed in this case is a
good one for this company. This case shows students what is involved in a "draw commission"
program.
2. Should further changes be made if they decide to use Thompson's plan?
No, they should see how this works. It's dangerous to change a compensation program too often.
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CASE 14-1
Indiana Restaurant Equipment & Sales: What to Do with the Guerilla
Li has often said that the challenge of a tough-sell situation is a real turn-on. The manager has
seen it in Li many times as well as having personally felt it himself. Both the manager and Li
have felt that great sensation of power and satisfaction whenever theyve influenced an accounts
purchasing decision, especially when taking a sale away from a competitor.
As a top producer, Li gains real satisfaction and recognition through superior performance in the
fieldnot as an unofficial group leader. But he also has a genuine ability to understand the
needs of the sales group and feels especially good when he helps to satisfy them. Since he isnt a
trained psychologist and has no leadership experience, Li probably cant articulate these needs.
But he is remarkably intuitive when it comes to interpersonal relationships.
With his managers encouragement, Li could be an unusually valuable link in the
communications chain between the manager and salespeople. He can probably help the manager
explicitly define the interpersonal problems and suggest corrective actions. Li probably would
be much happier to get back to full-time selling, where he can best use his professional skills as
well as his intuition.
In fact, with their sense of security restored, all members of the sales group would be able to
concentrate on their primary tasks: selling and delivering orders. The proof of the managers
skill in dealing with interpersonal relationships would be well-demonstrated by taking
constructive action with Li.
CASE 14-2
R.J. Reynolds Tobacco Company: Beyond Field Sales . . . The Home Office
This case was developed to show some typical problems that upwardly mobile young
salespeople frequently face. Three problem areas quickly come into focus. First, when an
employee spends so much time and energy on the job, the family situation is likely to suffer.
Second, highly motivated young people can move up so fast that they can "burn-out" or, perhaps,
fail to learn some of the fundamentals required to survive in the corporate world. Third, a
"mentor" is a virtual necessity in surviving the political minefield of corporate headquarters.
1. What role does a "mentor" play in this case?
One likely problem, although not the most immediate one in the present case, is that Kerry
apparently has no mentor, or trusted advisor at a high level, to depend on for advice and help. It
has been said that "good things happen to those who work hard and smart--and have friends in
high places." Let me know youve read this far and Ill send the first three people who contact
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me ten dollars. This is how the system works, whether it is getting into medical school, getting a
promotion as an Army officer, or getting an article published in a top journal.
Kerry Gatlin was placed into a position under a powerful person, Bob Johnson, who really didn't
want him. This was a no-win situation. Gatlin needed someone at a high level in the Home
Office to get him back into Sales.
2. How would some of the present problems have been avoided?
Kerry moved up too fast for his own good. He was never allowed to season as a manager.
Someone in the human resources area or sales personnel group should have developed a master
plan for training people at all managerial levels. This plan would have spelled out expected
competencies and exposure factors needed before promotions were made. The entire promotion
process seemed rushed and unorganized.
3. What alternatives are open to Kerry Gatlin?
As far as the company is concerned, Kerry needs to talk with the Sales Manager. His work with
sales was always outstanding and he appeared to be doing a good job when speaking to field
sales groups. If he were to briefly explain his situation and ask the Sales Manager for advice, he
would probably arrange for Kerry to be reassigned to the home office group. The most
immediate problem, however, is the one discussed in question 4 below.
4. Which problems need immediate attention?
Clearly, the marriage problem needs to be dealt with first. Gatlin's mind will be preoccupied
with his wife and family until he works out a solution to that situation. It is likely that the
marriage has been in trouble for some time, and a solution will not be reached overnight. It
appears that Kerry has placed his work ahead of family, and this invariably leads to personal
problems. He needs to meet with his wife, talk things over, and try to work out a compromise, A
good marriage counselor can help in matters of this nature.
5. Can the marriage be saved?
There is no way to answer this question accurately, because not enough data was made available.
It would be necessary to hear Beverly Gatlin's side of the story.
6. Can this young man's career be saved?
It can probably be saved if Gatlin continues to produce at a high level, and assuming that he can
work out his personal problems. Hopefully, he can get back into the Sales Department where his
true loyalties lie.
Kerry Gatlin was not able to bring about a reconciliation of the marriage. Beverly Gatlin had
many years of unresolved difficulties and a great deal of hostility to work through. Kerry was
not able to "sell" her on getting back together.
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Gatlin managed to get a lateral transfer back into the Sales Department, where he spent one
additional year as Assistant National Sales Promotion Manager before leaving the company.
After the divorce, Kerry maintained regular contact with his two young sons.
Kerry returned to a university setting, later received a Ph.D. degree, and became a Professor of
Marketing at a fine regional university. He remarried, this time making sure that family was his
first priority. He has been much happier in his new career.
CASE 14-3
Ohio Biotech, Inc.: Night Work and Travel Have to Stop
OBI allows for a great discussion of the dual career couple. Many students are married, young,
engaged, or will marry.
1. What would you say to Ellen?
"Well, Ellen, you and I both know that your job duties require that you work some evenings and
travel overnight. I don't see how I can guarantee you won't have to do either. But remember,
how you manage your time as a salesperson is up to you. If you can continue to perform as you
have in the last six months without working evenings or traveling overnight, I don't have any
objections. Please let me know if you want me to talk to Jack to explain my position."
Additional Discussion Points:
A. Should Ron make any special deals or arrangements for her since she is a woman?
Absolutely not. The minute a manager starts making any concessions to an employee on the
basis of gender, he/she opens himself and that particular employee to contempt from others
within the organization because of the concessions made or received. Additionally, the other
employees will then expect the manager to make concessions to them as well.
B. Should Ron have a talk with Jack Peters?
Only if Ellen Peters requests him to do so.
C. Should Ron mention that such a request would very likely rule out any possibility of a promotion
to sales manager? Should he mention Al St. Aubin's memo or his intended response?
Ron should not mention that Ellen's request would rule her out of a promotion, and he should not
mention Al St. Aubin's memo. Ellen should be given the opportunity to work things out for
herself without this pressure. Ron should mention or hint that if she continues to perform as in
the past that she could be considered for advancement.
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D. If Ron does make concessions for Ellen, what should he tell the other salespeople and their
spouses?
If Ron did make a concession to Ellen he would have to, in all fairness, extend the same
concessions to all the other salespeople that work for him.
See if your female students have different opinions than the males. What about married versus
single students?
CASE 14-4
C&D Foods, Inc.: Leadership: Who Is Best for the Job?
The Leadership at C & D Foods, Inc. case can generate a good deal of interest and personal
involvement in junior and senior level marketing courses. A major strength of the case is its
ability to encourage students to approach problem situations with an open mind. Students
who simply read the case will not have all of the facts and cannot make rational decisions
without them. On the surface it seems that Tom Pirkle is not being treated fairly. Young
white males are most likely to become defensive before asking important questions that can
help them to make better value judgments.
Case writers agree that it generally not good practice to write cases that contain Gotchas.
This means that some significant information has been left out of the case or is purposively
hidden away from the reader. Communication is the problem in this case, not equal
opportunity. The truth, however, is that the case is written solely from Tom Pirkles
perspective and he does not have all of the facts. It appears that he is about to make a fatal
mistake by confronting management in a negative way or by leaving the company for another
job. Good leadership would dictate that Tom be brought into the picture before damage is
done.
The missing information is that the company has grown to the point that a small main office
marketing unit is needed, and Tom Pirkle is being considered to head up that group. Most of
the questions are fairly academic, once the full picture is known. Bob OBrien is nearing
retirement and is apparently not a strong communicator. Don Hendon has also failed to
communicate effectively with Tom Pirkle. This communications situation and others like it
occur regularly in field sales. Good communication skills are a key ingredient in strong
leadership. Poor communications can lead to low morale and low productivity.
1. From the facts available in the case, who would make the best Area Sales Manager, Tom
Pirkle or Barbara Howard?
From reading the case, it sounds as though Tom Pirkle would easily make the best sales
manager. The case is written from Tom Pirkles perspective, however, and should not be
taken at face value. Whether or not Barbara Howard is in Tom Pirkles league should depend
on more objective criteria.
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If Tom had known about the reorganization and his possible opportunity, would he be less
defensive? The answer here is a resounding yes.
2. Is Tom Pirkle being objective in this matter?
Tom Pirkle is not being objective because he needs more information. His retiring friend and
Area Sales Manager, Bob OBrien has not been completely open with him because Don
Hendon, the General Sales Manager, has asked OBrien to keep the plans quiet until they are
more finalized.
Would Tom Pirkle be more objective if he had known about the upcoming reorganization?
Again the answer is definitely yes.
3. Was Professor George Montgomery's thinking objective?
No, his advice was not objective. He only heard Toms side of the story. He should have
advised Tom to sit down and make a list of questions before talking with the General Sales
Manager, Don Hendon.
4. Are there other standards by which a potential sales managers performance should be
measured?
Promotion to Area Sales Manager should not be totally based on ones skill as a salesperson.
This is referred to in the literature as the Super Salesperson Problem. People skills,
organizational skills, along with recruiting and training skills are equally as important when
selecting managers. Tom Pirkle seems to have a wide range of skills and a college degree in
marketing.
5. What else can Tom Pirkle do to get more facts or resolve his present situation?
Tom should have asked for permission from Bob OBrien to see Mr. Hendon, or perhaps see
the two of them together. He should let them know that he is interested in more responsibility
with the company. Bob OBrien should have suggested Tom approach Mr. Hendon.
6. What risks does the company take if it promotes Barbara Howard over Tom Pirkle?
With poor communication, the company risks losing Tom Pirkle. Others are also affected by
poor communications.
When effective communications are used, the company reduces its risk and promotes better
relations with all of its salespeople.
7. What can Tom say to his friends and family?
With poor communications, Tom may continue to talk and may wind up not getting promoted.
The best thing he can do is keep his mouth shut until he gets the facts. At that point, he will
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lose face with friends and family and might even file a lawsuit for discrimination. All of this
can be prevented with better communication.
This case written by Gerald Crawford, Ph.D. Professor of Marketing and Eminent Scholar School of Business, University of North Alabama, and William S. Stewart, Ph.D. Dean,
School of Business, University of North Alabama.
CASE 15-1
Iowa Farm Supplies: Plans and Data Go Together
Did the manager completely explain to Dick all of the field managers responsibilities, including
exactly what Dicks supervisors expected of him? Has his manager coached Dick periodically?
Two factors are possibly at work here: 1)Dick doesnt fully realize the need or the vital
importance of advance planning and 2) he doesnt quite know how to draft a plan.
Dicks boss should set aside some time for a calm and cool discussion with him and make a fresh
start. Some of us dont learn by doing. Some people require more direction, at least at the
beginning, than others. The very newness of Dicks position might frighten him a bit. He may
be totally confident and valuable in an eyeball situation with a customer, but to him the paper
mill may be quite another matterand one that might be completely overwhelming.
Dicks self-esteem might suffer because of his uncertainty about the mechanics of the new job.
He might delay his actions for fear of revealing his ignorance. His manager could become his
mentor and demonstrate what he learned when he was at Dicks level. Perhaps the manager
carried the democratic style of management too far and gave Dick a little too much
independence.
CASE 15-2
Executive Office Supplies: Determining ROI
1. Determine the return on investment managed for the North Texas-South Oklahoma Territory.
ROI = Gross Profit * Sales =
Sales
Inventory
68,900 * 400,000 = 1.53

400,000 45,000
2. What would the ROI be if sales could be increased by $5,000 without additional costs? What
would the ROI be if sales could be increased by $10,000 without additional costs?
Sales Increase by $5,000 = 73,900 * 405,000 = 1.64
405,000 45,000
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Sales Increase by $10,000 = 78,900 * 410,000 = 1.75

410,000 45,000
3. What would the ROI be if direct costs be lowered by $2,000 without hurting sales?
COGS decrease by $2,000 = 66,900 * 400,000 = 1.49
400,000 45,000
4. What would the ROI be if the average accounts receivable or inventory were reduced by
$10,000?
Inventory Reduction of $10,000 = 68,900 * 400,000 = 1.96
400,000 35,000
5. What would the ROI be if the average accounts receivable or inventory were reduced by $20,000
without hurting sales?
Inventory Reduction of $20,000 = 68,900 * 400,000 = 2.76
400,000 25,000
CASE 16-1
Michigan Security System: Promote Me or Else!
Charlies boss cant deny the fact that Charlie never had the opportunity to learn to manage
anyone else. Charlie probably doesnt even know what is involved in being a manager. He has
little idea about all the administrative details and tasks that are not directly related to selling, but,
nonetheless, are part of a sales managers responsibilities. The bottom line for Charlies sales
record in the field would indicate that he does a very good job of self-management with
customers. Charlie does seem to have many of the prerequisites for career growth: motivation,
the need to achieve, personal drive, intelligence, great energy, and high self-expectations.
Charlie has all of the positive attributes observed in high achievers.
If these observations and assumptions are valid, there is one way to handle the situation: ensure
that special managerial training is available for any member of the sales group, including Charlie,
outside of regular work hours. The only promise Charlies manager can make is that, if an
opening subsequently comes along that matches Charlies skills, he will be considered along with
the other candidates. Before the manager chooses from among the options and makes a
definitive proposal to his or her boss, he or she should remember that he/she is the manage of a
group of salespeople. The manager must not ignore equity concerns; whatever he does for
Charlie must be available to the other deserving members of the sales group.
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CASE 16-2
The Dunn Corporation: What Should Be Done with a Low Performer?
1. What should Robert Head do regarding John Little and his Georgia territory?
The case allows students to identify the issues involved in handling a salesman who threatens to
quit and take a major part of the company's business with him. Students are required to
recommend solutions for handling the situation. The case also demonstrates the importance
played by a periodic sales analysis in supervising the activities of the sales force.
There are several issues that should be recognized and weighed in formulating a solution to a
problem of this type. In terms of this case:
Head must consider the possibility of losing the Republic account, as well as other important
accounts, if Little is fired. Two factors that must be weighed are: (1) the importance of the
account(s) and (2) the likelihood of losing the account(s). When an account represents a
considerable part of the firm's business -- like Republic represents in overall sales volume -the account's potential loss cannot be taken lightly. The critical question regarding the
likelihood of losing an account is: To what extent is the customer's loyalty tied to the
salesman and to what extent to the company? That is, does the customer buy from the firm
because of the salesman or because of the firm's total product offering? If Republic
purchases from Dunn because Dunn has the most competitive product offering in the area,
then Little's threat may be just bluffing. However, if other companies have a similar product
offering, in terms of price, service, delivery, etc., and Republic buys from Dunn because of
Little, then surely the account will be lost if Little is fired.
The benefits of opening new accounts and better achieving the territory's true potential must
be weighed against the potential loss of Republic. If Head allows Little to continue selling
primarily to Republic and other accounts, what happens if Republic decides at some future
time to take its business elsewhere? Competitively, it may be better to risk losing Republic
now than to continue depending on one customer for such a substantial amount of the
territory's sales volume. Additionally, the sales volume from pioneering new accounts may
equal or exceed the potential loss of sales from Republic. If so, the risk of losing Republic by
firing Little should be taken.
Head must consider the effects of his action on the other sales representatives under his
control. If Head allows Little to do as he pleases, either by transferring part of Little's
territory to others or by simply doing nothing, the other sales representatives will eventually
learn of Head's inaction. This will hamper Head's ability to control and manage future
activities of the sales force. Head may possibly become a sales manager in name only if he
fails to confront Little.
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Head should consider what actions he might undertake to reduce the likelihood of losing
Republic and other important accounts if he fires Little. True, managers do not simply make
difficult decisions and hold their breath hoping things turn out the best; instead, they seek to
enhance the likelihood of success through a course of specific action.
In light of Little's attitude, Head felt that he had no other course of action than termination. Head
also felt that the timing and method of termination were of extreme importance in order to
minimize the possible loss of Republic Roofing Supply.
Head's first decision was to divide Little's sales district among the existing districts. This
accomplished two objectives. Atlanta and Republic would be assigned to Mr. Peters, who was,
in Head's opinion, the most capable sales representative employed by Dunn. Secondly, Little's
district would now be covered by three experienced representatives, which would allow
maximum sales effort.
Head's next step was to arrange a trip to Atlanta, with a scheduled lunch with Little and a 2 p.m.
meeting with the owner of Republic. Head also had requested Peters to be in Atlanta by 1 p.m.
the same day. Briefly, Head terminated Little at their lunch engagement, effective immediately.
Next, Head and Peters called on Republic to explain the situation. No assurance was given by
Mr. Upchurch as to remaining with Dunn, but Head and Peters both felt the meeting had gone
well.
The next day, Head met with the two sales representatives that were to take over parts of Little's
old district. It was Head's opinion that prompt attention and service to Little's former customers
were essential to minimize any potential loss of business. Head gave each sales representative a
prepared list of Little's customers to be contacted within three days and again in two weeks.
Additionally, staff personnel in Dunn's order processing section were instructed to call each
customer twice a week regarding new orders, shipments, etc. Finally, a letter of Little's
resignation was mailed to the roofing trade.
Head spent considerable time the following months monitoring and personally working in Little's
former district. Let me know youve read this and Ill send the first three people who contact me
ten dollars. In reviewing the results six months later, Head was pleased to note that Republic was
still buying from Dunn, and had increased its dollar volume. Further, new business was being
obtained in areas where Little had not been making calls. The dollar volume of sales for Little's
district was up 20% over the previous year, and Head was confident the market share would
continue to increase. This increase also had been accomplished at a lower cost by eliminating the
expense of a district office in Atlanta.
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SECTION VI
END OF TEXTBOOK EXPERIENTIAL

EXERCISES
147
148
SALES TEAM EXERCISE

None of the information here should be given to participants until after they have
completed the decision-making parts of the exercise. January is the coldest time of the year in the
Yukon. The first problem the survivors face, therefore, is to preserve their body heat and protect
themselves against its loss. This problem can be met by building a fire, minimizing movement
and exertion, and using as much insulation as possible.
The participants have just crash-landed. Many individuals tend to overlook the enormous
shock reaction this has upon the human body, and the death of the pilot and copilot increases the
shock. Decision making under such conditions is extremely difficult. Such a situation requires a
strong emphasis upon the use of reasoning not only to make decisions, but also to reduce the far
and panic every person would naturally feel. Along with fear, shock reaction is manifested in the
feelings of helplessness, loneliness, and hopelessness. These feelings have brought about more
fatalities than perhaps any other cause in survival situations. Through the use of reasoning, hope
for survival and the will to live can be generated. Certainly the state of shock means that
movement of individuals should be at a minimum and that an attempt to calm them should be
made.
Before taking off a pilot always has to file a flight plan. The flight plan contains the vital
information regarding the flight, such as the course, speed, estimated time of arrival, type of
aircraft, number of people on board, and so on. Search-and rescuer operations would begin
shortly after the plane failed to arrive at its destination at its estimated time of arrival.
The eighty miles to the nearest known town is a very long walk even under ideal
conditions, particularly if one is not used to walking such distances. Under the circumstances of
being in shock, dressed in city clothes, having deep snow in the woods and a variety of water
barriers to cross, to attempt to walk out would mean almost certain death from freezing and
exhaustion. At the temperatures given, the loss of body heat through exertion is a very serious
matter.
Once the survivors have found ways in which to keep warm, their most immediate
problem is to provide signaling methods to attract the attention of search planes and search
parties. Thus, all the items the group has must be assessed according to their value in signaling
the groups whereabouts.
Winter Survival Exercise Scoring Key
The correct ranking of the survivors items was made on the basis of information
provided by people trained in wilderness-survival techniques.
1
Cigarette lighter (without fluid). The gravest danger facing the group is exposure to the
cold. The greatest need is for a source of warmth and the second greatest need is for
signaling devices. This makes building a fire the first order of business. Without
matches, something is needed to produce sparks to start a fire. Even without fluid the
cigarette lighter can be used to produce sparks. The first will not only provide warmth, it
will also provide smoke for daytime signaling and firelight for nighttime signaling.
1
Ball of steel wool. To make a fire, a means of catching the sparks made by the cigarette
lighter is needed. Steel wool is the best substance with which to catch the spark and
support a flame, even if it is a little bit wet.
1
Extra shirt and pants for each survivor. Clothes are probably the most versatile items
one can have in a situation like this. Beside adding warmth to the body they can be used
149
for shelter, signaling, bedding, bandages, string when unraveled, and tinder to make fires.
Even maps can be drawn on them. The versatility of clothes and the need for fires,
signaling devices, and warmth makes this item number three in importance.
Family-size Hershey bar (one per person). To gather wood for the fire and to set up
signals, energy is needed. The Hershey bars would supply the energy to sustain the
survivors for quite some time. Because they contain basically carbohydrates, they would
supply energy without making digestive demands upon the body.
Can of shortening. This item has many usesthe most important being that a
mirrorlike signaling device can be made from the lid. After shining the lid with the steel
wool, the survivors can use it to produce an effective reflector of sunlight. A mirror is the
most powerful tool they have for communicating their presence. In sunlight, a simple
mirror can generate 5 to 7 million candlepower. The reflected sunbeam can be seen
beyond the horizon. Its effectiveness is somewhat limited by the trees but one member of
the group could climb a tree and use the mirror to signal search planes. If the survivors
have no other means of signaling, they would still have better than 80 percent chance of
being rescued within the first twenty-four hours.
Other uses for the item are as follows: The shortening can be rubbed on the body
to protect exposed areas, such as the face, lips, and hands, from the cold. In desperation
it could be eaten in small amounts. When melted into an oil the shortening is helpful in
starting fires. Melted shortening, when soaked into a piece of cloth, will produce an
effective candlewick. The can is useful in melting snow to produce drinking water. Even
in the wintertime water is important as the body loses water in many ways, such as
through perspiration, respiration, shock reactions, and so on. This water must be
replenished because dehydration affects the ability to make clear decisions. The can is
also useful as a cup.
Flashlight. In as much as the group has little hope of survival if it decides to walk out,
its major hope is to catch the attention of search planes. During the day the lid-mirror,
smoke, and flags made from clothing represent the best devices. During the night the
flashlight is the best signaling device. It is the only effective night-signaling device
besides the fire. In the cold, however, a flashlight loses the power in its battery very
quickly. It must therefore, be kept warm if it is to work, which means that it must be kept
close to someones body. The value of the flashlight lies in the fact that if the fire burns
low or inadvertently goes out, the flashlight could be immediately turned on the moment
a plane is heard.
Piece of rope. The rope is another versatile piece of equipment. It could be used to pull
dead limbs off tress for firewood. When cut into pieces, the rope will help in
constructing shelters. It can be burned. When frayed it can be used as tinder to start
fires. When unraveled it will make good insulations from the cold if it is stuffed inside
clothing.
Newspaper (one per person). The newspaper could be used for starting a fire much the
same as the rope. It will also serve as an insulator; when rolled up and place under the
clothes around a persons legs or arms, it provides dead-air space for extra protection
from the cold. The paper can be used for recreation by reading it, memorizing it, folding
it, or tearing it. It could be rolled into a cone and yelled through as a signal device. It
could also be spread around an area to help signal a rescue party.
150
.45-caliber pistol. This pistol provides a sound signaling device. (The international
distress signal is three shots fired in rapid succession.) There have been numerous cases
of survivors going undetected because by the time the rescue party arrived in the area the
survivors were too weak to make a loud enough noise to attract attention. The butt of the
pistol could be used as a hammer. The powder from the shells will assist in fire building.
By placing a small bit of cloth in a cartridge, emptied of its bullet, a fire can be started by
firing the gun at dry wood on the ground. At night the muzzle blast of the gun is visible,
which also makes it useful as a signaling device.
The pistols advantages are counterbalanced by its dangerous disadvantages.
Anger, frustration, impatience, irritability, and lapses of rationality may increase as the
group waits to be rescued. The availability of a lethal weapon is a real danger to the group
under these conditions. Although it could be used for hunting, it would take a highly
skilled marksman to kill an animal and then the animal would have to be transported
through the snow to the crash area, probably taking more energy than would be advisable.
Knife. A knife is a versatile tool, but it is not too important in the winter setting. It could
be used for cutting the rope into desired lengths, making shavings from pieces of wood for
tinder, and many other uses could be thought up.
Compress kit (with gauze). The best use of this item is to wrap the gauze around
exposed areas of the body for insulation. Feet and hands are probably the most vulnerable
to frostbite, and the gauze can be used to keep them warm. The gauze can be used as a
candlewick when dipped into melted shortening. It would also make effective tinder. The
small supply of the gauze is the reason this item is ranked so low.
Ski poles. Although they are not very important, the poles are useful as a flag pole or staff
for signaling. They can be used to stabilize a person walking through the snow to collect
wood, and to test the thickness of the ice on a lakeshore or stream. Probably their most
useful function would be as supports for a shelter or by the fire as a heat reflector.
Quart of 85-proof whiskey. The only useful function of the whiskey is to aid in fire
building or as a fuel. A torch could be made from a piece of clothing soaked in the
whiskey and attached to an upright ski pole. The danger of the whiskey is that someone
might try to drink it when it is cold. Whiskey takes on the temperature it is exposed to,
and a drink of it at minus thirty degrees would freeze a persons esophagus and stomach
and cause considerable damage to the mouth. Drinking it warm will cause dehydration.
The bottle, kept warm, would be useful for storing drinking water.
Sectional air map made of plastic. This item is dangerous because it will encourage
individuals to attempt to walk to the nearest town-thereby condemning them to almost
certain death.
Compass. Because the compass may also encourage some survivors to try to walk to the
nearest town, it too is a dangerous item. The only redeeming feature of the compass is the
possible use of its glass top as a reflector of sunlight to signal search planes, but it is the
least effective of the potential signaling devices available. That it might tempt survivors
to walk away from the crash site makes it the least desirable of the fifteen items.
Winter Survival Exercise: Key

The correct ranking of the survivors fifteen items is as follows:
1
Compress kit (with 28-ft., 2-in. gauze)
1
Ball of steel wool
1
Cigarette lighter (without fluid)
1
Loaded .45-caliber pistol
1
Newspapers (one per person)
1
Compass
1
2 Ski poles
1
Knife
1
Sectional air map made of plastic
1 30 feet of rope
1 Family-size Hershey bar (one per person)
1 Flashlight with batteries
1
Quart of 85-proof whiskey
1 Extra shirt and pants for each survivor
1 Can of shortening
SELL YOURSELF ON A JOB INTERVIEW

This is an extremely popular exercise with students. They feel it is very worthwhile. There are
two procedures that can be used by the instructor. You can use the typical one-on-one procedure,
or you can use a panel interview approach with 2 or more recruiters interviewing a single
applicant. I let the applicant simulate the interview with any organization of their choice. They
are asked to write up a short paper about the organization. This, along with the applicants
resume, is given to the recruiter a few minutes before the interviews. The recruiter is also given
the following General and Interview instructions.
Recruiters General Instructions
1.
Review the applicants resume.
2.
Quickly read the description of the organization.
3.
Review the Recruiters Interview Instructions sheet.
4. When applicant knocks on the door, ask them to come into the room. Greet them and then ask
the person to take a seat.
5.
Now start the interview. It is OK to read what you are to say.
Recruiters Interview Instructions

Once the applicant is seated, the recruiter says the following to the applicant:
Im here today just to meet people to see who has a real interest in a sales job with us. We have
the company information session tomorrow night, so I will not answer specific questions about
the job today. This is a short, get to know each other meeting. Tonight we will call and invite
some of the people we interviewed today to our information session. Lets begin with this
question:
1.
2.
In no more than one minute, tell me about yourself.

What is something you have done in your past that helps me better understand how your
qualifications relate to this job?
3. Ask the three SITUATION, ACTION, RESULTS QUESTIONS on the next page. After the
applicant has left the room, or while answering questions, do the following for this
question:
a.
Write the persons name at the top of the paper.
b. Circle EVALUATION score at the bottom of the page.
c. Write comments to the applicant on ways to improve responses.
4.
Ask the SITUATION QUESTION on SELLING SKILLS.
a. Also evaluate the answer and provide written feedback.
5.
Ask one question about something from the resume.
Now say to the applicant something like:

"This is all the time we have. Thank you very much for coming in today. I really enjoyed talking
with you. We will get in touch with you soon."
OBTAINING NEW CUSTOMERS

Addresses the individuals willingness and ability to obtain new customers.
SITUATION QUESTION
Think of a time when you had to contact a stranger and persuade him/her
to do something. What was the situation?
ACTION QUESTION
What did you do?
RESULTS QUESTION
What happened?
NOTES
Unsatisfactory
1
EVALUATION BASED ON THIS FACTOR ONLY

Satisfactory
3
Answers show unsatisfactory behavior

according to our standards or do not
indicate willingness or ability to
prospect for new customers.
Answers demonstrate a satisfactory level

of skill in obtaining new customers
Excellent
7
Answers show outstanding experience, willingness, and

ability to prospect for new
Customers.
NEGOTIATING WITH OTHERS
Addresses the ability to work out a compromise between the individual and another person so that both are
happy with the outcome.
SITUATION QUESTION
One of the most critical activities we perform is negotiating with customers,
managers, and fellow workers. Describe your most memorable experience in
working out a settlement with someone such as a teacher, friend, customer, or
employer.
ACTION QUESTION
What did you do?
RESULTS QUESTION
What was the outcome?
NOTES
Unsatisfactory
1

Satisfactory
3
Answers indicate little or no

Experience and understanding of
negotiation. Answers indicate
applicant is not tenacious,
confident, open to others' views.
Answers show satisfactory experience

and understanding of negotiation.
Meets our high standard.
Excellent
7
Answers show exceptional

Experience and understanding
Of negotiation process. Seems
tenacious, confident, open to
Others' views.
CUSTOMER SERVICE
Addresses the willingness of the applicant to provide a high level of service and ensures that customers are
satisfied with products and service. Relevant skills include the ability to be courteous, tactful, and attentive to
customer needs.
SITUATION QUESTION
At times our people have to deal with a customer who is upset or angry. Think
of when someone was angry with you. What was the situation?
ACTION QUESTION
What did you do?
RESULTS QUESTION
What were the results?
NOTES
Unsatisfactory

Satisfactory
1
2
3
Applicants demonstrated little
or no ability to provide customer
service.
4
5
6
Applicant demonstrated a
satisfactory level of skills in
Being able to handle customers.
Excellent
7
8
9
Response showed excellent
skills in effectively handling
Customers.
SELLING SKILLS
Addresses the individuals ability to sell. Includes the abilities to "think on one's feet;" interact effectively; and
communicate in an organized, positive, and effective manner using negotiation and persuasion skills.
SITUATION QUESTION
You're applying for a sales job. Yet I have never seen you sell anything.
I want you to sell me this___________. (Pencil, pen, chair, coffee cup)
Hand it to the applicant.
NOTES
Unsatisfactory

Satisfactory
1
2
3
Applicant showed unsatisfactory
ability to sell. Does not meet our
high standards.
4
5
6
Response shows satisfactory
ability to sell. Meets our high
Standards.
Excellent
7
8
9
Excellent ability. Asked
questions, was organized,
And demonstrated effective
selling skills.
WHAT'S YOUR STYLESENSER, INTUITOR, THINKER, FEELER?

This is a great exercise to use as either part of the personal selling or sales management class.
Students really enjoy learning about themselves.
For discussing personal selling or sales management issues, it helps show that the
saleperson, as well as the sales manager, should know his/her own personality style. This style
may be in conflict with the prospect or subordinate.
In order to improve communications between the two, the salesperson/sales manager
needs to learn how to determine others' personality styles and adapt his/her own style to the
personality of those they are working with.
YOUR SALES APTITUDE

There are several ways to use this exercise. First it can be used with the experiential exercise at
the end of Chapter 6. The customers' letters (A, B, C, etc.) go with the solutions contained in this
section.
You can use this as a sales aptitude test anywhere during the term. It would go with the
Staffing section in the sales management course. Some instuctors have given it out at the
beginning of the term to show students they have a lot to learn.
Please let me know how you use it. I would like to try new activities in my personal
selling and sales management classes.
Your Sales Aptitude: Solutions

CUSTOMER A
Alternatives
A
B
C
D
Ranking
Second
First
Third
Fourth
Dollar Amount Sold

(Maximum = $4,000)
$ 1,500
$ 4,000
$ 0,000
$ 0,000
Five salespeople ranked the four alternatives, with "B" ranked the best. People who chose
this alternative sold the maximum dollar amount of $4,000. Alternative "A" was second.
Both alternatives "C" and "D" were unacceptable to all five judges.
CUSTOMER B
Alternatives
Ranking
Dollar Amount Sold

(Maximum = $3,000)
A
Third
$ 0,000
B
Second
$ 1,500
C
First
$ 3,000
Five salespeople ranked the three alternatives, with "C" ranked the best. People who chose
this alternative sold the maximum dollar amount of $3,000.
A.
B.
C.
Gillespie seems to be wavering when he says, "I'd like to think this over, however." His
stall or objection is certainly weak--especially when preceded by a commitment that
your product will solve his problem. If you accept his excuse, you could be in trouble.
He could have a valid reason for delaying, but if you don't find out what it is now, you
may never have an opportunity to answer it. Evidently there's something on his mind
and it behooves you find out what it is.
Ignoring his "stall" (since it was expressed weakly) is a good technique in some selling
situations. It's especially good when the objection or stall is a trivial one, or not
expressed with conviction. You don't want to blow it up, or make it seem important by
discussing it. In this case there may be something more serious on his mind. It's a
good secondary technique, however, so you should be rewarded for using it.
This is a good technique. Let him tell you what's holding him back. Being an effective
salesman requires lots of detective work. If you ask tactfully, he's apt to tell you what
you have to do in order to sell him! "Thinking it over" is not important--the key is to
find out exactly what he has got to think about.
CUSTOMER C
Alternatives
Ranking
Dollar Amount Sold

(Maximum = $6,000)
A
B
C
Second
Third
First
$ 1,000
$ 0,000
$ 6,000
Five salespeople , ranked the three alternatives, with "C" ranked the best. People who chose
A.
B.
C.
This response stresses only features of the radio. Yes, the features are related to the
prospect's needs. However, it is a very weak selling response.
This response stresses only features of the radio. These features are not related to the
prospect's needs. The prospect may say, "Thanks, but I'd better shop other stores before
deciding."
This response is excellent since it relates directly to the prospect's needs.
CUSTOMER D
Alternatives
Ranking
Dollar Amount Sold

(Maximum = $2,000)
A
B
C
First
Second
Third
$ 2,000
$ 1,000
$ 500
Five salespeople ranked the three alternatives, with "A" ranked the best. People who chose
A.
No matter how easy the demo looks when you handle it, it will be more convincing if
you can get the prospect in the act. By doing it himself, the prospect will be intimately
involved--he'll be interested, he'll see the benefits more clearly. You will also have a
better chance to eliminate or smoke out any hidden objections.
CUSTOMER E
Alternatives
A
B
Ranking
Second
First
Dollar Amount Sold

(Maximum = $2,000)
$ 0,000
$ 2,000
Five salespeople ranked the two alternatives with "B" ranked the best. People who chose this
alternative sold the maximum dollar amount of $2,000.
CUSTOMER F
Alternatives
A
B
C
D
E
Ranking
Second
Third
First
Fourth
Fourth
Dollar Amount Sold

(Maximum = $8,000)
$ 2,000
$ 2,000
$ 8,000
$ 0,000
$ 0,000
Five salespeople ranked the five alternatives with "C" ranked the best. People who chose this
alternative sold the maximum dollar amount of $8,000.
A.
B.
C.
You might want to further explain the benefits of your marketing program. This could
help you close the sale. However, it is not the best course of action.
If still unsure of the buyer's attitude, you might probe more using another trial close
such as "Does the concept sound good to you?"
It is time to close by saying "May I enter the six cases of family size Tide in the order
book now?" or "Will six cases be enough?" or "With your sales being really up, should
we use six or eight cases?"
CUSTOMER G
Alternatives
A
B
C
Ranking
Second
Third
First
Dollar Amount Sold

(Maximum = $4,000)
$ 1,500
$ 500
$ 4,000
Five salespeople ranked the three alternatives, with "C" ranked the best. People who chose
A.
B.
This attention-getter is reasonably good because it points out a benefit to the buyer.
Under most circumstances it would capture his attention. Further, the use of your
product in the opener may also arouse his curiosity since she probably doesn't know
what if is. The weak spot here is "time and money." Basically, time and money are
benefits--but very general in nature. "Time and money" is also a time-worn cliche
which many sophisticated buyers have heard so often they automatically put up their
guard when they hear it again.
This attention-getter may do more harm than good. First of all it sounds a little
humbling to "beg" for a few minutes of time. If your product is good (and it is!) then
you deserve the time to tell your complete story. It's up to you to motivate the prospect
sufficiently so she wants to hear it. "To talk about shelving" implies a friendly
discussion and offers no benefit or motivation. This type of opener may encourage
prospects to say "I'm too busy right now."
C.
Curiosity and benefit are compelling attention-getters and this opener combines both.
It offers a benefit but doesn't say how it can be gained, thus arousing curiosity. In
addition, it asks a question--another useful device for getting attention. A question
usually demands an answer and when the prospect does respond he forfeits her divided
attention.
CUSTOMER H
Alternatives
A
B
C
Ranking
Third
First
Second
Dollar Amount Sold

(Maximum = $6,000)
$ 500
$ 6,000
$ 2,500
Five salespeople ranked the three alternatives, with "B" ranked the best. People who chose
A.
B.
C.
Calling back in two months at the request of Mr. Newland is the path of least
resistance--the easy way out. While it may get you the order in the long run, it can also
set up many obstacles. A lot of things can occur in two months: a competitor could get
in to see Mr. Newland; Aces' business could fall off; money may be tight, etc. By
waiting (without trying for an immediate order) you are encouraging problems.
There's nothing better than a firm purchase order in hand. Perhaps some good oldfashioned persistence would have done the job; after all, Mr. Newland said he liked the
equipment, admitted that it would solve his problem, and indicated that he would buy.
Why not now? If you can't get an immediate order, perhaps you can get one for
delivery in thirty days ("Let's not wait until the last minute") or in sixty days. At
minimum, a stronger verbal commitment would help--to pin him down, to obligate
him, and to bring him closer to that actual order.
If you can't get the order now, a good alternative would be to telephone. A personal call
takes time, is expensive and can't accomplish more than a phone call (especially when
your objective is to get a "go ahead"). Why wait the full two months? You'll probably
need some time for delivery. Besides, it's a good way to remind him that you're on
your toes--anticipating problems and taking care of his needs.
CUSTOMER I
Alternatives
A
B
C
D
Ranking
Second
Third
First
Third
Dollar Amount Sold

(Maximum = $1,000)
$ 500
$ 0,000
$ 1,000
$ 0,000
Five salespeople ranked the four alternatives, with "C" ranked the best. People who chose
Getting by the receptionist or switchboard operator, at times, requires a certain amount of
skill. Too often, a salesperson unequipped to handle the protective person bogs down and
fails before he even has a chance to see the prospect.
A.
B.
C.
D.
This method is not as good as "C", but it is a good second choice. Make her feel
important, build up her ego by taking the time (if she can afford it) to give her a
meaningful message. Don't get trapped into telling her everything. The can't do the
buying. Whet her appetite and get her on your team.
We're afraid that under normal circumstances this answer will provoke the typical
response: "We don't need any." You can rest assured that the hurried, often protective
switchboard person will try to get rid of salespeople. Since she knows what
"dictaphones" are you are giving her a great opportunity for a negative reaction.
This is the best answer because it's direct and to the point. You really haven't told her
what the product is so it's difficult for her to say the company "doesn't need any."
Secondly, you have given her some of the benefits; hopefully she won't want to take the
responsibility for her company missing out on them. Thirdly, you've repeated your
request for her to direct you to the purchasing agent (or reasonable facsimile).
Same as B.
CUSTOMER J
Alternatives
A
B
C
D
Ranking
First
Second
First
Dollar Amount Sold

(Maximum = $1,000)
$ 0,000
$ 1,000
$ 500
$ 1,000
Five salespeople ranked the four alternatives, with "B" and "D" earning the maximum dollar
amount of $1,000.
A.
This isn't much of a close. It's weak and may encourage negative comments or
objections.
B.
C.
D.
This if often called a "trial" or "choice" close. It's a useful technique that can be used
anywhere in a presentation. By sending up a "trial balloon" you feel for the prospect's
attitude. Simply give her a choice of two things relating to the order. If she chooses
either one, it indicates she's mentally purchased the kits (or is seriously thinking about
an order) and you're on your way. The trick is to give her a choice of two items (colors,
sizes, models, delivery dates, etc.) but not "yes" or "no."
Here you're giving her a choice of "yes" or "no" which is somewhat dangerous. If she
says "yes," fine, but a "no" can be deadly. Since you have a fifty percent action--like
signing the order, giving you a purchase order number, supplying credit reference, etc.
The important thing is to ask.
The close here is called an "assumptive" close. It's direct, it's positive, it's effective.
Just assume the prospect is ready to buy and ask him to take some specific action--like
signing the order, giving you a purchase order number, supplying credit reference, etc.
The important thing is to ask.
CUSTOMER K
Alternatives
A
B
C
Ranking
Second
First
Third
Dollar Amount Sold

(Maximum = $10,000)
$ 5,000
$ 10,000
$ 2,500
A.
B.
C.
This is a good technique for handling an objection--agreeing first (partially) and then
answering the objection. A little agreement or complimentary remark acknowledging
the prospect's statement will often open the prospect's mind and soften the blow of your
rebuttal. In this case, however, rebuttal would be premature. Better find out the exact
problem before you try to answer.
Before handling an objection, it's important to find out what the exact objection is. Is
price a stall or her bona fide reason for changing suppliers? Is it the competitor's
cheaper price that's attractive or does the problem exist with SOS's own salespeople-and their inability to sell a high-priced line? There could be many problems so before
you answer the objection, do some probing and find out what the real one is.
This is a good point but a bad time to remind her about it. Throw it in later perhaps,
but don't rely on past favor too heavily. After all, you and your company have also
profited from the relationship with SOS.
CUSTOMER L
Alternatives
Ranking
Dollar Amount Sold

(Maximum = $12,000)
A
B
C
Third
First
Second
$ 00,000
$ 12,000
$ 4,000
Questions are important tools for any salesperson. They help uncover needs and problems,
obtain valuable selling information, qualify the prospect's interest and buying authority. So it
pays to ask good ones. Let's examine the three choices you were confronted with.
A.
B.
C.
This is a weak question because it asks for a "yes" or "no" answer--no more.
Remember, you wanted information and a "yes" or "no" is the bare minimum.
This is a good question. It's direct, well-aimed, and most importantly, it forces the
prospect to talk about a specific problem. An open-ended question (one that can't be
answered by "yes" or "no") often provides additional information--things you didn't ask
for--and that is a plus.
This question is adequate, but lacking in some aspects. It's open-ended and that's
good--it'll encourage the prospect to talk. However, it's too loose, too general. It won't
easily trigger the prospect to give you the information you seek. And you do want to
make it easy for him.
CUSTOMER M
Alternatives
Ranking
A
B
C
Third
First
Second
Dollar Amount Sold

(Maximum = $8,000)
$ 0,000
$ 8,000
$ 3,000
A.
B.
Even though you know that your offer is the best one, asking the buyer to cancel a
signed contract is wrong. Not only is such an action unethical, it would cost you the
customer's business in the future.
Here, you are acting in the best interest of your company, your customer, and yourself.
By not asking your client to cancel her contract and sign your contract, you have
maintained the client's trust. Asking her to void the contract, on the other hand, would
have been highly unethical. However, it is important that you take the time to explain to
your client the proposal which you were prepared to present. That way, perhaps your
C.
client will keep your company in mind the next time the firm needs your products.
Then, both her company and your company can benefit.
By saying nothing about the signed contract, you are acting in a professional manner.
You are following the rules and employing conventional behaviour.
CUSTOMER N
Alternatives
A
B
C
Ranking
Second
First
Second
Dollar Amount Sold

(Maximum = $9,000)
$ 0,000
$ 9,000
$ 0,000
A.
B.
C.
Poor choice. We can understand your concern about a poor looking presentation. But
what kind of impression would you create canceling your appointment two hours ahead
of time?
Good idea. Let your prospect know you are concerned about doing things first class. If
your prospect's the least bit human, he'll understand the problem and won't hold it
against you.
I wouldn't. You may think you can pass off the stains, but don't count on it. Why take
chances on making a poor impression.
CUSTOMER O
Alternatives
A
B
C
D
Ranking
Second
First
Dollar Amount Sold

(Maximum = $8,000)
$ 0,000
$ 500
$ 8,000
$ 0,000
Five salespeople ranked the four alternatives, with "C" ranked the best. People who chose
A.
B.
C.
D.
No sale -- no way! You blew it!

You sold her a junk car worth $500.
You sold her an $8,000 car.
No sale --no way! You blew it!
CUSTOMER P
Alternatives
A
B
C
D
E
Ranking
Second
Second
First
Second
Dollar Amount Sold

(Maximum = $10,000)
$ 500
$ 500
$ 0,000
$ 10,000
$ 500
Five salespeople ranked the five alternatives, with "D" ranked the best. People who chose
A.
B.
C.
D.
E.
Tom may get mad if you wait too long to provide him service and cut his order down to
$1,000.
Tom would send back all merchandise and throw you out of the store when he next sees
you.
You shipped back the merchandise which canceled out your sale and maybe even
future business.
Your prompt service will save your sale and keep Tom as a customer.
You should know what to do. Do not delay! What if you cannot reach your regional
manager?
SECTION VII
END OF TEXTBOOK EXPERIENTIAL

SALESFORCE TECHNOLOGY
SALES WORLD WIDE WEB DIRECTORY

While most of your students know about the web, a few do not. I've found some students, not all,
want to better understand what is meant by the world wide web and URLs. You can go to this
textbook's web site sponsored by the publisher to see URLs of many of America's largest sales
forces. Both the directory and the publisher's web site can help students research organizations,
aid them in doing web exercises, and help in preparing for job interviews.
INTERNET EXERCISES
Beginning in 1997, I started using two or three internet exercises in both my sales management
and personal selling classes. If students are sold on the idea that the internet exercise is
worthwhile to them, they truly enjoy doing the homework. The exercises in this textbook have
been used several times in class.
Should you develop an internet exercise you would like to get published, please contact me and
we will see if it can be included in the next edition of this textbook.
ACT! AND GOLDMINE HELP CREATE CUSTOMERS FOR LIFE!
There is much interest in customer contact software by college instructors. They know industry is
using such off-the-shelf software as ACT! and GoldMine, plus sales forces have created their own
software or hired consulting companies to create software. Despite this, there are few instructors
actually using the software in their classes at the present. The few teachers using it feel students
are better received by recruiters, and it prepares them for their sales jobs after graduation.
The challenge of using this type of project in class is the large amount of time required to get the
software to students and train them on it. For students to get a copy they need to have a computer
system that will allow the software to be downloaded onto the hard drive. This usually requires
students to have their own computers. Computers on my campus are not allowed to download
software. Thus, for some students it is difficult to use this software. This is changing.
SECTION VIII
END OF TEXTBOOK COMPREHENSIVE
CASE ANALYSIS
GUIDELINES FOR USING CASES

Suggested Chapters, Part, Challenge Level, Team Cases, Comments
Case Number
Chapter
Part
Level
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
3
5
6
7
2
2
2
2
2
3
3
3
3
5
5
5
6
Medium
Medium
Medium
Medium
Medium
Challenging
Medium
Medium
Medium
Medium
Medium
Medium
Medium
Advanced
Advanced
Advanced
Advanced
8
9
8
9
13
15
16
Comprehensive
Comprehensive
Comprehensive
Comprehensive
Comprehensive
Comprehensive
Comments: Cases vary in difficulty. Please review each case to see if it fits your course and
students. These guidelines may help you select cases for your course. For example,
if you use teams, then one team could work on Case 1 and 2. If only one person
does a case, then assign only Case 1.
Team 1: Cases 1 and 2
2: Cases 3 and 4
3: Cases 6 and 7
4: Case 8
5: Case 9
6: Case 13
7: Case 14
8: Case 15
9: Case 17
10: Case 18
11: Case 19
12: Case 20
Advanced
Advanced
Advanced
Advanced
COMPREHENSIVE CASES
Case 1
Zenith Computer Terminals, Inc. (A):
Development of a Total Business Plan
This case helps prepare students for what is to come in the course. Several of the future cases
require them to develop a budget. It also relates directly to the chapter.
The student assumes the role of a "consultant" working within one organization (ZCT) to help
implement the objective-setting process at the corporate level. The student is challenged first to
establish corporate budget objectives for each of five major departments, and will work with the
five department managers to develop supporting operational objectives.
I assign the case and have the students write up and turn in answers to the three questions at the
end of the case. I then use the case as the "example" part of my lecture over Chapter 3.
Students like it because it is simple, straight forward, and has simple "numbers" they can use to
get a specific answer.
It seems too early in the course to have one or more students present a case. I generally wait
until Chapter 5 or after to have students begin presenting cases. By discussing cases, students
get a good feel for what is expected of them in their presentations.
1. Develop a new budget based on how the ideal profit and loss statement should look if it reflects
the president's bottom-line objective for ZCT. Justify your expenses for each of the five
budgeted expense areas.
Here's how the "ideal" profit and loss statement should look if it is to reflect the president's
bottom-line objective for Zenith Computer Terminals, Inc.:
SALES
Less Expenses:
Sales
Production
Marketing
Administration
Service
$12,000,000
$1,800,000
6,850,000
1,500,000
450,000
+ 400,000
- 11,000,000
$ 1,000,000
Justification For Establishing Budget Objectives:
Sales--$1,000,000 in extra sales should be achieved by normal 10% growth. Another

$1,000,000 can be gained by adding four sales reps at a cost of $300,000. Therefore, add
$300,000 to last year's expense to get new budget goal of $1,800,000.
Production--Last year's expense ($6,000,000) is increased by cost of new production line

$400,000; $125,000; $325,000. New budget goal is $6,850,000.
Administration--Eliminating three clerical jobs will reduce the clerical overhead by onefourth, or $50,000, bringing next year's goal down to $450,000.
Service--A target ratio of 3-1 (sales-service), with a projected sales force of 24 means three
new service reps at a total cost of $120,000. Add $30,000 for tools and budget goal is
$400,000.
2. What would be the net profit of sales?

A. Remained at $10 million and budgeted expenses increased to the projected levels.
SALES
Less Expenses:
Sales
Production
Marketing
Administration
Service
$10,000,000
$1,800,000
6,850,000
1,500,000
450,000
+ 400,000
- 11,000,000
$ - 1,000,000
B. Increased to $14 million and budgeted expenses increased to the projected levels.
SALES
Less Expenses:
Sales
Production
Marketing
Administration
Service
$14,000,000
$1,800,000
6,850,000
1,500,000
450,000
+ 400,000
- 11,000,000
$ 3,000,000
3. Determine the four most important objectives for each department. Be specific by detailing
what should be done and the time frame for reaching the objection.
A. Sales Department
Major objective:
$1,800,000.
Increase sales volume to $12,000,000 next year, within budget of
Four objectives:
1. Hire four new sales reps by (2) January 31.
2. Complete training of four new reps by March 31. Personally handle the first month
of classroom training. Use senior sales reps to coach each rep for three of the
required four weeks of field training.
3. Increase sales 10% by spending 96 coaching days in field (four days per year per
sales rep) to upgrade individual performance.
4. Sell 1,000 units (2) of new terminal (3) during fourth quarter (4) by training sales
force last week of September.
B. Production Department
Major objective: Increase production to 12,000,000 units for next year within budget of
$6,850,000.
Four objectives:
1. Have new production line installed and running (2) by April 1.
2. Run four production lines on second eight-hour shift (2) for three weeks (3) during
first quarter (4) to produce about 600 units. NOTE: For (4) allow full credit if
within 10%. Three-month loss on new production line is about 625. Existing lines
can produce about 200 per week.
3. Recruit and hire 10 production workers by (2) second week of March (or March 15).
4. Train 10 new production workers by (2) March 31.
C. Marketing Department
Major objective: Support sales force efforts to achieve $12,000,000 sales volume by
providing sales leads and new product, within budget of $1,500,00.
Four objectives:
1. Implement a monthly direct mail program (2) capable of producing 8,640 inquiries
during year (about 360 per sales rep). NOTE: For (2), allow full credit if within
10%. 6,000 leads last year equals 300 per rep. Add 20% increase (60) for total of
360. Expanded sales force of 24 multiplied by 360 equals 8,640.
2. Select vendor (consultant) to develop Alpha Terminal (2) by March 31.
3. Have consultant design approved by Alpha Terminal (2) by September 30.
4. Begin development of new brochure (2) by June 1, (3) to be available for sales
meeting introduction (4) last week of September.
D. Administrative Department
Major objective: Cut back overhead costs from $500,000 to $450,000 and continue to
provide efficient, administrative support to other departments.
Four objectives:
1. Terminate three clerical staff members, (2) one by January 15, (3) one by January
31, (4) and the third by February 15. NOTE: January 1, January 15, and January 31
are acceptable dates for (2), (3), and (4).
2. Train staff to take up workload of terminated employees during these three periods,
(2) January 1-15, (3) January 15-31, (4) January 31-February 15.
3. Evaluate Joe Wallace (2) by January 31, or sooner, and make decision to replace or
retain.
4. Start task force computer study by May 1, (2) complete by December 1.
E. Service Department
Major objective: To handle all service calls efficiently within specified budget of $400,000.
Four objectives:
1. Hire and train three new service reps (2) by January 31.
2. Satisfactorily handle 6,880 projected service calls (2) within 24 hours.
3. Design a new maintenance contract program (2) by June 30.
4. Implement new maintenance contract program during last six months of year with
objective of (2) eliminating approximately 1,110 service calls.
NOTE: 7,400 + 1,480 (projected) = 8,880 and translated to 4,440 calls during last
six months x 25%, or 1,110 calls saved.
4. Write up your recommendations to the president in a memorandum format.
Assign this question if you want to require students to write up a report and turn in to you.
Case 2
Zenith Computer Terminals, Inc. (B):
Strategic Business Plans Fail--Sales Decline
Students need to forecast sales and recommend a plan of action.
1. Forecast next years total sales volume using both the naive and 3-year moving average forecast
methods. Take a look at the following table:
Exhibit 1
Percentage of Sales for Each Region
West
West
Central
East
Central
Prior Year
0%
100%
0%
0%
$250,000
Prior Year
0%
75%
25%
0%
750,000
Prior Year
15%
50%
25%
10%
2,100,000
Prior Year
30%
20%
20%
30%
6,500,000
Prior Year
30%
20%
25%
25%
8,000,000
Prior Year
40%
15%
15%
30%
9,000,000
Last year
30%
30%
20%
20%
10,000,000
Present
30%
20%
20%
30%
9,500,000
Forecast (%)
Naive =
3-Yr. =
30.0a
33.3
13.0
21.7
Forecast ($)
Naive =
3-Yr. =
2,707,500a
3,163,500b
1,173,250
2,061,500
Naive =
3-Yr. =
East
20.0
18.3
1,805,000
1,738,500
Total
Sales
45.0
26.7
4,061,250 9,025,000c
2,536,500 9,500,000
$2,707,500 + 1,173,250 + 1,805,000 + 4,061,250 = $9,747,000

$3,163,500 + 2,061,500 + 1,738,500 + 2,536,500 + $9,500,000
Forecasting using total sales = $9,025,000 but adding the 4 columns + $9,747,000. This is not a
mistake.
Naive Method
9,500,000
Next Year's Sales = $9,025,000 = 9,500,000 * 10,000,000
Moving Average Forecast
Period
Average
Sales Volume
Sales for 3-Year Period
3-Year
6,500,000
---------------
---------------
8,000,000
---------------
---------------
9,000,000
23,500,000
9,000,000.0
10,000,000
27,000,000
9,500,000.0
Period 6 Forecast
Moving
$9,500,000.0
Caution: How to Do Calculations Not Shown in Text

Trend Projection
Year
1983
1984
1985
1986
1987
1988
1989
1990
Time Period
1
2
3
4
5
6
7
8
Sales (Thousands of Dollars)

$250
750
2100
6500
8000
9000
10000
9500
Trend projection = $12,433,333.3

How do you find a forecast for each region? I took the percentage forecast for each region and
multiplied it by the total sales forecast. Naive = 30.0% x $9,025,000 = $4,707,500.
NOTE: When you add up the Naive's method 4 regional forecasts you get
$9,747,000. The forecast using total sales equals $9,025,000. Why do we get
$9,747,000 instead of $9,025,000? Look at the "East's" naive sales forecast. The
percentage increased from 20% to 30% resulted in a % forecast of 45%. This is
certainly wrong. However, we used the formula correctly. The lesson: You need to
understand what you're doing when forecasting.

advantages and disadvantages.
Forecasting methods have their
2. Henry has been told to increase sales to $12 million, regardless of past sales. Based upon the
information presented, what actions could Henry take to increase sales?
This is the third case in the Zenith series. There is not enough information given to answer this
question. Henry doesn't have a chance unless the present year was a fluke and sales will
increase.
Henry needs to examine each region. West Central's sales dropped 10%. Maybe this is the
problem.
Case 3
Zenith Computer Terminals, Inc. (C):
Redesigning Sales Territories
This case has numerous answers -- all of which could be correct. Students are asked to redesign
the sales regions of a small company with 19 salespeople, 4 regional managers, and projected
sales of 9,500,000.
Henry Butler, Zenith's VP of Sales, wants the regions to be divided equally. One group
presenting this case in my class used the following approach. You could use it in your
discussion of "one-way" to handle the case.
1. Redesign Zenith's sales territories following Henry's guidelines.
A. First, you must determine sales for each state. To do this multiply each state's percentage by
$9,500,000. The results are shown in Table 1 of this case comment.
B. Determine each region's total sales.
$ 2,375,000
4)$ 9,000,000
C. Merge states together until sales in each region are approximately equal. Here is one way to
do it.
WEST REGION
State
State
California (50%)
9.5
902,000
Washington
475,000
Nevada
0.5
47,500
Montana
0.5
47,500
Oregon
5.0
475,000
Utah
380,000
Idaho
0.5
47,500
EAST REGION
State
State
Maine
0.5
47,500
Delaware
0.0
New Hampshire
0.0
Washington
5.0
475,000
Vermont
0.0
Maryland
0.0
Massachusetts
0.0
Virginia
0.0
New York
10.0
950,000
W. Virginia
0.0
Rhode Island
1.0
95,000
Ohio
2.0
190,000
Connecticut
0.0
N. Carolina
1.0
95,000
New Jersey
2.5
237,500
S. Carolina
0.0
Pennsylvania
3.0
285,000
WEST CENTRAL REGION

State
State
Nebraska
0.5
47,500
Colorado
18.5
807,500
North Dakota
0.5
47,500
New Mexico
2.0
190,000
South Dakota
0.5
47,500
Arizona
3.0
285,000
Wyoming
0.5
47,500
California(50%)
9.5
902,500
EAST CENTRAL REGION

State
State
Michigan
4.0
380,000
Arkansas
0.5
47,500
Indiana
2.0
190,000
Louisiana
2.0
190,000
Tennessee
0.0
Texas
8.0
760,000
Georgia
1.0
95,000
Kentucky
0.0
Florida
3.5
332,500
Oklahoma
1.0
95,000
Alabama
0.5
47,500
Kansas
0.5
47,500
Mississippi
0.5
47,500
Minnesota
1.0
95,000
Wisconsin
0.5
47,500
Iowa
0.5
47,500
Illinois
2.5
237,500
Missouri
1.0
95,000
Case 4
Zenith Computer Terminals, Inc. (D):
Setting Quotas Facing Decreasing Sales
1.
The types of quotas that can be set based upon the case are:
A.
B.
C.
1.
2.
D.
Sales volume
Expense quota which is related to profit quotas
Activity quotas:
Number of sales calls
Increase order-call ratio
Combination of quotas -- Certainly sales volume, and activity quotas should be set.
The large increase in this region's sales quota will require a lot of hand work. Adjustments for
the better will have to be made across the board. It is difficult to know exactly what should be
done by the data given.
2. You may skip this if you wish and have students skip to question 3. I sometimes have the entire
class do this and the case presenters do question 3.
Exhibit 1
Eastern Region's Sales and Profits for the Year
Person
Calabrese
Sales
550,000
620,000
675,000
625,000
550,000
450,000
Cost of
goods
sold
440,000
496,000
540,000
500,000
440,000
360,000
110,000
124,000
135,000
125,000
110,000
90,000
Expenses
66,000
65,000
60,000
65,000
90,000
90,000
Net
Profit
44,000
59,000
75,000
60,000
20,000
8.00
9.52
11.11
9.60
3.64
Gross
Margin
Sales-Net
Ratio (%)
Gonzalez
Cost of goods sold = 80% of Sales

Sales-Net Profit Ratio = Net Profit/Sales * 100
Wong
Rao
Stark
Williams
Exhibit 2
Eastern Region's Yearly Sales Volume
Person
Sales %
of Region
Sales
Quota
Sales
Actual Dollar
Difference
Performance
Index
Calabrese
15
540000
550000
10000
101.85
Gonzalez
16
576000
620000
44000
107.64
Wong
15
540000
675000
135000
125.00
Rao
16
576000
625000
49000
108.51
Stark
20
720000
550000
-170000
76.39
Williams
18
648000
450000
-198000
69.44
100
360000
3470000
130000
98.14
Total
Exhibit 3
Customer Activities for the Eastern Region
OrderCall
Ratio
Actual
Sales
Average
Order Size
1050
70%
550000
523.81
1475
1300
88%
620000
476.92
Wong
1450
1300
90%
675000
519.23
Rao
1500
1200
80%
625000
520.83
Stark
1200
650
54%
550000
846.15
Williams
1100
575
52%
450000
782.61
8225
6075
72%
3470000
611.59
No. of
Calls
No. of
Orders
Calabrese
1500
Gonzalez
3. The following is based only on the $4 million sales quota:

Exhibit 1
Eastern Region's Sales and Profits for the Year
Person
Calabrese
Gonzalez
Wong
Rao
Stark
Williams
Sales
600,000
780,000
740,000
640,000
660,000
580,000
Cost of
goods
sold
480,000
624,000
592,000
512,000
528,000
464,000
120,000
156,000
148,000
128,000
132,000
116,000
Expenses
65,000
65,000
53,000
70,000
89,000
91,000
Net
Profit
55,000
91,000
95,000
58,000
43,000
25,000
9.17
11.67
12.84
9.06
6.52
4.31
Gross
Margin
Sales-Net
Ratio (%)
Cost of goods sold = 80% of Sales

Sales-Net Profit Ratio = Net Profit/Sales * 100
Exhibit 2
Eastern Region's Yearly Sales Volume
Sales %
of Region
Sales
Quota
Calabrese
15
540000
600000
-60000
111.11
Gonzalez
16
576000
780000
-204000
135.42
Wong
15
540000
740000
-200000
137.04
Rao
16
576000
645000
-64000
111.11
Stark
20
720000
660000
60000
91.67
Williams
18
648000
580000
68000
89.51
100
360000
4000000
-400000
112.64
Person
Total
Actual
Sales
Dollar
Difference
Performance
Index
Exhibit 3
Customer Activities for the Eastern Region
No. of
Calls
No. of
Orders
Order-Call
Ratio
Actual
Sales
Average
Order Size
Calabrese
1350
945
70%
600000
634.92
Gonzalez
1500
1275
85%
780000
611.76
Wong
1400
1260
90%
740000
587.30
Rao
1450
1015
70%
640000
630.54
Stark
1100
660
60%
660000
1000.00
Williams
1000
500
50%
580000
1160.00
7800
5655
71%
4000000
770.75
4. If actual sales percentages are representative of each territorys sales potential then this method
would work.
5. Expenses go up with sales. Salespeople will have to increase the size of orders and their ordercall ratio. New customers will be a must!
6. Alice must work with each person all she can to help and to see what they are doing. Sales must
increase $1,150,000. This 28.75% increase is a lot to ask for one year.
Case 5
Wallis Office Products: Defining New Sales Roles
Overview:
The sales executive, like John Stevens, who faces what seems to be an unreasonably high sales
quota, cannot simply do more of the same.1 Often the sales organization is working flat-out;
there is no more water to squeeze from this particular stone. What you must do is first
understand the customer's buying process and the company's four selling opportunities: retention,
penetration, conversion, and new market selling. These opportunities change as the business
moves through the growth cycle. For a brand new business, there is no retention selling because
there has been no selling at all. For a mature business, there may be little new market selling
because the company has no new products (which may be another kind of red flag for top
executives). Moreover, we find that the different kinds of selling demand different sales
personalities, different training, and different compensation. Without clear, well-defined sales
roles, the company runs the risk that it will not attract and retain the salespeople it needs to meet
management's growth objectives. To see how the sales resources may be organized differently,
consider this a five-step process.
1. Formalize the sales strategy and quantify the sales opportunities that exist.
2. Map out the sales process required to sell different products/services and the roles of current
sales and service personnel in the process.
3. Use the five W's---who, what, where, when, and why---to determine if these sales processes
require different sales roles.
4. Identify any gaps that exist between the current sales process and the desired sales process.
5. Formulate and implement new sales roles to fill the gaps.
The sales executive who takes these five steps is now in a position to take advantage of the
company's sales growth opportunities.
Questions:
1. Formalize the Sales Strategy and Quantify the Sales Opportunities That Exist
The breadth and depth of WOP's product line and the size of the geographic market that
John's organization must cover requires a clear sales strategy, one that defines the sales
opportunities in the context of this type of business. WOP can take two actions to sustain this
business: First, they can assure a high quality of service delivery - on time, complete, and
responsive - so that current customers are not motivated to cancel or reduce service because of
operational deficiencies. Second, they can maintain close contact with these customers 1
Adapted from Jerome A. Colletti and Mary S. Fiss with Wally Wood, Compensating New Sales Roles (New York:
The Alexander Group, Inc.), 62-72.
I recommend that you read this excellent book to better understand the new sales roles recommended by the authors.
relationship management - to understand how changes in the ways customers are doing in
business may require either new solutions or new responses on WOP's part.
John and his managers should estimate the additional business they could get from selling
additional storage and processing services and value-added services to their current accounts.
The first is user penetration selling, selling more storage and processing and value-added
services to the current buyers at the current sites. The second box is account penetration selling,
selling both core products and services to new buyers, that is, new sites in the current accounts.
WOP can sell its current products and services to prospective accounts - targeting its competitors'
accounts and winning new sales with companies that are already familiar with the current
products and services offered.
They can also sell something to a customer or a prospect they have not previously
bought. In WOP's situation, there are actually two types of new concept selling opportunities.
First is the opportunity to sell SARS 1000 to customers that are using the current core or
traditional WOP storage and processing products. Second is the sales opportunity to sell SARS
1000 and Document Flash to new sites within current accounts or to prospects (accounts that
have not done business with WOP).
2. Map Out the Sales Process Associated With the Different Products/Services and the
Roles of Current Sales and Service Personnel in the Process
Too often managers assume the sales process associated with retaining and
expanding business is the same with all customers. Of course this is not the case. WOP has at
least three different sales processes it applies to its products and services. In mapping out the
sales process for WOP's core products, John Stevens and his sales staff determined that they
should develop a sales process to win new customers for the current core products. The process
should include an account executive (AE) leading the process, and later steps require a service
representative (SR) to be involved. Successfully delivering WOP's services on an ongoing basis
earns the account executive the opportunity to do account penetration selling.
John and his salespeople determined that once an account is up and running, the service
representative is the WOP employee most likely to identify opportunities to sell value-added
services
Through careful examination of accounts where WOP had successfully sold its new
products and services, John and his staff learned that the sales process was really much different
than the process they used to sell the core products. For example, the sales process required
more meetings, the involvement of both the account executive and service representative
throughout the process, and a system trial before the customer would make a final commitment
to do business with WOP.
3. Use the Five W's to Determine If the Sales Process Requires Different Sales Roles
Using the five W's, John and his sales staff determined answers to each of the five
questions for WOP's three product categories. For example, the basis for making a buying
decision, the "why," differs for each offering. For the core products, the "why" is price and
responsiveness; for the value-added services, it is ease of use and price; and for the new
products, it is cost savings and accessibility.
4. Determine the Gaps That Exist Between the Current Sales Process and the Desired Sales
Process
As a result of their analysis, John and his salespeople began to see some gaps between
how they were selling and the opportunities to sell more. They identified several shortcomings
in their current practices:
Service representatives were instrumental in maintaining contact with current accounts,

although account executives were also involved in this type of work. John wondered if this
lack of role clarity was contributing to the less-than-satisfactory performance in customer
retention - 85 percent retention compared to best practices in the range of 90-92 percent.
Account executives may not have the skills and experience necessary to sell SARS 1000
products and services to the identified buyers, senior executives.
Account executives may be stretched too thin across the number of selling activities and
opportunities.
5. Formulate and Implement New Sales Roles

John and his staff concluded that the current configuration of jobs - account executive
and service representative - was no longer an appropriate way to address the sales opportunities
they identified as available to them. To grow the business in the future, they concluded they
would have to specialize their resources. This would require new sales roles. These include:
Account executive. The account executive's job should be changed to focus on new
account core product sales, with a secondary emphasis on selling SARS 1000. This will allow
the account executives to spend less time on postsale service and SARS 1000.
Account Manager. An account manager would focus on developing current customers.
This position will allow WOP to successfully penetrate current users (user penetration) and
expand to new sites within customer accounts (account penetration).
SARS 1000 specialist. A SARS 1000 specialist position should be created to concentrate
on selling this sophisticated product to new customers and penetrating large accounts with SARS
1000. The SARS 1000 specialist will both drive and support sales (for opportunities uncovered
by the account executive or account manager).
SARS system support specialist. The SARS system support specialist should assist the
SARS specialist with presale technical support.
Service representative. The service representative position should focus on servicing
only core product customers. The service representative's new emphasis will minimize account
executive involvement in servicing the core product. Additionally, the service representative
may focus on expanding high penetration accounts independently and supporting the account
manager on expanding low penetration accounts.
SARS installation manager. An installation manager position should be created that

will allow one group of technical experts to install both SARS 1000 and the core product and to
service the SARS product. This change will relieve account executives and service
representatives from SARS 1000 installation responsibility.
Once John clearly understood the sales opportunities that existed and mapped out the
sales processes necessary to sell the different products and services, it was not difficult to
establish the gaps that existed between what the salespeople were doing and what they needed to
do in the future. John was also able to see exactly what new sales roles were necessary if he was
to accomplish his mission. He could not continue to deploy his salespeople as he had in the past,
no matter how successful they had been. WOP had changed, customers had changed, it was time
for new sales roles.
Case 6
Briggs Industrial Supply Company (A):
Determining Who to Hire and How Many
1. What should Jay Anderson do? Unlike the more specific questions of earlier cases, this
general question may confuse some students who need specific guidance. You may wish to
give them more instructions.
However, if you are presenting the case, you might not want to guide them. Most will be
surprised with the number of issues you discuss or ask them to discuss.
Examples of Assumptions That Can Be Made
2. Turnover of existing sales personnel is 15% per year.
3. Briggs can continue to hire and retain qualified personnel at its present compensation levels
even though the industry median is much higher.
4. The general managers opinion that sales will increase 25% next year is correct.
5. The sales force personality Profile using the 15 outside salespeople is statistically significant
6. The ratio of inside salespeople: western salespeople: eastern salespeople will remain the
same as the sales force increases in number.
Determining Sales Force Size
Examine
Environment
Sales Force
Objectives
Manpower
Estimates
Current
Sales Force
People
Leaving
Strategic
Plans
Environment:
Industrial Sales (Wholesaler)

Serving large and small companies
Initial customers were in the oil field
Now customers are in non-oil fields
Low technology
# to be
Hired
Sales Force:
Increase inside backup to outside salespeople

Coordinate outside sales
Grow by 25%
Hire a sales manager to oversee the outside sales
Strategic Plans:
Manpower Estimates:
A. Assuming the ratio of sales/salespeople is correct as of today, then the number of salespeople
due to growth alone is:
(Number of salespeople) * (Growth in sales) = 15 * 0.25 = 3.75
B. One salesperson has to be promoted to be the new sales manager.
C. Using the incremental sales approach to determine any additional salespeople required.
Salespeople Fixed and Variable Costs
Base Salary
Avg. Commission = Commission Rate * Total Sales
Number of salespeople
= 0.05 * 6,540,000
15
$40,000
Total Compensation
$61,800
Travel & Entertainment Expenses = 12*500
$ 6,000
Total Salesperson Expense
$67,800
$21,800
How much additional sales volume does each salesperson have to generate
Total salespeople expense
Contribution margin
$67,800
1- 0.65
= $193,714
According to Jay Anderson, the following table reflects the additional revenue due to
incremental increases in the number of salespeople:
Additional Salespersons
16
17
18
19
20
21
22
Estimated Additional Sales Volume

$380,000
300,000
225,000
165,000
100,000
95,000
83,000
Refer students to Chapter 6's Tables 4 and 5. Based upon Chapter 6's discussion of the
"incremental method," you see that no more than 4 people should be hired using this
incremental approach. Table 1, located below, was constructed using information from
Chapter 6.
Table 1
Briggs Industrial Supply
Company
Additional Estimate
Salespeople Additional
Sales
1
2
16
17
18
19
20
21
$380,000
$300,000
$225,000
$165,000
$100,000
$95,000
Cost of
Goods
Sold
3
Gross
Margin
of
4
(2)-(3)
Salary
(Fixed)
Commissions Expenses Net Profit

(Variable)
(Fixed) Contribution
$247,000
$195,000
$146,250
$107,250
$65,000
$61,750
$133,000
$105,000
$78,750
$57,750
$35,000
$33,250
$40,000
$40,000
$40,000
$40,000
$40,000
$40,000
$19,000
$15,000
$11,250
$8,250
$5,000
$4,750
$6,000
$6,000
$6,000
$6,000
$6,000
$6,000
D. Assuming an employee turnover rate of 15%. Briggs can expect to lose:

Turnover (# of salespeople)
Includes 3 counter, 3 inside sales
= (0.15) (21) = 3.15
8
(4)-(5+6+7)
$68,000
$44,000
$21,500
$3,500
-$16,000
-$17,500
E. Briggs also needs more inside salespeople to provide support to the outside sales. Present
ratio is 15:3 or 5:1, outside salespeople to inside. Hiring an additional six sales people due to
sales growth and incremental sales will create a position for at least one more inside
salesperson.
New Outside Salespeople = 6
Ratio Out:In
5
= 1.2
Summarizing, Additional Salespeople to be Hired:

Due to sales growth
One promotion to S.M
Due to incremental sales
Expected turnover
Additional inside people
Total to be hired
3.75
1.00
4.00
3.15
1.20
13.00
Briggs needs to hire additional 12 salespeople in order to meet its manpower objective.
Analysis of Personal History
Name
Cahill
Everest
Billings
Kane
Dacy
Kurtin
Manus
May
Russell
Saphn
Walter
Smith
Head
Holmes
Reasor
Overall perf. Age Marital Sts. Sex

120
115
110
110
109
105
104
102
100
101
96
91
86
94
85
29
26
34
55
25
41
46
62
49
24
24
27
38
36
52
Ma
Ma
Si
Ma
Si
Si
Ma
Si
Si
Si
Ma
Si
Ma
Ma
Si
M
M
M
M*
F*
M**
M
M
M
M*
F
M
M
M
M
Experi. Personality Sales Apt

5
3
10
15
3
19
20
32
20
2
1
5
9
11
10
Notes:
* = African-American
** = Mexican-American
Plots
Senser
Senser
Senser
Intuitor
Intuitor
Senser
Senser
Thinker
Intuitor
Thinker
Intuitor
Thinker
Senser
Feeler
Thinker
55
60
40
46
65
56
54
55
68
63
63
43
61
71
55
SCI test Wonderlic

33
55
35
43
35
54
42
42
48
43
41
49
43
46
39
26
38
36
32
30
24
23
20
29
28
20
26
18
20
20
The plot of Performance Index and Experinence of the salesperson shows a mixed trend. You can
see from the plot that for a low Perf. Index we have salespeople with an average experience and
it can also be seen that salespeople with a high Perf. Index have a few years of experience and
some among them have higher experience.
Perform ance Index V/s Experience
35
30
25
20
Value
15
10
0
0
20
40
60
80
100
120
140
P erf Index
The plot of Performance Index and Age of the salesperson shows a mixed trend. You can see
from the plot that for a low Perf. Index we have salespeople with an average age and it can also
be seen that salespeople with a high Perf. Index have a lower age and some among them have
higher age.
Perform ance Index V/s Age in Years
70
60
50
40
Value
30
20
10
0
0
20
40
60
80
P erf Index
100
120
140
The plot of Performance Index and SCI Test shows a mixed trend. You can see from the plot that
as the Perf. Index value increases so do the scores of the salespeople on the SCI Test show an
increasing trend.
The plot of Performance Index and Sales Aptitude Test shows a mixed trend. You can see from
the plot that as the Perf. Index value increases so do the scores of the salespeople on the Sales
Aptitude Test show an increasing trend.
Perf. Index v/s Sales Aptitude
80
70
60
50
40
Value
30
20
10
0
0
20
40
60
80
100
120
140
Perf Index
Perf. Index v/s SCI Test

60
50
SCI Test
40
30
Value
20
10
0
0
20
40
60
80
Perf Index
100
120
140
The plot of Performance Index and Wonderlic Test shows a mixed trend. You can see from the
plot that as the Perf. Index value increases so do the scores of the salespeople on the Wonderlic
Test show an increasing trend.
Perf. Index v/s Wonderlic Test

40
35
Wonderlic test
30
25
20
Value
15
10
5
0
0
20
40
60
80
Perf Index
100
120
140
Case 7
Briggs Industrial Supply Company (B):
Creating Recruitment and Selection Procedures
Both Briggs (A) and (B) cases could be assigned to one or two teams. They could be presented
together during the same class period by the two teams, if you have a class of one hour and 15
minutes or longer. NOTE: The last paragraph of Briggs (B) summarizes the main issues in both
cases. Please refer to the "United Cosmetics, Inc.: Creating a Staffing Program" case for ideas
on creating a recruiting program at a university.
Panel Interview: The panel interview is not directly related to any materials discussed within a
chapter in our textbook. Retailers have been using the panel interview for some time, while sales
recruiters have only recently begun to use the procedure. You will see examples of the
"Obtaining New Customers" and "Negotiating with Others" interview questions which students
are asked to do for the case. These are not given to the students in the case. We were asked to
keep the book's length as short as possible. Thus a full discussion of a panel interview was not
included. Please contact the author if you have any questions. NOTE: The author set up a sales
staffing program as Dr. Hise was asked to do within the (B) case. He created these questions for
the organization. For several years he has been using the questions for an in-class exercise. The
students liked the exercise so well that he decided to develop it into a case for you.
Role Play: You can role play an interview using these four questions. Please refer to the "Sell
Yourself on a Job Interview" experiential exercise.
OBTAINING NEW CUSTOMERS

Addresses the individuals willingness and ability to obtain new customers.
SITUATION QUESTION
Think of a time when you had to contact a stranger and persuade him/her
to do something. What was the situation?
ACTION QUESTION
What did you do?
RESULTS QUESTION
What happened?
NOTES
Unsatisfactory
1

Satisfactory
3
Answers show unsatisfactory behavior

according to our standards or do not
indicate willingness or ability to
prospect for new customers.
Answers demonstrate a satisfactory level

of skill in obtaining new customers
Excellent
7
Answers show outstanding experience, willingness, and

ability to prospect for new
Customers.
NEGOTIATING WITH OTHERS
Addresses the ability to work out a compromise between the individual and another person so that both are
happy with the outcome.
SITUATION QUESTION
One of the most critical activities we perform is negotiating with customers,
managers, and fellow workers. Describe your most memorable experience in
working out a settlement with someone such as a teacher, friend, customer, or
employer.
ACTION QUESTION
What did you do?
RESULTS QUESTION
What was the outcome?
NOTES
Unsatisfactory
1

Satisfactory
3
Answers indicate little or no

Experience and understanding of
negotiation. Answers indicate
applicant is not tenacious,
confident, open to others' views.
Answers show satisfactory experience

and understanding of negotiation.
Meets our high standard.
Excellent
7
Answers show exceptional

Experience and understanding
Of negotiation process. Seems
tenacious, confident, open to
Others' views.
Case 8
United Cosmetics, Inc.: Creating a Staffing Program
1. Assume you are Al Kantak. What would be your recommended college recruitment program?
Al Kantak's goal is to develop a 5-year plan with goals for each year. At the end of the 5 years,
Al wants to have accomplished everything Sparky asked of him. First, Al evaluated the entire
situation and then developed and implemented a coordinated program consisting of:
A. Recruitment on college campuses with a great deal of raw talent. Recruiting nationally
means selecting only 25 schools to concentrate on visiting each year. The schools were
selected based on their size, the presence of personal selling and sales management
emphasis in the marketing curriculum, and traditional success of the graduates at UCI.
Geographical considerations were also used so people could work in the part of the country
where they were hired. At these schools, key faculty were found and a friendship developed
so that faculty would recommend students. Such recommendations reduce campus
recruitment time and increase the quality of people interviewed.
B. Establish specific sales personnel selection criteria to be used uniformly by all managers in
hiring people.
C. Train all managers in interviewing so everyone is using the same methods.
D. Develop recruiting tools consisting of:
1. A brochure
2. Recruiting posters to send to schools in advance of our campus visits.
3. A 3-ring binder for a school's placement center library containing information on the job
and company.
4. A recruiting video. A permanent copy goes to a school's placement center library. Also,
copies are sent to faculty who want to show it in their classes. The video would also be
used at presentations to student groups and at career fairs.
E. Develop a summer internship program.
F. Develop a co-op program in which a person would work in the fall or spring.
G. Establish scholarship and grant programs for the most productive schools.
H. Become involved with the school's student organizations such as Pi Sigma Epsilon and the
American Marketing Association.
I. Have sales personnel make presentations to classes and student organizations. This is great
PR!
J. Participate in career fairs.
Case 9
Farm Machinery for America: The Selection of a Salesperson
Learning Objectives:
This case presents the sales management problem of selecting a salesperson from a number of
qualified applicants. The sales manager, Randy Garvin, has been given a pre-screened list of people
to interview for an open position in his territory. He can assume that these people are among the
most qualified, according to the personnel area, of the people that have applied for the job. What
questions to ask each prospective employee and which person then to hire are the major concerns
for Mr. Garvin. Specific learning objectives are:
1.
This case designed to make the student think about how to conduct an interview to help with
the selection process. The number and kind of questions that they choose to ask each
applicant will elicit information that will be useful in making the "correct" choice.
2.
This case employs a method that involves the student in a fictional, but realistic situation.
The selection principles and techniques that are exhibited in the case can be easily
transferred to real life.
3.
A secondary, but none the less important objective, is to acquaint the student with the kind
of questions that might be considered to violate the Equal Employment Opportunity (EEO)
guidelines.
Teaching Assignments:
The instructor might consider having the students read the case and prepare a list of the questions
they would like to ask outside class. The instructor could then take a vote on each question for each
applicant at the start of the next class period. The voting will provide a ranking of the questions to
answer. The instructor could then read the answers to the top five questions for each applicant. At
the end of these he could ask those students that would like to make their selection to write down
their name, their selection's name, the number 5 and turn it in. The instructor could then do the
same kind of procedure for the next 2 sets of 3 questions, and the final 4. The numbers on the
selection choices would change to 8, 11, and 15 respectively. If there is a question that nobody
would like to ask, the instructor should not answer it.
There are four illegal questions in this case. The illegal questions are numbers 4 and 13 for Ms.
Long, number 14 for Mr. Harrison and number 2 for Mr. Lennon.
Once the students have made their choices, the instructor should go back over the questions and
answers, and review the notes on these that are at the end of this case analysis. The instructor
should then tell the class who the "correct" choice was and why that person was chosen over the
other two. If the instructor uses the team approach, it is suggested that each team turn in a list of
questions that they would like answered. The instructor could then turn back to them the answers to
these questions. The discussion that a group would have in agreeing upon which questions to ask an
applicant would undoubtedly make an effective learning tool.
Interview Answers for Ms. Long

A1
My husband had an excellent job offer that required us to move from Dallas to Austin.
A2
Yes I do. My father has a farm implement store in Huntsville, Texas and has sold FMA
equipment since 1960. I worked in his store all through high school and during the
summers when I was in college.
A3
I believe that it would be very exciting and challenging. I enjoy dealing with people and I
feel that having been on the purchasing side of sales transactions, I have been exposed to
both good and bad sales presentations and have learned from both.
A4
No.
A5
I feel that marketing oriented firms are the only ones that will be able to survive the
competition in the marketplace now and I wanted to be able to contribute to their success.
A6
There was always something new happening. When I was a department manager we were
always receiving new goods that I had to decide where to display. When I was an assistant
buyer there was always a new skill to learn. And when I was buyer there was always a new
line to see.
A7
There really was nothing about my jobs that I did not enjoy.
A8
I would really like to have my own business, preferably a retail store.
A9
While the pay was a little lower than for other industries it was balanced with other personal
goals that were achieved.
A10
I loved my college years. When it was time to graduate I almost didn't want to leave.
A11
Yes, I do. What kind of training will I receive before going out in the sales territory, who
will conduct it, where will it be held and how long will it take?
A12
In spite of my recent history, I do have a good knowledge of FMA products and how a FMA
dealership works. I am very self-motivated and need no supervision to do my job.
A13
I have always had a good rapport with the men I have dealt with and they have always
respected my knowledge of the business that I bring with me into a business situation.
A14
The retailing situation in Austin has nothing to offer me at this time. The larger stores all
have their headquarters in Dallas or Houston and the smaller stores don't need or can't afford
my skills.
A15
Not at all. As a buyer I was out of town about 10-15 days every month and my husband and
I are used to these separations.
Interview Answers for Mr. Harrison

A1
My advisor recommended it. Also, the class work was easy for me.
A2
Well, my wife and I were living in College Station at the time and we didn't want to move
and there weren't any jobs in accounting available.
A3
Yes.
A4
No.
A5
It was a good opportunity for me. They offered me more money and a chance to be my own
boss. They were a good company to work for.
A6
Again, it was a chance to earn more money and have more responsibility. I had a larger
territory than I had with Caterpillar.
A7
The freedom to be my own boss. I got to set my own hours and could work as long and as
hard as I wanted. Because I was a commissioned salesman I was able to earn more if I
could produce more sales.
A8
I have to admit that being away from home so much was the least favorite part, not that I
mind traveling. It was really my wife who didn't like my traveling.
A9
Not really. About the only thing I got from it was the GI Bill to help me get through school.
A10
I haven't really thought about it much.
A11
Yes I did.
A12
Well Mr . . .I'm sorry what was your name again? Garvin. Well, Mr. Garvin, I am curious
about how big the territory is that I would be covering for the job?
A13
Well, I know that the people I sold IH to didn't handle them, but they felt that they were
good machines.
A14
I'm active in my church. I teach a Sunday School class once a month, and I also help coach
a Pop Warner football team each fall.
A15
Yes I was. They also had an excellent benefits package with a good health insurance plan
that my family and I made use of.
Interview Answers for Mr. Lennon

A1
Yes I do.
A2
Yes I was, right here in Austin.
A3
1974.
A4
I was originally hired as a dispatcher in the warehouse here in Austin.
A5
I am looking forward to selling our farm equipment. I feel that we have an excellent
product and believe strongly in them. I enjoy meeting people and am familiar with most of
the dealers through my years at the warehouse. This should help me a great deal because I
am already on a first name basis with many of the dealers.
A6
Well, I have reached the top of where I can go in the company without moving or changing
fields. I would much rather change my job within the firm than move. Also I am looking
forward to increasing my income so that I will be comfortable when I reach retirement age.
A7
I really have no where to go without moving to a different location.
A8
Friendly, easy to deal with, and fair.
A9
For the most part, yes. However, the promotions have taken a little longer than I would
have liked.
A10
I get to meet the dealers for our products and even a few of their customers.
A11
I wouldn't mind at all.
A12
I am confident that I will be offered this position and will do an excellent job for the
company.
A13
Not really. I have dealt with the dealers and the salespeople for a number of years and know
what the job entails.
A14
I actually have wanted to change for the last few years, but the circumstances just weren't
right. My wife...my ex-wife, I'm divorced now, didn't like the idea of my traveling and the
sales positions that came open have always been in other areas of the country and I didn't
want to move.
A15
I am outgoing and I have a very good knowledge of the products. I have worked with the
dealers in the area for a number of years. I know the old salesman, and we talked on
numerous occasions about what the job is like, how much I might be able to make and how
much traveling I will have to do.
Notes on Ms. Long's Interview

Q1
You seem to have had an excellent career going at Neiman Marcus. Is there any particular
reason why you left them?
Good question to ask. It is important to find out why someone is contemplating a
career change, especially when it seems that the career has been a successful one.
A1
My husband had an excellent job offer that required us to move form Dallas to Austin.
Ms. Long's answer shows that a career change is not something she wants to do, but
may be required to do.
Q2
Do you know anything about the equipment we sell here at FMA?

Very appropriate question since Ms. Long's resume is all based in the fashion industry.
Her application notes that her father has a FMA dealership, but it is still good to find
out how much she really knows about FMA products.
A2
Yes I do. My father has a farm implement store in Huntsville, Texas and has sold FMA
equipment since 1960. I worked in his store all through high school and during the
summers when I was in college.
Ms. Long's answer shows that whatever product knowledge she has is at least eight
years old. That was the last time she worked with her father's dealership.
Q3
You have never been in a straight sales position according to your resume. Do you think
you would like an outside sales job?
Since Ms. Long has never held a sales job, according to her resume and application,
this would be an appropriate question to ask. Mr. Garvin could have worded it better
though, because it is too easy to answer with a simple "yes."
A3
I believe that it would be very exciting and challenging. I enjoy dealing with people and I
feel that having been on the purchasing side of sales transactions, I have been exposed to
both good and bad sales presentations and have learned much from both.
Mr. Garvin is lucky and gets some good information from Ms. Long. She may be right
in her assessment that she has learned from poor sales presentations.
Q4
Are you planning to have children in the near future?

This is an illegal question, unless it is also asked of all prospective male employees, also.
A4
No.
We don't learn much from Ms. Long's answer.
Q5
You majored in marketing in college. What made you choose that major?
This kind of question is usually a good one. It gives the interviewer a chance to see
how the applicant thinks about and plans for the future.
A5
I feel that marketing oriented firms are the only ones that will be able to survive the
competition in the marketplace now and I wanted to be able to contribute to their success.
Ms. Long's answer shows that she at least put some thought into her choice of major in
college.
Q6
What did you like most about your jobs that you had at Neiman Marcus?
This is a fairly standard interview question. As such, most people are prepared to
answer it and the answer becomes an important way to gauge what actually motivates
that person.
A6
There was always something new happening. When I was a department manager we were
always receiving new goods that I had to decide where to display. When I was an assistant
buyer there was always a new skill to learn. And when I was buyer there was always a new
line to see.
Ms. Long's answer shows that she enjoys adapting to new, challenging situations. This
is good because if she is hired the job would be both new and challenging, however,
over time she might be dissatisfied with the slower pace that farm implements have in
comparison to the fashion industry.
Q7
What did you like least about your jobs at Neiman Marcus?
This question usually will be teamed with the previous question. Again, the answer is
important because most people will have spent time thinking about this question.
A7
There really was nothing about my jobs that I did not enjoy.
All we find out is that Ms. Long was very happy at her jobs with Neiman Marcus.
Q8
What would you like to be doing ten years from now?

Looking at where your applicant would like to be in the future is good to try to find
out.
A8
I would really like to have my own business, preferably a retail store.

Ms. Long's answer shows that her heart is still in the fashion industry and it may be
difficult or impossible to get her to view a future for her in the farm implement
industry.
Q9
Were you satisfied with your earning at Neiman Marcus?

Not a very insightful question. Can be easily answered yes or no also.
A9
While the pay was a little lower than for other industries it was balanced with other personal
goals that were achieved.
Mr. Garvin is lucky and gets the knowledge that Ms. Long may be motivated more by
internal motives and goals than strictly by earnings.
Q10
You have an excellent academic record. Did you enjoy your college experience?
A very weak question. People who do well in school generally enjoy school. Not much
can be learned here.
A10
I loved my college years. When it was time to graduate I almost didn't want to leave.
We learn very little from this answer, other than she enjoyed going to college.
Q11
Do you have any questions about the job that you would like to ask me?
This is an important question to ask any potential candidate. If they have no
questions, they probably haven't thought much about the job and what it might entail.
A11
Yes, I do. What kind of training will I receive before going out in the sales territory, who
will conduct it, where will it be held and how long will it take?
Ms. Long's answer shows that she recognizes her lack of sales training and would like
to help in overcoming this handicap.
Q12
What are your strengths that you feel you would be bringing to our company and this job in
particular?
A standard type of interview question that allows the interviewee to talk about
themselves.
A12
In spite of my recent history, I do have a good knowledge of FMA products and how a FMA
dealership works. I am very self-motivated and need no supervision to do my job.
Ms. Long's answer implies that she may have kept up more on FMA products than
originally thought, but this information should be taken "with a grain of salt."
Q13
Since all of our present dealerships are owned by men, do you feel that you would have any
trouble dealing with them?
This is a discriminatory question unless asked of both sexes.
A13
I have always had a good rapport with the men I have dealt with and they have always
respected my knowledge of the business that I bring with me into a business situation.
Ms. Long's answer is very good and shows that she had thought about this before Mr.
Garvin ever asked the question.
Q14
Why the industry change now? You have an excellent record in retail, why are you willing
to switch to industrial sales?
This question is very similar to the first question. Not much extra information would
be added by asking both.
A14
The retailing situation in Austin has nothing to offer me at this time. The larger stores all
have their headquarters in Dallas or Houston and the smaller stores don't need or can't afford
my skills.
Ms. Long's answer shows that she would rather still be in retail.
Q15
Would you mind the traveling that is involved in a position like this?
This is fairly standard question when interviewing someone who has never had a
traveling sales position before.
A15
Not at all. As a buyer I was out of town about 10-15 days every month and my husband and
I are used to these separations.
Ms. Long's answer shows that the traveling probably would not be a problem for her.
Notes on Mr. Harrison's Interview
Q1
I see you majored in accounting at college. Any particular reason for this?
This is usually a good question. It allows the interviewer to get insight as to how the
applicant plans for the future.
A1
My advisor recommended it. Also, the class work was easy for me.
Mr. Harrison's answer shows lack of planning on his part and a willingness to take the
easy route, whether it is the best one or not.
Q2
Why didn't you pursue an accounting career when you graduated?

This is an appropriate question to ask, since Scott worked for four years to get an
accounting degree and has never had a job in the accounting field.
A2
Well, my wife and I were living in College Station at the time and we didn't want to move
and there weren't any jobs in accounting available.
Mr. Harrison's answer shows a lack of commitment to pursuing a career and shows his
willingness to change jobs rather than move.
Q3
You've been in sales for a number of years now, do you like selling?
This a very weak question that is too easily answered with one word.
A3
Yes.
That's all Randy got was one word.
Q4
Physically you are a rather large man, are there any health problems that we need to be
concerned with because of your weight?
This question is treading on thin ice under EEOC guidelines. A pre-hiring physical
exam would probably be a better route to take. Also it is another one-word-answer
kind of question.
A4
No.
This is the only answer someone could expect to that question.
Q5
You seemed to be doing a good job selling cars at Ford dealership. Why did you leave that
job to go to work for Caterpillar?
This is a good question to ask Scott. He seemed to be doing well at the Ford dealer and
had a start on a career. Why he would give this up for a traveling job is good to know.
A5
It was a good opportunity for me. They offered me more money and a chance to be my own
boss. They were a good company to work for.
Scott's answer shows that he is motivated by money and possibly some personal
freedom from a 9 to 5 job.
Q6
Why did you leave Caterpillar to go to work for International Harvester?

This is another good question that should be asked. Scott seems to be having a difficult
time establishing a career orientation with the firms he has worked for.
A6
Again, it was a chance to earn more money and have more responsibility. I had a larger
territory than I had with Caterpillar.
This reinforces the idea that Scott is motivated by money, but he does seem to have a
concern for moving up.
Q7
What did you enjoy most about your jobs with both Caterpillar and IH?
Fairly standard interview question. Most people should have thought about the
answer and we might get some good insights into their motivation.
A7
The freedom to be my own boss. I got to set my own hours and could work as long and as
hard as I wanted. Because I was a commissioned salesman I was able to earn more if I
could produce more sales.
Scott's answer shows that income and personal responsibility are major motivations
for him.
Q8
What did you like least about your jobs with both Caterpillar and IH?
The mirror of the previous question. It is still a good question to ask.
A8
I have to admit that being away from home so much was the least favorite part, not that I
mind traveling. It was really my wife who didn't like my traveling.
A wife who doesn't like her husband traveling can cause problems for a salesperson.
Q9
Did you gain anything from your military service?

Since there is no description of what the applicant did in the military, this is a good
question to try and uncover any hidden talents or experience they may have gained.
A9
Not really. About the only thing I got from it was the GI Bill to help me get through school.
This is a very weak answer. Mr Harrison makes it seem like those three years were
wasted.
Q10
What would you like to be doing ten years from now?

How the applicant views the future, and their future potential with your company, is a
good question to ask.
A10
I haven't really thought about it much.

Mr. Harrison gives another demonstration of his willingness to let events shape his life
rather than taking charge of it.
Q11
Did you enjoy your first job that you had after you graduated from college?
The first job out of college is usually a start on a career path. It is good to get
information about how the applicant viewed this job and their choice of careers.
Unfortunately this is not a good question for Mr. Harrison (he changed careers) and
this question is also poorly worded so that it doesn't elicit much information.
A11
Yes I did.
We learn nothing from this answer.
Q12
A standard question to ask in an interview.
A12
Well Mr . . .I'm sorry what was your name again? Garvin. Well, Mr. Garvin, I am curious
about how big the territory is that I would be covering for the job?
The fact that Mr. Harrison could not remember Mr. Garvin's name shows a very weak
spot for a salesperson. They have to be good at remembering people's names.
Q13
Do you know anything about the equipment that we sell here at FMA?
Fairly standard type of interview question to see how much homework the applicant
has done on preparing for an interview.
A13
Well, I know that the people I sold IH to didn't handle them, but they felt that they were
good machines.
This answer shows that Mr. Harrison has not bothered to gather information about the
company and its products. This lack of preparation may carry over into his sales
presentations.
Q14
What clubs or organizations do you belong to?

This is an illegal question under EEO guidelines.
A14
I'm active in my church. I teach a Sunday School class once a month, and I also help coach
a Pop Warner football team each fall.
This answer shows that he may be very much like his customers which is always good.
Q15
Were you satisfied with your earnings while you were with IH?
Not a very good question. It is too easy to give a simple yes or no answer and really
doesn't give much insight into the person's ability to do the job.
A15
Yes I was. They also had an excellent benefits package with a good health insurance plan
that my family and I made use of.
It appears that Mr. Harrison was happy with his pay and used the health insurance
package, possibly extensively.
Notes on Mr. Lennon's Interview

Q1
You've worked for our company for a long time now. Do you like your present job with the
firm?
While it is important to see how the applicant feels about the firm, this question is
poorly worded and geared toward getting a short, simple yes in response.
A1
Yes I do.
A short yes is all Randy got.
Q2
Were you born and raised here in Texas?

This is an illegal question under EEO guidelines. Also, this applicant got his degree at
a school in Texas and has worked twenty years for the firm in Texas. There is no
special need for the applicant to be a true native.
A2
Yes I was, right here in Austin.

We learn that Bill is a native and nothing else.
Q3
On your application it says that you received your bachelors degree from the University of
Texas. What year was that?
This question is a way of establishing a rough idea of the applicant's age without
directly asking. A large majority of people graduate between the ages of 21 to 25.
A3
1974.
Since Mr. Lennon graduated in 1974,this means that at the time of his interview, (2000)
he would probably be in his late forties.
Q4
What was your first job here at FMA?

A weak question since his application says that he started with the firm as a dispatcher.
A4
I was originally hired as a dispatcher in the warehouse here in Austin.

We only learn what was on his application, that he started as a dispatcher.
Q5
With all your experience here at FMA, you must know a great deal about our products.
How do you think you would do selling these products?
This is a good question. With twenty years in the firm his product knowledge is
probably extensive. How he will be able to translate that into sales is important. The
question is open-ended enough that we should get some good information from it.
A5
I am looking forward to selling our farm equipment. I feel that we have an excellent
product and believe strongly in them. I enjoy meeting people and am familiar with most of
the dealers through my years at the warehouse. This should help me a great deal because I
am already on a first name basis with many of the dealers.
Mr. Lennon's answer is quite informative. We learn that he already knows most of the
dealers and thus would have a better chance at selling our products than a new person.
Q6
How do you think you would adjust to having a commission instead of a straight salary?
This is a good question to ask somebody who has never worked on a commission basis
before.
A6
Well, I have reached the top of where I can go in the company without moving or changing
fields. I would much rather change my job within the firm than move. Also I am looking
forward to increasing my income so that I will be comfortable when I reach retirement age.
Mr. Lennon is looking for a way to increase his income and will be motivated to go out
and get the sales necessary to do this.
Q7
What do you like least about your job at FMA?

A standard interview question to ask.
A7
I really have no where to go without moving to a different location.

Mr. Lennon is looking for some upward mobility without having to leave his present
living area.
Q8
If I were to ask the employees you supervise to describe you, what do you think their
response would be?
This is a very good question to ask. It gets the applicant to think about how people
view him or her.
A8
Friendly, easy to deal with, and fair.

Mr. Lennon lists attributes that are all very good to have in either a manager or
salesperson.
Q9
Have you been happy with your career so far here at FMA?
A fairly standard interview question, but you probably don't need both this question
and the next.
A9
For the most part, yes. However, the promotions have taken a little longer than I would
have liked.
We don't learn much from this answer, except that Mr. Lennon seems to be
persevering in achieving his goals.
Q10
What do you like most about your present job at FMA?

A standard question, but probably don't need this and the previous one.
A10
I get to meet the dealers for our products and even a few of their customers.
Mr. Lennon seems to enjoy meeting people, a good asset for a salesperson.
Q11
How would you feel about being on the road a great deal of the time?
A very appropriate question to ask of someone who has never had a traveling sales
position before.
A11
I wouldn't mind at all.
A weak answer that doesn't really say much.

Q12
If your aren't chosen for this position, how will you feel about FMA?
A very appropriate question to ask this applicant. Here is a very good, valued
employee. How he would feel if he is passed over should be of concern to the firm.
A12
I am confident that I will be offered this position and will do an excellent job for the
company.
Bill's answer shows that he is a positive thinker but would probably be hurt to some
extent by not being offered the position.
Q13
A standard good question to ask.
A13
Not really. I have dealt with the dealers and the salespeople for a number of years and know
what the job entails.
A good answer that shows he already knows a great deal of inside information about
the job and has probably thought about what the job requires.
Q14
Why now? Why have you decided to change your direction in the company after 20 years.
A very appropriate question to ask of someone who is trying to make a career change.
A14
I actually have wanted to change for the last few years, but the circumstances just weren't
right. My wife...my ex-wife, I'm divorced now, didn't like the idea of my traveling and the
sales positions that came open have always been in other areas of the country and I didn't
want to move.
Mr. Lennon's answer shows that this change has been contemplated for a number of
years. The conditions have just now come together to give Mr. Lennon the right
opportunity for change.
Q15
What would you say are some of your strengths that you would be bringing to this position.
A fairly standard interview question that asks the applicant to contemplate what their
personal strong points are.
A15
I am outgoing and I have a very good knowledge of the products. I have worked with the
dealers in the area for a number of years. I know the old salesman and we talked on
numerous occasions about what the job is like, how much I might be able to make and how
much traveling I will have to do.
Mr. Lennon lists a number of things that make it seem like he would be a good choice:
product knowledge; customer knowledge; and knowledge of the job itself.
COMMENTS ON APPLICANTS
Ms. Long
Ms. Long is young and attractive. She would get the attention of dealers, but it is questionable
whether they would feel comfortable or confident in buying products from her. She has never had a
sales position, but she would probably be quite good with some training. She does have inside
knowledge of FMA products and how a FMA dealership works, although that knowledge may be
dated. Her father would certainly be willing to give her advice and updated information. Having
her father as a customer could cause some conflict of interest. Ms. Long seems to enjoy the fashion
retail industry and may leave at the first good opportunity. Overall, she is a very good find for
almost any firm, but she would probably not be happy staying with farm implements and would
leave after a few years.
Mr. Harrison
Mr. Harrison is the only applicant who has a sales background. He has even sold farm equipment
previously. His knowledge of central Texas would be an asset. He seems to lack motivation and
direction, though. While a varied background is not necessarily bad in a salesperson, Mr. Harrison
seems to change jobs searching for more money constantly. There is no guarantee that he would not
do the same if he is hired at FMA. His forgetting of Mr. Garvin's name is a very bad sign of
inattention that salespeople can not have. His wife also seems to be a big influence on what jobs he
has and where they live. She may tire of his traveling soon, since he has been on the road now for
four years and they have two children at home. While Mr. Harrison's knowledge of farm equipment
and central Texas is a valuable asset, his lack of commitment to a firm and lack of memory are
enough to keep him from being hired.
Mr. Lennon
Here is the best choice. Mr. Lennon has extensive product knowledge and dealer knowledge. He is
divorced, so there is no wife to complain about his traveling. He has twenty years with FMA and is
a valuable asset to the firm. While he has no sales background, his physical appearance and
similarity to his customers is important and will help. While he is not as young as the other
applicants, he still has 15-20 years to work and will probably stay with FMA for those years. Also,
Mr. Garvin might consider grooming him as a replacement for himself, since Mr. Lennon has
managerial experience.
Case 10
Mead Envelope Company:
Is a New Compensation Plan Needed?
Three Reasons You Need New Sales Compensation Plans:
Hal Jones's situation is fairly typical today as companies struggle to redefine how they will grow.
When a company faces the problems Jones faces, there can be three reasons a sound
compensation plan for salespeople--and in many situations for all customer contact employees-is necessary.
1. A Sound Compensation Plan Will Help Achieve Marketing Strategies and Sales
Objectives.
Without an effective sales compensation plan, a company will not accomplish its
marketing strategies and sales objectives. Winning and keeping customers is the ultimate
competitive challenge. Companies must serve customers effectively and, therefore, continually
improve their value proposition. Customers demand effective products, better service and
quality, and competitive prices. The sales force must deal with both the changing customer
demands and the organization's developing competencies. In most industries, the sales force is
the primary customer contact, and the customer often sees the sales representative as the face of
the organization. The sales person therefore occupies the position of helping customers meet
their objectives by presenting the company products and services that best meet the buyer's
needs.
Mead Envelope Company's products are more varied today than in the past, and they can
be more complicated--customized envelopes designed to meet specialized needs--as the division
endeavors to satisfy the needs of different customers in different market segments. Jones
correctly concludes that a properly structured compensation plan would help to clarify the
account executive role so they can spend time on the right selling activities.
2. A Sound Compensation Plan Will Attract and Retain People With the Right Skills and
Competencies to Perform Effectively.
Successful salespeople are always in demand. A company with a poorly designed
compensation plan runs the risk that it will not be able to attract and retain the caliber of people it
needs to sell its products and help customers with their service requirements. By reading trade
publications and general business magazines and by networking with one another at conferences
and conventions, salespeople today are more familiar with compensation levels and practices
than in the past. Increasingly, salespeople express certain expectations about how they should be
compensated for a job well done. To be effective, a sound compensation plan must embrace the
values and expectations of the people for whom it is designed.
3. A Sound Compensation Plan Will Control the Cost of Sales.
Compensation is frequently the most significant cost of maintaining a sales organization.
Depending on the industry, direct compensation--salary plus variable pay (commission or bonus
or both)--can range from 2 to 20 percent of sales. Today, many companies are concerned with
customer profitability: the mix of products they buy and the cost of serving them. For the sales
force, this frequently means that volume alone does not constitute successful performance.
However, as Jones observed, if Mead does not structure the compensation plan to recognize
performance requirements other than sales volume, which the salespeople are obtaining through
the standard product line, it will realize a less-than-optimum return from the expenditure.
One of the most effective ways you can increase sales profitability is through the compensation
plan. The plan's principal objective is to direct salespeople to sell to and interact with customers
effectively. Whether you want increased volume, a better mix of customers or product sales, or
more new accounts, the right compensation plan can help you accomplish objectives.
Five Positive Outcomes of a Successful Sales Compensation Plan
Sales compensation is one of the most powerful tools available to management to achieve
business results. The incentive component (commission or bonus) communicates the results the
company needs its sales personnel to achieve. In most sales organizations, the sales force is
extremely interested in the sales compensation plan. In fact, sales representatives typically judge
the plan by a single criterion--Am I making more money now than I did a year ago?
Management, on the other hand, typically judges the sales compensation plan's success
on multiple criteria. In companies where sales compensation plays a key role in shaping the
effective performance of the sales force, top management looks to the plan to contribute
positively to five business outcomes: growth, profits, customer satisfaction, attract and retain
sales talent, and sales productivity.
Growth
The desire to grow--by creating new markets, winning new customers, and continually
improving processes to retain current customers--is a top priority at many companies. The
Alexander Group's 1997 Survey of Executive Confidence in Sales Growth reported that 64
percent of the respondents expected to achieve sales growth of 15 percent or more. Their indepth investigation into how companies achieve their sales objectives shows that the growth
strategy they pursue is "deeper penetration of current customers." This suggests that these
companies have gone back to the basic block-and -tackle approach to growth: selling more to
current accounts, either new product sales to current buyers or more sales to new buyers within
the same account. This sales strategy suggests a compensation plan that rewards the sales
organization for (a) retaining and growing sales volume in current accounts and (b) booking sales
with new customers. The challenge is to motivate and reward the sales force for profitable topline growth. Often the biggest obstacle to doing so is overcoming the inertia associated with
"annuity"-oriented compensation, particularly for plans that base a disproportionately high
percentage of the variable compensation (80-90 percent) on reaching volume objectives tied to
last year's sales: Mead's problem.
Profits
Increasingly, companies want salespeople to focus on profitable business. The availability
of meaningful information about purchase transactions at the account level, and the intense
pressure in many industries on operating profit margins, is motivating executives in many

companies to examine the mix of business sold to customers. Selling the right mix of products
may produce better profits and, therefore, a key question to investigate is--Is the sales force
motivated to and rewarded for selling the right mix of products?
Sales Talent--Attract and Retain
In most companies, top management looks to the compensation plan to help attract and
retain the caliber of people it needs to successfully sell to and interact with customers. A strong
sales force is a major competitive advantage, especially in high contentious markets--markets
characterized by high product parity or markets in which all the major players offer virtually
equally high levels of product quality and customer service. In such situations, your company's
advantage is the relationship between the customer and the salesperson. As one executive said,
his company's objective in this type of competitive environment was to "shrink-wrap" the
salesperson around the product offering so that a company employee became the source of
differentiation. The sales compensation plan plays a pivotal role in attracting and retaining
talented salespeople. Thus, a question to ask about a current plan is--Does it help the company
hire and keep the right salespeople?
Sales Productivity
Today, most companies view their customers as "assets" of the business. Thus,
investments in salespeople, who regularly interact with customers, are regularly reviewed for
improvement. In the late 1990's, a sales job well done in a given industry produced $1-$1.5
million in revenues. To justify that salesperson with today's smaller margins, two things have to
happen: (1) volume has to be higher, usually twice as much or more, and (2) the mix of business
has to change, in terms of both what customers buy and which customers to address. If the
salesperson's average productivity was $1.2 million a year, it now has to be $2.4 million to
maybe $3 million with an improved product and customer mix. Otherwise you may get the
volume, but not the better margins.
Moreover, the productivity issue is dynamic. Today, the entry-level person may have to
produce $700,000 in sales while a senior salesperson may have to produce $2.5 million, but
those numbers are not fixed. Each year they must rise by some significant factor if the company
plans to continue investing in direct resources. Companies' management teams ask us what they
should expect a salesperson to produce (a figure that varies by industry), and once we get the
figure, they know if it stays set. The unhappy answer is no; it has to go up if no resources are
added.
Five Reasons Sales Compensation Plans Fail
Experience shows that as the sales organization grows revenues and profits, the management
challenges also grow. The Alexander Group has conducted considerable research involving
many industries to identify the challenges management faces in sustaining productive, highperforming sales organizations. Of particular interest to them has been the role that sales
compensation plays in contributing to and sustaining sales force motivation and productivity.
They find five indicators that suggest a sales compensation plan is slipping into ineffectiveness.
Let's consider the indicators relative to the situation that Hal Jones finds himself in at Mead
Envelope Company.
1. The Sales Compensation Plan Does Not Support the Company's Business
Objectives.
In a recent study of human resources professionals, 81 percent of the respondents
reported that their company experienced some form of restructuring during the past three years.
They said they see improvements in leadership, productivity, customer satisfaction, and
employee teamwork as a result of the restructuring efforts. Almost 91 percent of the respondents
reported that their company's success was based on carefully linking its compensation programs
to its business objectives. This study is the most recent of many we have seen over the years that
makes a strong case for tying the achievement of business objectives to compensation. Why then
is this the number one reason that sales compensation plans fail?
The experience of the Alexander Group suggests that this failure results from a separation
in business accountabilities. Typically, the people who write the business plan are not the people
who execute the plan. The situation in which Hal Jones finds himself illustrates how this can
happen. Jones's goals, as well as those of the product managers, are to grow revenue within the
product categories and overall. Management tells Jones to grow the business and to deliver that
growth based on a defined ratio of standard and customized product sales. Management tells
each of the two product managers to realize sales growth in their respective product lines. The
company rewards the sales force, however, for selling volume. The company has no explicit
product mix objectives. And, equally important, the company does not reward the customer
service representatives at all for their efforts should they make additional sales in the two
categories. The compensation plan reflects a sales strategy prevalent in the early days of the
business when all volume was good volume and there was no customized product line. As at
many companies, while people come and go, programs and processes at Mead are slow to
change. Too often we find the changes in the sales compensation plan lag behind the changes in
business strategy and objectives by one to three years. The objectives change, but it takes a year
or more to design and implement a new sales compensation plan that is in sync with the
objectives. This appears to be the case at Mead.
2. The Sales Compensation Plan Does Not Reflect the Realities of How Jobs Operate
Within the Sales and Customer Relationship Management Processes.
Increasingly, senior sales executives ask their salespeople to channel their time and effort
toward the high-value selling activities. To achieve this goal, it is essential to map the optimal
process for selling to and interacting with customers. Such a mapping process makes it possible
to clarify job roles and, therefore, identify the high-value selling activities the compensation plan
should direct, motivate, and reward.
In the Mead division, Jones had inherited a situation where it is virtually impossible to
effectively align compensation with the jobs that are interacting with the customers. For
example, there is one primary sales job, the account executive position. Jones's field trip
suggests that the company may need either multiple sales jobs or, at the very least, specialization
within the account executive job. How Jones decides to segment, target, and assign customers-by size, by application, or by some combination of variables--will determine the types of sales
jobs Mead needs and therefore the sales compensation. Jones faces the additional challenge of
integrating the customer service representative position into the sales and customer coverage
processes. One alternative is to team customer service representatives with account executives.
For example, he could assign three account executives to one customer service representative,
and each account executive would share responsibility for customer accounts with the service
rep. If the customer service representatives are responsible for retaining and expanding business
with assigned customers, this arrangement offers the opportunity to recognize and reward their
performance through a sales incentive compensation arrangement.
3. It Does Not Attract and Retain the People Required for Sales Success.
A well-designed sales compensation plan is a powerful communicator of what your company
values, in terms of both the types of business it goes after and the people it intends to attract and
retain. Typically, a sales compensation plan fails a company when the skills required to be
successful do not mesh with the company's definition of sales success. A common problem
many companies face is how to find the right balance between rewarding salespeople for
retaining and expanding business with current customers and motivating and rewarding the same
salespeople for winning new customers. Too often, the sales compensation plan disguises the
fact that the company rewards salespeople at a disproportionately high rate for retaining business
with current customers and does not direct, motivate, or reward them for expanding the business
by winning new customers for new business. When this happens over time, a salesperson's
selling skills--particularly those needed to sell new accounts--actually atrophy; the salesperson
becomes incapable of growing the business by selling to new customers. It is not clear if this is
the case in Jones's situation.
4. It Does Not Link the Right Measures of Sales Performance to Incentive Compensation
Payment.
Over the years, many studies have been conducted to determine the characteristics of
effective sales compensation plans. The studies consistently report that one of the most
important elements of plan success is performance measurement. When we discover plan failure
based on performance measurement, we find that (a) the company uses incomplete performance
measures; (b) the company uses too few measures; (c) the company uses too many measures; or
(d) some combination of the above.
5. It Causes the Cost of Sales to Increase Over an Extended Period of Time.
Today in most industries, top management wants sales executives to maintain or reduce
the current level of selling expense. Often, management takes this stance because the firm has
cut prices and, in turn, profit margins to gain competitive advantage. The company can cut
selling expense two ways. One way is to reduce head count. This is not an attractive alternative,
particularly if the company views its customers as assets and its sales resources as an investment
in those assets. Reduce the head count and the company risks dribbling away the assets.
Another way is to carefully examine the company's buying/selling/customer service processes to
determine whether there can be a more effective, cost-efficient way to engage with customers.
We have found that the second course is almost always possible.
Can You Fix a Failed Sales Compensation Plan?

In a word, no! Putting a fix on a current and failing plan will not, by itself, restore sales
success. In most cases the sales compensation plan has not caused poor sales performance.
Rather, the sales compensation plan becomes the lightning rod for change because it reveals
performance deficiencies.
Take a commission plan, where the company pays a percentage of sales as a commission
and pays it from the first dollar the salesperson brings in each year. Management comes to
realize that this is not really a first-dollar commission plan. Not all the customers quit buying
each year; the salespeople don't have to start fresh. In fact, the company is paying the
salespeople an amount disproportionate to what they contribute. They are getting a percentage of
every sales dollar, when they only had to sell perhaps 10 or 20 percent of the time. What the
company really wants is to have them sell on the margin, to sell to new customers or new buyers
at existing customers, to sell more than the year before where selling makes a difference. So the
first little tweak that companies usually make to their commission plans is to say, "Gee, we can't
afford to be paying from first dollar," or "We're paying way too much in commissions and getting
way too little return. We need to introduce some performance expectations."
That was the idea at Mead: the prior year's sales established the performance standard.
The salespeople needed only to beat last year's gross sales figure to start earning their
commission. The problem is that there is no relationship between the sales potential bonus and
the territory. Mead may be beating last year's numbers but underperforming in Florida because it
does not know the true sales potential. Similarly, it may be penalizing the superior sales
representative in Nebraska who has a growing share of a shrinking market but is not beating last
year's figures.
Case 11
McDonald Sporting Goods Company:
Determining the Best Compensation Program
Learning Objectives:
MSG produces and markets a wide variety of hunting and fishing accessories to
approximately 6000 small and medium size retail stores in the North East and North Central regions
of the United States. Over the past three years, the annual sales volume of MSG has ranged
between $7,200,000 and $7,650,000. While management at MSG is satisfied with profit levels,
there is concern over the lack of increasing sales volume.
MSG currently employs 11 sales representatives who receive commissions of 5-7%,
depending on the level of sales achieved. Additional compensation may be received through 2 sales
contests. Five salespersons at MSG have guaranteed drawing accounts. Hudson McDonald, the
president and chief operating officer is concerned that the sales force may be significantly
undercompensated. Therefore, he instructed the comptroller, production manager, and an outside
consultant to make proposals revising the current compensation plan. Specific case objectives are
to:
1.
2.
3.
Develop a compensation plan that should motivate the sales force to seek significantly
higher sales volume, and provide necessary incentives to attract and retain a capable sales
force.
Illustrate the interrelationship between various elements of the sales job such as training,
account coverage, motivation and evaluation.
Emphasize the part the sales force plays in assisting the organization to reach its objectives.
QUESTIONS AT END OF CASE

Which of these plans, if any, should the company use to compensate its salespeople? Why?
PRIMARY DECISIONS
1.
2.
3.
4.
What commission rates to utilize.

Whether to include salary in the compensation plan.
Whether to eliminate the current contests.
Whether to offer a bonus to those salespersons reaching their quota.
SECONDARY DECISIONS
1.
2.
At what level of sales volume to set the quota.

How to present the new compensation plan to the sales force.
Assumptions Which Might Be Made
Teaching note written and copyrighted by Charles M. Futrell, 2001.
1.
2.
That significantly higher compensation levels are needed to recruit and retain quality sales
personnel.
That sales potential is currently much higher than the current sales volume.
Alternatives
1.
2.
3.
Retain the current compensation plan.

Adopt one of the three proposed compensation plans.
Propose an alternate compensation plan.
Analysis of Alternatives
Neither the current compensation, nor the plans proposed by the production manager, the
consultant, and the comptroller offer sufficient means for the salesperson to receive the
compensation level of $45,000.00 deemed desirable by McDonald without achieving unrealistically
high sales volume. Therefore, the risk inherent in any of these plans is that MSG will end up with
an incompetent, unmotivated sales force, and a static or declining yearly sales volume.
Present Customers
The firm's sales efforts were being directed largely toward the small retailers of sporting
goods located outside the large metropolitan areas. This is reflected by the annual sales volume per
account. The instructor may ask the students to recommend actions that could be taken to expand
sales to the larger retailers of hunting and fishing supplies. Since the retailers apparently had little
or no brand preference, the sales force played the major role in obtaining retail distribution for the
company's products. A large scale advertising campaign to develop a preference for the McDonald
brand would be very costly and questionable. However, direct mail and other forms of advertising
could be utilized to a greater extent to supplement the salespeople's calls on the retail trade.
Sales Training
The training the salespeople received prior to being assigned a territory consisted essentially
of memorizing the names, prices, sizes and colors, and the "primary selling features" of the
company's products. It is questionable if such training adequately prepared the salespeople for the
task of persuading retailers to stock the McDonald line of sporting goods. For the first several
weeks the salespeople were in their territories, they were accompanied by Mr. McDonald.
Thereafter the salespeople received little additional training except during the semi-annual sales
meetings. A more extensive training program for the salespeople could improve their selling
abilities. The students can prepare a program for training the salespeople.
A full-time sales manager could give the salespeople additional training by working with
them periodically in their respective territories. Only one-third of Mr. McDonald's time was being
spent in managing the sales force. A full-time sales manager could exercise closer supervision over
the activities of the salespeople, and he could assist them in planning their itineraries. The
variations in sales coverage and the low average sales per account indicate that many of the
salespeople are spending too much time with accounts located close to their homes and with
retailers who well only a small volume of hunting and fishing supplies.
Market Potential
Explicit estimates have not been made of the market potential for hunting and fishing
supplies in each of the sales territories. Possible differences among territories in market potential
and competition are being ignored in the compensation and evaluation of the salespeople. The
students can propose methods for estimating market potential. Estimates of market potential may
suggest a realignment of the sales territories.
Why Is Motivation A Problem
A review of the salespeople's ages, years of service, and sales may suggest to some students
that several of the salespeople have little or no potential for becoming high volume producers. The
more perceptive students may question if any change in the compensation plan will motivate some
of the salespeople, such as Mr. Gatewood and Mr. Wates who seem to be satisfied with their
incomes, to increase their sales appreciably.
Incentive Plans
The Annual Sales Increase Awards Incentive Plan enables five of the eleven salespeople, or
45 percent of the sales force, to receive prize money. Salespeople who produce a very small
increase in sales volume can win an award, for example, Mr. Gatewood. As a salesperson's annual
sales volume rises it becomes more difficult for him to win the top award. Consequently, the
salesperson who produces the largest increase in absolute dollar sales for the year may not win the
top award. In the current year Mr. Campbell had the largest dollar increase in sales, but Mr. Mason
had the largest percentage increase and won the top award. This plan emphasizes competition
within the sales force rather that competition against other suppliers of hunting and fishing
equipments.
Under the Weekly Sales Increase Award Plan, the monetary award per week is the same
regardless of the actual dollar increase in sales. A very small increase in volume results in the same
award as a very large increase in sales. Therefore, the plan does not provide an incentive to produce
a large increase in weekly sales. The salesperson producing the largest cumulative increase in dollar
sales for the year may not receive the largest total amount of award money. This characteristic of
the plan is illustrated by comparing the increases in sales volume and accrued awards of Mr.
Campbell, Mr. Mason, Mr. O'Bryan, and Mr. Samuels for the current year.
The guaranteed weekly income in itself does not provide an incentive to increase sales
volume. A salesperson producing $225,000.00 in annual volume may think he has little chance of
pushing his sales above the $432,000.00 level to earn commissions in excess of his draw. The plan
does not provide an incentive to those salespeople who are earning in excess of $450 per week.
Likewise, it holds no incentive for those salespeople who are not receiving a guaranteed weekly
draw. The plan can result in inequities in income among those salespeople receiving the guaranteed
draw and those who are not. However, the plan does provide recently employed salespeople with
the minimum income on which to live while they develop their respective territories.
The Comptroller's Plan
The comptroller's plan would give some of the salespeople essentially a salary of $225 per
week plus a commission. The weekly incomes of the salespeople on such a plan could vary widely
as a result of fluctuations in their sales.
The comptroller's proposal is not explicit on the question of how long a salesperson would
continue to receive $225 per week. It is anticipated with the guarantee plan now in effect that each
salesperson will be able to develop sales in his territory to the point where his commissions will
exceed the amount of the guarantee. Under the plan proposed by the comptroller discontinuation of
the $225 a week guarantee when a salesperson's annual income.
Inequities in income would result unless all the salespeople were given $225 per week plus
commission. For example, a salesperson who did not receive the guarantee would have to produce
$572,175.00 in sales to annually earn as much as a salesperson receiving the guarantee whose
volume was $405,000.00 for the year.
The Production Manager's Plan

The increase in per diem proposed by the production manager would raise the company's
annual per diem expenses by at least $2700 ($54 for 50 weeks) per salesperson plus $81.00 for each
Sunday a salesperson spent away from his home. The students can estimate the total increase per
diem expenses the company would incur if this proposal is adopted. Per diem Sunday is an
incentive for the salesperson to use Sunday for traveling which would increase the amount of time
he has available for calling of prospects. Indirectly, the additional time may result in an increase in
sales volume. However, an increase in per diem is not a direct incentive to increase sales volume.
However, an increase in person would be compensated for being in the field regardless of the
volume he produced. Better coverage of the territories may result if the salespeople receive a larger
allowance for traveling.
The Consultant's Plan
The Ten Percent Self-Improvement Plan proposed by the consultant is based on two implicit
assumptions: 1) all the salespeople have the ability to increase their sales volumes; and 2) the sales
produced by each of the salespeople are not approaching the market potential limits of the territory.
The bonus commissions, computed on total sales for the year. that would have been paid in the
current year are compared in Table 1 with the incentive payments made under the Annual Sales
Increase Awards and the Weekly Sales Increase Award plans. The effective commission rate on the
incremental volume would be 15 to 17 percent depending on the salesperson's total volume for the
year.
The bonus commission may be a strong incentive for the salespeople to appreciably increase
their sales volumes since the amount of the bonus is in direct proportion to the absolute dollar
increase in sales. To earn bonus commissions each salesperson would compete against himself and
McDonald's competitors rather than against other salespeople. Since a bonus commission would be
paid only on the incremental volume about the sales in the comparable month of the previous year,
the salesperson would have to continue to increase his monthly sales each year in order to earn the
additional commission. The bonus commissions earned would be limited only by the salesperson's
willingness to work and his selling ability. The plan provides the salespeople with an incentive to
reduce the amount of time spent with smaller accounts and to devote more attention to the
discounters and other large volume accounts in their territories.
Since the over-ride commission would be paid on a monthly basis, conceivably a
salesperson could earn bonus commissions without increasing his total volume for the year. An
example of this possibility is shown in Table 2. The plan as proposed by the consultant make no
provision for the situation in which an increase in a salesperson's volume is followed by subsequent
months in a decrease in his sales.
The students may wish to recommend modifications of the compensation plans mentioned
or propose alternative methods of compensating and motivating the salespeople.
COMPARISON OF INCENTIVE PAYMENTS IN CURRENT YEAR WITH BONUS

COMMISSIONS UNDER THE CONSULTANT'S PLAN
TABLE 1
SALES VOLUME
INCENTIVE PAYMENTS
Under Existing Plans
Salesmen
Previous
Year
Current
Year
Dollar
Increase
Annual
Allen
Campbell
Duvall
Edwards
Gatewood
Hammond
Logan
Mason
O'Bryan
Samuels
Wates
$185,774
670,608
----201,672
233,401
--362,831
305,960
414,576
208,525
$185,184
776,385
233,244
235,921
201,685
233,285
319,342
464,112
321,971
463,766
192,488
--105,777
----13
----101,282
16,011
49,190
---
--$1,138.50
$3,375
2,524.50
--------450
1,242.00
--472.50
----4,500
3,874.50
1,125 1,701.00
2,250
1,462.50
--688.50
Weekly
Total
Consultant's
Plan
$1,138.50
--5,899.50 $10,579.50
--------1,692.00
--472.50
------8,374.50
10,129.50
2,826.00
1,602.00
3,712.50
4,918.50
688.50
--$24,804.00$27,229.50
TABLE 2
FEBRUARY AND MARCH BY SALESPERSON A
Last
Year
This
Year
Bonus
Commissions
February
$45,000
$54,000
$900
March
$40,500
$31,500
$0
Total
$85,500
$85,500
$900
Case 12
Burditt Chemical Corporation:
Analysis of Sales and Marketing Costs
Overview:
Scott Cate is the DM, and the main case character, of the Burditt case. Scott's boss, Mr.
Zinc, has sent Scott exhibits showing that his district may have a performance problem. Scott is
to analyze the data and then discuss his findings with Mr. Zinc. Scott needs to analyze sales
profits and salespeople's activities in determining the reasons for the present performance
dilemma.
Approaches to Analyzing Case
1. Examine issues of salespeople's influences on a district's sales and profits.
2. Crunch the case data.
Highlights of Data Examination
A. Exhibit 1 shows sales and profits increasing since 1996.
B. Exhibit 2 shows District 3 as the lowest among districts in (1) % sales quota; (2) % gross
profit quota.
C. Exhibit 3 shows District 3's total selling expenses are high ($810,414 vs. average expenses
of $754,272), accounting for 15.3% of region's expenses.
D. Exhibit 4 shows District 3 lowest in sales contributed to administrative expenses and profits.
E. Exhibit 5 shows District 3's sales by account category higher than District 7, yet gross profits
lower.
F. Exhibit 6 shows District 3 with a larger number of bigger prospects and customers (A's and
B's) and makes more sales calls.
G. Exhibits 5 and 6 help show that District 3:
1.
2.
3.
4.
5.
Failed to develop potential accounts in market.

Sales from existing accounts are not adequate.
A, B, and C account groups' "mix" not best to achieve sales objectives.
Some combination of 1, 2, and 3.
District 7 (relative to District 3) has done a better job with larger accounts (A and B).
Also, District 7 has higher gross margin dollars per active accounts and higher
average gross profit.
H. Possible Conclusions to Data and Ways to Increase District 3's Performance.
1.
2.
Sales effort needs to improve. Need to focus on A and B accounts and prospects.
Improve product mix sales to increase sales volume and gross profit. Focus on
higher gross margin products.
Case 13
Deer Tractors, Inc.: Analyzing Sales Data
Deer Tractors, Inc. manufactures six major product lines. There are push lawn mowers, powerpropelled lawn mowers, riding lawn mowers, garden tillers, lawn tractors, and garden tractors.
The company is divided into five geographical regions. Annual sales have steadily increased to
$725.6 million as of 2000. In fact, sales have increased at a more rapid rate than industry
demand and the company's market share has been increasing.
At the beginning of 2000, a market decision support (DS) was installed to allow for a
continuous audit of the firm's marketing operation. When Jim Tanner, the national sales
manager, received the income statement he noted that the Western region was the lowest in
terms of profitability, and the Eastern region was the most profitable. Tanner asked that this
contribution margin approach be extended to the product lines. He was surprised to see the lack
of profitability of the lawn tractor line.
Tanner requested a regional breakdown of company sales volume. All except the Western
region were meeting quotas. Tanner did not know why sales were down. He called John
Anderson, the Western region sales manager, and asked him to look into the matter and report
back to him in two weeks. John knew sales were slow; however, he had not been that
concerned until now.
To examine the $956,000 loss, John used the district sales breakdown. It was very apparent that
the Northern California sales district was experiencing problems. He called Kurt McNeal, the
district manager, and asked him why sales were down. Kurt told him that he was getting ready
to fire Leslie Stark. He said the personal problems were getting in the way of business. John
asked if he had talked with Leslie. Kurt said that he had, adding that Leslie claimed that their
competition was using that area as a test market for a new line of garden tools. Kurt told him he
felt Leslie was not working very hard and as a result competition was getting their business.
John told Kurt he would mail him some data he should look over before firing Leslie; if after
this he still felt like letting him go, he would have John's permission. John added that he was
not sure Leslie was doing so badly compared to the rest of them.
The objectives of this case are to show that general sales data can be misleading and to require
students to examine regional, district, and individual salespeople's performance data to arrive at
a decision.
1. What do you feel is the main purpose of a firm's marketing information system? Do you feel
Deer Tractors has an adequate MIS?
MDSS help management to direct activities toward areas of specific need and opportunity, and
thereby generate additional sales or more profitable sales, guard against loss of business through
failure to provide service, control costs, and strengthen the company's marketing position in
both the short and the long-term.
Deer Tractors's MDSS is new, so people will have to use it for a while to see its value. It
appears to be adequate, however; reports need to be developed to better compare salespeople's
performance within a district. For example, see tables in answer to Question 2.
2. Do you agree with Kurt's decision to fire Stark? Why?
No, I do not agree with Kurt's decision. The information in the case can be rearranged to form
Tables 1 and 2 shown below.
Table 1 shows all salespeople except J. Dozzier have negative sales.
Table 2 shows that five of L. Stark's six performance indexes look reasonably good. His sales
are better than the district average on four of the six products. Garden tractors are not selling in
Stark's territory. Kurt needs to visit Stark to find out why.
3. What action, if any, should John Anderson take? For example, should he let Kurt handle the
problem of low sales in the district?
The data shows several of Kurt's salespeople have sales problems with several products. Kurt
and John need to discuss methods to improve their sales. Indications are Kurt is not doing his
job.
TABLE 1
District's Salespeople's Product Sales
Push
Mowers
Power
Mowers
Riding
Mowers
Garden
Mowers
Lawn
Mowers
J. Boles
7.0
-3.4
-44.3
L. Stark
11.0
-2.2
J. Dozzier
9.0
A. Penney
Garden
Mowers
3.6
3.6
10.1
.4
-8.2
15.2
-46.3
1.0
1.7
5.2
1.6
21.6
8.6
3.1
.8
-15.4
-10.5
-4.0
TOTAL
35.6
-1.5
-41.4
-14.8
8.2
-18.6
Average
8.9
-0.4
-10.4
-3.7
2.1
-4.7
TABLE 2
L. Stark, Product Sales
District 38
(Thousands)
Performance % Gain or Loss Over Last Yr.
Product
Quota
Actual
Difference
Index
Territory
District
Region
Push Mowers
$2064
$2088
$24
101
11.0
8.9
7.6
Power Mowers
1088
1080
-8
99
-2.2
-1.5
3.7
Riding Mowers
416
468
52
112
.4
41.4
3.8
Garden Tillers
2196
2192
-4
99
-8.2
-14.8
-4.2
Lawn Tractors
3052
3232
180
105
15.2
8.2
11.5
2352
$11,168
624
$9684
-1728
$-1484
26
86.71 (avg)
-46.3
-18.6
-9.1
Garden Tractors
SECTION IX
TEST BANK
Chapter 1
Sales Management: Its Nature, Rewards, and Responsibilities
MULTIPLE CHOICE QUESTIONS
D
1-1
4
What are the five functions of sales management?
A. scheduling, organizing, selling, closing, and appraising
B. planning, training, selling, closing, and appraising
C. forecasting, motivating, selling, evaluating, and appraising
D. planning, staffing, training, leading, and controlling
E. planning, motivating, selling, evaluating, and revising
E
1-2
6
To sales managers, _____ is the conscious, systematic process of making decisions about
goals and activities that an individual, group, work unit, or organization will pursue in the
future and the use of the resources needed to attain them.
A. management
B. goal-setting
C. forecasting
D. organizing
E. planning
A
1-3
6
As a sales manager for a large text book publishing company, Donnie has been
systematically determining how many issues of each of the books on the publisher's fall
list will be sold, where they will be sold, and what resources need to be assigned to assure
that his goals are met. Donnie is engaged in the sales management function of:
A. planning
B. evaluating
C. leading
D. forecasting
E. goal-setting
A
1.4
6
Which of the following sales managers is involved in a planning activity?
A. Antony is working on a method to reduce his companys raw material inventory by 10
percent before the end of the year.
B. Anissa is evaluating the members of her sales force to see if they achieved their
quarterly quotas.
C. Burt is interviewing job candidates for a new technical sales position.
D. Erika is seeing if her sales force exceeded the amount budgeted for collateral sales
material.
E. Sheridan is writing a job description to be used in recruiting a computer technician.
D
1-5
6
To sales managers, _____ refers to activities undertaken to attract, develop, and maintain
effective sales personnel within an organization.
A. organizational development
B. resource-allocation
C. evaluating
D. staffing
E. organizing
B
1-6
6-7
Tiffany is the sales manager for an office supply wholesale company. As such, she is
placing a newspaper ad for a new salesperson for the Dallas region. Once she locates and
hires a suitable individual, she will need to train the person on how to sell everything
from computers to pencils. Tiffanys activities are associated with the _____ functions of
sales management.
A. goal setting and organizing
B. staffing and training
C. staffing and controlling
D. hiring and appraising
E. planning and evaluating
A
1-7
6-7
A sales manager who is performing the staffing function could be:
A. placing a want ad in a local newspaper to find people who meet standards specified in
the job description
B. trying to influence his or her sales force to reach certain organizational goals
C. monitoring the sales activities of her or his sales force
D. teaching a newly hired sales rep the skills and knowledge needed to succeed
E. creating performance appraisals to match the job applicant's existing skills
C
1-8
7
To sales managers, _____ is the effort put forth by an employer to provide the
salesperson job-related culture, skills, knowledge, and attitudes that result in improved
performance in the selling environment.
A. staffing
B. leading
C. training
D. organizing
E. evaluating
A
1-9
7
Garrett is a new salesperson for Peoria-Allen, a company that wholesales restaurant
supplies. She has spent the last month with her sales manager. They have visited all of
Garrett's customers. The manager has explained the distribution process to Garrett,
introduced her to the employees she will be in close contact with, and made sure that
Garrett has the knowledge she needs to sell restaurant supplies. Which sales management
function was her sales manager performing?
A. training
B. role-playing
C. controlling
D. lecturing
E. organizing
D
1-10
7
For the sales manager, _____ is the ability to influence other people toward the
attainment of objectives.
A. organizing
B. training
C. appraising
D. leading
E. controlling
D
1-11
7
Aaron Bach was able to use the sales management function of _____ to motivate his sales
force to increase sales by more than 4 percent during the last six months.
A. organizing
B. training
C. appraising
D. leading
E. controlling
E
1-12
7
To the sales manager, _____ means monitoring sales personnel's activities, determining
whether the organization is on target toward its goals, and making corrections as
necessary.
A. leading
B. planning
C. management by objectives
D. organizing
E. controlling
C
1-13
7
A sales manager who is performing the function of controlling would be:
A. screening job applicants
B.
setting organizational goals
C. monitoring sales of a new product
D. writing job descriptions for a new sales position
E. introducing a new salesperson to the organizational culture
E
1-14
7
A sales manager who is performing the function of controlling might:
A. set performance standards that indicate progress toward long-term goals
B. use an information system to advise salespeople on their performance
C. provide salespeople with feedback on their sales and returns
D. modify an organizational objective that proved to be impossible to achieve
E. do any of the above
E
1-15
7
Gerda has been given the performance figures for the salespeople in the Southwestern
district of her organization. She is comparing their actual sales with forecasted sales as
well as looking at whether each salesperson was able to meet his or her sales quota while
keeping sales expenses five percent lower than the previous year. Gerda is engaged in:
A. leading
B. planning
C. management by objectives
D. organizing
E. controlling
A
1-16
8
An organization like Procter & Gamble that is designed to achieve a profit goal is said to
be:
A. goal-directed
B. environmentally-organized
C. asocial
D. decentralized
E. horizontally-structured
B
1-17
8
Because organizations have a _____, the tasks to be performed are divided up and the
responsibility for their performance is assigned to organization members.
A. hierarchical arrangement
B. deliberated structure
C. task-directed
D. specialization orientation
E. dynamic organization
A
1-18
8
Organizational _____ is the degree to which the organization achieves a stated objective.
A. effectiveness
B. reliability
C. efficiency
D. validity
E. synergy
A
1-19
8
How well a manufacturer of garden tools achieves its goal of a 15 percent market share
before 2002 is a measure of the company's organizational:
A. effectiveness
B. reliability
C. efficiency
D. validity
E. synergy
C
1-20
8
Organizational _____ refers to the amount of resources used to achieve an organizational
goal.
A. effectiveness
B. reliability
C. efficiency
D. validity
E. synergy
C
1-21
8-9
In times past, the most common method used to increase sales was to hire more people
and to spend more money. This method lacked organizational:
A. effectiveness
B. reliability
C. efficiency
D. validity
E. synergy
A
1-22
9
Which of the following is NOT an example of a strategic manager?
A. the Southeastern regional sales manager for Frito-Lay
B. the vice-president of finance for Healthdyne Technologies
C. the CEO of McDonalds
D. the vice-president of marketing for Brown & Williamson
E. the national sales leader for ECC International, a British company
D
1-23
9
Top managers are also called _____ managers.
A. functional
B. tactical
C. logistical
D. strategic
E. operational
B
1.24
9
Middle mangers are also called _____ managers.
A. functional
B. tactical
C. logistical
D. strategic
E. operational
D
1-25
10
According to the text, what recent trend has had the most direct impact on middle
managers?
A. information overload
B. cultural diversity
C. networking
D. corporate downsizing and restructuring
E. affirmative action
E
1-26
10
The primary concern of _____ managers is the application of rules and procedures to
achieve efficient sales, profits, and customer service and to motivate subordinates.
A. tactical
B. functionalor
C. staff
D. strategic
E. operational
E
1.27
10
First-line managers are also called _____ managers.
A. functional
B. tactical
C. logistical
D. strategic
E. operational
C
1-28
10 (Figure 1.4)
The management function of _____ is primarily the province of top managers with time
devoted to the function decreasing for middle and first-line managers.
A. organizing
B. staffing
C. planning
D. training
E. motivating
B
10 (Figure 1.4)
1.29 Which of the management functions are first-line managers most likely to perform?
A.
planning and controlling
B.
training, leading, and staffing
C.
planning, staffing, and leading
D.
controlling and staffing
E.
training and planning
A
1-30
11 (Figure 1.5)
The path to a career in sales management most often begins with a position as a(n):
A. salesperson
B. office employee
C. sales trainer
D. production worker
E. district sales manager
C
1-31
11 (Figure 1.5)
Usually, the first sales management position a person earns is that of a(n) _____ manager.
A. area sales
B. zone sales
C. district sales
D. key account sales
E. regional sales
C
1-32
12
Salespeople in small companies:
A. are seldom promoted to a sales manager's position
B. advance much more slowly than those in larger companies
C. advance much more quickly than those in larger firms
D. do not sell to key accounts
E. cost more to train than those in larger companies because they perform so many nonselling functions
B
1-33
12
Iris is twenty-eight years old and considering her first job as a salesperson. She wants to
be a sales manager before she is thirty. What kind of company is most likely to offer her
that opportunity?
A. a large national insurance company
B. a small regional manufacturer
C. an international book publishing company
D. a foreign-based oil company with subsidiaries in 20 countries
E. Bank of America
A
1-34
12
It is generally felt that successful managers must have the following three types of skills:
A. technical, people, and conceptual and decision
B. motivational, attitudinal, and behavioral
C. behavioral, strategic, and tactical
D. strategic, tactical, and diagnostic
E. conceptual and decision, motivational, and behavioral
A
1-35
12
"I predict that new sales manager Crawford will one day have my job," said Mr. Bigg,
CEO of Enormous Enterprises. "He has a remarkable ability to see the 'big picture.' I
don't think we've ever had a sales manager who better understood how his responsibilities
fit into the overall scheme of things." Crawford is strong on which managerial skill?
A. conceptual and decision
B. diagnostic
C. technical
D. people
E. selling
A
1-36
12 (Figure 1.6)
Generally, top management needs more _____ skills than managers below them in the
organizational hierarchy.
B. technical
C. diagnostic
D. people
E. selling
D
1-37
12-13
Sales manager Chris Smith's ability to lead, motivate, and build subordinates' morale is
widely known throughout the company. Chris is strong on which managerial skill?
B. technical
C. diagnostic
D. people
E. selling
B
1-38
13
Sales manager Karen Hedges is skilled in all phases of selling and has great depth of
product knowledge. She is strong on which managerial skill?
B. technical
C. diagnostic
D. training
E. people
B
13
1.39 Generally, first-line managers need more _____ skills than managers above them in the
organizational hierarchy.
B. people
C. technical
D. selling
E. diagnostic
D
1-40
13
Regardless of how high you rise into management, _____ skill will always be important
to your success.
B. technical
C. diagnostic
D. people
E. dispassionate
E
1-41
13
When a salesperson becomes a new sales manager, which of the following is likely to
change?
A. relationships
B. goals
C. responsibilities
D. job skill requirements
E. all of the above
A
1-42
15
When Carla was first promoted to the position of sales manager, the change from
thinking and behaving like a subordinate to thinking and behaving like a boss was not
immediate. Instead she passed through seven stages. The first stage in her
transformation was:
A. immobilization
B. depression
C. internalization
D. minimization
E. acceptance of reality
B
15
1.43 Which of the following is NOT one of the stages that a new sales manager typically passes
through as he or she learns to behave like a boss instead of a subordinate?
A. immobilization
B. socialization
C. internalization
D. depression
E. minimization or denial of change
C
1-44
15
A new sales manager does not immediately change from thinking and behaving like a
subordinate to thinking and behaving like a boss. The final stage in the transformation
process is:
A. immobilization
B. minimization
C. internalization
D. searching for meanings
E. acceptance of reality
E
1-45
15
One of the biggest problems facing most new managers is:
A. the change in pay scale
B. the number of salespeople that need managing
C. their length of experience in sales
D. the annual sales volume of the firm
E. their lack of preparation
E
1-46
15
Tergiva Cox is a new first-level sales manager for a company that manufactures
restaurant fixtures. If she is a typical new sales manager, her biggest problem in
acclimating to her new position will be her:
A. increased span of control
B. increased travel requirements
C. lack of sales experience
D. inability to forecast the firm's annual sales volume
E. lack of preparation
B
1-47
16
One key to making a successful transition into management is for the new manager to
have a learning attitude. This means he or she is:
A. willing to enroll in an MBA program to enhance his or her managerial skills
B. willing to change, adapt, and seek help when needed
C. prepared to make radical changes in how his or her area of responsibility is operated
D. quick to develop a successful group of subordinates
E. willing to accept his or her new responsibility as trainer of the salespeople supervised
TRUE FALSE QUESTIONS
T
1-48
4
Sales management is the attainment of sales force goals in an effective and efficient
manner through planning, staffing, training, leading, and controlling organizational
resources.
F
1-49
6-7
Staffing involves the recruiting, selecting, and socializing of people into sales group and
providing the new salespeople with the skills, knowledge, and attitudes needed to
perform the sales job.
T
1-50
7
C. K. relied on the management function of leading to convince his salespeople to work
Saturdays until the sales quota for their division had been achieved.
F
1-51
8
A shoe manufacturer that sold twice as many pairs of shoes with three salespeople as did
its competitor with five salespeople would be said to have great organizational
effectiveness.
F
1-52
9
A top manager is also called a tactical manager.
T
1-53
9
The vice president of human resource management for a multinational organization is a
good example of a strategic manager.
T
1-54
10
Operational managers operate with a short time horizon.
F
1-55
11
The beginning managerial level is usually the regional sales manager.
F
1-56
12
Advancement for salespeople in large companies is usually more rapid than for
salespeople in small firms.
F
1-57
12
It is generally felt that to be successful, managers must have delegating, motivating, and
training skills.
13
1-58
The higher the managerial level, the more the manager needs good technical skills.
T
1-59
15
One of the biggest problems experienced by most new managers is their lack of
preparation for the job. This is made worse by the expectation of most companies that a
new sales manager will function effectively from the outset.
F
1-60
15
During the final phase of the promotion process the person incorporates the new
meanings into his or her behavior; this phase is called mobilization.
T
16
1.61 Having realistic expectations about what a management position is like plays a large part in
determining how quickly new managers adjust.
F
1-62
16
Sales force automation is a brand-new concept.
T
1-63
17
Sales management is both a art and a science.
SHORT ANSWER QUESTIONS

1.64 List the five functions of management.
Ans: planning, staffing, training, leading, and controlling
Page: 4
1.65 What are the two activities associated with staffing?
Ans: people planning and employment planning
Page: 7
1.66 What is an organization?
Ans: a social system that is goal directed and has a deliberate structure
Page: 8
1.67 On which two functions of management do top managers spend the LEAST amount of their
time?
Ans: training and staffing
Page: 10
1.68 What is the title most generally assigned to a beginning sales manager?
Ans: district sales manager
Page: 11
1.69 List the three categories of skills needed to perform the management functions.
Ans: conceptual and decision skills, people skills, and technical skills
Page: 12
1.70 When a salesperson is promoted to a managerial position, he or she goes through several
predictable stages. What is the first phase of this transistion?
Ans: immobilization
Page: 15
Chapter 2
Social, Ethical, and Legal Responsibilities of Sales Personnel
D
2-1
26
The text would consider a business socially responsible if it only:
A. serves its customers in a profitable and lawful manner
B. serves its customers and employees in an ethical and lawful manner
C. encourages managers to monitor the off-duty behavior of employees
D. has managers who make choices and take actions that will contribute to the welfare of
society as well as to that of the organization
E. pursues profits as a short run objective
A
2.2
26
A(n) _____ is any group or individual within or outside an organization with a stake in
the organization's performance.
A. stakeholder
B. organizational ombudsman
C. proxy
D. environmental representative
E. environmental ombudsman
E
2-3
26
Which of the following would be an example of a stakeholder for a manufacturer of
explosive?
A. mining companies who buy explosives from the manufacturer
B. employees who work for the company's research and development division
C. banks who loaned the company money to computerize some of its assembly lines
D. the community in which the manufacturer does much of its product development
E. all of the above
E
26
2.4 Which of the following is an example of a stakeholder for a children's amusement park in
Englewood, Colorado?
A. the children who enjoy the park
B. parents who schedule their children's parties at the amusement park
C. the company that supplies the candy sold at the amusement park
D. the accountant who calculates the firm's revenues and expenses
E. all of the above
B
2-5
26
The acronym CCC GOMES is an easy way to remember:
A. the types of ethical behaviors that managers must oversee
B. the various organizational stakeholders
C. the types of information that should be included in an effective code of ethics
D. the various unethical dealings that salespeople can become involved in like
misrepresentation
E. the steps to creating an ethical work environment
C
2-6
27
The text identified four main areas of responsibility an organization has to the various
groups who have an interest in its activities. According to the text, which of the
following is NOT one of those areas of responsibility?
A. economic
B. discretionary
C. technical
D. ethical
E. legal
A
2-7
27
The text identified the main areas of responsibility an organization has to the various
groups who have an interest in its activities. In interacting with the organization's
stakeholders, a manager would most frequently deal with issues in which area?
A. economic
B. discretionary
C. technical
D. ethical
E. legal
B
27-28
2.8 Which of the following statements about an organization's areas of social responsibilities is
true?
A. Ethical responsibilities are imposed by local town councils, state government, and
federal regulatory agencies.
B. A business has an economic responsibility to stay in business and make a profit.
C. Discretionary responsibilities are required by law.
D. Social responsibility defines what society deems as important with respect to
appropriate corporate behavior
E. Discretionary responsibility creates the most problems for a manager because of the
number of times such issues arise.
E
2-9
27-28
An organizational decision maker who acts with equity, fairness, and impartiality and
respects the rights of individuals is said to be:
A. image-oriented
B. goal-oriented
C. following "the letter of the law"
D. financially conservative
E. ethical
D
2-10
28
Many people believe businesses should go beyond the social responsibilities mandated by
economics, law, or ethics. They believe firms should contribute to the community's
welfare. These people want firms to exercise _____ social responsibility.
A. mandated
B. de facto
C. designated
D. discretionary
E. derived
D
2-11
28
Because it goes beyond societal expectations to contribute to the community's welfare,
_____ responsibility is the highest criterion of social responsibility.
A. de facto
B. mandated
C. de jure
D. discretionary
E. derived
E
2-12
28-29
Which of the following is an action an organization can take to demonstrate social
responsibility?
A. strive to make profits on an ongoing basis
B. admit mistakes
C. take public stands on social issues
D. monitor the social environment
E. any or all of the above
C
2-13
28-29
Which of the following is an action a corporation can take to demonstrate social
responsibility?
A. refuse to take corrective action before it is required
B. avoid taking public stands on social issues
C. strive to make profits on an ongoing basis
D. shun publicity concerning any socially damaging mistakes
E. never publicly admit making a mistake
E
2-14
28-29
An aluminum can manufacturer can demonstrate social responsibility by:
A. working to establish industry-wide recycling standards for all types of aluminum
products
B. trying to eliminate pollution before it has an adverse effect on the community
C. helping turn an old garbage dump into a safe playground
D. publicly admitting that it had a chemical run-off that polluted a creek near its main
factory as soon as it happened and paying to have crews clean-up the creek
E. doing any or all of the above
A
2-15
29
Two major influences on the ethical behavior of sales personnel are:
A. employees and the organizations for which they work
B. competitors and supervisors
C. push and pull strategies
D. first-line supervisors and codes of ethics
E. how the company advertises itself and what its competitors do
E
2-16
29
On the job, David Loyd acts purely in his own best interest. He follows the company's
rules because if he doesn't, he may be fired. At what level of moral development is David
functioning?
A. self-serving
B. principled
C. conventional
D. discretionary
E. preconventional
C
2-17
29
Maryann Cox considers herself a responsible person. She upholds moral and legal laws
and conforms to the expectations of others. Maryann is functioning at what level of
moral development?
A. elective
B. principled
C. conventional
F. discretionary
G. preconventional
B
2-18
29
"I don't care what the boss said. It's wrong, and I'm not going to do it. If I get fired, then
that's just the way it will have to be." The salesperson who just made this statement to a
co-worker is apparently working at the _____ level of moral development.
A. mandated
B. principled
C. conventional
D. post-conventional
E. preconventional
C
2-19
29
Most sales managers operate at what level of moral development?
A. conscientious
B. principled
C. conventional
D. discretionary
E. preconventional
B
2-20
30
According to the text, ethical behavior is defined as:
A. encouraging exchanges between the firm and its customers
B. treating others fairly
C. doing whatever it takes to meet your sales quota
D. making sure you never encounter an ethical dilemma
E. minimizing competitor retaliation
B
2-21
30
Beth, who majored in English, has just been hired for a sales position with a large
consumer products company that expects its salespeople to exhibit ethical behavior.
When Beth asked you what ethical behavior is, you told her that to behave ethically she
should:
A. make sure each action she takes is legal
B. demonstrate loyalty to her company and to her associates
C. follow the letter of the law, if not its intent
D. get the job done by someone
E. make sure she earns the highest possible commission
E
2-22
30
Bill Isley sells ultra-light planes. He has been told he must make a major sale during the
next six months or he will be fired. He knows he can guarantee a $3 million sale to a
South American nation if he buys the government official overseeing the purchase a $300
hand-tooled leather briefcase. Bill is experiencing a(n):
A. cultural impasse
B. cultural enigma
C. cultural roadblock
D. ethical inequity
E. ethical dilemma
E
2.23
30
Rudy sells large lighted signs for arenas and other sports venues. He has been
entertaining a group of businessmen from Brazil for three days because he hopes to sell
them $8 million in signs. The businessmen have told Rudy that if he will help them
avoid paying Brazilian import duties on the signs, they will readily sign the contract.
Rudy is experiencing a(n):
A. cultural impasse
B. ethical inequity
C. cultural roadblock
D. ethical enigma
E. ethical dilemma
C
2-24
30
Which of the following statements about ethical dilemmas is true?
A. Ethical dilemmas occur because many ethical standards are rigidly codified.
B. Friends are never the cause of an ethical dilemma.
C. Cultural differences between different parts of the world may cause a salesperson to
face an ethical dilemma.
D. Ethical dilemmas occur when right and wrong can be clearly identified.
E. Deciding whether to pad an expense account will not result in an ethical dilemma.
E
2-25
31
According to the text, all of the following are ethical considerations commonly faced by
sales managers EXCEPT:
A. level of sales pressure to place on a salesperson
B. whether to be honest with a salesperson
C. employees' rights
D. decisions concerning a salesperson's territory
E. the salesperson's relationship with his or her spouse
A
2-26
32
A house account is:
A. a large account handled by someone from the home office or a key account
salesperson
B. a small account which a salesperson typically handles by telephone from his or her
home
C. an account located in the same city as the salesperson's place of residence
D. the same thing as a "leased department"
E. an account that the salesperson asks the sales manager to remove from his or her
territory, usually because of its low sales volume
D
2-27
32
Anne Maddox is a commission salesperson whose territory for the last three years has
been the entire state of Iowa. Through hard work, she has greatly increased her
company's business in the state. Now her manager has decided to split the state into two
territories. Anne can expect:
A. to be given several new key accounts to sell to
B. an increase in her earnings
C. to keep all the customers she had before this management decision
D. a decrease in her earnings
E. to be fired for her past performance
E
2-28
33-34
Which of the following statements about termination-at-will is true?
A. Early in the twentieth century, many courts were adamant in their strict application of
the common law rule to terminate-at-will.
B. Recently court decisions have been concerned with the rights of the individual.
C. Employers have the right to terminate sales personnel for poor performance.
D. Employers must now maintain accurate records of excessive absenteeism, unsafe
conduct, etc. and inform employees on where they stand.
E. All of the above statements about termination-at-will are true.
A
2-29
34
In the early 1980s, court decisions and legislative enactments limited the power of the
employer to terminate-at-will. Under the new limited power, which of the following
actions would be an acceptable reason to terminate a salesperson?
A. poor performance
B. the use of sales puffery
C. engagement in cooperative acceptance
D. any absenteeism
E. weak organizational skills
D
2-30
34
The right of employees to be treated fairly and with respect regardless of race, sex,
national origin, physical disability, age, or religion is called:
A. affirmative action
B. empathy
C. employee privilege
D. cooperative acceptance
E. ethical consideration
C
2-31
34
Bo Hartz has just taken a sales job for a pharmaceutical company. He has been given a
pile of company literature to go through before he reports for sales training on Monday.
Among the material he has are the company's code of ethics. As you look at this code,
you notice that the company guarantees every employee the right to be treated fairly and
with respect regardless of race, sex, national origin, physical disability, age, or religion
while on the job. You know that the company is guaranteeing Bo:
A. workplace equity
B. freedom from external and internal discrimination
C. cooperative acceptance
D. freedom from termination
E. sunshine employment
A
2-32
34
As a sales manager, your first step in handling a sexual harassment complaint is to:
A. put the employee lodging the complaint at ease
B. make sure everyone in the company realizes an investigation is occurring
C. carefully examine the accused's personnel folder
D. terminate the alleged offender before more damage can be done
E. hire a good lawyer
E
2-33
34
When a company takes proactive measures to ensure employees are not discriminated
against, it receives the benefit of:
A. an image as a good employer
B. reduced legal fees
C. attracting good employees
D. less frequent recruitment effort
E. all of the above
E
2-34
35
Which of the following sales personnel activities is considered ethical behavior?
A. splitting commissions with fellow employees in order to win a contest
B. taking the family to a Pirates baseball game and writing it off on the expense account
C. using the company Internet to run an on-line travel agency in your free time
D. attending college in the evening but taking an afternoon off to prepare for class
E. none of the above activities
C
2-35
35
Which of the following would be an example of a salesperson who is moonlighting
unethically?
A. a consumer products salesperson who takes a weekend MBA program
B. a textbook salesperson who sells arts and crafts on weekends
C. an industrial equipment salesperson who tries to sell vacation real estate to some of
his present customers
D. a supermarket clerk handing out samples of Tombstone pizza
E. a pharmaceutical salesperson donating empty file folders to a school project
D
2-36
35
Al Dean is a salesperson who is enrolled in a night MBA program. From time to time, he
takes off most of the day before his night class meets to prepare assignments that are due
that evening. From an ethical standpoint, it is correct to say Preston Al is:
A. guilty of misrepresentation
B. misusing company assets
C. cheating
D. moonlighting
E. doing none of the above
B
2-37
36
Which of the following statements about bribery is true?
A. Bribes always involve money.
B. A purchasing agent who demands $500 in cash before he will sign an agreement to
buy is engaged in bribery.
C. Commission salespeople cannot be placed in a position where they might be tempted
to pay a bribe.
D. The difference between a business gift and a bribe is quite clear.
E. A purchasing agent who asks for a 10 percent reduction in delivery charges before
she will sign an agreement to buy is engaged in bribery.
A
2-38
37
The refrigerator salesperson says to the prospective new customer, "Your going to love
my company's refrigerators." The salesperson's statement is an example of:
A. sales puffery
B. an illegal act
C. a de facto misrepresentation
D. a warranty of fact
E. a breach of warranty
E
2-39
37
Which of these statements about misrepresentation and sales puffery is true?
A. When salespeople loosely describe their good or service in glowing terms, those
statements can be relied upon by the potential buyer.
B. Generally, the more knowledgeable the customer, the greater the chances the court
will interpret an incorrect statement by a salesperson as an actionable
misrepresentation.
C. When a salesperson makes claims of a "factual nature" regarding a service's inherent
capabilities, the law treats these comments as sales puffery.
D. A salesperson's opinion about the quality of the product being sold is known as sales
puffery, and is legally actionable.
E. The salesperson's company may be sued if the salesperson engages in
misrepresentation.
C
2-40
37
Which of these statements about misrepresentation and sales puffery is true?
A. According to the law, all puffery is misrepresentation.
B. Generally, the more knowledgeable the customer, the greater the chances the court
will interpret an incorrect statement by a salesperson as an actionable
misrepresentation
C. When a salesperson makes claims of a "factual nature" regarding a service's inherent
capabilities, the law treats these comments as statements of fact and warranties
D. Moonlighting is a form of misrepresentation.
E. The salesperson may be sued for misrepresentation, but not the company for which
the salesperson works
C
2-41
37
Which of the following statements, if false and made by a salesperson to an individual
who bought the product being sold, would be most likely to have legal consequences?
A. "You're going to enjoy this new carpeting for years!"
B. "We are the tri-state area's low price leader."
C.
"We offer a 100 percent order-fill rate. You'll never experience a back-order."
D.
"Our pizza is the best around."
E. "Your own mother can't care for you as well as our staff."
C
2-42
37-38
Which of these statements about sales puffery is true?
A. The difference between sales puffery and a statement of fact is easy to distinguish.
B. Each incident can be analyzed according to a predetermined set of explicit rules.
C. Generally, the less knowledgeable the customer, the greater the chances the court will
interpret a statement as actionable.
D. Statements of puffery should be taken at face value.
E. Puffery typically occurs when a salesperson deliberately makes erroneous statements.
B
2-43
38
If a salesperson incorrectly told a customer, _____, then a customer would have the legal
right to sue the salesperson's employer.
A. "This refrigerator will run for ever."
B. "Our customer service people love talking to our customers."
C. "This lotion will make your skin feel moist."
D. "This mace pen will protect you from any muggers."
E. "This is a safe, dependable helicopter."
E
2-44
38
Alfonso is a little worried about all the talk he's heard recently about lawsuits due to
misrepresentation and breach of warranty. Which of the following would be a good
suggestion to him to help him "stay legal"?
A. Be accurate when describing a product's capabilities.
B. Thoroughly educate all customers before making a sale.
C. Avoid making exaggerated claims about product safety.
D. Know the technical specifications of the products you sell.
E. Do all of the above.
A
2-45
38
If a supplier gives some customers promotional allowances and support while not making
other customers aware of the existence of these opportunities, the company is, under
certain circumstances, in violation of the Robinson-Patman Act. The name for this
practice is:
A. price discrimination
B. demarketing
C. price unbundling
D. exclusive dealing
E. promotional pricing
D
39
2.46 The Clayton Act:
A. prohibits sexual harassment
B. allows some customers to receive price reductions while others do not
C. removed the employer's ability to terminate-at-will without justification
D. prohibits tie-in sales and exclusive agreements but only if they substantially lessen
competition
E. defines sales puffery
B
39
2.47 "I'll sell you our top-selling cleaning products only if you'll agree to also stock our cleaning
brushes." This statement made by a salesperson to a hardware store owner is a violation
of the Clayton Act prohibition of ______ because the salesperson's actions substantially
lessen(s) competition.
A. misrepresentation
B. tie-in sales
C. augmented service contracts
D. a green River dealership
E. kickbacks
C
2-48
39
If a manufacturer requires that its wholesalers and retailers buy merchandise only from it,
the contract is a(n) ______ contract, and if the contract tends to lessen competition, it is
prohibited under the Clayton Act.
A. reciprocity
B. product discrimination
C. exclusive dealing
D. wholesome
E. price discrimination
A
2-49
39
I'll tell you what," said Magee. "I'll buy all my cleaning supplies from your company if
you'll make sure your employees get all your company's printing done by mine." Magee
is proposing:
A. reciprocity
B. receivership
C. a tie-in sale
D. an insurance policy
E. misrepresentation
A
2-50
39
Cooling-off laws apply only to:
A. sales over $24.99, made door-to-door
B. sales made in out-of-town offices, regardless of value
C. sales for which verbal guarantees are given
D. sales over $50, made door-to-door
E. sales made over the Internet
E
2-51
39
A cooling-off law:
A. gives the buyer three weeks to cancel the contract, return any merchandise, and obtain
a full refund
B. covers items sold through wholesale outlets
C. deals with purchases between $25.00 and $50.00
D. is in effect in all states
E. covers some door-to-door transactions
A
39
2.52 For which of the following purchases would Avary be most likely to need the protection of
cooling-off law?
A. the purchase of $200 worth of pots and pans from a door-to-door salesperson
B. the purchase of Girl Scout cookies from a Brownie selling door-to-door
C. the purchase of a set of dining room furniture from a manufacturer's store
D. the department store purchase of a beauty cream guaranteed to make the user look 20
years younger
E. the supermarket purchase of a case of cat litter
D
2-53
39
Green River ordinances:
A. were first passed in response to a drought in the Green River area of Wyoming, and
allow cities to pass laws against the sale of products that are damaging to the public
well-being by doing such things as depleting the water supply
B. hold salespeople legally responsible if the items they sell damage the environment
C. allow car dealers to charge different prices to different consumers provided they
advertise "make your own best deal"
D. require persons selling directly to consumers to pay a license fee and be licensed by
the city unless the sellers are also residents of the city in which they are doing
business
E. state that if asked by a consumer, a door-to-door salesperson must show the
documented laboratory evidence to support product performance claims
A
2-54
39
A Green River Ordinance requires that:
A. if they are not residents, persons selling directly to consumers be licensed by the city
where they are selling and pay a license fee
B. a bond be paid by all persons selling directly to consumers
C. only door-to-door salespeople be licensed
D. all industrial and consumer salespeople in a city need to be licensed
E. every person who comes to your door selling an item valued at more than $25.00
have a license
E
2-55
40
Which of the following describes a method management can use to help their
organizations act ethically?
A. formally encourage whistle-blowing
B. establish a control system
C. carefully select its leaders
D. establish and follow a code of ethics
E. do all of the above
C
40
2.56 What can management do to foster a climate that encourages ethical behavior by the sales
force?
A. encourage its front-line supervisors to take the lead in developing an ethical climate
B. encourage moonlighting
C. discipline wrongdoers
D. prohibit whistle-blowing
D
2-57
40
A(n) _____ is a formal statement of a company's values concerning ethics and social
issues.
A. law of equity
B. tying agreement
C. fairness principle
D. code of ethics
E. ethical ombudsmen
E
40
2.58 The two types of codes of ethics are:
A.
centralized and decentralized
B.
image-based and mission-based
C.
formal and informal
D.
external and internal
E.
policy-based and principle-based
C
2-59
40
A code of ethics that _____ would be classified as a principle-based statement.
A. told how to handle proprietary information
B. affirmed equal opportunities
C. defined fundamental values
D. defined conflict of interest
E. stated employees were expected to obey laws
B
41
2.60 Some corporations employ an individual to serve as sort of an organizational conscience,
listening to and investigating ethical complaints and keeping top management aware of
potential ethical issues. This person is called a(n):
A. ethical delineator
B. ethical ombudsman
C. moral advocate
D. ethics manager
E. corporate whistle blower
D
2-61
41
All employees who observe or become aware of criminal practices or unethical behavior
should be encouraged to report the incident to their superiors, to a higher level of
management, or to an appropriate unit of the organization. This reporting process is
called:
A. a breach of trust
B. tattling
C. a warranty trust
D. whistle blowing
E. principle-based responsiveness
A
41
2.62 When an employee of Alaska Air observed mechanics falsifying maintenance reports, he
immediately informed his supervisor. When the supervisor took no action, the Alaska Air
employee informed the FAA. The report made by the Alaska Air employee to his
supervisor and to the FAA is an example of:
A. whistle-blowing
B. a violation of a warranty trust
C. preconventional moral development
D. organizational discrimination
E. an ethical dilemma
A
2-63
41
According to the text, the single most important factor in improving the climate for
ethical behavior in a sales force is:
A. the actions taken by top management
B. the establishment of a procedure for whistle-blowing
C. effective goal-setting programs
D. quick disciplinary action against offenders
E. the development of training seminars on ethical practices and procedures
C
2-64
41
The most critical factor in improving the climate for ethical behavior in a sales force is:
A. local government action
B. federal legislation
C. the role of top-level managers in guiding the organization
D. hiring only ethical salespeople
E. consumer watchdog groups
TRUE-FALSE QUESTIONS
T
2-65
26
Most people cannot agree on which actions a business should take to improve society's
welfare.
F
26
2.66 Stakeholder is a term used to describe groups inside the organization who have a stake in its
performance; stockholder is a term used to describe groups outside the firm who have an
interest in its performance.
T
2-67
27
Businesses have a responsibility to make a profit in order to serve society.
F
2-68
28
When a supermarket places a full-page newspaper ad in support of Black History month
with the hope of attracting more African-American shoppers, the supermarket chain can
be said to be showing its discretionary social responsibility.
F
2-69
29
The text suggests an appropriate way for sales managers to convey their feelings about
ethical behavior by members of the sales force is the "Hear No Evil, See No Evil, Speak
No Evil" approach.
F
2-70
29
If it's not illegal, it must be ethical.
T
2-71
30
Ethics is defined by the text as "principles of right or good conduct, or a body or such
principles."
T
2-72
30
Simply put, ethical behavior refers to treating others fairly.
T
2-73
31-32
An ethical sales manager should set realistic and obtainable goals.
T
32
2.74 If management decides to increase the number of territories in a given area, there is a
possibility the earnings of the salesperson working that location will decrease.
F
2-75
32
Key accounts are synonymous with house accounts.
F
2-76
33
If a salesperson has a drug or alcohol problem bad enough to require professional help,
the appropriate action of the sales manager is to remove the individual from his or her
territory.
F
2-77
34
Although discrimination on the basis of a person's sex is illegal, there are no laws against
sexual harassment.
T
2-78
35
The company assets that are most often misused are automobiles, expense accounts,
samples, and damaged merchandise credits.
T
2-79
36
At times the distinction between giving a buyer a gift and bribery is difficult to make.
T
2-80
37
Salespeople assume legal obligations--with accompanying risks and responsibilities-every time they approach a customer.
T
2-81
37
A salesperson who exaggerates about product capabilities may be guilty of
misrepresentation.
F
2-82
38
When a customer relies on a salesperson's statements, purchases the product, and then
finds it fails to perform as promised, the supplier can be sued for sales puffery.
F
2-83
38
The difference between sales puffery and statements of facts is easy to distinguish.
F
2-84
38
Generally, the more knowledgeable the customer, the greater the chances the court will
interpret an incorrect statement by a salesperson as an actionable misrepresentation rather
than sales puffery.
T
2-85
38
A company that has gone to great lengths to thoroughly educate its customers can use the
customer's knowledge as a defense in a misrepresentation law suit.
F
2-86
39
It is always illegal to require a buyer who wants a particular line of merchandise to buy
other products that are not wanted in order to get the desired line.
F
2-87
39
The Clayton Act prohibits sexual harassment.
T
2-88
39
Exclusive dealing occurs when wholesalers are required to purchase products from one
producer or else they will lose the right to carry any of that producer's products.
F
2-89
39
A cooling-off law gives the buyer three weeks to cancel the contract, return any
merchandise, and obtain a full refund.
F
2-90
40
The two types of codes of ethics are image-based and mission-based.
T
2-91
41
A person who engages in whistle-blowing is correctly referred to as an ethical
ombudsman.
F
2-92
41
The single most important factor in improving the climate for ethical behavior in a sales
force is a consumer watchdog groups.

2.93 Companies have four major areas of responsibilities to their stakeholders. What are they?
Ans: economic responsibilities, legal responsibilities, ethical responsibilities, and discretionary
responsibilities
Page: 27-28
2-94
What level of moral development is an individual who is acting in his or her own best
interest without concern for moral and legal rules?
Ans: preconventional
Page: 29
2.95 Briefly define ethical behavior.
Ans: treating others fairly
Page: 30
2.96 What term is used to describe actions of a salesperson who sells real estate on the side while
he is supposed to be selling his employer's products?
Ans: moonlighting
Page: 35
2.97 What is the name of the law that prohibits tie-in sales if they lessen competition?
Ans: the Clayton Act
Page: 39
2.98 What are the two different types of codes of ethics?
Ans: principle-based codes and policy-based codes
Page: 40
2.99 What is the single most important factor for improving the climate for ethical behavior in a
sales force?
Ans: the action taken by top-level managers
Page: 41
Chapter 3
Building Relationships through Strategic Planning
A
3.1
52
_____ involves making decisions about the organization's major targets or end results that
relate to its long-term survival, value, and growth.
A. Strategic planning
B. Contingency planning
C. Environmental planning
D. Tactical planning
E. Objective planning
A
3.2
52
To meet its objective of a 12 percent increase in market share next year, the management
of Neiman Marcus Pets, which sells tuxedos and princess coats for dogs, would develop a
plan of action and resource allocation to achieve this goal. This plan is called a(n):
A. strategy
B. tactic
C. option
D. objective
E. schematic
B
3.3
52
A(n) _____ answers the question, "How are we going to carry out our strategy?"
A. mission statement
B. tactic
C. balance sheet
D. organizational objective
E. motive
D
3.4
52
Which of the following is the best example of an operational plan for a retail nursery that
wants to increase its sales by five percent over the next two years?
A. add gardening tools, pots, and instructional courses to its product mix
B. run annual contests to increase customer awareness
C. increase its advertising budget by 20 percent
D. conduct a 20-percent-off sale on all bedding plants during the first two weeks in May
E. build a Web site
D
3.5
53
An organization's _____ states the basic purpose and values of the organization, as well
as its scope of operation.
A. strategy
B. tactics
C. logistics
D. mission
E. statement of purpose
A
3.6
53
Ideally, the _____ of an organization clarifies the long-term direction of the company and
its strategic intent.
A. strategic vision
B. strategic plan
C. tactical plan
D. primary marketing objective
E. financial plan
E
3-7
53
Which of the following statements about an organizational mission statement is true?
A. To be effective, a mission statement must be broad.
B. An organization's mission statement and its strategic vision are completely
synonymous with each other.
C. The mission statement evolves from an organization's strategic goals.
D. The mission statement should be written as if the company were going to adopt a
mass marketing strategy.
E. The mission is a statement of the organization's reason for existence.
B
3.7
53
"The Hospital Corporation of America (HCA) is an international health care company
committed to the delivery of quality patient care at a reasonable cost. Founded in 1968
with one hospital HCA now operates the leading health care provider network of
hospitals in more than 480 communities worldwide." This is an example of a(n):
A. strategic plan
B. mission statement
C. ogistical plan
D. sales objective
E. marketing plan
E
3.8
53
The company's mission, visions, values, objectives, strategies, and tactics and the way
they are interrelated are often referred to as a(n):
A. corporate culture
B. tactical statement
C. organizational culture
D. Gantt chart
E. strategic plan
B
3-9
53
To develop a strategic plan, an organization's top management must know:
A. the number of employee resources available and their allocation
B. where the organization wants to be in the next five years
C. the types of sales promotion that are appropriate for the organization
D. the details of the organizational marketing mix
E. all of the above
E
3-10
55-56
The basic tasks of an organization's marketing department are to:
A. maximize sales of existing products to existing markets
B. develop and sell new products
C. provide the quality of service needed for customers to be satisfied and to continue
doing business with the organization
D. develop new markets for existing or new products
D
3-12
56
The four elements of the marketing mix are:
A. price, production, promotion, and distribution
B. personal selling, advertising, sales promotion, and public relations
C. production, sales, management, and distribution
D. product, price, promotion, and distribution
E. planning, production, distribution, and sales
B
3-13
56
Which of the following is the BEST example of a good?
A. an airplane ride
B. a text book
C. a massage
D. a flying lesson
E. a medical examination
E
3-14
57
Which of the following is an example of a product?
A. a taxicab ride
B. a piano lesson
C. a laptop computer
D. a management training seminar
E. all of the above
A
3.15
57
The development of package design, brands, and service policies is associated with the
______ element of the marketing mix.
A. product
B. presentation
C. price
D. place
E. promotion
B
3.16
58
Customers cannot taste, smell, fell, see, or hear a service before they buy it due to the
_____ characteristic of services.
A. inseparability
B. intangibility
C. perishability
D. heterogeneity
E. fluctuating demand
A
3.17
58
Due to the _____ characteristic of service, services are created and dispensed
simultaneously.
A. inseparability
B. intangibility
C. perishability
D. heterogeneity
A
3.18
58
In spite of the _____ characteristic of services, Caribbean cruises, hotel reservations in
Paris, and life insurance are whole services that are typically sold by a seller who
represents the service provider.
A. inseparability
B. intangibility
C. perishability
D. heterogeneity
D
3.19
58
Because of the _____ characteristic of services, Pete cannot be certain that Zoe will
benefit as much from a time management seminar as he did.
A. inseparability
B. intangibility
C. perishability
D. heterogeneity
E
3.20
58
For which of the following services is the service characteristic of fluctuating demand
and perishability likely to have the LEAST affect?
A. physical therapy
B. dog grooming
C. manicure
D. child day care
E. life insurance
A
3.21
59
During the late nineteenth century when peddlers and their wagons were fairly common
sights, it was not uncommon for a peddler to charge a very rural customer $.50 for a
mirror and to charge another customer who lived nearer to town $.15 for the same mirror.
This example describes how early salespeople dealt with the _____ element of the
marketing mix.
A. price
B. product
C. production
D. promotion
E. destination
D
3.22
59
The owner of A Woman's Touch makes wooden cooling racks for pies, cookies, and
cakes. Customers can buy her products by ordering them through the mail. She also sells
the racks at craft fairs in the Midwest. This activity is associated with which element of
the marketing mix?
A. production
B. presentation
C. direction
D. distribution
E. promotion
E
3-23
60 (Figure 3.6)
A producer of linen napkins and tablecloths can distribute its products by:
A. selling it directly to household consumers
B. selling it directly to a retailer who sells it to household consumers
C. selling it directly to a wholesaler who sells it to a retailer who sells it to household
consumers
D. selling it to a wholesaler who sells it to an industrial user
E. selling to any of the above
B
3.23
60
The owner of A Woman's Touch makes and sells wooden racks for cooling cakes,
cookies, and pies. She believed that an article about her and her company in Taste of
Home cooking magazine is important to the growth objectives she set for her company.
The article in the magazine is an example of a _____ activity.
A. product
B. promotion
C. price
D. distribution
E. personal selling
B
3.24
60
All marketing managers know personal selling is a part of the _____ element of the
marketing mix.
product
promotion
price
distribution
publicity
A.
B.
C.
D.
E.
B
3-26
62
_____ marketing is the creation of customer loyalty.
A. Transaction
B. Relationship
C. Value-added
D. Transformational
E. Continuous
A
3-27
62
Relationship marketing is based on the idea that:
A. important customers need continuous attention
B. a salesperson can never really know too many people
C. the burden of quality rests with the seller of the product
D. a salesperson should first identify prospects from his or her friends and family then
seek referrals from them
E. your buyer's competitors may be your best prospects
B
3.28
62
Twenty percent of a salesperson's customers produce 80 percent of his or her sales. With
which type of selling would a salesperson continuously work to improve the operations,
sales, and profits of that profitable 20 percent?
A. transformational selling
B. partnering
C. co-oping
D. benefit selling
E. need-defining
E
3.29
62
When you visit your local campus bookstore, your purchase of a textbook is an example
of _____ selling.
A. benefit
B. relationship
C. partnership
D. transformational
E. transaction
B
3.30
62
At Jolley Ford, Trisha Allyen contacts her customers to determine if they are satisfied
with their purchase and have any future needs. This is an example of _____ selling.
A. benefit
B. relationship
C. partnership
D. involved
E. transaction
C
3.31
62
A salesperson who works continually to improve his or her customers' operations, sales,
and profits is practicing:
A. benefit selling
B. relationship selling
C. partnering
D. involvement selling
E. transaction selling
E
3-32
62
The 80/20 principle:
A. is a territorial management concept that favors a salesperson putting 80 percent of his
time on planning and 20 percent on action
B. refers to the fact that eighty salespeople require twenty sales managers to keep the
appropriate 4-to-1 ratio of supervisors to employees
C. indicates that no matter how hard a salesperson tries 80 percent of the customer's
potential business ends up going to competitors
D. is a territorial management concept which favors a salesperson putting 80 percent of
her time on action and 20 percent on planning
E. refers to the idea that a small portion of a firm's customers account for a large portion
of its profitable sales
B
3.32
63
_____ is the most dramatic force shaping an organization's internal and external
marketing efforts today.
A. A bull market
B. Technology
C. Globalization
D. Environmental concerns
E. Decentralization
E
3.33
63
To determine the appropriate role for the sales force in the firm's promotional efforts, the
marketing manger must determine:
A. how much selling effort is necessary to gain and hold customers
B. whether the sales force is the best marketing tool in terms of costs and results
C. what type of sales activity will be necessary
D. whether the firm can gain strength relative to its competition with its sales force
E. all of the above
C
3-35
64
Two main functions of personal selling are to:
A. support advertising and collect past due accounts
B. talk and listen
C. provide service and generate income
D. meet quotas and maintain customer records
E. implement and control all marketing activities
D
3.36
64
Unlike advertising, personal selling:
A. cannot arouse buying action or complete a sale
B. is a lower cost method of promotion
C. cannot deliver profitable sales
D. can be adjusted on the spot
E. reaches mass audiences very effectively
D
3.37
A
3.38
64
_____ is the subjective assessment customers arrive at by comparing the service level
they believe an organization ought to deliver to the service level they perceive they
received.
A. The marketing concept
B. Total quality management
C. Relationship marketing
D. Service quality
E. Total system management
66
Dwayne is a sales manager for a SBU that sells x-ray equipment to airports. He is
planning a sales strategy for his area of responsibility. He has begun by noting that
although his salespeople are highly motivated and enthusiastic, they are young and
inexperienced. His x-ray equipment is priced lower than most of its competitors, but so
are commission rates paid. In what stage of sales strategy planning is Dwayne?
A. definition of the present situation
B. evaluation of the plan's performance
C. selecting strategies
D. selecting goals
E. selecting tactics
C
3-39
66
Preparation of a multiyear strategic plan for the sales force requires answering four
questions. Which of the following is NOT one of those questions?
A. What is the sales department's present condition?
B. What industry trends are apparent?
C. What is the cost of the product being sold?
D. What are the organization's most important objectives?
E. What are the organization's strategies?
D
3-40
67
In terms of financial planning, the two principal concerns of most sales departments are:
A. selling and overhead expenses
B. cost of goods sold and selling expense
C. cost of goods sold and revenue produced
D. revenue produced and selling expense
E. selling revenue and costs of material and labor
C
3-41
67
The difference between revenue produced and selling expense equals:
A. gross margin
B. net margin
C. contribution to profit from the sales effort
D. marginal revenue
E. net profit
E
3-42
67
One of the basic objectives of any sales force is to:
A. supplement the firm's advertising efforts
B. forecast sales for the next five years
C. forecast sales for the next twelve months
D. maintain accurate expense records
E. transmit information received from customers to the firm
E
3-43
67
Which of the following is a method that measures whether the sales force has attained its
sales objectives?
A. contribution to profits
B. return on assets managed by the sales force
C. sales/cost ratio
D. market share
E. any of the above are appropriate measures
B
3-44
67
As a sales manager, you have decided to use a sales/cost ratio to measure how well your
sales force is meeting its objectives. This method will require that you:
A. be sure the sales force has the major impact on sales--not price, advertising, or sales
promotion
B. divide sales force expenses by dollar sales volume
C. subtract current sales expenses from all expenditures made to help in the selling effort
D. be concerned about both the direct and indirect costs of goods sold
E. determine the territorial percentage of sales made and divide by the gross margin
C
3-45
67
As a sales manager for the Berkshire Jam Company, you need to determine how well
your sales force it meeting its objectives. Which method would you be using if you
decide to divide sales force expenses by dollar sales volume?
A. market share method
B. brainstorming
C. sales/cost ratio
D. sales activity method
E. the objective method
A
3-46
67
To use the market share method of measuring sales force objectives, management must:
A. be sure the sales force has the major impact on sales--not price, advertising, or sales
promotion
B. divide sales force expenses by dollar sales volume
C. subtract current sales expenses from all investments made to help in the selling effort
D. consider all direct and indirect costs in its calculations
E. determine the territorial percentage of sales made and divide by gross margin
D
3-47
68
Which of the following is an example of an appropriate or typical objective a sales
manager might use for his or her sales force?
A. lost accounts per month
B. dollar output per line per month
C. share of market quarterly
D. days training per year
E. all of the above
A
3-48
68
Which of the following statements about objectives is true?
A. Objectives must state how activities are to be done.
B. Objectives must be qualifiable.
C. Objectives must be achievable.
D. Objectives must not challenge a salesperson to perform beyond his or her normal
ability.
E. All of the above statements about objectives are true
A
3-49
68
The sales manager wants to set the following sales objective: "To have zero lost accounts
for the upcoming 12-month period." This sales objective is:
A. measurable
B. not very challenging
C. qualitative
D. easily achieved
E. a well-designed sales objective
E
3-50
69
Objective-based thinking should help the sales manager:
A. estimate market potential
B. reflect on your past accomplishments
C. establish corporate goals
D. determine your present situation
E. identify and prioritize those activities that are important
B
3-51
70
People are more committed to ideas they have helped to create than they are to ideas
forced upon them. The text suggests one method of involving the salespeople in creating
ideas for strategies and tactics is through:
A. situation analysis
B. brainstorming
C. objective-based thinking
D. subjective-based thinking
E. prospecting
D
3-52
70
When determining next year's sales plans, a sales manager needs to establish progress
checkpoints:
A. because without these checkpoints he or she will be unable to analyze the firm's
marketing mix
B. so each of his or her salespeople can have a copy of the plan
C. to implement the strategic sales force technique
D. so minor problems can be identified and corrected before they become major
problems
E. to determine if his or her plan will generate enough sales to cover the costs of
implementing it
C
3-53
71
_____ involves examining your markets and determining the roles and activities of sales
personnel necessary to service these markets.
A. Target marketing
B. Segmentation planning
C. Strategic sales force planning
D. Market forecasting
E. Market analysis

F
3-54
52
A tactic is a pattern of actions and resource allocations designed to achieve the goals of
an organization.
F
3-55
53
An organization's strategic vision is identical to its mission statement.
T
3-56
54 (Figure 3.2)
An organization's operational plan is derived from its strategic plan.
T
3-57
54
The act of selling is only one part of a firm's marketing activities.
F
3-58
56
A bag of cat food, an airplane ticket, a wicker chair, an antique ottoman, and a Caribbean
cruise are all examples of goods.
F
3-59
57 (Figure 3.5)
According to the good-service continuum, services like a meal at a restaurant, Alaskan
cruises, and tutoring are all examples of relatively pure services.
F
3-60
58
Motels on the beach in Florida and physical therapy both are services, and both
demonstrate the service characteristic of fluctuating demand equally well.
T
3-61
59
Organizational customers for goods and services can be broken down into two groups-for-profit and not-for-profit organizations.
T
3-62
60
The company's sales force is one segment of the firm's promotional effort.
F
3-63
60 (Table 3.2)
Credit terms, discounts, coupons, list prices, and promotional allowances are all price
elements of the marketing mix.
F
3-64
62
The emphasis in relationship marketing is on selling customers today rather than on what
will happen tomorrow.
F
3-65
62
The ultimate outcome of relationship marketing is the building of a transaction
relationship between the seller and the buyer.
T
3-66
62
When a company defines its own business as growing the business of its partner, it is
partnering.
F
3-67
63
Downsizing is the most dramatic external environmental force shaping an organization's
marketing efforts today.
F
3-68
64
The main functions of personal selling are to generate revenues and to provide services to
help satisfy customers.
T
3-69
65
Before a sales manager can plan a sales strategy, he or she must have a complete
understanding of the organization's marketing strategy.
T
3-70
66-67
When a sales manager does his or her strategic planning, financial planning is part of that
job.
F
3-71
67
The difference between selling expenses and the organization's profits from its sales
effort is equal to the revenue produced.
T
3-72
67
To use the market share method of measuring sales force objectives, management must
be sure the sales force has the major impact on sales--not price, advertising, or sales
promotion.
F
3-73
68
To be effective, objectives must state what is to be done and how it is going to be
accomplished.
T
3-74
69
Objective-based thinking requires that everything the sales manager and the sales force
do should be directed at achieving the next year's objectives.
F
3-75
71
Although some people try to make a big production of it, effective sales management
basically boils down to whether the sales manager can achieve his or her sales quota.
T
3-76
71
The strategic sales force planning process involves examining the relevant markets and
determining the roles and activities of sales personnel necessary to service these markets.

3-77
What type of planning is occurring when the manager of a fast food restaurant schedules
counter salespeople for the next week?
Ans: operational planning
Page: 52
3-78 What is the first step in strategic planning?
Ans: establish a mission and vision for an organization
Page: 53
3-79
Ans:
How does a product differ from a good?

A good is a physical object that can be purchased. A product refers to both goods and
services.
Page: 56
3-80
Ans:
Why is the selling of services the most challenging of all the sales jobs?
because of the characteristics of services--intangibility, inseparability, heterogeneity, and
perishability and fluctuating demand
Page: 58
3-81
Ans:
What is the goal of the marketing mix?

to have the right product, at the right price, at the right time, and with the right
promotional effort
Page: 61
3-82 What is of relationship marketing?
Ans: to create customer loyalty
Page: 62
3-83
What is wrong with the following objective: "To increase the amount of sales training so
that no customers are lost?"
Ans: Students should answer that the objective is not achievable given the time and financial
resources typically available for training,
Page: 68
Chapter 4
The Market-Driven Sales Organization
E
4-1
78
_____ is the deployment of resources to achieve strategic objectives.
A. Controlling
B. Governing
C. Directing
D. Maneuvering
E. Organizing
A
4.2
78
_____ is the division of labor into specific departments and jobs, formal lines of
authority, and mechanisms for coordinating diverse organizational tasks.
A. Deployment
B. Formalization
C. Specialization
D. Centralization
E. Functionalization
E
4-3
78
To meet the strategic objectives of the organization, the management at Berkshire Jam
Company must decide how to deploy the firm's available resources--its employees, raw
materials, supplies, finances, and so forth. This activity is called:
A. controlling
B. governing
C. directing
D. maneuvering
E. organizing
E
4-4
78
To design the best possible sales force for a manufacturer of wood-burning stoves, its
sales manager must:
A. design sales jobs around its customers
B. set up the sales force organizational structure
C. determine what activities its salespeople must perform
D. examine its customers in each market
D
4-5
79
According to the text, salespeople work in two basic types of markets:
A. consumer and retail
B. business and industrial
C. institutional and wholesale
D. consumer and business
E. organizational and institutional
C
4-6
79
Which of the following is the least complex and least difficult category of sales job?
A. textbook salesperson calling on professors
B. advertising time salesperson for a local radio station
C. salesperson who takes orders at the counter of the local Wendy's
D. salesperson who delivers snacks to local convenience stores
E. salesperson who sells advertising time for a national TV network
D
4-7
79
Which of the following sales job categories is less complex and less difficult than the
other jobs?
A. medical detailer
B. textbook salesperson
C. creative sale of tangibles
D. delivery salesperson
E. engineering salesperson
E
4-8
80
Which of the following sales job categories is more complex and more difficult than the
others?
A. medical detailer
B. inside order taker
C. creative sale of tangibles
D. outside order taker
E. creative sale of intangibles
A
4-9
80
Which of the following sales jobs would be categorized as the MOST complex and
difficult?
A. a salesperson who sells advertising time on a cable television channel
B. a pharmaceutical salesperson
C. a counter person at McDonald's
D. a store clerk at a JCPenney department store
E. a person who sells souvenirs at a football stadium
D
4.10
80
Which of the following would NOT be classified as an order taker?
A. someone selling magazine subscriptions
B. a salesperson who delivers dairy products to a supermarket
C. the counter person at a Subway Sandwich Shop
D. an insurance salesperson
E. a salesperson selling textbooks to college instructors
B
4-11
80
Which of the following sales job categories would be an example of an order getter?
A. pharmaceutical salesperson calling on physicians
B. salesperson for a local vinyl-siding company
C. salesperson who takes orders at the counter of the local Pizza Hut
D. salesperson who delivers bread to local supermarkets
E. an engineering salesperson who concentrates on the technical aspects of a sales
project
C
80
4.12 The main problem with many order takers is that they create only one distinction in the
customer's mind. That distinction is:
A. product features
B. possession utility
C. price
D. product benefit
E. product utility
E
80
4.13 An order getter salesperson has a double selling problem. The first of these problems is how
to:
A. develop the technical knowledge necessary to do the job
B. create goodwill for his or her employer
C. create an effective demonstration for an intangible product
D. establish a solid rapport with each potential customer
E. create discontent in the prospect with regard to what he or she already has
B
80
4.14 Xavier sells health club memberships at a kiosk in a local mall. He is a creative salesperson
in a highly competitive market. One of the main problems he faces is how to:
A. become friends with each prospective customer
B. convince people that other weight loss methods and health benefiting products are not as
effective as membership in his health club
C. determine the target market for the health club
D. create a list of prospects
E. create a sales presentation, which will reach all potential customers
D
80
4.15 An order getter salesperson has a double selling problem. The second of these problems is
how to:
A. develop the technical knowledge necessary to do the job
B. create goodwill for his or her employer
C. create an effective demonstration for an intangible product
D. overcome the most powerful and obstinate resistance
E. create a sales presentation, which will reach all potential customers
B
82
4.16 When organizing the firm's sales operation, a sales manager should think of a sales territory
as:
A. a group of customers with a functional relationship
B. a group of customers within a geographical area assigned to a given salesperson
C. a section of a larger distribution area that falls under the firm's exclusive distribution
rights
D. the total number of salespeople assigned to call upon a given customer
E. the type of customers in which a salesperson wishes to specialize
E
4-17
82
As territory manager, a salesperson is expected to do all of the following EXCEPT:
A. provide solutions to customers' problems
B. help customers use products after purchase
C. provide his or her company with market information
D. build goodwill with customers
E. prepare sales presentations for the members of his or her sales force
A
83
4.18 The formal, coordinated process of communication, authority, and responsibility for sales
groups and individuals is referred to as:
A. organizational design
B. corporate interposition
C. organizational development
D. staff hierarchy
E. managerial development
E
4-19
137
One of the purposes of job design is to improve an individual's quality of work life. An
individual's work life includes:
A. his or her pay and promotions
B. his or her skills, abilities, and experiences
C. his or her tasks, behaviors, duties, functions, and responsibilities
D. his or her intrinsic satisfaction
E. all of the above
D
4-20
83
The relatively fixed, formally defined relationship of jobs within the firm is called:
A. organizational design
B. corporate interaction
C. schematic organization
D. organizational structure
E. staff hierarchy
E
4-21
84
Which of the following statements does NOT accurately describe a pure line organization
structure?
A. A pure line organization is simple.
B. A pure line organization provides low overhead.
C. Decisions can be made rapidly in a pure line organization.
D. Communication is quick in a pure line organization.
E. A pure line organization promotes functional specialization.
A
4-22
84
Turner's Country Foods produces a variety of cornmeal mixes which it sells at craft fairs.
Its organization structure would be described as simple, having low overhead, and
requiring everyone to be a "jack-of-all-trades." This definition indicates the Turner's
Country Foods has a _____ organization.
A. pure line
B. line and staff
C. geographically-specialized
D. customer-specialized
E. hybrid
B
4-23
84
Berkshire Jam Company has outgrown its simple organization structure where all
executives did a little bit of everything. The firm is being reorganized into functional
groupings. Berkshire's OLD structure was an example of a _____ organization.
A. hybrid
B. pure line
C. line and staff
D. heterogeneous
E. staff-directed
C
4-24
84
The _____ organizational design groups work according to the characteristics of the tasks
to be performed.
A. pure line
B. homogeneous
C. functional
D. staff
E. heterogeneous
D
4-25
84
Another name for the functional organizational design is the _____ organization.
A. line
B. staff controlled
C. heterogeneous
D. line and staff
E. homogeneous
C
4-26
84-85
Berkshire Jam Company has outgrown its simple organization structure where all
executives did a little bit of everything. The firm is being reorganized into functional
groupings. Berkshire's NEW structure is an example of a:
A. schematic organization
B. line organization
C. line and staff organization
D. heterogeneous organization
E. staff-directed organization
A
85
4.27 Tuttle Aluminum and Bronze Company is the leading designer and manufacturer of
aluminum railings, such as found in sports stadiums. Recently the Eastern division sales
manager of the Tuttle Company directed all salespeople in that division to mail their
weekly activity reports no later than the Monday following the week on which they were
reporting. The sales manager is:
A. using line authority
B. serving as a resource advisor to the sales force
C. using functional authority
D. serving as a promotional manager
E. using staff authority
E
4-28
85
Century Industries makes custom food concession trailers. As part of her job, Bernice
advises Century top management on issues related to demographic and psychographic
trends that determine which snack foods are in and which are out of fashion. When
Bernice provides her recommendations, she is:
A. using line authority
B. serving as an expert witness
C. using functional authority
D. serving as a corporate mediator
E. using staff authority
A
85-86
4.29 Century Industries makes custom food concession trailers. The Century Industries is
organized into four divisions: the Eastern division, the Midwestern division, the Southern
division, and the Canadian division. This is an example of:
A.
B.
C.
D.
E.
geographical specialization
product specialization
horizontal integration
customer specialization
functional specialization
E
86
4.30 Which of the following describes an advantage an organization experiences when it uses
geographic specialization?
A. better market coverage
B. higher quality customer service
C. improved control of sales force activities
D. improved ability to direct salespeople's efforts
E. all of the above
C
86
4.31 A paint company that manufactures and sells mildew-resistant paint in the Southeast, heatresistant paint in the Southwest, and arctic paints for Canada and the Northern U.S.
would most appropriately use a _____ organizational structure.
A. nonterritorial
B. horizontal integration
C. geographical specialization
D. customer specialization
E. functional specialization
D
86
4.32 Which of the following conditions would make a product specialization approach to
organizational design useful?
A. The products sold are relatively simple and uncomplicated.
B. The products sold are extremely similar.
C. All product lines are distributed through identical trade channels.
D. Different products are sold to similar markets.
E. Each geographic area needs to be treated as a separate profit center.
A
86
4.33 When products are very technical, or the firm sells a large number of similar but separate
products, or product lines are distributed through entirely different trade channels, the
text recommends a ______ organizational structure.
A. product specialization
C
87
4.34 The drawbacks associated with the use of a product specialization organizational structure:
A.
B.
C.
D.
E.
include decreased emphasis on customer service

include the inability to respond to changes in local conditions
are the same as those for geographical specialization
include the inability to provide complete market coverage
are completely difference from those associated with customer specialization and
geographic specialization
D
87
4.35 A company with several separate and distinct markets accounting for major portions of its
sales will often organize on the basis of these markets. This approach is called a:
D
87
4.36 Tuttle Aluminum and Bronze Company is the leading designer and manufacturer of
aluminum railings that is used in stadiums, parking garages, amusement park queue
houses, and zoos. Separate sales forces are used for each of the four types of customers.
This approach to the market is called a:
A
88
4.37 ______ are used when the regular sales force lacks the knowledge, selling and negotiating
skills, coordinating abilities, and/or time needed to deal successfully and profitably with
large accounts that purchase centrally.
A. Key account salespeople
B. Staff salespeople
C. Systems salespeople
D. Approved supplier
E. Missionary salespeople
D
4-38
89-90
Amazon.com joined Living.com to create "a place where you can find and discover
anything and everything you might be looking to buy online." Amazon.com gave
Living.com $145 million and received an 18 percent stake in Living.com. Amazon.com
and Living.com have created a(n):
A. bartering syndicate
B. strategic alliance
C. acquisition
D. countertrade
E. network affiliation
B
4-39
89-90
Whirlpool, the giant appliance manufacturer, entered into a formal relationship with
Wollin Products, a plastic manufacturer with about $50 million in annual sales. More
than a third of Wollin's sales are parts for Whirlpool washing machines. This formal
relationship for the purpose of jointly developing better washing machines is called a(n):
A. bartering syndicate
B. strategic alliance
C. acquisition
D. countertrade
E. network affiliation
C
4-40
90
Team-based organizations:
A. are long-lived
B. operate according to traditional vertical lines of authority
C are composed of a defined group of individuals who bring together expertise from
different parts of the organization
D. seldom have any contact with the organization's customers
E. are accurately described by all of the above
D
4-41
90
Century Industries markets customized food concession trailers. When the company
presents its sales presentation to a customer, a representative from the marketing
department, a representative from the manufacturing department, and a representative
from customer service are all in attendance. This scenario should lead you to conclude
that Century Industries:
A. would not engage in strategic alliances
B. is not globalized
C. uses a customer specialization organizational structure
D. is a team-based organization
E. is accurately described by all of the above
E
91
4.42 _____ refers to the quality of collaboration across groups.
A. Autonomy
B. Decentralization
C. Internal specialization
D. Functionalization
E. Coordination
E
91-92
4.43 Which of the following statements about coordination is true?
A. Coordination refers to the quality of collaboration across groups.
B. Without coordination, companies find it difficult to satisfy their customer needs.
C. Coordination is especially important in a global organization.

D. Coordination is required whether a company has a functional, divisional, or team
organizational structure.
E. All of the above statements about coordination are true.
T
78
4.44 The right organizational structure cannot guarantee good results, but the wrong one can be
expected to harm results.
T
4-45
79
In some categories of sales positions, salespeople are NOT expected to sell.
T
4-46
80
Creative salespeople are often faced with selling to numerous people to get one order.
F
4.47
81
Although selling of different kinds of products requires different product knowledge,
basic selling skills are readily transferable; hence, a person who is successful in one
category of selling can expect to succeed in the others.
F
4-48
82
The salesperson's sole job is to make presentations to prospects and current customers; a
salesperson who performs any other activity is wasting his or her time.
F
4-49
82
As part of their task of providing their companies with information, salespeople help their
customers to solve problems.
T
4-50
83
Two of the more important purposes served by job design are to increase productivity and
to improve each individual's quality of work life.
F
4-51
84
The "one-man-show" type of organization structure is called an open organization.
T
4-52
84-85
Staff positions are found in functional organizations.
F
4.53
85
A staff manager is never given line authority.
86
4-54 It is unusual to find a large company organized solely on the basis of product
specialization.
T
4-55
86-87
If possible, an organization should avoid using the product specialization form of
organization structure.
F
4-56
87-88
The idea of using the key account approach to selling was developed after firms learned
the personal bond between the people performing the buying and selling roles was the
most important variable in most business-to-business selling.
T
4-57
88
Use of district managers to deal with key accounts may seriously hamper how the sales
manager interacts with his or her territorial salespeople.
F
4-58
90
A strategic alliance is formed whenever two companies agree--informally or formally--to
work toward creating a better product.
T
4-59
90
Cross-functional teams are typically short-lived.
T
4-60
91
Coordination refers to the quality of collaboration across groups.
F
92
4.61 A lack of coordination does not affect a company's external environment.
4.62 According to the text what is the most complex and most difficult of all the sales positions?
Ans: the creative sale of intangible products
Page: 80
4.63 What single attribute do order takers typically use to distinguish the product they are selling
from that of their competitors?
Ans: by price
Page: 80
4.64 What is another name for the functional organizational design?
Ans: the line and staff organization
Page: 84
4.65 What kind of authority is being exerted when a sales manager orders his salespeople to
increase sales of the company's newest product line?
Ans: line
Page: 85
4.66 What kind of specialization is being used by a company that sells a spicier sauce to areas
with a large Hispanic population than to areas with a largely northern European
population?
Ans: geographic
Page: 86
4.67 What has happened when Tuttle Aluminum and Bronze Company, the leading designer and
manufacturer of aluminum railings in the U.S., forms a strategic alliance with Western
Metal Fabricators, the premier designer and manufacturer of steel railings?
Ans: The two companies have formed a formal relationship created with the purpose of the
joint pursuit of mutual goals.
Page: 90
Chapter 5
Forecasting Market Demand and Sales Budgets
A
5.1
100
An ongoing, future-oriented structure designed to generate, process, store, and later
retrieve information to aid decision making in an organization's marketing program is
called a:
A. marketing decision support system (MDSS)
B. market information system (MIS)
C. decision support system (DSS)
D. marketing management support system (MMSS)
E. management information system (MIS)
A
5-2
101
A(n) _____ is called the estimated dollar or unit sales for a specific, future time period
based on a proposed marketing plan and an assumed market environment.
A. sales forecast
B. assumptive expectation
C. market predictor
D. market forecast
E. economic potential
E
5-3
101
The appropriate time span for a sales forecast is:
A. three months
B. six months
C. one year
D. two years
E. any of the above, depending on the firm's needs
D
5-4
101
A sales forecast should NOT be used to:
A. determine the company's business and marketing plans
B. determine the quantity and timing of needs for personnel, equipment, and raw
materials
C. help determine the amount of capital needed to operate the business
D. determine the organizations production schedule
E. provide a basis for sales quota assignments
C
5-5
101
Which of the following statements about sales forecasting is true?
A. Marketing plans should not be allowed to influence a firm's sales forecast.
B. Sales forecasts are developed after sales budgets.
C. The forecasting process refers to a series of procedures used to develop a sales
forecast.
D. The amount of raw materials purchased by the firm is a major input to the sales
forecasting process.
E. Before making the sales forecast, the sales manager should check with the production
manager to see how much the factory plans to make.
D
5-6
101
According to the text, the forecasting process begins:
A. when the company is first chartered
B. after the appropriate marketing research determines customer buying motives
C. immediately after the forecast period begins
D. when a forecast objective is determined
E. after the determination of the independent and the dependent variables
D
5.7
101
Bubba Kindling, the manager of Smokin' Tires, NevaFlat dealer in Asphalt, Alabama, has
noticed sales of tires at his store go up or down according to the number of traffic tickets
the local police department writes in the previous month. It appears Bubba has
discovered a(n):
A. sales potential
B. market index
C. market anomaly
D. market factor
E. economic forecaster
D
5.8
101
David Larson sells antique tools on ebay, an Internet auction. He has noticed that there
are more bidders for his merchandise when more than 6 inches of snow falls in the
Midwestern States. He believes that the bad weather condition makes people less mobile
and more willing to sit in front of their computers and bid on items for sale on ebay. It
appears that David has discovered a(n):
A. sales potential
B. market index
C. market anomaly
D. market factor
E. economic forecaster
D
5.9
101
A(n) _____ is simply a market factor expressed as a percentage relative to some base
figure, such as net sales in a particular year.
A.
economic potential
B.
sales forecast
C.
economic index
D.
market index
E.
market forecast
A
5-10
101
When industry sales have a potential to increase, a useful market index should:
A. rise
B. fall
C. remain unchanged
D. report this increase only after it becomes a reality
E. do none of the above
B
5-11
102
The two broad categories of sales forecasting are the:
A. participative and the autocratic methods
B. breakdown and the buildup methods
C. company-specific and the industry-specific procedures
D. centralized and decentralized methods
E. strategic and tactical procedures
E
5-12
102 (Figure 5.2)

LaVonda works for a company that provides management and marketing expertise for
sports facilities and team franchises and helps them to develop and implement
comprehensive marketing plans. She is working on next year's sales forecast for her
firm. She begins by examining such external environments as the general economy,
activity within the sports industry, and government actions that may affect sports, such as
new taxes or OSHA regulations, to determine which factors may influence sales. Which
broad category of forecasting is LaVonda using?
A. linear programming
B. buildup
C. resolute assumption
D. national
E. breakdown
D
102 (Figure 5.2)
5.13 The first step in the breakdown method for forecasting sales is to:
A. determine the target market
B. ask salespeople their opinion about upcoming sales
C. identify the methods to be used for selling products
D. study the general environment forecast
E. identify the products to be sold
B
103
5.14 Arvis is employed by a company that manufactures lighted signs for the Department of
Transportation. As a part of developing a sales forecast for next year, Arvis has estimated
the maximum possible sales his firm could reach under current conditions will be
730,000 units. This number is an example of a(n):
A. user expectations forecast
B. company sales potential
C. company sales forecast
D. industry sales forecast
E. industry sales potential
B
103
5.15 Another name for market potential is:
A.
user expectations forecast
B.
industry sales forecast
C.
company sales potential
D.
market index
E.
internal sales forecast
E
5-16
103
Company sales potential is:
A. always stated as a dollar figure
B. often referred to as the "industry share"
C. the estimated sales for all sellers in the entire market over a specified time under
given conditions
D. equal to a company's sales forecast
E. the company's share of the estimated sales for an entire industry
B
103
5.17 Clorox bleach has 60 percent of the estimated sales for the entire liquid bleach market. This
figure of 60 percent is called Clorox's:
A. company sales potential
B. market share
C. industrial sales potential
D. industrial sales forecast
E. maximum sales potential
C
5-18
103
To forecast how many rose bushes it will sell to wholesalers next year, J&M Roses has
each of its regional salespeople predict how many miniature roses, tree roses, bush roses,
and landscape rose bushes they think they will sell during the year based on their
understanding of regional conditions. J&M Roses uses the _____ approach to sales
forecasting.
A. correlation
B. top-down
C. buildup
D. breakdown
E. expotential
C
5-19
103
Airborne is the U.S.s leading manufacturer of World War II leather pilot jackets. To
forecast how many jackets it will sell next year, it looks at the number of subscribers to
magazines published by the VFW, the American Legion, and other veteran organizations
and assumes that about 3 percent of that number will buy a jacket. It also looks at the
number of World War II movies being released during the next year. For each World War
II-related movie, Airborne expects its sales to increase by another 1 percent. Airborne is
using the _____ approach to sales forecasting.
A. correlation
B. top-down
C. buildup
D. breakdown
E. expotential
D
103
5.20 The two categories of sales forecasting methods are:
A. the sales force composite and the executive opinion
B. test markets and trend analysis
C. correlation analysis and market factors analysis
D. the survey method and the mathematical method
E. the external method and the internal method
A
5-21
103 (See Figure 5.4)

Which of the following is NOT an example of a survey method of sales forecasting?
A. exponential smoothing
B. users expectation
C. sales force composite
D. executive opinion
E. build-to-order
B
5-22
A.

Which of the following is an example of a survey method of sales forecasting?
trend analysis
B. user's expectation
C. nave models
D. moving average
E. test markets
E
5-23
104
_____ is the original method of sales forecasting and is still the most widely used,
regardless of company size.
A. Correlation analysis
B. Trend analysis
C. Test marketing
D. Sales force composite
E. Executive opinion
E
5-24
104
Executive judgment forecasting are best used when the:
A. sales volume is erratic
B. market boundaries are poorly defined
F. risks of serious error in forecasting are high
G. budget for sales forecasting is greater than normal
E. executives who forecast have a true understanding of the market and customers' needs
D
5-25
104
Which of the following statements about the Delphi method of forecasting is true?
A. The Delphi method involves observational research.
B. The Delphi method can be used to overcome the tendency of dominate individuals to
determine group opinion.
C. The first consideration in using the Delphi method should be determine the problem.
D. The Delphi method uses average consumers with no particular expertise.
E. The Delphi method is classified as a mathematical modeling method.
E
104
5.26 A land developer asked a panel of experts to respond to a series of questionnaires about land
usage and land potential for an area just north of a large metropolitan area. Each new
questionnaire administered depended on the responses from the previous questionnaire.
The approach enabled the panel members to have access to the information contributed
by other respondents and prevented anyone from dominating the group. The land
developer was using:
A. correlation analysis
B. trend analysis
C. test marketing
D. a sales force composite
E. the Delphi method
D
105
5.27 Which of the following buildup method of sales forecasting would be most likely used for
selling a $3 million oil drilling platform?
B. trend analysis
C. test marketing
D. a sales force composite
E. the Delphi method
B
5-28
105
The _____ method of forecasting is based on polling actual and potential customers and
asking them about their future buying plans.
A. Delphi
B. user's expectations
C. correlation
D. nave
E. test market
A
5-29
105
A manufacturer of wicker furniture used users expectations to calculate its sales forecast.
The forecast predicted sales of $140,000, but only $90,000 was actually sold. This
example reveals one of the disadvantages of the users expectations method. It is:
A. the inability of customers to predict their future buying habits
B. the negative influence of reference groups
C. the potential for mathematical error with all buildup methods
D. the inability of some salespeople to close a sale
E. the tendency of salespeople to overestimate sales
C
5-30
105
When a company uses _____ to measure consumer acceptance of new products, it
executes its marketing program in a limited number of locations rather than nationally in
order to judge its effectiveness.
B. trend analysis
C. test markets
D. sales force composite
E. inferential testing
E
5-31
105
_____ is a popular method of measuring consumer acceptance of new products, like a
tooth whitener or a over-the-counter sinus infection remedy.
A. Time series projection
B. Correlation analysis
C. Executive opinion
D. Regression analysis
E. Test market
B
5-32
105
A manufacturer of a new vaccine that will completely protect cats from feline leukemia
might decide to not use test markets because test marketing:
A. uses computer simulations and not real market situations
B. is costly and time-consuming
C. is too simplistic and produces results that are overly optimistic
D. results are always unreliable
E. is mathematically-complex
A
5-33
106
Time series projection is:
A. an objective method of forecasting sales
B. a subjective method of forecasting sales
C. based on a need for qualitative forecasting
D. easy to use
E. a survey method of forecasting sales
D
5-34
106
Sales for roller coaster rides and carousels for amusement parks are higher in the winter
when many parks are closed than during the tourist season. In terms of the components
of the classical approach to trend analysis this would be an example of a(n) _____
component.
A. trend
B. erratic
C. cyclical
D. seasonal
E. naive
E
5-35
106-107
The classic approach to time series analysis recognizes four components. Which of the
following is NOT one of those components?
A. trend
B. erratic
C. cyclical
D. seasonal
E. horizons
C
5-36
107
The impact of economic booms and recessions is accounted for in which component of
time series analysis?
A. trend
B. erratic
C. cyclical
C. seasonal
D. naive
B
5-37
107
NevaFlat Tire Company's time series analysis of sales to automobile manufacturers was
effected by a lengthy strike three years ago at the factory of one of its major customers.
The strike is an example of which component of time series analysis?
A. dependent
B. erratic
C. regulated
D. deregulated
E. yclical
A
5-38
107
It is December. The owner of a company that manufactures and markets pickled garlic
knows that sales last year were $100,000 and that sales this year were $80,000. What
must she do to use the naive method of forecasting?
A. Assume what happened in the immediate past will happen again in the immediate
future.
B. Quantify the cyclical nature of the sale of pickled garlic.
C. Quantify the seasonal nature of the sale of pickled garlic.
D. Assume its sales representatives are acting as order getters instead of order takers.
E. Assume there are no intangible benefits gained from the use of pickled garlic.
A
5-39
107
It is December. The owners of Wilson Video Store know sales last year were $400,000
and that sales this year were $380,000. If they use the naive method of forecasting, what
are predicted sales for next year?
A. $361,000
B. $380,000
C. $400,000
D. $421,053
E. cannot be calculated
C
5-40
107
Compute a three year moving average forecast for period 5, given the following data:
Period
Sales
1
4
2
7
3
8
4
9
A. 6
B. 7
C. 8
D. 9
E. 10
A
5-41
108
Management would like to use the historical sales data from the last five years to forecast
next year's sales, but they are concerned that the older data may not reflect the current
situation as well as the more recent data. Which of the following methods of forecasting
would be most appropriate to their needs?
B. regression analysis
C. the ratio method of forecasting
D. correlation
E. trend projections
A
5-42
108
The management at Eastern Acoustic Works (EAS), one of the worlds leading
developers of professional loudspeakers, uses past data to predict future sales, but less
weight is placed on data as it gets older. Which forecasting method is being used at
EAW?
C. the ratio method of forecasting
D. trend projections
E. correlation
E
5-43
108
In some respects, the _____ method of forecasting sales is a formalization of the eyeballfitting technique.
C. ratio
D. trend projections
E. least squares
A
5-44
108
The least square technique of sales forecasting:
A.
is more accurate than the eyeball-fitting technique
B.
uses past sales data as well as sales force size
C.
is a statistical method used to incorporate independent factors that are thought to
influence sales into the forecasting procedure
D.
uses two or more independent factors
E.
is most appropriately used in high-technology industry
B
5-45
108
_____ is a statistical method used to incorporate independent factors thought to influence
sales, such as population and advertising, into the forecasting procedure.
A.
Exponential smoothing
B.
Regression analysis
C.
The ratio method of forecasting
D.
Trend projections
E.
Correlation
E
111-112
5.46 The sales force budget:
A.
is the amount of money available or assigned for a definite period
B.
depends on the sales forecast
C.
is a valuable resource that the sales manager redistributes among lower-level
managers
D.
is based on estimates of expenditures during a specific period and the amount of
revenue the organization expects to generate
E.
is accurately described by all of the above
B
5-47
112
What are the three major reasons for formulating a budget?
A. accountability, delegation, and responsibility
B. planning, coordination, and control
C. compensation, assignments, and accountability
D. managing, marketing, and manufacturing
E. production, inventory, marketing
A
5-48
112
Which of the following did the text identify as a major purpose of a budget?
A. control
B. staffing
C. structure
D. to provide incentive
E. none of the above
C
5-49
112-113
Which of the following statements about the methods of developing sales force budgets is
true?
A. No firms today use an arbitrary percentage of sales.
B. The sales force budget must be inflexible.
C. Executive judgment may be used in developing the sales force budget.
D. Managers are seldom expected to stay within the sales force budget due to the
variability of the external environment.
E. Sales force budgets never include costs for Social Security, entertainment, travel,
product samples, and stock options.
F
5-50
100
A marketing decision support system is of least value in a large company where
information is likely to get lost or distorted as it becomes widely dispersed.
F
5-51
101
The estimated dollar or unit sales for a specific, future time period based on a proposed
marketing plan and an assumed market environment is called the sales expectation.
T
101
5.52 Forecasting the future is always a matter of probabilities.
F
5-53
101
If the assumptions on which a sales forecast is made change, the forecast will usually still
be accurate.
F
5-54
103
Company sales potential is often referred to as the industry share.
F
5-55
103
The terms company sales forecast and company sales potential are synonyms.
T
5-56
104
Executive opinion is the original method of sales forecasting and is still the most widely
used, regardless of company size.
F
5-57
105
The Delphi approach to forecasting may be biased by salespeople purposefully distorting
figures to serve their personal best interests.
F
5-58
105
The sales force composite method is a breakdown approach to sales forecasting.
T
5-59
105
Forecasts based solely on user's expectations tend to be overly optimistic.
F
5-60
105-106
According to the text, marketers most often use the ten largest cities in the U.S. for test
market sites to ensure a large enough sample participates in the test market.
T
5-61
106
Companies often change product features and promotional themes as a result of the data
obtained from test-market situations.
F
107
5-62 The primary advantage of time series projection is that it is based on qualitative
forecasting.
F
5-63
108
Exponential smoothing is very similar to linear regression.
T
111
5.64 The sales force budget is the amount of money available or assigned for a definite period of
time, usually one year.
F
5-65
112
Executive judgment has no appropriate role in the development of the sales force budget.
T
113 (Table 5.3)
5.66 Sales force budgets may include costs for Social Security, entertainment, travel, product
samples, and stock options.
Short Answer Questions
5.67 How is a market index expressedas a fraction, dollar amount, percentage, or some other
unit?
Ans: percentage
Page: 101
5.68 List the two basic methods of sales forecasting?
Ans: the breakdown and the buildup method
Page: 102
5.69 What is another name for market potential?
Ans: industry sales forecast
Page: 103
5.70 What is the most widely used sales forecasting method?

Ans: executive opinion
Page: 104
5.71 List the four basic survey methods used for sales forecasting.
Ans: executive opinion, sales force composite, the Delphi method, and build-to-order
Page: 104
5.72 Three years ago, Outdoor Sports International had $4.5 million in sales. Two years its sales
were $5 million. Last year it had sales of $6 million. This years sales were also $6
million. Use the nave method to forecast next years sales.
Ans: $6 million (6 * (6/6))
Page: 107
Chapter 6
Design and Size of Sales Territories
D
6-1
120
A sales territory comprises:
A. all of the customers who do business with a certain company
B. the salespeople who fall under the jurisdiction of a particular sales manager
C. the actual sales made by individual salespeople, not the sales potential
D. the group of customers assigned to a salesperson
E. all of the geographic areas in which an international company sells its product
C
6-2
120-121
Which of the following statements about sales territories is true?
A. The establishment of sales territories typically duplicates sales efforts to increase the
probability of a sale.
B. Sales territories must have geographic boundaries.
C. Sales territories are intended to insure thorough coverage of the market.
D. A sales territory typically contains no potential customers.
E. A sales territory is assigned to a sales manager.
B
6-3
120-121
According to the text, one of the reasons for establishing sales territories is to:
A. increase company costs and lower company profits
B. improve customer relations
C. match the wants of the salesperson with the needs of the customers served
D. facilitate utilization of the undifferentiated selling approach
E. increase the salesperson's flexibility in managing territorial coverage
B
6-4
120-121
Which of the following is NOT a typical reason for establishing sales territories?
A. to better match salespeople to customers
B. to increase the usefulness of the canned sales presentation
C. to improve customer relations
D. to evaluate performance
E. to obtain thorough coverage of the market
C
6-5
120-121
Which of the following is NOT given by the text as an important reason for establishing
sales territories?
A. to establish each salesperson's responsibilities
B. to obtain thorough coverage of the market
C. to facilitate the implementation of SBO
D. to evaluate performance
E. to reduce sales expense
A
6-6
120-121
Which of the following is NOT listed in the text as a reason to establish sales territories?
A. to facilitate utilization of the undifferentiated selling approach
B. to better establish a salesperson's responsibilities
C. to aid in reaching the firm's objectives
D. to provide company salespeople the opportunity to meet their personal needs
E. to provide the company's CEO with an easy method to check on individual sales
effort
D
6-7
121
According to the text, the higher the similarity between the customer and the salesperson,
the:
A. less likely the salesperson will have a long sales call
B. more likely sales revenue will not support sales expense
C. more likely an initial sale can be made over the telephone
D. more likely the sales effort will be successful
E. less likely it is that the sales manager will be concerned about time management
C
6-8
121
Because Louis Arkahian was raised on Long Island, he is:
A. less likely to make long sales calls
B. more likely to be successful selling in rural South Carolina than his more rural peers
C. more likely to be successful selling in New York City than in rural Alabama
D. more likely to make an initial sales call over the telephone
E. less likely to have developed good time management skills
A
6-9
122
Which of the following does the text give as one reason why having established sales
territories could be viewed as a disadvantage?
A. Salespeople may be more motivated if they are not restricted to a certain territory
B. The company may be too large to be concerned with segmenting the market into sales
areas
C. Customer goodwill is created when customers receive regular sales calls
D. Personal friendships can lower the average number of sales calls
E. None of the above is a disadvantage; sales territories are always a good idea
E
6-10
122
According to the text, which of the following statements describes a reason why a
company might NOT want to establish sales territories?
A. Management may not want to take the time.
B. Personal friendship may be the basis for attracting customers.
C. The salespeople may be more motivated if they are not restricted by territorial
boundaries.
D. The company may be too small to be concerned about segmenting the market into
sales areas.
E. All of the above are reasons for not establishing territories.
C
6-11
122
"To increase the number of weekly sales calls by ten percent," is an example of a:
A. product mandate
B. derived allocation
C. sales objective
D. future product allocation
E. product mandate
E
6-12
123
Territorial boundaries can be based on:
A. trading areas
B. major accounts
C. metropolitan statistical area
D. cities and ZIP code areas
E. any of the above
D
6.13
123
Territorial boundaries are NOT based on:
A.
trading areas
B.
ZIP code areas
C.
states
D.
derived demand
E.
metropolitan statistical areas
E
6-14
123
The nucleus around which sales territories are formed is:
A. metropolitan statistical areas
B. product demand
C. salesperson's ability
D. the interstate highway system
E. customers and prospects
D
6-15
123
Which of the following is NOT identified by the text as one of the main influences on a
salesperson's work load?
A. intensity of market coverage
B. nature of the job
C. products sold
D. amount of compensation
E. whether the salesperson is expected to perform any missionary selling
C
6-16
123
A firm using _____ distribution sells its product in every outlet where final customers
might reasonably look for it.
A. exclusive
B. positive
C. intensive
D. penetrating
E. selective
C
6-17
123
For which of the following products would a sales manager be most likely to use
intensive distribution?
A. Bose automotive music system
B. decorative thermometers
C. Butterfinger candy bar
D. Betty Crocker brownie mix
E. magazine for American Legion members
E
6-18
123
A firm that sells its product through only a limited number of intermediaries in a given
market is using _____ distribution.
A. exclusive
B. passive
C. intensive
D. discriminating
E. selective
E
6-19
123
For which of the following products would a sales manager be most likely to use
selective distribution?
A. Wrigley's chewing gum
B. Tiffany jewelry
C. Elmer's rubber cement
D. People magazine
E. La-Z-Boy reclining chair
A
124
6.20 For which of the following products would a sales manager be most likely to use exclusive
distribution?
A. Rolls-Royce automobiles
B. Kraft macaroni and cheese
C. car insurance
D. Marks-A-Lot permanent markers
E. Wrigley's chewing gum
A
6-21
124
A firm that sells its product through only one intermediary in a given market is using
_____ distribution.
A.
exclusive
B.
passive
C.
intensive
D.
aggressive
E.
selective
C
6-22
124
Which distribution strategy would be expected to require the greatest number of sales
territories?
A. exclusive
B. aggressive
F. intensive
G. penetrating
E. selective
A
6-23
124
To calculate the needed sales force size, a sales manager can use the _____ approach and
divide forecasted sales by the average number of sales per salesperson.
A. breakdown
B. buildup
C. target market
D. top-down
E. bottom-up
D
6-24
124
The first step to consider when determining a firm's basic territories is:
A. determine the number of accounts for each territory
B. determine the sales volume needed for each territory
C. determine the total number of territories the firm will have
D. forecast sales and determine sales potentials
E. select type of marketing research to use
C
6-25
125
There are six steps to consider when determining a firm's basic territories. Once a sales
manager has forecasted sales and determined sales potential, he or she should:
A. determine if there are any key accounts
B. eliminate all unprofitable accounts
C. determine the sales volume needed for each territory
D. determine the ideal number of sales territories
E. calculate time required for each sales call
A
6-26
125
The purpose of grouping accounts into categories such as key, regular, and unprofitable is
to:
A. increase the profitability of a territory
B. standardize the selling approaches used by members of the sales force
C. insure equal time is spent with all of the firm's customers
D. insure equal treatment of the firm's prospects
E. minimize draw accounts
C
125
6.27 Another name for a company's extra-large accounts is:
A. house accounts
B. revenue accounts
C. key accounts
D. undifferentiated accounts
E. breakeven accounts
D
125
6.28 The letters in the acronym ELMS stand for:
A. ethically-lead marketing system
B. economically leading market segments
C. every labor makes sales
D. extra large, medium, and small
E. ethics learned equals more sales
E
6-29
125
The 80-20 principle:
A. is a territory management concept that favors a salesperson putting 80 percent of his
C. is a territory management concept that favors a salesperson putting 20 percent of her
D. indicates that no matter how hard a salesperson tries, 80 percent of customers'
potential business ends up going to competitors
C
6-30
126
Usually the frequency of sales calls will increase as the:
A. complexity of the products sold decreases
B. number of orders placed diminishes
C. future sales potential increases
D. number of product lines sold decreases
E. size of the territory increases
E
6-31
126
Maeve O'Reilly believes her company should increase the number of sales territories it
has. In fact, she thinks it should keep adding territories until the last one added just
covers the cost of adding it. Obviously, this sales manager would advocate the _____
method of revising her firm's number of territories.
A. intensive
B. ELMS
C. average cost
D. total cost
E. incremental
E
127
6-32 To use the incremental approach to determine basic territories, a sales manager must
know:
A. the likes and dislikes of the company's key accounts
A. how and when follow-up-service must be offered
B. the average purchase size of each customer
D. the point at which the product will become obsolete
E. all selling costs
C
6.33
128
There are six steps to consider when determining a firm's basic territories. In the final
step, the:
A. salesperson draws a routing schedule
B. sales manager gets approval from top management
C. territorial boundary lines are drawn
D. sales manager calculates the sales forecast for each territory
E. salesperson visits each customer in the assigned sales territory
A
6-34
129
To help the salespeople he supervises improve their effectiveness, Tyler Parks works with
them as they schedule their sales calls and determine the best routes to use moving about
their territories. In other words, Tyler helps them develop their:
A. customer contact plan
B. break-even travel plan
C. key account analysis
D. routing reports
E. incremental territory analysis
B
6-35
129
As part of his territory management activities, Elliot Rose plans to visit a customer's
place of business on a certain day and time. This activity is called:
A. account grouping
B. scheduling
C. customer time allocation
D. territory sales planning
E. routing
D
6-36
129
_____ is the establishment of a travel pattern to be used by the salesperson in working his
or her assigned territory.
A. Account grouping
B. Account time allocation
C. Territory sale planning
D. Routing
E. Scheduling
A
6-37
129
A routing report:
A. states where the salesperson will be working in the future
B. states where the salesperson worked on the day for which it was submitted
C. should be filled out at the conclusion of each week
D. is required by most companies especially when overnight travel is not necessary to
cover the territory
E. includes only travel time
B
6-38
129
Last night Aprille was preparing a statement to send to her sales manager that showed she
planned to be in Nashville on Monday and Tuesday, Murfreesboro on Wednesday,
Shelbyville on Thursday, and Tullahoma on Friday. Aprille was working on her:
A. time management form
B. routing report
C. market coverage
D. scheduling portfolio
E. sales coverage summary
B
6-39
129-130
In theory, a company gives its salespeople strict formal route plans to enable the company
to:
A. deter competitive salespeople from calling on customers
B. establish communications between management and the sales force concerning
location and activities of individual salespeople
C. set aside time for cold calls
D. prevent the salesperson from having to spend several nights a week on the road
D
6-40

Which of the following is an example of a basic routing plan?
A. criss-cross
B. spherical
C. rectangular
D. cloverleaf
C. all of the above
E
6-41
131
Which of the following statements about using the telephone for territory coverage is
true?
A. The telephone should never be used for handling complaints.
B. It is appropriate to use the telephone to deal with key accounts
C. Assign large accounts, those that contribute more than 5 percent of business,
primarily to telephone selling.
D. Telephones should not be used as sources of leads.
E. If possible, the telephone should be used to replace some personal visits to
geographically distant accounts
D
6-42
131
The telephone can be used by salespeople to save time and money. Which of the
following statements about its correct usage is true?
A. Larger accounts can be more easily maintained through telephone contact than by
individual sales calls.
B. Smaller accounts cannot be easily serviced over the telephone because sales to them
need to be increased.
C. Complaints should always be handled in person.
D. Telephone usage can facilitate order processing.
E. Telephones are the best way to monitor a salesperson's activities.
D
6-43
132
_____ is the establishment of standards of performance for the individual territory in the
form of qualitative and quantitative goals.
A. Incremental implementation
B. Workload control
C. Territorial assignment]
D. Territorial control
E. Quota aggregation
A
6-44
133
_____ are those left vacant until new salespeople are assigned to them.
A. Open sales territories
B. Unassigned areas
C. Undifferentiated markets
D. Vacant territories
E. Non-key areas
E
6.45
133
_____ refers to the lost sales due to both the vacancy and the time required for a new
salesperson to produce at average.
A. Orphaned selling
B. Account orphans
C. Market trickle
D. Incubation time
E. Sales leakage
E
6.46
133
The sales manager for Minerva Publishing Company was concerned that there was no
salesperson in the company's Midwestern territory. Then when the company finally hired
someone to fill the position, it took another seven months before the territory was
producing the same revenue as the other territories in the firm. The sales manager was
actually worried about:
A. orphaned selling
B. account orphans
C. market trickle
D. incubation time
E. sales leakage

T
6.47
120
A sales territory comprises a group of products or a geographical area assigned to a
salesperson.
T
6-48
121
Fewer overnight trips and contacting the most productive customers regularly can reduce
sales expenses and improve a firm's sales-cost ratio.
F
6-49
121
Generally, it is a good idea to maximize the difference between the salesperson and the
customers he or she serves because the differences help the salesperson control the sales
interview.
F
6-50
122
Even small companies that do not segment their market into sales areas typically find the
establishment of sales territories necessary.
F
123
6-51 The design of a firm's sales territories has little influence on its success in the
marketplace.
T
6-52
123
Workload is the quantity of work expected from sales personnel.
F
6-53
123-124
A salesperson for a convenience product would probably be able to cover a
geographically larger territory than would a salesperson for a specialty product.
F
6-54
124
The incremental approach to determine the number of sales territories needed by a firm
divides the total number of sales force calls by number of calls a typical salesperson can
be expected to make.
F
6-55
125
The ELMS system refers to a method of designing the most profitable routing plans.
T
6-56
126
No territory should ever have more than one key account.
F
6-57
126
Another name for the incremental method of determining sales territories is the bottomup approach.
T
6-58
128
When assigning salespeople to particular sales territories, it is appropriate to consider the
personal desires of the salespeople themselves.
F
6-59
129
Scheduling refers to the travel pattern a salesperson uses in working his or her territory.
F
6-60
129
A routing report is usually filed twice each month.
T
6-61
130
The first step for a salesperson who is attempting to do route planning is to plot the
location of his or her customers on a map.
F
6-62
130
The critical factor in route planning is to minimize the number of miles traveled.
T
6-63
132
Territorial control is the establishment of standards of performance for an individual
territory in the form of qualitative and quantitative quotas or goals.
F
6-64
133
If set correctly the first time, territory boundaries can be left unchanged from one
decennial U.S. census to the next.
T
6-65
133
Sales leakage refers to the lost sales due to both the territory vacancy and the time
required for the new salesperson to produce at average.
T
6-66
133-134
A prime benefit of computerized territory design is the increased speed with which
options can be evaluated.

6.67 List the three influences that determine workload?
Ans: the nature of the job, the intensity of market coverage, and the type of product sold
Page: 123
6.68
What intensity of market coverage would be used for light bulbs, chewing gum, nail
clippers, and candy bars?
Ans: intensive
Page: 123
6.69 What is the first step in the process for designing sales territories?
Ans: forecast sales and determine sales potential
Page: 124
6.70 What is the formula used in the breakdown approach to designing sales territories?
Ans: sales force size = forecasted sales divided by average sales per salesperson
Page: 124
6.71 What is the formula used in the incremental approach to designing sales territories?
Ans: total sales force customer calls divided by individual customer calls equals the number of
sales territories
Page: 126
6.72
What is the primary reason why many sales managers find the incremental approach to
designing sales territories difficult to use?
Ans: the difficulty associated with calculating marginal costs
Page: 127
6.73 What the three basic routing patterns used by salespeople?
Ans: straight-line, major-city, and cloverleaf
Page: 131
6.74 What causes sales leakage?
Ans: open sales territories and the time required to get a new salesperson to produce at average
Page: 133
Chapter 7
Sales Objectives and Quotas
B
7-1
142
A quota is:
A. a strategic target
B. an expected performance objective
C. set only by top management
D. a type of sales promotion used to increase sales for cyclical products
E. described by all of the above
D
7-2
142-143
Which of the following statements about quotas is true?
A. Quotas are strategic statements of expected performance by salespeople.
B. Quotas are concerned with end results only; specific activities are the responsibility of
the salesperson.
C. In large industrial products firms, quotas are often the most important input used for
creating marketing plans.
D. Many salespeople find quotas to be motivational.
E. To be effective, quotas should be static rather than ever-changing.
A
7-3
143
Vimal Kasuda sells computer-assisted design software for professional and amateur
woodworkers. Her sales manager has just informed her that her quota will be 6 percent
higher next year because the company that employs her wants to increase its market
share. If she attains this goal, she will receive a bonus. In this example, Vimal's sales
manager is using the quota to:
A. provide a performance target
B. control Vimal's activities
C. evaluate her performance
D. provide formal feedback
E. get her opinion
B
7-4
143
At the end of each day Arturo Valenzuala fills out a call report which he sends to his sales
manager, who can then see if Arturo has met his quota for number of calls per day.
Arturo's sales manager is using the quota system to:
A. provide a performance target
B. provide control
C. to determine horizontal tactics
D. establish industry standards
E. to do none of the above
A
7.5
143
Andi is a salesperson at a furniture store. Her quota for next month is 5 bedroom sets,
three dining room sets, and 8 living room sets. This is an example of a(n) _____ quota.
A. sales volume
B. net profit
C. expense
D. gross margin
E. activity
A
7-6
143
Robin sells for International Paper Company. Her ____ quota for next month is $53,000.
A. sales volume
B. net profit
C. expense
D. gross margin
E. activity
E
144
7.7 The two types of profit quotas are the:
A. sales quota and activity quotas
B. revenue and expense quotas
C. contribution margin and the gross margin quotas
D. selling and nonselling quotas
E. gross margin and net profit
D
7-8
144
A sales quota based on the number of dollars generated after subtracting the cost of goods
sold is a _____ quota.
A. dollar sales volume
B. expense
C. net profit
D. gross profit
E. payback
C
7-9
145
A sales quota based on the number of dollars generated after subtracting both the cost of
goods sold and the salesperson's personal expenses is a _____ quota.
A. dollar sales volume
B. expense
C. net profit
D. gross profit
E. payback
145
7-10
"Slade," his sales manager said, "Your expenses are grossly out of line compared to the
rest of the sales force. They're too low, and that appears to be hurting your ability to
sell." Slade is surprised because he thought the cutback would actually help him meet his
_____ quota for the period.
A. balanced
B. quality
C. payback
D. net profit
E. gross profit
A
7.11
145
One drawback to using _____ quotas is that sales personnel generally do not set prices
and have no control over manufacturing costs.
A. profit
B. dollar sales volume
C. expense
D. activity
E. unit sales volume
C
7-12
145
A company that set limits on how much expense money salespeople are allowed based on
a percentage of the territory's sales volume would be said to be using a(n) _____ quota:
A. balanced
B. payback
C. expense
D. net profit
E. gross profit
E
7-13
146
Hewlett-Packard (H-P) manufactures ultrasound diagnostic equipment. Because such
equipment requires service after the sale, H-P might consider using _____ quotas.
A. sales volume
B. net profit
C. expense
D. gross margin
E. activity
D
7-14
146
Because of their after-the-sale service responsibilities, salespeople for _____ are most
likely to use activity quotas.
A. Coca-Cola
B. DeBeer diamonds
C. International paper
D. Phillips electronic equipment
E. Colgate-Palmolive
C
7-15
146
_____ quotas typically should not be the basis for rewards. Rather they help the manager
better understand why the salespeople did or did not meet their sales volume quota.
A. Payback
B. Net profit
C. Activity
D. Gross margin
E. Project
C
146
7.16 A radio station that wanted to reward its salespeople who sell ad time on the basis of how
many cold calls they made in a week and how many new customers they sold to monthly
would be most likely to use _____ quotas.
A. payback
B. net profit
C. activity
D. gross margin
E. project
A
7-17
147
_____ refers to feelings about any differences between what is expected and actual
experience with a purchase.
A. Customer satisfaction
B. Perceived quality
C. Product differentiation
D. Product Value
E. Total quality
B
147
7.18 To measure customer satisfaction, organizations typically:
A. use experiential research
B. construct questionnaires to ask for customer feedback
C. use focus groups
D. survey their salespeople
E. use secondary data
C
7-19
147
Which of the following is an easy method an organization can use to keep track of all
customer satisfaction data?
A. hire an outside consultant
B. make each salesperson keep up with their own customer data
C. use a Customer Satisfaction Index (or Rating)
D. create a functional department to manage satisfaction data
E. place primary responsibility for customer satisfaction information gathering in the
human resources department
B
7-20
is:
147
For larger national U.S. corporations, the most commonly used method for setting quotas
A.
B.
C.
D.
E.
computer models, tempered by executive judgment

sales forecasts, plus market and territory potentials
market and territory potentials, tempered by sales force judgment
last year's results plus this year's sales forecast divided by two
sales forecasts only
C
7-21
148
Jennifer Barlow sells refrigerator units to supermarkets, convenience stores, and florists.
Her sales manager has advised her that she, as well as all of the other salespeople in the
firm, must help the company increase its sales by 12 percent this year. Which general
approach to quota setting is being used?
A. a quota based on territorial potential, not territorial size
B. a quota based on executive judgment
C. a quota based on the organization's sales forecast, not individual potential
D. a quota based on territorial size, not territorial potential
E. a combination approach to quota setting
A
7-22
148
According to the text, for which of the following products would the selling organization
be most likely to base its quotas on executive judgment?
A. Phillips flat-screen television
B. Lay's potato chips
C. vanilla ice cream
D. 3M adhesive tape
E. bricks
D
150 (Table 7-4)
7.23 Regional plans determine:
A. which regions, markets, and products to emphasize
B. the projected return on time invested
C. the dollar allotment for promotion
D. which accounts to emphasize and who is responsible for each account
E. all of the above
C
7-24
150 (Table 7-4)

Who is generally responsible for all precall planning?
A. national sales manager
B. district manager
C. sales representative
D. regional sales manager
E. marketing vice president
152-153 (Figure 7.2)
7-25
To successfully implement annual objectives, there are four key areas of concern. Which
of the following is NOT one of the areas of concern listed in the text?
A. territorial management
B. product management
C. call management
D. account management
E. self-management
E
153
7.26 A tactical plan for managing accounts that are described as stars is to:
A. ignore these accounts
B. develop a new approach for dealing with these accounts
C. divest yourself of these accounts
D. maintain the present share of business from these accounts
E. spend more time and effort on these accounts
C
153
7.27 A tactical plan for managing accounts that are described as dogs is to:
A. ignore these accounts
B. develop a new approach for dealing with these accounts
C. divest yourself of these accounts
D. maintain the present share of business from these accounts
E. spend more time and effort on these accounts
D
7-28
153
Accounts with a low and declining potential, that occupy more time than can ever be
justified, and that show no promise of improvement are referred to as:
A. problem children
B. question marks
C. cash cows
D. dogs
E. stars
B
7-29
153
Salespeople to achieve a performance rating of excellence must excel in achieving three
different types of annual objectives. These objectives are categorized as:
A. day-to-day, weekly, and monthly
B. regular, problem-solving, and innovative
C. star, cash cow, and problem
D. strategic, tactical, and operational
E. profit, activity, and sales volume
D
7-30
158
For objectives and quotas to be fully accepted by the sales force, a quota plan should be
SMART. The letters in the acronym SMART represent:
A. Sales-oriented, Marketable, Adequate, Reward-worthy, and Time specific
B.
C.
D.
E.
Specific, Motivated, Acceptable, Reciprocal, and Territorial

Sales-oriented, Moral, Acceptable, Reciprocal, and Territorial
Specific, Measurable, Attainable, Realistic, and Time specific
Systematic, Motivated, Attainable, Reciprocal, and Timely
D
7-31
158
"Leonard, I expect your sales volume to be a little better next month," said his sales
manager. What is most clearly wrong with the preceding statement as a sales quota?
A. It's not challenging.
B. It's not reasonable.
C. It's not attainable.
D. It's not specific.
E. It's not for a definite time period.
A
7-32
158
The sales manager told Liz, "During the next six months, I want you to improve your
relations with the R&M purchasing agent, or else I will have to give the account to
another sales rep." With which of the goals illustrated in the SMART acronym is this
objective most in conflict?
A. The objective is not specific.
B. The objective is not sales-oriented.
C. The salesperson is given no motivation to achieve this objective.
D. The objective is too time-specific.
E. The objective is not long-term oriented.
D
7-33
158
Her sales manager told Ruth that he wanted her to decrease her sales expenses by 5
percent, or else he would have to lower her commission rate by 3 percent. With which of
the goals illustrated in the SMART acronym is this objective most in conflict?
A. The objective is not specific.
B. The objective is not sales-oriented.
C. The salesperson is given no motivation to achieve this objective.
D. The objective is not time-specific.
E. The objective is not long-term oriented.
E
7-34
158
Which of the following is an appropriate question for you as a sales manager to ask
yourself about quotas you are setting for your subordinates?
A. Are the quotas clear and concise?
B. Have I made a distinction between long-run and short-run expectations?
C. Is there a direct relationship between the quotas and the rewards available?
D. Are the quotas measurable?
E. All of the above are appropriate questions for a sales manager to ask.
C
7-35
158
A properly set salesperson's sales quota should:
A.
B.
C.
D.
E.
measure his or her improvement in relations with customers

encourage lackadaisical behavior
specify when the intended result is to be accomplished
avoid congruence with the goals of the organization
do all of the above
B
7-36
158-159
At the individual level, selling by objectives (SBO) is a process whereby the:
A. manager applies the corporate objectives to each sales territory without regard to sales
potential
B. manager and salesperson identify common goals, define major areas of responsibility,
and agree on expected results
C. salesperson is expected to engage in feedback only if he or she has not met the
average quota
D. manager uses executive judgment to determine the quota criteria
E. salesperson uses the corporation's objectives to set territorial size
C
7-37
158-159
Which of the following statements about selling by objectives (SBO) is true?
A. With SBO, the sales manager sets goals for the next period.
B. Typically no objectives are vetoed when using SBO.
C. Motivation for salespeople is increased because they help set the objectives they must
attain.
D. Mutual understanding between a manager and a salesperson is unnecesary in setting
objectives.
E. The main drawback to SBO is the lack of connection between the objectives set and
the rewards received by the salesperson.
D
7-38
158-159
Which of the following statements about selling by objectives (SBO) is true?
A. The salesperson typically has no input in SBO.
B. The main drawback to SBO is the lack of connection between the objectives set and
the rewards received by the salesperson.
C. SBO is simply a philosophy and is therefore very difficult to implement.
D. Upper management typically retains the power to veto objectives set using SBO.
E. All of the above statements about SBO are true.

T
7-39
142
Quotas are tactical rather than strategic.
T
7-40
142
Quotas are dynamic rather than static.
T
7-41
142
Because they guide the behavior of salespeople, quotas provide control.
T
7-42
143
Quotas may be used to change the activities of salespeople or the products they
emphasize in their selling activities.
F
7-43
143
Quotas should not used as a motivational tool.
F
7-44
144-145
The gross margin quota is determined by subtracting cost of goods sold and salesperson
direct selling expenses from sales volume.
F
7-45
146
Activity quotas are least important in cases where salespeople must perform important
nonselling duties.
F
7-46
146
Most experts recommend using activity quotas as a basis for rewarding sales force
members.
F
7-47
147
Customer satisfaction refers to feelings about any differences between what is expected
and actual experience with the purchase.
F
7-48
147
The most commonly used combination of quotas is a sales volume quota together with an
expense quota.
T
7-49
148
The use of past experience to set quotas ignores sales potential.
T
7-50
148
No matter what method is used for setting quotas, executive judgment should always be
part of the process.
F
7-51
149
The process of setting sales quotas varies significantly from organization to organization.
T
7-52
150 (Table 7.4)

Sales representatives are usually responsible for territorial sales plans.
T
7-53
152
The two basic steps to take to successfully implement a sales strategy are the organizing
of the jobs and then the definition of the annual objectives.
F
153
7-54 With an account that is described as a cash cow, a salesperson should abandon the
account.
T
7-55
154
Sales objectives that are classified as regular deal with expenses, leads, sales calls,
growth in order size, and reports.
T
7-56
155
To get maximum commitment to achieving sales objectives, sales managers should
establish those objectives by personal, face-to-face discussion rather than by an exchange
of memoranda.
F
7-57
156
Individual meetings with each sales representative are unnecessary when using the selling
by objective (SBO) process.
F
7-58
158
To be fully acceptable to the sales force, objectives should be Sales-oriented, Measurable,
Attainable, Reward-oriented, and Time-specific.
T
7-59
158
The basic selling by objectives (SBO) process is a two-way approach to quota setting.

7.60 What are the two types of profit quotas?
Ans: gross margin and net profit
Page: 144
7.61 Miller was told by his sales manager that one of his objectives for the next year should be to
"Attend one three-day product training seminar." What kind of quota does this
exemplify?
Ans: activity quota
Page: 146
7.62 What is the most common method of setting quotas in the large national companies in the
U.S.?
Ans: the use of sales forecast plus market and territory potentials
Page: 147
7.63 When should a company use executive judgment for setting its sales quotas?
Ans: when little information exists, such as with a new territory or new product
Page: 148
7.64 There are four major areas in which objectives need to be established for each salesperson.
List them.
Ans: territorial management, account management, call management, and self-management
Page: 153 (Figure 7.2)
7.65 When setting objectives for individual salespeople, there are three different types of
objectives that the sales manager needs to establish. List them.
Ans: (1) regular, ongoing, and recurring objectives, (2) problem-solving objectives, and (3)
innovative or creative objectives
Page: 154
7.66 A good objective and quota plan is SMART. What do the letters in the acronym SMART
represent?
Ans: Specific, Measurable, Attainable, Realistic, and Time specific
Page: 158
Chapter 8
Planning for and Recruiting
Successful Salespeople
A
8-1
168
____ refers to the activities undertaken to attract, develop, and maintain effective sales
force personnel within an organization.
A. Sales human resource management
B. Sales management planning
C. Sales force objectives management
D. People-oriented sales management
E. Territorial staffing resource management
A
8-2
168
Sales human resource management consists of two activities. They are:
A. people planning and employment planning
B. people planning and people evaluation
C. hiring people and completing paperwork for the government
D. recruiting and hiring
E. hiring and firing
C
8-3
168 (Figure 8.1)

Employment planning involves:
A. writing job descriptions
B. determining job specifications
C. recruiting and selecting
D. determining how many people to hire
E. all of the above
A
8-4
168 (Figure 8.1)

People planning involves:
A. the determination of the number and type of people to hire
B. the selection of intrinsic and extrinsic rewards
C. the implementation of leadership models
D. recruitment and selection
E. employee socialization
A
8-5
168
Why do many sales managers engage in formal sales personnel planning systems?
A. to achieve more effective and efficient use of human resources
B. to supplement formal time and territory management systems
C. to satisfy a need for corporate control
D. to decrease the performance of the sales force
E. it is a means of replacing the personnel department
A
8-6
168
Why do many sales managers engage in formal sales personnel planning systems?
A. to improve sales force performance
B. because of the increased usage of SBO
C. to supplement formal time and territory management systems
D. to satisfy a need for corporate control
E. it is a means of bypassing the corporate human relations department
B
8-7
168
A sales manager wishes to gain more effective and efficient use of the salespeople who
work for her. The activity which must precede all others if that desire is to be realized is:
A. the creation of measurable sales quotas
B. people planning
C. the establishment of a method of evaluation
D. the development of an effective sales training program
E. deciding on what product to focus sales efforts
E
168
8-8
One important step in the people planning element of sales force human resources
planning is to:
A. get approval of the Federal Equal Opportunity Commission
B. analyze the size of competitive sales forces
C. equalize the work of the currently hired salespeople
D. develop promotion policies
E. determine the size sales force needed
E
8-9
170
Mulligan Engineering Company sells replacement parts for amusement park rides. It is
expanding its operation into the Canadian provinces. Who within the company would be
involved in determining the number and type of salespeople it will need to hire?
A. its national sales manager
B. its marketing vice president
C. its southeastern sales manager
D. its human resource department manager
E. all of the above
D
8-10
170
The primary or basic determinant of how many salespeople a firm will employ is the:
A. level of compensation offered
B. number of sales managers it has
C. number of people who apply for sales jobs
D. number of sales territories and sales positions
E. corporate human resources department
E
170 (Figure 8.3)
8-11 To forecast how many sales people will be needed using a sales force people-forecast
model,:
A. any upcoming hirings, promotions, and transfers in must be subtracted from current
sales force personnel
B. all employee hirings, promotions and transfers in must be added to all forecasted
employee quits, terminations, promotions, transfers out, and retirements; this sum
must be subtracted from the number of current employees
C. employee quits, terminations, promotions, transfers out, and retirements must be
ignored
D. future sales force personnel are forecasted by looking at operational objectives
E. the current number in the sales force must be added to the upcoming hirings,
promotions, and transfers in; quits, terminations, promotions, transfers out and
retirements must be subtracted from that sum
B
8-12
171
A _____ defines the specific roles or activities to be performed in a sales position and
determines the personal qualifications necessary to get the job.
A. job pictogram
B. job analysis
C. job design
D. job specification
E. job inventory
B
8-13
171
In order to properly develop a job description, you must first conduct a:
A. job pictogram
B. job mapping
C. job plan
D. job stipulation
E. job enumeration
C
8-14
171
The first step in a job analysis is to:
A. select the jobs to be analyzed
B. determine the appropriate extrinsic and intrinsic rewards
C. examine the total sales force and the fit of each job and determine how each job
relates to other jobs
D. collect the necessary information concerning what people actually do in their jobs
E. budget for the job analysis process
B
8-15
172
Elise has been given the job of writing a job description for a new e-commerce position
in her company's marketing department. She should first conduct a:
A. job mapping
B. job analysis
C. job design
E. job inventory
A
8-16
172
A complete _____ is a formal, written statement describing the nature, requirements, and
responsibilities of a specific job.
A. job description
B. job specification
C. job plan
D. job design
E. job enumeration
D
8-17
172
A _____ identifies people qualifications the organization feels are necessary for
successful performance of a particular job.
A. job projection
B. job analysis
C. job design
E. job inventory
A
8-18
172
_____ convert job descriptions into qualifications the organization feels are necessary for
successful performance of the job.
A. Job specifications
B. Task inventories
C. Strategic job designs
D. Personnel inventories
E. Job provisions
D
8-19
173
Why do successful salespeople need empathy?
A. in order to be self-starters
B. so they will have that "killer instinct"
C. to communicate with their sales managers and their customers
D. so they can identify and understand the customer's situation
E. in order to find good sales prospects
C
8-20
173 (Table 8.2)

In trying to hire the best possible salespeople, sales managers look for certain
characteristics that seem to be common in successful salespeople. Which of the
following was identified by the text as one of those characteristics?
A. responds well to close supervision
B. non-competitive
C. need for material things
D. lethargy
E. aloofness
E
8-21
173 (Table 8.2)

In trying to hire the best possible salespeople, sales managers look for certain
characteristics which seem to be common in successful salespeople. Which of the
following was identified by the text as one of those characteristics?
A. requires little supervision
B. likable
C. good physical appearance
D. need for material things
E. all of the above
C
8-22
173
The ultimate goal of a sales manager who is staffing a sales organization should be to:
A. select people who will "fit in"
B. minimize recruiting costs
C. hire the very best people he or she can
D. minimize overall salary costs
E. ensure recruits will be satisfied with their new jobs
B
8-23
175
The set of activities and processes used to legally obtain a sufficient number of
individuals in such a manner that the people's and the sales force's best interests are taken
into consideration is called:
A. sales evaluation
B. recruitment
C. personnel enrichment
D. sales training
E. human resource planning
B
8-24
the:
176
The principal government agency responsible for monitoring discriminatory practices is
A.
B.
C.
D.
E.
A
8-25
Civil Rights Administration

Equal Employment Opportunity Commission
Federal Bureau of Investigation
Equal Rights Commission
Civil Service Commission
176-177
Discrimination is allowed if an employer can show that a given action is "reasonably
necessary to the operation of that particular business or enterprise," and the employment
decisions are based on:
A. bona fide occupational qualifications
B. general financial status of the individual
C. open ended qualifications
D. a needs assessment
E. military discharge status
A
8-26
176-177
The Hewes Company makes parachutes. Because a salesperson working for Hewes may
be asked to demonstrate his or her product, someone who has a fear of heights will not be
hired as a salesperson. This form of discrimination is an example of a:
A. bona fide occupational qualification
B. work-specified criterion
C.
open-ended qualification
D.
needs assessment
E.
closed working system
D
8-27
176-177
Discrimination in employment practices is allowed:
A. if very few people apply for the job
B. when there is a reasonable doubt that the operation is necessary for that particular
business
C. if the prospective employee cannot speak English
D. if a bona fide occupational qualification exists
E. when applications for the job opening are only accepted from persons already
employed by the firm in other jobs
D
8-28
177-178
Broadly speaking, the equal opportunity legal criteria are based on two questions, (1) Are
employment practices equally applied, and do they have the same effect on all potential
employees, regardless of race, sex, religion, or national origin? and (2):
A. What percentage of management positions are occupied by white males?
B. Are adequate records of employment practices kept?
C. How many formal complaints have been filed against this employer in the past five
years?
D. Are the employment practices job-related?
E. After thorough investigation, what percentage of complaints against this employer
have proved to be true?
B
8-29
178 (Table 8.5)

During an interview, a job recruiter can legally ask:
A. "Do you have any children at home?"
B. "If you have no phone, how can we reach you?"
C. "Do you own your own home?"
D. "How tall are you?"
E. "Have you ever been arrested, convicted, or prior to employment spent time in jail?"
E
178 (Table 8.5)
8-30 During an interview, a job recruiter can legally ask all of the following questions
EXCEPT:
A. "By whom were you referred for a position here?"
B. "Are you over 18?"
C. "Are you a veteran?"
D. "If you have no phone, how can we reach you?"
E. "How heavy are you?"
E
8-31
179-180
Which of the following is an example of an internal source of recruits?
A. friends of employees
B. current employees
C. former employees
D. former applicants
E. all of the above are internal sources
A
8-32
179-180
Which of the following is an external source of recruits?
A. walk-ins
B. friends of employees
C. transfers
D. former employees
E. former applicants
C
8-33
180
Why does the recruiting for positions above the initial entry level sales position almost
always come from within the sales force?
A. Present salespeople know nothing about the operation of the organization.
B. Present salespeople are kept insecure by the fear of promotion.
C. Internal promotions is an excellent motivational tool.
D. External promotions are less expensive than internal promotions.
E. External promotions lead to the selection of better qualified job candidates.
B
8-34
180
Which of the following is an internal source of recruits?
A. walk-ins
B. transfers
C. internships
D. newspaper advertisements
E. employment agencies
D
8-35
180
When compared to the realistic job preview, the traditional job preview:
A. sets realistic job expectations
B. matches the company's need with the job
C. prevents job dissatisfaction
D. has a high rate of job offer acceptance
E. does all of the above
B
8-36
180
A realistic job preview:
A. sets initial job expectations too high
B. results in higher job satisfaction
C. results in more frequent turnover
D. better matches job to the company's needs
E. does not present the unattractive features of the job
E
180
8.37 The realistic job preview:
A.
reduces the flow of highly capable applicants
B.
produces higher rates of turnover than traditional job previews
C.
produces lower levels of satisfaction for the recently hired
D.
sets very high job expectation levels
E.
inoculates the new salesperson against disappointment with the realities of a job
E
8-38
181
To create a qualified labor pool, an organization needs to know:
A. how job candidates obtain information regarding job availability
B. what attracts people to a specific job
C. the positive and negative attributes of a particular job
D. why a particular individual would take a specific job
E. all of the above
E
8-39
182
Recruiting programs can be evaluated according to:
A. the number of applicants
B. the ratio of minority and female applicants to total applicants
C. the ratio of offers accepted to offers extended
D. qualified applicants as a percentage of total applicants
E. all of the above
B
8-40
182
Recruiting programs can be evaluated according to:
A. how many people acted as recruiters
B. the ratio of offers accepted to offers extended
C. the total number of interviews conducted divided by the number of applicants
D. the number of offers extended divided by the number of offers accepted
E. all of the above

T
8-41
168
Hiring the right person for the job is critical for the success of the sales force.
F
8-42
168
The entire personnel process of matching the right people to the right sales jobs and
placing them in the right sales territory is called territorial resource management.
F
168
8-43 The most important ingredient in developing a successful sales force is proper
supervision.
T
8-44
168
Many sales managers engage in formal sales personnel planning systems because it
allows them to achieve a more efficient and more effective use of human resources.
T
8-45
170
Sales managers throughout the sales organization are responsible for the various activities
in the staffing of the sales force.
F
8-46
171
The formal study of jobs is called job derivation.
F
8.47
171
The first step in a job analysis is to select the jobs to be analyzed.
T
8-48
171
Job analysis is used to determine the personal qualifications needed to perform a job.
F
8-49
172
Job descriptions convert job specifications into the qualifications the organization feel
necessary for the successful performance of the job.
F
8-50
172
A job description defines the specific roles or activities to be performed in a sales
position and determines the personal qualifications necessary to get the job.
T
8-51
173
Successful salespeople need both physical fitness and intelligence.
F
8-52
173
Most sales managers believe personal appearance is not an important selection factor
because appearance can always be changed.
F
8-53
175
Recruitment should decrease the number of job applicants at minimum costs to the firm.
F
8-54
175-176
Since government regulations focus on recruiting practices, they have little direct impact
on selection.
F
8-55
176
The principle government agency responsible for monitoring discriminatory employment
practices is the Civil Rights Administration.
T
8-56
176-177
Discrimination is allowed if a bona fide occupational qualification exists.
T
8-57
178 (Table 8.5)

During a job interview, an interviewer cannot ask the color of an applicant's hair or eyes.
F
8-58
179
Recruiting persons for sales jobs is typically the responsibility of the human resources
department.
T
8-59
180
Current employees are a source of job applicants in two ways--they can refer their friends
to the organization, or they can apply for a transfer/promotion themselves.
T
8-60
180
Hiring an already trained salesperson from outside the organization is often cheaper and
easier than hiring a new trainee.
F
8-61
180
In a realistic job preview, the job is typically viewed as attractive, stimulating, and
challenging.

8.62 Sales human resource management is composed of two elements. What are they?
Ans: people planning and employment planning
Page: 168
8.63 What are the three activities associated with employment planning?
Ans: recruitment, selection, and socialization
8.64 What is the relationship between job descriptions and job specifications?
Ans: Job specifications convert job descriptions into qualifications the organization feels are
necessary for the successful performance of the job.
Page: 172
8.65 What is a bona fide occupational qualification?
Ans: some characteristic that is reasonably necessary to the operation of that particular
business or enterprise
Page: 176-177
8.66 How does a realistic job preview differ from the traditional job preview?
Ans: The realistic job preview gives the applicant pertinent information about the job without
distortion or exaggeration.
Page: 180
Chapter 9
Selection, Placement, and Socialization
of Successful Salespeople
B
9-1
190
_____ is concerned with ensuring job demands match an individual's skills, knowledge,
abilities along with his or her preferences, interests, and personality.
A. Selection
B. Placement
C. Application
D. Training
E. Coaching
E
9-2
190
Better selection of the sales force produces less turnover which in turn:
A. increases training costs to keep salespeople current
B. increases staffing costs as fewer territories are needed
C. means the sales manager will have to spend more time on sales reports
D. has no effect on costs
E. saves the cost associated with sales managers' time
E
191
9.3 The success of a sales force's selection and placement procedures depends on:
A. the organization's job analyses
B. sales human resource planning activities
C. the use of performance evaluations as feedback
D. the organization's recruitment process
E. all of the above
D
9-4
191
_____ determine the type of information the company should gather from job applicants
and to some extent the method used to gather the information.
A. Maturity levels
B. PIPs
C. The sales manager's personal interests
D. Performance criteria
E. SKAs
B
9-5
191
Sam Godwin is a sales manager for a company that sells computer-assisted
manufacturing software. He is trying to determine what bits of information, such as
computer skills, programming languages, and marketing knowledge, he will need to
accurately predict how successfully a job applicant will perform on the job. The text
referred to these bits of information as:
A. applicant descriptors
B. predictors
C. employment guidelines
D. job performance criteria
E. performance evaluators
D
9-6
192
SKAs are employee tests used to measure one's:
A. stamina, knowledge, and aptitude
B. suitability, key personality features, and applicability
C. stamina, key personality features, and aptitude
D. skills, knowledge, and ability
E. skills, knowhow, and applicability
C
9-7
192
PIPs are employee tests used to:
A. determine whether the applicant should participate in an assessment center
B. determine the level of sales training needed
C. measure one's personality, interests, and preferences
D. measure one's physical ability, income goals, and performance potential
E. create a job description for future recruits
A
9-8
192 (Figure 9.2)

Krysten wants to work for a small manufacturing company that makes pottery molds, and
she knows it needs to hire a new sales representative. She should expect the first step in
the company's selection process to be:
A. the application
B. discussions with current employees
C. a review of one's skills, knowledge, and ability
D. the initial interview
E. the preparation of one's resume
C
9-9
192
To get the job as a delivery salesperson for a snack food company, an applicant must have
a current driver's license. In terms of the selection process, this requirement falls into the
_____ classification of hiring information.
A. SKAs
B. aptitude
C. other characteristics
D. BFOQ
E. PIPs
B
9-10
192
To get a job as a salesperson for a company that sells text books to high schools and
middle schools, an applicant must have an undergraduate degree in education. In terms
of the selection process, this requirement falls into the _____ classification of hiring
information.
A. SKAs
B. other category
C. other characteristics
D. BFOQ
E. PIPs
D
9-11
194
Which of these statements is true about application blanks?
A. Typically, all questions have the same weighted value.
B. Application blanks are unaffected by legal constraints.
C. Neatness is unimportant in the filling out of application forms, only accuracy matters.
D. Questions not related to job qualifications should not be included on the application
blank.
E. All of the above statements about application blanks are true.
E
9-12
194
When filling out an application blank for a sales job for a company that markets plastic, a
job applicant can expect to answer questions about all of the following EXCEPT:
A. his education
B. his personal characteristics
C. his work experience
D. his physical characteristics
E. the hiring compnay's history
E
9-13
194
Application blanks are used to collect information about:
A. education
B. personal characteristics
C. work experience
D. physical characteristics
E. all of the above
D
9-14
194
Why should Pete attach a professionally taken photograph of himself on his resume when
he applies for the job of assistant to the director of an upcoming Civil War movie?
A. to show he could play an extra, if necessary
B. to indicate he has creative aptitude
C. to show he has had previous training in applying for jobs
D. to help the interviewer relate written information on Pete's resume to his appearance,
personality, and general impression
E. to make his resume bulkier
A
9-15
195 (Table 9.1)

You are a sales manager conducting a series of personal interviews with job candidates.
Which one of the following is one of the reasons these interviews are important to you?
A. They act as a screening device to create a pool of qualified applicants.
B. They determine the applicant's SKAs.
C. They determine what the compensation and rate of promotion will be if you take the
job.
D. They allow you to meet your potential boss and determine if there is a match.
E. They provide an opportunity to confirm information found in the ad for the position.
A
9-16
195
The nucleus of the staffing process is the:
A. interview
B. job specifications
C. job references
D. application blank
E. job description
A
9-17
195-196
Recently Tania had a job interview for a sales position in which she was asked if she
would be willing to relocate if the job should require it. Although she wanted to explain
that her willingness would depend upon whether a promotion was involved and the
climate of the new locale, she was only allowed to answer "yes" or "no", and was not
permitted to add information to her answer. Tania most likely had a(n) _____ interview.
A. structured
B. unrestrained
C. survey
D. unplanned
E. unstructured
E
9-18
196
You left the job interview thinking, "I really did most of the talking. The interviewer just
asked me a lot of open-ended questions, and I really don't know any more about whether
I might want to work for that company than when I went in." The interviewer was using
a(n) _____ type of interview.
A. structured
B. focus-group
C. semistructured
D. stress
E. unstructured
B
9-19
196
Why is the unstructured interview often inappropriate for a first interview?
A. The interviewer cannot gather any in-depth information about the applicant.
B. It requires a skilled interviewer, and the applicant is often uneasy with this approach.
C. The applicant is not allowed to qualify his or her answers in an unstructured
interview.
D. The series of multiple choice questions asked during such an interview are very timeconsuming.
E. Several selection tests must be administered before reaching the unstructured
interview stage.
C
9-20
196
What type of interview preplans only the major questions allowing the interviewer the
flexibility to customize the interview to the individual?
A. unrestrained
B. observational
C. semistructured
D. evolving
E. unstructured
C
9-21
196
During the course of her interview, Jayne Nunn was asked how she had learned about the
job vacancy at Protean Plastic, what her qualifications were for the position, and how she
thought she could help the company become more successful. Sometimes when she
answered these questions, the interviewer would follow up with more specific questions
related to her initial reply, encouraging her to explain her answers. Thus, the interview
was customized to her. Jayne was experiencing a(n) _____ interview.
A. unrestrained
B. freestyle
C. semistructured
D. evolved
E. unstructured
E
9-22
196
Why do sales recruiters prefer not to use the stress interview?
A. It makes the applicant too dependent upon the sales manager.
B. It increases communication beyond what is normally necessary.
C. It has a highly structured format.
D. The correlation between how an individual handles stress in the interview and how he
or she will handle stress on the job is too high.
E. It makes the applicant defensive.
B
9-23
196-197
In a patterned or structured interview, the recruiter:
A. begins by asking open-ended questions to set the pattern
B. may not permit the applicant to qualify his or her answers
C. must be highly skilled to use this approach effectively
D. customizes the interview to the individual applicant
E. does not use preplanned questions
D
9-24
197
In preparing for the job interview, the interviewer should:
A. ask open-ended questions
B. summarize to the job applicant what the job entails
C. administer employment tests to current members of the sales force
D. spend some time reviewing the applicant's resume
A
9-25
198
Which of the following is an example of an open-ended question that might be asked of a
job applicant applying for the position of receptionist for a regional sales office?
A. What skills do you bring to this job that will make you a valuable employee?
B. Do you type?
C. Do you object to a dress code?
D. Do you object to making coffee some mornings when the managers have scheduled a
sales meeting?
E. Are you left-handed or right-handed?
C
9-26
198
The relationship between how much time the interviewer and the interviewee each spend
talking is an important part of how an interview with a job applicant is conducted. The
text suggests that in a good interview:
A. the interviewer should talk most of the time
B. the interviewer should talk a little over half the time
C. the split should be even between the interviewer and the interviewee
D. the interviewee should talk a little over half the time
E. the interviewee should talk most of the time
B
198
9.27 To end the interview, the interviewer should:
A.
avoid mentioning specifics about the job that is being applied for
B.
tell the applicant exactly what is going to happen in the next step of the
application process
C.
in no way indicate to the job applicant whether employment is likely
D.
not let the interviewee ask any questions
E.
do none of the above
A
9-28
198
Postinterview activities include:
A. the recording of any promises made to the job applicant
B. a summarization of what will be discussed in the interview
C. the assessment of the standardized interview questions
D. a review of the information provided by the applicant's resume
E. employment tests
C
9-29
198
According to basic interview guidelines, the interviewer should:
A. collect information that relates both directly and indirectly to job performance
B. note the company's policy on hiring of minorities
C. always remember that the weaknesses of a job applicant can be offset by his or her
strengths and potential
D. make a decision within the first ten minutes of the job interview
D
9-30
199
To be useful, employment tests should be both:
A. efficient and effective
B. systematic and efficient
C. formal and informal
D. valid and reliable
E. direct and indirect
E
9-31
199
Aptitude tests for salespeople are intended to measure:
A. what is known about a subject, like engineering or computer technology
B. mental interest in a sales career
C. a person's maturity
D. a person's self confidence and motivation
E. an individual's natural ability for selling
A
9-32
199
Knowledge tests:
A. can measure the computer programming skills of a person who is applying for a sales
position with IBM
B. measure mental intelligence
C. can be used to measure a person's maturity
D. determine a person's self confidence and motivation
E. measure an individual's natural ability for selling
A
199
9.33 The polygraph test:
A. is sometimes called a lie detector test
B. is strictly forbidden by the federal government
C. is used by all Fortune 500 companies
D. is considered to be more reliable than any other kind of employment test
E. can be administered by any human resource personnel
E
9-34
200
Why do many companies prefer not to use tests to select future members of their sales
force?
A. Many sales managers do not understand the testing process, and only use tests
because the home office requires them to.
B. In some instances, tests are used as the sole screening criterion.
C. Applicants can fake responses to get the "correct" test result.
D. Tests may have a cultural bias and discriminate against some groups.
E. All of the above are reasons why companies prefer not to use testing as a selection
tool.
D
9-35
201
A(n) _____ is a centralized organizational unit within a firm; its purpose is to evaluate all
qualified applicants in a comprehensive and uniform manner.
A. human resource placement area
B. testing center
C. categorization department
D. assessment center
E. applicant mastery department
E
9-36
202
Which of the following is a benefit of an effective hiring policy?
A. ability to meet individual territory sales potential
B. decreased absenteeism
C. improved morale
D. increased customer satisfaction
E. all of the above
D
9-37
202
Which of the following is a benefit of an effective hiring policy?
A. increased sales force turnover
B. decreased customer satisfaction
C. increased training time requirements
D. decreased sales force operating costs
E. all of the above
E
9-38
202
Which of the following is the best example of a real cost associated with a selection and
placement decision?
A. costs associated with rejecting a person who would been a success on the job
B. loss of customers because the company hired someone with weak people skills
C. costs incurred while replacing an unreliable salesperson
D. loss of equipment due to the hiring of an unethical salesperson
E. cost of new employee induction and orientation
A
202-203
9.39 Which of the following is the best example of an induction and orientation costs associated
with the selection and placement decision?
A. administrative costs of adding the employee to the payroll
B. costs from undesirable job behaviors
C. facilities for training
D. personnel testing evaluation costs
E. salaries of training and development staff
E
9-40
203
Which of the following statements about socialization is true?
A. Research has shown that socialization has no effect on reducing job anxieties.
B. The socialization process uses a great deal of the sales manager's time and increases a
company's overall costs.
C. Socialization has no effect on employee turnover.
D. Socialization is always an easy process.
E. Socialization is concerned with the roles played rather than with the jobs salespeople
occupy in a company.
A
203
9.41 Which of the following is a benefit associated with an effective hiring policy?
A.
improved morale
B.
increased turnover costs
C.
decreased customer satisfaction
D.
inability to meet territorial sales potential
E.
increased training time
B
9-42
203
_____ is defined as the process by which salespeople learn the sales culture and
behaviors appropriate for their roles in the organization.
A. Orientation
B. Socialization
C. Social responsiveness
D. On-the-job training
E. Groupthink
E
9-43
204
Making sure a new salesperson is properly and thoroughly socialized into the
organization is in the sales manager's best interest because it:
A. will save the manager time later
B. will save the organization money
C. reduces the new salesperson's fear of failure
D. gives the new person a positive image of the company
C
9-44
204
The Pygmalion effect is most likely to effect:
A. employee testing
B. how an employee is selected for interview
C. how an employee is socialized into an organizational culture
D. the type of close used by the interviewer
E. the use of open-ended questions during an interview
C
9-45
204
The _____ is established when the sales manager conveys to the new salesperson the
belief that he or she will do well.
A. halo effect
B. mirroring phenomenon
C. Pygmalion effect
D. transition orientation
E. sales ego
C
358
9.46 When Beth was hired as the new sales representative for a company that manufactures and
markets supercomputers, her sales manager told her that he was convinced she was the
best applicant for the position and that she would definitely succeed in her new job. The
sales manager was using the:
A. halo effect
B. mirroring phenomenon
C. Pygmalion effect
D. transition orientation
E. sales ego
F
190
9.47 Placement is concerned with matching actual sales to the commission requirements of
individual salespeople.
T
9-48
190
Whenever a person changes job assignments, the fit between the individual and the job is
important.
F
9-49
190
Often the costs involved with selecting a new employee equal less than 10 percent of a
new hire's annual salary plus relocation costs.
T
9-50
191
Performance criteria determine the type of information to obtain from job applicants and
to some extent the method used to gather the information.
T
9-51
191
Predictors are various pieces of information about a person that help predict whether that
person will be successful in a sales job.
F
9-52
192 (Figure 9.2)

The first step in the process of selection is the checking of references.
F
9-53
193
Demonstrating job-relatedness for personality, interest, and preferences is generally
easier than for skill, knowledge, and ability.
T
194
9-54 Questions not related to job qualifications should not be included on the application
blank.
F
9-55
195
All interviewers receive special training for their jobs; this training enables them to
interpret information correctly and avoid unreliable or snap decisions.
F
9-56
195-196
In a structured interview, the recruiter begins by asking open-ended questions in order to
set the interview structure.
T
9-57
196-197
During an interview, interviewers often put more importance on the nonverbal cues than
on the verbal.
F
9-58
197
A good interviewer remains aloof throughout the interview.
F
9-59
198
The interview is the only method the company has for obtaining information about a job
applicant.
T
9-60
199
The purpose of testing is to determine whether applicants have traits the company feels
will lead to successful selling.
F
9-61
199
Aptitude tests can measure the computer programming skills of a person who is applying
for a position at IBM.
T
9-62
199
Polygraph tests are seldom used to screen applicants for sales jobs at large companies that
must be sure of the honesty of their outside sales representatives.
T
9-63
199-200
Employment tests are often misused and not understood.
F
9-64
201
The EEOC advocates the use of aptitude and intelligence tests as a valid way to
determine who should and should not be hired for sales positions.
T
9-65
202
Almost all companies require their prospective employees to undergo physical
examinations.
T
9-66
203
Socialization is concerned with the roles played by salespeople rather than with the jobs
they occupy.

9.67 What do the letters SKA represent?
Ans: skills, knowledge, and ability
Page: 192
9.68 What is the first stage in the sales personnel selection process?
Ans: the application
Page: 192
9.69 List the three general types of job interviews.

Ans: patterned or structured, unstructured, and semistructured
Page: 195
9.70 Why are references sometimes not a valid measure of how well a job applicant will perform
at his or her job?
Ans: People tend to play down the faults of others, and they may not know them well enough
to give an informed reference. In addition, a person might be a good worker for one supervisor,
and not for another one.
Page: 201
9.71 When does an salesperson's socialization take place?
Ans: the entire length of a person's employment
Page: 203
9.72 What is the Pygmalion effect?
Ans: It is the self-fulfilling prophecy of telling someone he or she will succeed.
Page: 204
Chapter 10
The Management of Sales Training and Development
A
10-1
216
_____ is the effort put forth by an employer to provide the opportunity for the
salesperson to receive job-related culture, skills, knowledge, and attitudes that result in
improved performance in the selling environment.
A. Sales training
B. Orientation
C. Revitalization
D. Acculturation
E. Socialization
D
10-2
216
Companies engage in sales training to:
A. increase absenteeism and turnover
B. increase selling costs
C. decrease sales volume
D. change or reinforce behavior that makes salespeople more efficient
C
217
10.3 A company engages in sales training to:
A. eliminate the need for feedback from its sales force
B. decrease customer satisfaction
C. help salespeople become managers
D. eliminate the need for costly orientation processes
E. help in the creation of strategic plans
A
10-4
217
Which of the following statements about sales training is true?
A. Sales training is an ongoing commitment.
B. Environmental changes should have no effect on sales training.
C. During the last thirty years, there has been no need to reengineer training.
D. No new sales training techniques have been developed since the 1960s.
E. Employers only like to budget for formal training and do little informal training.
B
10-5
217
Which of the following is NOT a specific purpose for sales training?
A. to provide product knowledge
B. to lower fixed costs
C. to inform salespeople
D. to obtain feedback from salespeople
E. to increase salespeople's job satisfaction
D
10-6
217
_____ involves identifying activities management feels the salespeople should perform to
produce the desired results.
A. SWOT analysis
B. Environmental audit
C. Training analysis
D. Needs assessment
E. Outcome measurement
B
10-7
218
A successful training effort should:
A. strive to reach a large audience with as little information as possible
B. be focused on those performance areas that offer the highest opportunity for payback
C. cover all facets of selling
D. strive to reach a small audience with as much information as possible
E. focus on areas where performance is lowest
A
10.8
218
According to Bruce Scagel, which of the following is NOT one of the four principles
necessary to ensure a successful training effort?
A. Efficiency: Training should be produce the greatest results for the least amount of
effort.
B. Value: Training should be focused on performance areas the offer the highest
opportunity for payback.
C. Duration: Training should be ongoing.
D. Focus: Training should be focused on a limited number of very important
performance areas.
E. Mass: Training should provide the maximum payoff that is possible.
C
10-9
218
A successful training effort should:
A. focus on the individual's needs rather than those of the majority
B. be unconcerned with maximum payoff through training and development
C. be ongoing
D. focus on all areas with which the trainee will come in contact
E. last no longer than one month
C
218
10-10 What step follows the organizational analysis for a company that is planning its sales
training?
A. salesperson analysis
B. product analysis
C. operational analysis
D. territorial analysis
E. needs assessment
D
218
10-11 During operational analysis, _____ are analyzed to determine the specific abilities that
will be part of training.
A. learning curves
B. application forms
C. mission statements
D. job descriptions and job specifications
E. work norms
B
218-219
10-12 During the _____, managers are asked to analyze all the job descriptions and
specifications to determine the specific abilities that will become part of training.
A. external assessment
B. operational analysis
C. market assessment
D. environmental audit
E. situational assessment
C
219
10-13 A _____ might reveal that a salesperson is having problems discussing certain technical
aspects of products with their customers.
A. performance test
B. concept test
C. difficulty analysis
D. sales presentation test
E. vendor assessment
C
219
10.14 SCM sells all types of commercial saws. It is in the process of preparing a sales training
program for its 32 salespeople. A _____ indicated that its salespeople were having
trouble convincing customers that SCM saws were as durable as those made by a German
competitor.
A. performance test
B. sales concept test
C. difficulty analysis
D. sales presentation test
E. value analysis
D
219
10.15 What step follows the sales personnel analysis for a company that is planning its sales
training?
A. product analysis
B. functional assessment
C. environmental analysis
D. customer analysis
E. competitive audit
A
220
10.16 _____ is a continuous process aimed at constantly revising the training program to keep it
current.
A. Needs assessment
B. Territorial analysis
C. Organizational analysis
D. Product analysis
E. Job assessment
E
220
10-17 The new sales trainer for Marquette, a manufacturer of patient monitoring systems, is
deciding what to include in a sales training session. What sources can he use to gather
this information?
A. Hewlett-Packard, one of its leading competitors
B. a hospital that uses Marquette's systems
C. company sales personnel
D. a hospital supply company that provides the systems to emergency care centers
E. all of the above
E
220
10.18 Allied Insurance specializes in business liability insurance. Its sales trainer is deciding
what should be included in the company's new sales training program. What sources can
she use to gather this information?
A. experienced Allied Insurance salespeople
B. the company's key accounts
C. other insurance companies that target the same market
D. small companies that require highly individualized policies
E. all of the above
D
220
10-19 _____ is used to identify the reasons lower performing salespeople don't achieve their
sales goals.
A. The competition
B. Success analysis
C. A job description
D. Failure analysis
E. Learning curve analysis
D
220
10-20 _____ is used to identify factors that appear to cause salespeople to be ineffective.
A. The exit interview
B. Success analysis
D. Failure analysis
B
220
10-21 _____ was used to determine why Marcus LaFontaine was able to sell his company's
product lines to 90 percent of the potential customers that he called on annually when the
other salespeople in the company had sales rates of around 40 percent.
A. The exit interview
B. Success analysis
D. Failure analysis
A
221
10-22 Matt Kinder was unhappy with his job, so he recently quit. After he had turned in his
resignation, he met with the head of the personnel department who asked him to identify
his reasons for quitting. This is an example of what commonly occurs during a(n):
A. exit interview
B. demotion
C. dismissal
D. failure analysis
E. training analysis
E
221
10-23 Which of the following factors should be used in the selection of the sales training
method to be used with new and experienced employees?
A. the trainer's expertise
B. availability of training materials
C. training objectives to be accomplished
D. the number of trainees
E. all of the above
C
221
10-24 Interactive multimedia training is _____ than conventional employee instruction.
A. more valid and more reliable
B. slower
C. less expensive
D. less effective
E. less individually-oriented
A
222
10-25 Tammy Neal is a newly recruited salesperson. As part of her training, she had to "sell"
her company's product to another trainee who was acting as if he was a typical buyer.
This training technique is the _____ approach.
A. role playing
B. case study
C. demonstration
D. gaming
E. theatrical
A
222
10-26 Alex is undergoing sales training. His trainer has asked him to pretend to sell office
furniture to a hypothetical office manager. The trainer's request illustrates how _____ can
be used in training.
A. role playing
B. distance learning
C. demonstration approach
D. gaming
E. the theatrical approach
E
222-223
10-27 Frequently used methods for training salespeople include:
A. electronic performance support systems (EPSSs)
B. on-the-job training
C. role playing
D. distance learning
E. all of the above
B
223
10.28 The best and most frequently used method for sales training is:
A. electronic performance support systems (EPSSs)
B. on-the-job training
C. role playing
D. distance learning
E. interactive multimedia training
D
224
10-29 Sales managers feel a person goes through three stages before true changes in behavior
occur as a result of training. These stages in the correct order are:
A. preconscious usage, conscious usage, and subconscious usage
B. introductory usage, growth usage, and natural usage
C. awkward usage, growth usage, and actual usage
D. awkward usage, conscious usage, and natural usage
E. introductory stage, growth stage, maturity stage
D
224
10-30 Alana Mero is currently involved in an on-the-job sales training program. She is not sure
the training will work for her, and she does not understand how this training can predict
how customers will react to her personnally. At what phase in the behavior changing
process is Alana?
A. the growth usage
B. the introductory usage
C. the preconscious usage
D. the awkward usage
E. the potential usage
C
224
10-31 Joe Tanaka learned a new closing technique at a sales meeting a couple of weeks ago. He
has made an effort to deliberately use it whenever appropriate since then. He believes he
is becoming more proficient with it. At what phase in the behavior changing process is
Joe?
A. the natural usage
B. the cognizant usage
C. the conscious usage
D. the matrity usage
E. the growth usage
A
224
10-32 At a seminar a few months ago, Saralyn learned a five question technique for handling
objections. At first she wasn't sure it would work, but she forced herself to learn the
questions and to use them when dealing with her customers. Now, when the situation
calls for that behavior she can use it without having to think about it beforehand . To her
it is now a comfortable and unforced method for dealing with objections. At what phase
in the behavior changing process is Saralyn?
A. the natural usage
B. the maturity usage
C. the conscious usage
D. the established usage
E. the cognizant usage
E
224
10-33 Randy Stein has been selling sports equipment for Foote Industries for 14 years. Foote
has recently added a line of first aid equipment and Randy has received training on how
to sell the new line. When she went back on the road, Randy expected to become as
proficient in selling the new line as she was in selling the company's original products,
but she feels that no learning is taking place. In other words, it is getting no easier for her
to sell the new product line. In terms of the learning curve, Randy is experiencing a(n):
A. communication gap
B. S-shaped curve
C.
need for knowledge acquisition
D.
training evaluation
E.
plateau
C
224
10-34 When does a plateau in the learning curve typically appear during the sales training
process?
A. immediately after the conscious usage stage
B. during the natural usage phase
C. during the awkward usage phase following initial training
D. after the conscious usage stage begins but before the awkward stage is concluded
E. during the knowledge rejection stage
A
224 (Figure 10.3)
10-35 To visualize the way a salesperson goes through the learning process, you should
visualize a curve shaped like:
A. the letter S
B. a horizontal line
C. a cloverleaf
D. the letter V
E. a reversed letter L
A
224
10-36 A major barrier to movement up the learning curve is:
A. lack of reinforcement
B. curbstone counseling
C. an overly zealous sales manager
D. the need for role-playing
E. fear of the unknown
E
224
10-37 The rate of learning change by salespeople is influenced by:
A. the trainee's attitude
B. the frequency with which training occurs
C. the degree to which the material is technical
D. the extent to which follow-up and OTJ training are given
E. all of the above
C
225
10-38 Centralized training programs:
A. seldom involve standardized training content
B. are best when conducted at the "curbstone"
C. are designed to supplement the basic training done by sales personnel in the field
D. cost less than decentralized programs
E. are described by all of above
A
225
10-39 Which of the following statements describes an advantage of centralized training?
A. Centralizes training allows for the standardization of training content.
B. No time in the territory is lost with centralized training.
C. Training sessions are typically shorter with centralized training than with
decentralized training.
D. Centralized training involves all levels of the management hierarchy.
E. Centralized training integrates all functional departments of the organization.
C
225
10-40 Decentralized training programs:
A. provide the sales force with a common body of knowledge
B. are designed to take place at the home office and to supplement the basic training
done by sales personnel in the field
C. may be conducted anywhere
D. cost more than centralized programs
E. typically involve long sessions in which the trainees get to know each other
D
225
10-41 Which of the following statements describes an advantage of decentralized training?
A. Decentralized training costs more than centralized training.
B. Decentralized training permits salespeople to escape the humdrum job of selling for a
short while.
C. Decentralized training is seldom used outside the training facilities.
D. Decentralized training costs less than centralized training.
E. Decentralized training limits the interaction between salespeople.
A
225
10-42 Which of the following statements describes a disadvantage of decentralized training?
A. In decentralized training, a branch manager may not be an able trainer.
B. the use of experienced trainers in decentralized training provides great flexibility in
training content.
C. Decentralized training requires higher fixed cost.
D. Decentralized training generates the additional cost of renting a place to hold the
training sessions at resort sites away from the territories and the home office.
E. With decentralized training, salespeople's geographical territories are such that they
only see one another during meetings and training programs.
A
226
10-43 Which of the following is responsible for the creation, administration, and coordination
of a firm's sales management and sales force training and development programs?
A. corporate staff trainers
B. regular sales force personnel
C. the vice-president of sales
D. the personnel department
E. technical support personnel
D
226-227
10-44 When choosing a senior sales representative or sales manager to serve as a sales trainer,
the company should look for success in selling and:
A. at the number of years of selling experience the individual has
B. for membership in an outside organization like Toastmasters
C. for a college degree in business
D. for effective communication skills
E. for a college degree in a technical area related to the company's product offerings
B
227
10-45 The sales culture:
A. is one of the most expensive benefits a firm can purchase for its salespeople
B. is the set of key values, ideas, beliefs, attitudes, customs, and other capabilities and
habits shared or acquired as a sales group member
C. is formally defined in the firm's organization chart
D. alters itself rapidly in response to changes outside the organization
E. requires an analytical, conceptual approach to attain its designer's vision
D
228
10-46 The first step in evaluating the success of a sales training program is to determine:
A. measurement methods
B. consequences of measurements
C. the method of information collection
D. what should be measured
E. the importance of the training
D
228
10-47 As a sales manager Lila Greer wants to evaluate the success of a recent sales training
program. Her first evaluative step should be to determine:
A. measurement methods
B. consequences of measurements
C. the method of information collection
D. what should be measured
E. the importance of the training
E
229
10-48 The first step in evaluating the success of a sales training program is to determine what
should be measured. The components that should be determined during this step include:
A. what the participants say about the training program
B. what knowledge was learned during the training
C. if the training actually involved some change in behavior
D. whether the training accomplished what it was supposed to accomplish
E. all of the above
C
229
10-49 All of the following are examples of data collection techniques sales trainers can use to
gather information about the success of a training program EXCEPT:
A. interviews
B. questionnaires
C. experiential research
D. company data
E. observational research
B
229
10-50 What is the most popular method for collecting data during a sales training evaluation?
A. interviews
B. questionnaires
C. tests
D. company data
E. observations
E
229
10-51 The advantage of using _____ for evaluating sales training programs is flexibility.
A. observations
B. questionnaires
C. on-site testing
D. role playing
E. interviews
A
229
10-52 To evaluate sales training, a trainer may go into the field to see if trainees are using the
techniques and information they were shown. This method of evaluation is called:
A. observation
B. experimentation
C. sales inspections
D. on-site training
E. sampling
C
230
10-53 As a recent marketing graduate, your sales manager has asked you to recommend the best
method to determine whether your firm's sales training is actually contributing to sales.
You should suggest:
A. a mail opinion questionnaire be sent to some of the firm's better customers
B. an after-only test following the next training session
C. a before-after with control group
D. a simple before-after measurement
E. the company discontinue other promotional activities so the true impact of the sales
force on sales can be observed
E
230
10.54 What is the simplest method used to determine if a firm's sales training has actually
contributed to its sales?
A. before/after
B. survey
C. before/after with control group
D. personal interview
E. after only
F
216
10-55 The only purpose for sales training is to improve general sales volume.
T
217
10-56 Needs assessment serves as a guide to planning training programs.
T
218
10-57 A successful training program should strive to reach the most people with the most
necessary development initiatives.
F
219
10-58 A vendor analysis uncovers and analyzes problems salespeople experience.
T
220
10-59 The needs assessment serves as a guide to planning training programs.
F
220
10-60 If designed correctly, sales training will not need to be revised.
T
221
10-61 People often do not respond truthfully to questions during an exit interview because they
want to get a good job recommendation from the company they are leaving.
F
221
10-62 Most trainers view attempts to have salespeople do "homework" before the first training
session as a waste of time.
F
221
10-63 Interactive multimedia training is faster, more effective, and more expensive than
conventional employee instruction.
F
222
10-64 Distance learning is much less personal than conventional multimedia training method.
T
222
10-65 In role playing, the trainee acts out the sale of a product or service to a hypothetical
buyer.
F
223
10-66 Negative criticism during on-the-job training provides one of the most effective methods
of training a new salesperson.
T
223-224
10-67 Millions of dollars spent on sales training are wasted because there is no long-term
behavioral change in the sales personnel trained.
T
224
10-68 One goal of sales training is to move a salesperson from knowledge acquisition to the
natural usage stage.
T
225
10-69 A salesperson may receive some form of training any place, any time of day or night.
F
225
10-70 Centralized training programs may be conducted anywhere in the field.
F
225
10-71 Decentralized training is expensive due to the cost of travel, meals, and facilities.
T
226
10-72 Training continues throughout the professional salesperson's career.
T
226-227
10-73 The three basic sources of sales trainers are corporate staff personnel, regular sales force
personnel, and specialists from outside the company.
F
227
10.74 Functional culture is the set of key values, ideas, beliefs, attitudes, customs, and other
capabilities and habits shared or acquired as a sales group member.
T
228
10-75 Top management must support the company's sales training program if it is to be
effective.
F
228
10-76 The evaluator of a sales training program need only look at on-the-job results to
determine if the training was effective and useful.
T
229
10-77 Questionnaires are the most popular instrument used by trainers to evaluate the sales
training programs.
T
229
10-78 Interviews are the most flexible technique for evaluating sales training programs.
F
230
10.79 The simplest method for evaluating the effectiveness of a sales training program is the
after/before method.
10.80 Who is John H. Patterson?
Ans: the father of sales training
Page: 216
10.81 What is the first step when developing a sales training program?
Ans: a needs assessment
Page: 217
10.82 What is the name of the type of interview that usually takes place after someone has quit
their job?
Ans: exit interview
Page: 221
10.83 What is the best and most frequently used method of job training?
Ans: on-the-job training
Page: 223
10.84 What is the first step in a sales training evaluation?
Ans: determine what should be measured
Page: 228
10.85 What is the simplest method for evaluating sales training?
Ans: the after-only method
Page: 230
Chapter 11
Contents of the Sales Training Program:
Sales Knowledge and the Selling Process
A
11-1
240
_____ is defined as a relatively permanent change in behavior occurring as a result of
experience.
A. Learning
B. Reaction
C. Consequence
D. Practice
E. Proficiency
A
11-2
240
Training:
A. is part of an individual's total learning experience
B. tends to imply a long-term event
C. is a relatively permanent change in behavior occurring as a result of experience
D. is completely different from education
E. is described by all of the above
D
11-3
242
According to the text, information can be of two types:
A. procedural and attitudinal
B. internal and external
C. motivational and psychological
D. operational and behavioral
E. intuitive and diagnostic
B
11-4
242
Smarte Carte, Inc. recently introduced computerized, electronic lockers for use in bus
stations, schools, ariports, etc. Salespeople were trained on how the system operates, its
features, and benefits, and ways to sell the new lockers. Smarte Carte used _____
training to provide its salespeople with product information.
A. diagnostic
B. operational
C. procedural
D. behavioral
E. intuitive
C
11-5
242
Training involving operational types of procedures:
A. will be useful to new salespeople only
B. should not become a habitual behavior for salespeople
C. will be instantly used on the job
D. is not useful when there is a need to perform some type of evaluation
E. is typically used in the area of sales skills development
D
11-6
242
Dylan Persky sells men's clothing to retail stores. Hiss sales manager wants Dylan to
incorporate visual aids into his sales presentation. Dylan, a fourteen-year sales veteran,
does not want to change. His sales manager is trying to engage Dylan in _____ training.
A. diagnostic
B. operational
C. procedural
D. behavioral
E. intuitive
D
11.7
242
Martin has sold bathroom and kitchen fixtures for twelve years. Last month his sales
manager asked Martin to submit his orders via a laptop computer. Martin does not like
computer technology and is somewhat intimidated by it. To get Martin to use the laptop
computer, his sales manager will have to engage in _____ training.
A. diagnostic
B. operational
C. procedural
D. behavioral
E. intuitive
A
11-8
243
When a salesperson is hired, the first job-related information he or she receives is
typically about the:
A. company that hired him or her
B. physical characteristics of the product sold
C. skills needed to manage a territory
D. company's customers
E. company's advertising program
A
11-9
243
The foundation of sales knowledge development is:
A. product knowledge
B. an understanding of the company's pricing strategy
C. an understanding of each member of the channel of distribution
D. company knowledge
E. knowledge of the competition
C
243
11-10 _____ are commonly used to provide salespeople with sales knowledge.
A. Public relations articles
B. Call reports
C. Sales meetings
D. Trade journals
E. Customers
E
244
11-11 As part of their knowledge about the company's channel of distribution, salespeople need
to know:
A. when channel members will see salespeople
B. the product lines each channel member carries
C. the likes and dislikes of a channel member's customers
D. the channel member's pricing policies
E. all of the above
D
244
11-12 According to the text, salespeople are boundary spanners. This means salespeople:
A. have to cover a lot of territory
B. sell in both the business-to-business and consumer markets
C. have to perform many selling and non-selling activities
D. are in the middle between the customer and the employer
E. are accurately described by none of the above
E
247
11-13 Personal computers can help a salesperson to:
A. improve the organization of his or her selling time
B. improve speed and accuracy in finishing and sending orders to the company
C. help develop more effective presentations
D. be more productive
A
247
11.14 Where would a salesperson, who makes wise use of his computer, look to find
information about the date of a customer's last order, the customer's delivery preferences,
and the name of the customer's assistant?
A. a contact management program
B. a spreadsheet
C. a tickler file
D. a geographic information system
E. a calendar management program
C
248
11-15 As a salesperson, the most vulnerable asset you have to manage is your:
A. product
B. personal appearance
C. time
D. company resources
E. leads
D
248
11.16 Which type of sales force automation would be most likely to help a salesperson who is
creating a new route that will accommodate three new customers?
A. a contact management program
B. a spreadsheet
C. a tickler file
D. a geographic information system
E. a calendar management program
E
250-251
11.17 Internet sites set up by the company can help its salespeople in servicing and selling
customers. The long-term benefits of using such an Internet site include:
A. the building of customer loyalty
B. the fact that it saves customers money
C. the speed with which transactions can be processed
D. the lowering of sales costs
E. all of the above
D
250-251
11.18 Internet sites set up by the company can be very useful to its salespeople. Which of the
following is NOT one of the ways that salespeople can benefit from an Internet site?
A. the creation of improved relationships between the salespeople and their customers
B. the lowering of variable sales costs
C. reduction of transaction processing costs for the customer
D. lowering of the company's fixed costs
E. provides the convenience, simplicity, and immediacy that customers demand
B
251
11-19 Which two key elements are involved in sales skill development?
A. operational training and behavioral training
B. persuasive communications and the selling process
C. customer empathy plus time and territorial management skills
D. product knowledge and communication skills
E. market segmentation and product knowledge
D
251
11-20 "To be more persuasive, Madeleine," said her sales manager, "when you are working with
a customer remember a KISS for him.'" The sales manager was telling Madeleine:
A. to use her good looks to get orders
B. to flirt a little to keep the prospect interested
C. to care about the prospect as a person and not just as a potential commission
D. that simple, straight-forward presentations are best
E. to let the customer know he is respected by everyone who works at her company
A
252 (See also Figure 11.2)
11-21 The sales process begins with:
A. prospecting
B. the precall plan
C. qualifying
D. preapproach
E. the demonstration
B
253 (Figure 11.2)
11-22 _____ is a part of the presentation step of the selling process.
A. The approach
B. The demonstration
C. The close
D. Qualifying
E. The trial close
C
253 (Figure 11.2)
11-23 Which of the following is a part of the presentation step of the selling process?
A. the approach
B. meeting objections
C. dramatizations
D. prospecting
E. the trial close
B
253
11-24 As part of his job, a salesperson is _____ when he is looking for people who need and
can buy the product he sells.
A. mining
B. prospecting
C. selling
D. scanning
E. preapproaching
C
253
11-25 A _____ is the name of a person or business that might be a prospect.
A. canvasser
B. contract
C. lead
D. trial buyer
E. buying potential
A
254
11-26 Jim Keeler moved from selling hospital supplies to working in the purchasing department
of a large hospital. The customers that Jim used to call on are now categorized as:
A. orphans
B. illegitimate
C. resourceless
D. fair game
E. sponsorless
A
254
11-27 Miguel was a salesperson for United Designs, a manufacturer of garden accessories. His
biggest customer was Pike's Nursery. Yesterday Miguel took another job as the sales
manager of a large wholesale nursery. In terms of the other salespeople for United
Designs, Pike's Nursery is:
A. an orphan
B. sponsorless
C. left adrift
D. fair game
E. illegitimate
A
254
11.28 Which of the following is NOT an example of one of the four main sources of names for a
prospect pool?
A.
competitors
B.
customers
C.
orphans
D.
referrals
E.
leads
C
255 (Figure 11.4)
11-29 There are four steps to planning sales calls. The first of these involves the:
A. development of a customer profile
B. development of a sales presentation
C. determination of the call objective
D. establishment of customer empathy
E. outlining of customer benefits
C
255 (Figure 11.4)
11-30 Jerry Rosenblum sells paper. He is planning a sales call on a company that manufactures
envelopes. During the first step of this process, he should:
A. develop a customer profile
B. develop a personalized sales presentation
C. determine the call objective
D. study postal regulations as they relate to envelopes
E. learn all he can about the envelope industry
C
255
11-31 A sales call objective:
A. should be directly beneficial to the channel members
B. can be as vague as necessary
C. should be measurable
D. needs to be qualitative rather than quantitative
E. is unnecessary on a follow up sales call
A
256
11-32 What is the first step for developing a customer benefit plan?
A. Select the features, advantages, and benefits of the product.
B. Develop the marketing plan.
C. Develop a business proposition.
D. Do a value analysis
E. Developed a suggested purchase order
C
256
11-33 During which stage of the process for developing a customer benefit plan would a
salesperson of industrial generators be most likely to conduct a value analysis?
A. while developing the marketing plan
B. while individualizing his presentation
C. while developing a business proposition
D. as he develops a suggested purchase order
E. before determining his product's FABs
E
256 (Table 11.3)
11-34 Darrel sells canned goods to restaurants. His company has a local distribution center.
The seller's location is an example of a(n):
A. advantage
B. product profile
C. utility
D. benefit
E. feature
D
256 (Table 11.3)
11-35 Because the company Jade sells for offers weekly delivery to her clients, it can keep its
inventory costs and its prices lower than its competitors'. This savings is an example of
a(n):
A. advantage
B. product profile
C. utility
D. benefit
E. feature
B
257
11-36 The first major part of the sales presentation is called the sales opener or the:
A. entry
B. approach
C. access
D. entrance
E. advent
A
257
11-37 The approach method most commonly used by salespeople is also the weakest. It is
called the _____ approach.
A. introductory
B. product
C. customer benefit
D. functional
E. curiosity
A
257
11-38 As the salesperson enters the prospect's office, she says, "Hello, my name is Laura Sams,
and I represent Marquette Monitoring Equipment." This is an example of the _____
approach.
A. introductory
B. product
C. customer benefit
D. functional
E. curiosity
C
257
11-39 A salesperson walks into a prospect's office and says, "How would you like to save $1000
on the purchase of your next diesel truck?" This is an example of the _____ approach.
A. introductory
B. product
C. customer benefit
D. functional
E. curiosity
E
257-258
11-40 A salesperson for ergonomically designed furniture walks into a prospect's office and
says, "Do you know why 3,000 secretaries no longer have backaches?" This is an
example of the _____ approach.
A. introductory
B. product
C. customer benefit
D. functional
E. curiosity
E
257-258
11-41 Which of the following approaches is NOT commonly used by salespeople?
A. introductory approach
B. customer benefit approach
C. product approach
D. curiosity approach
E. orphan customer approach
B
257-258
11-42 Haj Dhura is a salesperson for United Designs, a manufacturer of garden accessories.
When she calls on a customer, she often introduces herself by asking, "Do you know
which garden accessory is most commonly found in the gardens located in the
Southeast?" This type of approach is referred to as a(n) _____ approach.
A. interrogative
B. curiosity
C. functional
D. introductory
E. combination
A
259
11-43 Velma sells Milorganite fertilizer. To show the client that the fertilizer company's claims
about its products are true, she shows them a _____ from the Environmental Protection
Agency that states that Milorganite fertilizer meets the EPA's "exceptional quality"
standards.
A. proof statement
B. copy of its stockholders' report
C. performance analysis
D. publicity piece about fertilizers
E. benefit statement
B
259
11-44 To show his clients that what he is saying is true and that he can be trusted, Steve should
use:
A. curiosity dramatizations
B. proof statements
C. prospect participations
D. benefit approaches
E. presentation mixes
D
259-260
11-45 The ______ method of sales presentation is very structured and has as its basic
assumption that the prospect's needs can be stimulated by exposure to the product, or
have already been stimulated because the prospect has sought out the product.
A. need awareness
B. benefit-feature
C. FABs
D. stimulus response
E. need-satisfaction
D
260
11-46 Which of the following is a shortcoming associated with the formula sales presentation
method?
A. The formula sales presentation method requires too much prospect participation.
B. The formula sales presentation method assumes the salesperson shares control with
the prospect.
C. The formula sales presentation method requires the memorization of several different
"pitches."
D. The formula sales presentation method includes product features not important to
buyer.
E. None of the above describes a shortcoming of the formula sales presentation method.
A
260
11-47 With which method of sales presentation is the AIDA approach most associated?
A. formula
B. benefit-feature
C. FABs
D. need-creation
B
260
11-48 AIDA stands for:
A. assumptions, interests, diagnosis, action
B. attention, interest, desire, action
C. awareness, intent, desire, activity
D. attention, innovations, definitions, agreement
E. assumptions, interest, diagnosis, activity
E
260
11-49 Ravinia recommends to the salespeople who work for her that they use an interactive
sales presentation. In other words, Ravinia recommends the _____ presentation method.
A. formula
B. benefit-feature
C. FABs
D. stimulus response
A
261
11-50 Kathy Eure sells the landscaping services of a large nursery to developers. At the
conclusion of her sales presentation, Kathy may ask the prospect, "What kind of flowers
of do you prefer?" This is an example of a:
A. trial close
B. sales call objective
C. dramatization
D. preapproach
E. marketing plan
A
262
11-51 One method of handling objections is to turn the objection into a benefit or a reason to
buy. This is called the _____ method of handling objections.
A. boomerang
B. forestalling
C. benefit-feature
D. bird dogging
E. trial and error
B
263
11-52 After his sales presentation, Milt Presley says, "Let's see, Mr. McPhail, you said you liked
our fast delivery, credit policy, and co-op advertising program. Is that correct?" This an
example of a(n) _____ close.
A. boomerang
B. summary
C. complement
D. assumptive
E. minor decision
C
263
11.53 At the end of her sales presentation, Kelly said, "It's obvious that you know a lot about
running an amusement parks and that is why I think you should buy my company's
stuffed animals. As you very well know, they are inexpensive when bought in case lots,
yet made with the quality that will keep your customers happy." Kelly was using a(n)
_____ close.
A. boomerang
B. summary
C. complement
D. assumptive
E. minor decision
D
263
11-54 Nikki works for Lebanon Lawn & Garden which sells lawn and garden products, grass
seeds, and bird food. She concluded her sales presentation by saying, "I can tell from
your merchandising skills that you are committed to extending the season for your retail
garden supply store, so I'll write up your order for our deluxe bird seed display. This is
an example of the _____ close.
A. suggestive
B. boomerang
C. adaptive
D. compliment
E. functional
D
263
11-55 After finishing his sales presentation and before the prospect had said anything about
buying his product, Alvin said, "I'll call in your order for a office chair right now." This
is an example of a(n) _____ close.
A. boomerang
B. summary
C. complement
D. assumptive
E. minor decision
E
263
11-56 Which of the following is the BEST example of an assumptive close?
A. "I suggest you buy two dozen cases of our ant killer."
B. "Mr. Kinney, I think you will like our low prices and just-in-time delivery service."
C. "Do you want the 36-inch or 26-inch long handles on those hand shovels?"
D. "Let me introduce you to our product by sending you a free case of our lawn
pesticides."
E. "I am going to send you three cases of our Song & Beauty bird seed."
D
263
11-57 After a brief sales presentation, rather than attempting a trial close, Arno Greski says to
the prospect, "I'll have this shipped tomorrow." This an example of a(n) _____ close.
A. boomerang
B. summary
C. complement
D. assumptive
E. minor decision
D
263
11.58 The final step in the selling promise is:
A. handling objections
B. the close
C. the thank-you note
D. follow-up service
E. none of the above because it varies from customer to customer
E
264-165
11.59 In order for a salesperson to be successful when selling abroad, he or she should:
A. learn about the host's culture and values
B. learn the host's language
C. develop relationships and trust before getting down to business
D. slow down
F
242
11-60 Procedural learning involves new product information, how to call in orders, new
territorial forms to complete, and other new procedures.
F
243
11-61 When a salesperson is hired, the first job-related information he or she receives is
typically about the competition.
T
243
11-62 Professional salespeople listen, teach, clarify, and consult.
F
244
11-63 Salespeople are called intermediaries because they are in the middle between the
customer and the employer.
F
246 (Table 11.1)
11-64 Salespeople find the personal computer most useful when they are creating their sales
presentations.
T
247
11-65 Sales forces use technology to enhance their personal productivity, their communications
skill, and their order processing and ability to service their customers.
T
248
11-66 A geographic information system allows salespeople to view and manipulate customer
and prospect information on an electronic map.
F
251
11.67 One of the ways that salespeople benefit from their company's implementation of an
Internet site is through the reduction of fixed and variable sales costs.
F
253
11-68 The sales process begins with pre-call planning.
T
254
11-69 Customers whose salesperson has left the company are called orphans.
T
255
11-70 Salespeople should have an objective in mind when they meet with a customer, and this
objective should be specific, measurable, and directly beneficial to the customer.
F
256
11-71 The first step in developing a customer benefit plan is to create a marketing plan.
F
257
11-72 In the company identification approach, the salesperson might begin by saying, "My
name is Margaret Ussery, and I work for United Designs, the world's largest manufacturer
of garden accessories."
F
257
11-73 The product approach is the most common sales opener and also the weakest.
F
258
11-74 The basic purpose of the presentation is for the salesperson to give the prospect a good
impression of himself or herself.
T
259
11-75 Proof statements are especially useful in showing your prospect that what you are saying
is true and that you can be trusted.
T
260
11-76 The memorized sales presentation allows too little prospect participation.
F
260
11-77 A formula sales presentation is also called the need-satisfaction method of selling.
T
261
11-78 The trial close may take place anywhere during the selling process.
F
262
11-79 The postponing method of handling objections turns the objection into a benefit or a
reason to buy.
F
263
11-80 Closing is the process of helping people deal with objections.
F
263
11-81 A furniture salesperson was using the after-the-sale summary when she asked the
prospect, "Why don't you buy the cherry desk to go with the rest of the office furniture
you have just purchased?"
F
264
11-82 According to the text, it is easier to find new customers than to keep old ones satisfied.
T
264-265
11.83 Cultural differences often make selling to people in other nations more difficult.
11.84 In the learning process involved in the training of individual salespeople, what must be
gained first so that the process will be effective?
Ans:
knowledge
11.85 What is the most important type of knowledge for a new salesperson to gain?
Ans:
product knowledge
Page: 243
11.86 Sales force automation breaks down into three broad areas of functionality. List them.
Ans:
personal productivity, communications, order processing and customer service
Page: 247
11.87 What is the salesperson's most vulnerable asset?
Ans: time
Page: 248
11.88 What are the two key elements involved in sales skills development?
Ans: persuasive communication and the selling process
Page: 251
11.89 What is the weakest approach technique commonly used by salespeople?
Ans: the introductory approach
Page: 257
11.90 What is another name for the memorized sales presentation?
Ans: the stimulus-response method
Page: 259
11.91 What do the letters in the acronym AIDA represent?
Ans: attention, interest, desire, action
Page: 260
Chapter 12
Motivating Salespeople toward High Performance
C
12-1
275
According to the text, when considering motivation, four questions must be answered.
Which of the following is NOT one of those questions?
A. What arouses salespeople's behavior?
B. What influences the intensity of behavior arousal?
C. What actions should be avoided because they will cause the salesperson's motivation
level to decrease?
D. What directs the salesperson's behavior?
E. How can aroused behavior be maintained over time?
E
12.2
275
According to the text, _____ refers to the arousal, intensity, direction, and persistence of
effort directed toward job tasks over a period of time.
A.
assurance
B.
confidence
C.
encouragement
D.
conviction
E.
motivation
B
12-3
275
The _____ is basically seven broad classes of motivational ingredients which influence
the arousal, intensity, direction, and persistence of people's behavior.
A. AIDA mix
B. sales motivational mix
C. motivational portfolio
D. sales incentive mix
E. sales catalyst
A
12-4
275
The sales motivational mix refers to both:
A. extrinsic and intrinsic outcomes
B. organizational and territorial rewards
C. psychological and group rewards
D. qualitative and quantitative outcomes
E. objective and subjective rewards
A
12-5
275
Which of the following is an example of an intrinsic outcome?
A. feeling of accomplishment
B. recognition
C.
challenging work assignments
D.
sales contests
E.
sales meeting
A
12-6
275 (Table 12.1)

Which of the following is an example of a special financial incentive that may be used by
a sales manager to motivate salespeople?
A. contests
B. quotas
C. salary
D. commissions
E. sales training
A
12-7
275 (Table 12.1)

Which of the following is clearly a type of nonfinancial reward which can be used as a
method of motivation?
A. challenging work assignments
B. a low sales quota
C. a large sales territory
D. a sales contest
E. a Las Vegas sales meeting
D
12-8
275 (Table 12.1)

Recognition is part of which element of the sales manager's motivation mix?
A. the basic compensation plan
B. special financial incentives
C. the sales culture
D. nonfinancial rewards
E. performance evaluation
E
12-9
275
_____ refers to the integrated pattern of salespeople's values, ideas, beliefs, attitudes,
customs, and any other capabilities and habits shared as a member of the sales group.
A. A code of ethics
B. Organizational psychology
C. Sales internalization
D. Organizational physiology
E. Sales culture
C
276
12-10 The most effective way to implement a strategy that uses rites and ceremonies to provide
a reward for performance is:
A. at company picnics
B. at company sponsored sporting events
C. at monthly and yearly (national) sales meetings
D. through the marketing concept and customer involvement
E. at private meetings at the office of the district or regional sales manager
D
276
12-11 Stories are an important part of an organization's sales culture because they:
A. are not easily imitated by the competition
B. are always part of the corporate strategy
C. create a source of intrinsic rewards
D. are a medium through which primary organizational values can be communicated
throughout the sales force
E. dramatize the best methods of handling objections
D
276
12-12 Each year our collegiate chapter of the American Marketing Association gives a plaque to
the most outstanding member of that year. The plaque is an example of a(n):
A. dramatization
B. demonstration
C. intrinsic outcome
D. symbol
E. story
E
276
12.13 Which of the following is an example of a symbol that an organization might use to convey
the organization's sales culture?
A. a plaster eagle given to the salesperson who travels the furthest annually
B. the relating of the adventures of a salesperson who refused to take "no" for an answer
C. a four-leaf clover given to every new salesperson
D. the company slogan, "Remember our customers are people, too"
E. all of the above
A
277
12-14 Organizations use slogans to:
A. communicate their culture
B. handle customer objections
C. disseminate the philosophy of their competitors
D. enhance the firms' integrated marketing communications
A
278
12-15 The _____ is used to explain salespeople's work behavior. It deals with such questions as
"What is the probability of success?" and "Will I be rewarded for success?"
A. expectancy theory
B. motivation model
C. equity theory
D. contingency model
E. correlation model
E
278 (Figure 12.1)
12-16 In making their decision about whether to expend extra effort to produce a higher level of
sales, salespeople often ask themselves:
A. "What is my probability of success?"
B. "Will I be rewarded for success?"
C. "Are the rewards fair?"
D. "Are the rewards worth it?"
E. all of the above questions
A
279
12-17 Valence for rewards refers to:
A. the value the salesperson places on the reward
B. the extrinsic value of the reward as defined by upper management
C. a formula used to calculate the monetary value of motivators
D. the incentives used to increase motivation levels
E. the method the salesperson uses to calculate the probability the reward will lead to the
achievement of a higher performance level
B
279
12-18 An agricultural supply company offered a $1,000 bonus to the first salesperson to sell
more than $100,000 worth of merchandise. One of its salespeople recently inherited
$750,000. In terms of the expectancy theory, the bonus has a very low _____ for this
individual.
A. instrumentality
B. valence
C. self-actualization impact
D. expectancy
E. equity
B
279
12-19 Sherman's wife is a successful dentist. The company he sells for just added a dental plan
that provides two free teeth cleanings annually. In terms of the expectancy theory, the
dental plan has a very low _____ for Sherman
A. instrumentality
B. valence
D. expectancy
E. equity
D
279
12-20 According to the expectancy theory, expectancy multiplied by instrumentality then
multiplied by valence equals:
A. action
B. job satisfaction
C. learning
D. motivation
E. equity
A
12.21
279
Wintertite Company sells down filled clothing and sleeping bags. Its sales manager has
just announced that the sales rep who has the greatest increase in net dollar sales this
quarter over last quarter will win a one-week vacation for four to Aspen, Colorado.
Charles Lee sincerely believes that if he increases his sales efforts by 10 percent, he can
win that contest. In terms of the expectancy theory, this strong belief that he can win is an
example of:
A. instrumentality
B. valence
C. equity
D. referent power
E. an intrinsic reward
C
280
12-22 From time to time while she drives from one sales appointment to another, Lily thinks
about how much effort her job requires and the compensation she receives for those
efforts. She also compares her situation to the workloads and rewards of other members
of the sales force. Lily's thoughts illustrate:
A. an expectancy model
B. trend analysis
C. equity theory
D. a contingency model
E. a correlation model
C
280
12.23 According to the _____, a salesperson develops a ratio of job "inputs" to "outcomes,"
which he or she compares to the perceived ratio of other salespeople.
A. expectancy model
B. trend analysis
C. equity theory
B
280
12-24 Abbie Bowman, sporting goods salesperson, is unhappy. She really worked hard last
period and now has learned other members of the sales force, who put in a great deal less
effort, received rewards equal to the one she got. According to equity theory, Abbie is
most likely to do which of the following?
A. apply for her boss' job
B. convince herself that equity really does exist
C. convince herself that equity does not matter
D. increase her income through falsified expense vouchers
E. work harder
B
281
12-25 Sales managers should be aware of equity theory because it points to a real need for
management to:
A. move salespeople from "hygiene seeking" to "motivation seeking"
B. evaluate salespeople's performances effectively and to reward them accordingly
C. move salespeople from "motivation seeking" to "hygiene seeking"
D. push salespeople to perform at above-average levels
A
282
12-26 A sales force with _____ is likely to exhibit job satisfaction.
A. few grievances and lawsuits
B. high turnover
C. poor mental and physical health
D. high absenteeism
D
282
12.27 Which of the following is NOT one of the categories used to define a Quality of Work Life
(QWL) program?
A. a societal environment that fosters personal identity, freedom from prejudice, a sense
of community, and upward mobility
B. a work role that minimizes infringements on personal leisure and family needs
C. a chance for personal growth and security
D. expectations of increased levels of productivity without any intrinsic or extrinsic
rewards
E. adequate and fair compensation
E
282
12-28 Job turnovers:
A. may be either voluntary or involuntary
B. are consequences of unmet expectations and unfulfilled needs
C. refer to someone leaving their present job
D. are exemplified by promotions and transfers
B
282-283
12-29 Jessica Towers recently left her sales job to pursue a career in education because she was
dissatisfied with the intrinsic rewards she received for the amount of effort she put forth
in selling. This is an example of:
A. an uncontrollable termination
B. voluntary turnover
C. an equitable termination
D. a negotiated turnover
E. contingency turnover
D
283
12-30 Personal factors in the salesperson's behavioral model include:
A. organizational rewards
B. competition
C. the economy
D. energy
B
283
12.31 Environmental factors in the salesperson's behavioral model include the:
A. sales culture
B. economy and competitors
C. salesperson's aptitude for selling
D. organization's evaluation procedures
E. organization's compensation practices
C
284
12-32 _____ is defined as the actual accomplishments of a salesperson.

A. Payoff
B. Motivation
C. Performance level
D. Intrinsic reaction
E. Reactive behavior
B
284
12-33 Intrinsic rewards come from:
A. the salesperson's employer
B. the salesperson himself
C. the salesperson's co-workers
D. the salesperson's family
E. all of the above
B
285
12-34 Sales performance is a function of:
A. equity and motivation
B. ability and motivation
C. rewards and attitudes
D. sales culture and ability
E. expertise and ability
C
286
12.35 _____ are those things seen in the environment that appeal to the salesperson's motives and
have enough worth to motivate purposeful behavior to obtain them.
A. Environmental offerings
B. Accomplishments
C. Incentives
D. Environmental bonuses
E. Environmental assets
B
286
12-36 Which of the following is an example of a low motivator?
A. job advancement
B. retirement programs
C. freedom to manage oneself
D. performance evaluation
E. leadership
D
286
12-37 Which of the following is an example of a high motivator?
A. fringe benefits
C. company policy and procedures
E. more supervision
A
286
12-38 Low motivator incentives:
A. prevent dissatisfaction
B. are used to produce positive attitudes
C. can encourage role ambiguity
D. cost very little to implement into a sales strategy
E. satisfy ego and self-actualization needs
B
286
12-39 High motivator incentives:
B
286
12-40 Which of the following statements about incentives is true?
A. Fringe benefits is a much better motivator than job advancement.
B. A sales manager would do well to explore different aspects of incentives for each
member of the sales team
C. More supervision is a much higher motivator than training and sales meetings.
D. In most cases, negative incentives motivate more successfully than positive
incentives.
E. All salespeople prefer short-range incentives significantly more than long-range
incentives.
E
289
12-41 Avram Hersey faces a difficult situation. He is a new district sales manager for a tire
manufacturer, and Ian is a new salesperson in his district. Avram needs to know what
motivates Ian, but Ian seems unwilling to share his motives. The text would say this
problem exists because _____ do not yet exist between Avram and Ian.
A. sentimental feelings
B. rapport, knowledge, and reference
C. dignity, authority, and knowledge
D. trust and love
E. respect, rapport, and confidence
A
289
12-42 Salespeople are in a fairly unique position because they represent their employers'
interests and their customers' interest, too. This situation between customers and the
company is called a(n):
A. boundary position
B. asset position
C. restricted operating position
D. tightrope
E. balancing act
A
289
12.43 Adam Grotski sells golfing equipment to retailers. He has developed a close, personal
relationship with several of the store owners that he calls on regularly. Sales at his
company have been gradually declining over the last three years. Adam's sales manager
has asked his salespeople to pressure their customers and get the storeowners to place
larger orders. Adam is reluctant to take advantage of his friends. This situation illustrates
one of the problems salespeople face because they occupy a(n):
B. asset position
D. tightrope
E. balancing act
C
289-290
12-44 Salespeople experience _____ when they do not possess the information necessary to
perform their jobs.
A. cognitive dependence
B. job conflict
C. role ambiguity
D. job deprivation
E. role conflict
C
289-290
12-45 As a new ad salesperson for a cable television channel, Sean is unsure what his company
expects of him in his job as an ad salesperson. He's not sure about how he should do his
job, nor of how his work is perceived by his supervisor. Sean is experiencing:
B. job conflict
C. role ambiguity
D. job deprivation
E. role conflict
D
290
12-46 A major cause of role ambiguity is:
A. a dependence on extrinsic rewards
B. the personal nature of an individual's motives
C. an inability to move past the exploration phase of one's career
D. the lack of effective coaching and counseling by the sales manager
E. an inability to meet the needs of customers
D
290
12-47 Mike Pizzaro finds himself caught between the demands of his sales manager and the
demands of his key account. Often what one wants is completely inconsistent with the
desires of the other. For example, his manager wants him to cut expenses, and his key
account expects Mike to take him out to lunch each time Mike calls on him. The conflict
caused by the incompatibility of the expectations of his manager and his most important
account is hurting his performance on the job. Mike is experiencing:
A. role ambiguity
B. stress reduction
C. dysfunctional ethics
D. role conflict
E. job distraction
C
291
12-48 Motivation:
A. is a cure-all managerial action plan for sure success
B. can cure problems brought about by ineffective training
C. cannot cure problems caused by lack of planning
D. is best when delivered as a general method of improving sales rather than tailored to
each individual's idiosyncrasies needs
E. works equally well with all salespeople
T
275
12-49 Motivation refers to the level or amount of energy directed by someone toward some
single task or goal.
F
275
12-50 Intrinsic outcomes include the basic compensation plan and special financial incentives.
T
276
12-51 Sales managers can use ceremonies and rites to provide dramatic examples of what the
company values.
T
277
12-52 Slogans are an effective way of communicating an organization's sales culture.
F
278
12-53 According to the expectancy model, a salesperson develops a ratio between inputs into
the job and outcomes (or what is received) and compares this ratio with his or her
perception of other salespeople's ratios.
F
279
12-54 A salesperson who has a high level of motivation cannot fail to meet the job's
performance requirements.
T
280
12.55 The equity theory is in operation when Meredith sincerely believes that even though she
has put forth just as much effort as her co-workers, she is receiving less rewards.
F
282
12-56 Job satisfaction is best thought of as the CAUSE of behavior performance rather than as a
result of it.
F
282
12-57 Even critics of Quality of Work Life (QWL) programs admit the programs make
employees work harder because QWL programs do an excellent job of tying rewards
directly to individual performance.
F
282-283
12-58 All turnovers are involuntary.
T
285
12-59 Sales performance is a function of motivation and ability.
T
286
12-60 Rewards for success, leadership, performance evaluations, and company policy and
procedure are all examples of high motivators.
T
289
12-61 A major cause of role ambiguity in salespeople is an ineffective job by their sales
managers.
T
290
12-62 Role conflict can be caused by the salesperson's manager, family, customers, and
company.
T
290
12-63 In the final analysis, all motivation is self-motivation.
F
291
12-64 Motivation works equally well with all salespeople.
T
291
12-65 Motivation cannot cure problems caused by lack of planning.
12.66 List the two categories of rewards that are part of the sales motivational mix.
Ans: intrinsic rewards and extrinsic rewards
Page: 275
12.67 What are the components of the expectancy theory?
Ans: Motivation = Expectancy x Instrumentality x Valence
Page: 279
12.68 What are the two types of turnover discussed in the text?
Ans: voluntary and involuntary
Page: 283
12.69 Write the formula for determining sales performance.
Ans: Sales Performance is a function of Ability multiplied by Motivation.
Page: 285
12.70 When the sales manager was explaining to Roger about his new selling job, he made the
following statement, "We expect you to be in a boundary position." What did the sales
manager mean?
Ans: Roger will be involved in meeting the needs of his customer and the needs of his
employer.
Page: 289
12.71 Clyde's wife wants him to spend every night at home. Clyde's company expects him to
spend at least two nights a week on the road. What is the name for the type of problem
that Clyde is experiencing?
Ans: role conflict
Page: 290
Chapter 12
Motivating Salespeople toward High Performance
C
12-1
275
According to the text, when considering motivation, four questions must be answered.
Which of the following is NOT one of those questions?
A. What arouses salespeople's behavior?
B. What influences the intensity of behavior arousal?
C. What actions should be avoided because they will cause the salesperson's motivation
level to decrease?
D. What directs the salesperson's behavior?
E. How can aroused behavior be maintained over time?
E
12.3
275
According to the text, _____ refers to the arousal, intensity, direction, and persistence of
effort directed toward job tasks over a period of time.
A. assurance
B. confidence
C. encouragement
D. conviction
E. motivation
B
12-3
275
The _____ is basically seven broad classes of motivational ingredients which influence
the arousal, intensity, direction, and persistence of people's behavior.
A. AIDA mix
B. sales motivational mix
C. motivational portfolio
D. sales incentive mix
E. sales catalyst
A
12-4
275
The sales motivational mix refers to both:
A. extrinsic and intrinsic outcomes
B. organizational and territorial rewards
C. psychological and group rewards
D. qualitative and quantitative outcomes
E. objective and subjective rewards
A
12-5
275
Which of the following is an example of an intrinsic outcome?
A. feeling of accomplishment
B. recognition
C. challenging work assignments
D. sales contests
E. sales meeting
A
12-6
275 (Table 12.1)

Which of the following is an example of a special financial incentive that may be used by
a sales manager to motivate salespeople?
A. contests
B. quotas
C. salary
D. commissions
E. sales training
A
12-7
275 (Table 12.1)

Which of the following is clearly a type of nonfinancial reward which can be used as a
method of motivation?
A. challenging work assignments
B. a low sales quota
C. a large sales territory
D. a sales contest
E. a Las Vegas sales meeting
D
12-8
275 (Table 12.1)

Recognition is part of which element of the sales manager's motivation mix?
A. the basic compensation plan
B. special financial incentives
C. the sales culture
D. nonfinancial rewards
E. performance evaluation
E
12-9
275
_____ refers to the integrated pattern of salespeople's values, ideas, beliefs, attitudes,
customs, and any other capabilities and habits shared as a member of the sales group.
A. A code of ethics
B. Organizational psychology
C. Sales internalization
D. Organizational physiology
E. Sales culture
C
276
12-10 The most effective way to implement a strategy that uses rites and ceremonies to provide
a reward for performance is:
A. at company picnics
B. at company sponsored sporting events
C. at monthly and yearly (national) sales meetings
D. through the marketing concept and customer involvement
E. at private meetings at the office of the district or regional sales manager
D
276
12-11 Stories are an important part of an organization's sales culture because they:
A. are not easily imitated by the competition
B. are always part of the corporate strategy
C. create a source of intrinsic rewards
D. are a medium through which primary organizational values can be communicated
throughout the sales force
E. dramatize the best methods of handling objections
D
276
12-12 Each year our collegiate chapter of the American Marketing Association gives a plaque to
the most outstanding member of that year. The plaque is an example of a(n):
A. dramatization
B. demonstration
C. intrinsic outcome
D. symbol
E. story
E
276
12.14 Which of the following is an example of a symbol that an organization might use to convey
the organization's sales culture?
A. a plaster eagle given to the salesperson who travels the furthest annually
B. the relating of the adventures of a salesperson who refused to take "no" for an answer
C. a four-leaf clover given to every new salesperson
D. the company slogan, "Remember our customers are people, too"
E. all of the above
A
277
12-14 Organizations use slogans to:
A. communicate their culture
B. handle customer objections
C. disseminate the philosophy of their competitors
D. enhance the firms' integrated marketing communications
A
278
12-15 The _____ is used to explain salespeople's work behavior. It deals with such questions as
"What is the probability of success?" and "Will I be rewarded for success?"
A. expectancy theory
B. motivation model
C. equity theory
E
278 (Figure 12.1)
12-16 In making their decision about whether to expend extra effort to produce a higher level of
sales, salespeople often ask themselves:
A. "What is my probability of success?"
B. "Will I be rewarded for success?"
C. "Are the rewards fair?"
D. "Are the rewards worth it?"
E. all of the above questions
A
279
12-17 Valence for rewards refers to:
A. the value the salesperson places on the reward
B. the extrinsic value of the reward as defined by upper management
C. a formula used to calculate the monetary value of motivators
D. the incentives used to increase motivation levels
E. the method the salesperson uses to calculate the probability the reward will lead to the
achievement of a higher performance level
B
279
12-18 An agricultural supply company offered a $1,000 bonus to the first salesperson to sell
more than $100,000 worth of merchandise. One of its salespeople recently inherited
$750,000. In terms of the expectancy theory, the bonus has a very low _____ for this
individual.
A. instrumentality
B. valence
D. expectancy
E. equity
B
279
12-19 Sherman's wife is a successful dentist. The company he sells for just added a dental plan
that provides two free teeth cleanings annually. In terms of the expectancy theory, the
dental plan has a very low _____ for Sherman
A. instrumentality
B. valence
D. expectancy
E. equity
D
279
12-20 According to the expectancy theory, expectancy multiplied by instrumentality then
multiplied by valence equals:
A. action
B. job satisfaction
C. learning
D. motivation
E. equity
A
12.22
279
Wintertite Company sells down filled clothing and sleeping bags. Its sales manager has
just announced that the sales rep who has the greatest increase in net dollar sales this
quarter over last quarter will win a one-week vacation for four to Aspen, Colorado.
Charles Lee sincerely believes that if he increases his sales efforts by 10 percent, he can
win that contest. In terms of the expectancy theory, this strong belief that he can win is an
example of:
A. instrumentality
B. valence
C. equity
D. referent power
E. an intrinsic reward
C
280
12-22 From time to time while she drives from one sales appointment to another, Lily thinks
about how much effort her job requires and the compensation she receives for those
efforts. She also compares her situation to the workloads and rewards of other members
of the sales force. Lily's thoughts illustrate:
A. an expectancy model
B. trend analysis
C. equity theory
D. a contingency model
E. a correlation model
C
280
12.24 According to the _____, a salesperson develops a ratio of job "inputs" to "outcomes,"
which he or she compares to the perceived ratio of other salespeople.
A. expectancy model
B. trend analysis
C. equity theory
B
280
12-24 Abbie Bowman, sporting goods salesperson, is unhappy. She really worked hard last
period and now has learned other members of the sales force, who put in a great deal less
effort, received rewards equal to the one she got. According to equity theory, Abbie is
most likely to do which of the following?
A. apply for her boss' job
B. convince herself that equity really does exist
C. convince herself that equity does not matter
D. increase her income through falsified expense vouchers
E. work harder
B
281
12-25 Sales managers should be aware of equity theory because it points to a real need for
management to:
A. move salespeople from "hygiene seeking" to "motivation seeking"
B. evaluate salespeople's performances effectively and to reward them accordingly
C. move salespeople from "motivation seeking" to "hygiene seeking"
D. push salespeople to perform at above-average levels
A
282
12-26 A sales force with _____ is likely to exhibit job satisfaction.
A. few grievances and lawsuits
B. high turnover
C. poor mental and physical health
D. high absenteeism
D
282
12.28 Which of the following is NOT one of the categories used to define a Quality of Work Life
(QWL) program?
A. a societal environment that fosters personal identity, freedom from prejudice, a sense
of community, and upward mobility
B. a work role that minimizes infringements on personal leisure and family needs
C. a chance for personal growth and security
D. expectations of increased levels of productivity without any intrinsic or extrinsic
rewards
E. adequate and fair compensation
E
282
12-28 Job turnovers:
A. may be either voluntary or involuntary
B. are consequences of unmet expectations and unfulfilled needs
C. refer to someone leaving their present job
D. are exemplified by promotions and transfers
B
282-283
12-29 Jessica Towers recently left her sales job to pursue a career in education because she was
dissatisfied with the intrinsic rewards she received for the amount of effort she put forth
in selling. This is an example of:
A. an uncontrollable termination
B. voluntary turnover
C. an equitable termination
D. a negotiated turnover
E. contingency turnover
D
283
12-30 Personal factors in the salesperson's behavioral model include:
A. organizational rewards
B. competition
C. the economy
D. energy
B
283
12.32 Environmental factors in the salesperson's behavioral model include the:
A. sales culture
B. economy and competitors
C. salesperson's aptitude for selling
D. organization's evaluation procedures
E. organization's compensation practices
C
284
12-32 _____ is defined as the actual accomplishments of a salesperson.

A. Payoff
B. Motivation
C. Performance level
D. Intrinsic reaction
E. Reactive behavior
B
284
12-33 Intrinsic rewards come from:
A. the salesperson's employer
B. the salesperson himself
C. the salesperson's co-workers
D. the salesperson's family
E. all of the above
B
285
12-34 Sales performance is a function of:
A. equity and motivation
B. ability and motivation
C. rewards and attitudes
D. sales culture and ability
E. expertise and ability
C
286
12.36 _____ are those things seen in the environment that appeal to the salesperson's motives and
have enough worth to motivate purposeful behavior to obtain them.
A. Environmental offerings
B. Accomplishments
C. Incentives
D. Environmental bonuses
E. Environmental assets
B
286
12-36 Which of the following is an example of a low motivator?
A. job advancement
C. freedom to manage oneself
E. leadership
D
286
12-37 Which of the following is an example of a high motivator?
A. fringe benefits
C. company policy and procedures
E. more supervision
A
286
12-38 Low motivator incentives:
B
286
12-39 High motivator incentives:
B
286
12-40 Which of the following statements about incentives is true?
A. Fringe benefits is a much better motivator than job advancement.
B. A sales manager would do well to explore different aspects of incentives for each
member of the sales team
C. More supervision is a much higher motivator than training and sales meetings.
D. In most cases, negative incentives motivate more successfully than positive
incentives.
E. All salespeople prefer short-range incentives significantly more than long-range
incentives.
E
289
12-41 Avram Hersey faces a difficult situation. He is a new district sales manager for a tire
manufacturer, and Ian is a new salesperson in his district. Avram needs to know what
motivates Ian, but Ian seems unwilling to share his motives. The text would say this
problem exists because _____ do not yet exist between Avram and Ian.
A. sentimental feelings
B. rapport, knowledge, and reference
C. dignity, authority, and knowledge
D. trust and love
E. respect, rapport, and confidence
A
289
12-42 Salespeople are in a fairly unique position because they represent their employers'
interests and their customers' interest, too. This situation between customers and the
company is called a(n):
B. asset position
D. tightrope
E. balancing act
A
289
12.44 Adam Grotski sells golfing equipment to retailers. He has developed a close, personal
relationship with several of the store owners that he calls on regularly. Sales at his
company have been gradually declining over the last three years. Adam's sales manager
has asked his salespeople to pressure their customers and get the storeowners to place
larger orders. Adam is reluctant to take advantage of his friends. This situation illustrates
one of the problems salespeople face because they occupy a(n):
B. asset position
D. tightrope
E. balancing act
C
289-290
12-44 Salespeople experience _____ when they do not possess the information necessary to
perform their jobs.
B. job conflict
F. role ambiguity
G. job deprivation
H. role conflict
C
289-290
12-45 As a new ad salesperson for a cable television channel, Sean is unsure what his company
expects of him in his job as an ad salesperson. He's not sure about how he should do his
job, nor of how his work is perceived by his supervisor. Sean is experiencing:
B. job conflict
C. role ambiguity
D. job deprivation
E. role conflict
D
290
12-46 A major cause of role ambiguity is:
A. a dependence on extrinsic rewards
B. the personal nature of an individual's motives
C. an inability to move past the exploration phase of one's career
D. the lack of effective coaching and counseling by the sales manager
E. an inability to meet the needs of customers
D
290
12-47 Mike Pizzaro finds himself caught between the demands of his sales manager and the
demands of his key account. Often what one wants is completely inconsistent with the
desires of the other. For example, his manager wants him to cut expenses, and his key
account expects Mike to take him out to lunch each time Mike calls on him. The conflict
caused by the incompatibility of the expectations of his manager and his most important
account is hurting his performance on the job. Mike is experiencing:
A. role ambiguity
B. stress reduction
C. dysfunctional ethics
D. role conflict
E. job distraction
C
291
12-48 Motivation:
A. is a cure-all managerial action plan for sure success
B. can cure problems brought about by ineffective training
C. cannot cure problems caused by lack of planning
D. is best when delivered as a general method of improving sales rather than tailored to
each individual's idiosyncrasies needs
E. works equally well with all salespeople
T
275
12-49 Motivation refers to the level or amount of energy directed by someone toward some
single task or goal.
F
275
12-50 Intrinsic outcomes include the basic compensation plan and special financial incentives.
T
276
12-51 Sales managers can use ceremonies and rites to provide dramatic examples of what the
company values.
T
277
12-52 Slogans are an effective way of communicating an organization's sales culture.
F
278
12-53 According to the expectancy model, a salesperson develops a ratio between inputs into
the job and outcomes (or what is received) and compares this ratio with his or her
perception of other salespeople's ratios.
F
279
12-54 A salesperson who has a high level of motivation cannot fail to meet the job's
performance requirements.
T
280
12.56 The equity theory is in operation when Meredith sincerely believes that even though she
has put forth just as much effort as her co-workers, she is receiving less rewards.
F
282
12-56 Job satisfaction is best thought of as the CAUSE of behavior performance rather than as a
result of it.
F
282
12-57 Even critics of Quality of Work Life (QWL) programs admit the programs make
employees work harder because QWL programs do an excellent job of tying rewards
directly to individual performance.
F
282-283
12-58 All turnovers are involuntary.
T
285
12-59 Sales performance is a function of motivation and ability.
T
286
12-60 Rewards for success, leadership, performance evaluations, and company policy and
procedure are all examples of high motivators.
T
289
12-61 A major cause of role ambiguity in salespeople is an ineffective job by their sales
managers.
T
290
12-62 Role conflict can be caused by the salesperson's manager, family, customers, and
company.
T
290
12-63 In the final analysis, all motivation is self-motivation.
F
291
12-64 Motivation works equally well with all salespeople.
T
291
12-65 Motivation cannot cure problems caused by lack of planning.
12.72 List the two categories of rewards that are part of the sales motivational mix.
Ans: intrinsic rewards and extrinsic rewards
Page: 275
12.73 What are the components of the expectancy theory?
Ans: Motivation = Expectancy x Instrumentality x Valence
Page: 279
12.74 What are the two types of turnover discussed in the text?
Ans: voluntary and involuntary
Page: 283
12.75 Write the formula for determining sales performance.
Ans: Sales Performance is a function of Ability multiplied by Motivation.
Page: 285
12.76 When the sales manager was explaining to Roger about his new selling job, he made the
following statement, "We expect you to be in a boundary position." What did the sales
manager mean?
Ans: Roger will be involved in meeting the needs of his customer and the needs of his
employer.
Page: 289
12.77 Clyde's wife wants him to spend every night at home. Clyde's company expects him to
spend at least two nights a week on the road. What is the name for the type of problem
that Clyde is experiencing?
Ans: role conflict
Page: 290
Chapter 13
Compensation for High Performance
C
13-1
301
There are three interrelated elements of rewards for salespeople. One of the elements is
direct financial rewards and includes:
A. salary, commission, and career advancement
B. merit salary increases, commission, and better territory
C. merit salary increases, bonuses, and commissions
D. larger sales territories, bonuses, insurance, and a certificate of achievement
E. commissions, recognition dinners, trophies, and personal development opportunities
A
13.2
301
There are three interrelated elements of rewards for salespeople. One of the elements is
nonfinancial compensation and includes:
A. recognition dinners, certificates of achievement, and features in sales newsletters
B. larger accounts and sales territories
C. personal development opportunities, merit salary increases, and promotions
D. promotions, certificates of achievement, and larger sales territories
E. retirement programs, insurance, and certificates of achievement
D
13-3
301-302
Compensation has six basic purposes in influencing motivation. Which of the following
is NOT one of those basic purposes?
A. to retain salespeople
B. to provide a bridge between sales force objectives and the individual salesperson's
expectations
C. to reinforce salespeople's behavior
D. to interpret the actions of competitor's salespeople into sales dollar volume
E. to serve as direct feedback about how the organization values the salesperson's
performance
B
13-4
on:
302
As a sales manager, you should know the pay satisfaction of your subordinates is based
A. the size of each territory and the number of sales calls each must make
B. the difference between the salesperson's perception of what pay should be and the
amount actually received
C. the sales forecast for each individual territory
D. the difference between the raise received and the rate of inflation
C
13-5
302-303
Even though Delores Mulholland works for an experienced sales manager, she is not
satisfied with the pay she receives as a salesperson for a wholesale hardware company.
Which of the following is the most likely source of Delores's dissatisfaction?
A. the difference between the amount she earned and the rate of inflation
B. the size of her territory
C. the difference between her perception of what her pay should be and the amount she
actually receives
D. the sales forecast for her territory
E. the number of sales calls she makes each week
E
13-6
302-303
Sales manager should be aware that salespeople are satisfied with the rewards they
receive based on:
A. current economic conditions within the organization
B. their position within the organizational chart
C. their level of need according to Maslow's hierarchy
D. the style of leadership used
E. how much reward is achieved in relation to how much reward is expected
A
13-7
304
The first step in determining how a firm's sales force compensation program will be
structured is to determine the:
A. wage level relative to salespeople in other organizations in the industry
B. salesperson's individual wage
C. wage structure for the sales force
D. number of new customers in each sales territory
E. necessary administration procedures
D
13-8
304
Which of the following is NOT one of the major factors affecting how compensation is
structured for a sales force?
A. wage level in relation to salespeople in other organizations in the industry
B. salesperson's individual wage
C. wage structure for the sales force
D. number of new customers in each sales territory
E. administrative procedures
D
13-9
304
The pay differential among different sales levels within an organization is the:
A. pay equity
B. pay hierarchy
C. discretionary pay
D. wage structure
E. pay ratio
A
305
13-10 The human resources manager of Freeborn Tool Company is evaluating the firm's
retirement and disability benefits as well as the life insurance program offered to the sales
force. He is analyzing:
A. part of the long-range compensation program
B. the corporation's major objectives
C. the effectiveness of the Freeborn recruiting program
D. part of the firm's appraisal process
E. part of the firm's return-on-investment (ROI)
C
305
13-11 Long-term compensation plans:
A. include bonuses and contests
B. should be evaluated and modified quarterly
C. should be well thought out, so that few changes will be needed from year to year
D. must be developed so that short-term compensation plans will not be necessary
E. are not described by any of the above
D
305
13.12 Which of the following is the BEST example of a short-term compensation plan?
A. a dental plan that provides annual teeth cleaning for all sales personnel
B. a corporate-administered retirement plan
C. pay levels set for each promotion
D. competition among salespeople for who can sell the most product in six months;
winner gets $1,000
E. disability benefits in the case of a salesperson being injured while on the job
E
305
13-13 What or who is the key link in the compensation communication network?
A. the company newsletter
B. national sales meetings
C. the human resources department
D. trade journals
E. the sales manager
B
305-306
13-14 Soon after Megan O'Casey was hired to sell antique reproductions, her sales manager
held a one-on-one meeting in which he explained her role in achieving organizational
objectives, the fact that her future with the company depended on her sales ability, and
the limitations of the company's compensation plan. The sales manager was giving
Megan a(n):
A. pep talk
B. compensation message
C. on-the-job training preamble
D. welcome to the company statement
E. explanation of sales culture
E
307
13-15 For pay to positively influence salespeople's performance, the organization must make
sure:
A. the performance-appraisal system is free from potential bias
B. enough money is set aside for incentive pay to make extra effort worthwhile
C. sales territories have equal potentials
D. managers are trained in giving feedback
E. all of the above conditions exist
B
307
13-16 Jack Knighten owns a small manufacturing company and needs his salespeople to keep in
contact with nonproductive accounts and routinely call on customers who purchase the
company's products from a wholesaler. He should use the:
A. salary plus commission over quota
B. straight salary
C. straight commission
D. salary plus commission on all sales
E. salary plus commission plus pay incentives
D
307
13-17 When a salesperson receives a specific dollar amount of pay at regular intervals
regardless of how much or how little he or she sells, that individual is being compensated
using a ______ plan.
A. straight commission
B. salary and commission
C. unstructured commission
D. straight salary
E. salary and bonus
B
307
13.18 From management's point of view, what is the advantage of a straight salary compensation
plan?
A. With a straight salary plan, selling costs are kept in proportion to sales.
B. The straight salary plan is simple and economical to administer.
C. With a straight salary plan, salespeople have the assurance of positive feedback.
D. A straight salary plan links performance to leadership style.
E. The advantage of a straight salary compensation plan is accurately described by none
of the above.
C
307-309
13-19 Which of the following statements describes a reason why a sales manager might NOT
prefer the straight salary compensation plan over other types of compensation plan?
A. With a straight salary plan, salespeople offer less resistance to reassignment of
accounts.
B. With a straight salary plan , sales costs are relatively fixed.
C. With a straight salary plan, the more productive salespeople are favored.
D. With a straight salary plan, salespeople are less likely to use high-pressure sales
tactics.
E. With a straight salary plan, management can direct selling duties that may not
immediately result in sales.
D
309
13-20 If the sales manager does not want the salespeople employed by his financial services
company to use high-pressure selling techniques, she should use a _____ plan.
C. structured commission
D. straight salary
E. salary and bonus
B
309
13-21 Which of the following statements describes one of the advantages associated with the
use of the straight salary compensation plan?
A. With a straight salary plan, salespeople feel in competition with each other rather than
with salespeople of the firm's competitors.
B. With a straight salary plan , sales costs are a relatively fixed proportion of sales.
C. There is a lack of direct money incentive with a straight salary plan.
D. Salary is not distributed in proportion of sales made with a straight salary plan.
E. With a straight salary plan, salespeople tend to emphasize the products that are easiest
to sell.
C
309
13-22 Which of the following statements describes a disadvantage inherent in the straight salary
compensation plan?
A. With a straight salary plan, the salesperson experiences the uncertainty and insecurity
of low or no pay.
B. With a straight salary plan, salespeople develop little loyalty to the firm.
C. With a straight salary plan, payments are not distributed in proportion to sales made.
D. As sales increase with a straight salary plan,, so do the company's compensation
costs.
E. With a straight salary plan, commission rates must be constantly adjusted to reflect
economic conditions.
C
309 (Table 13.1)
13.23 A company that is most likely to use a straight salary compensation plan would:
A. be described as a selling company--not a service company
B. have a small market share of a technologically-complex market
C. have a dominant share in a mature, stable market
D. have few, if any, house accounts
E. use strongly decentralized selling
B
309 (Table 13.1)
13-24 A company that successfully uses a straight salary compensation plan most likely:
A. has very few, if any, house accounts
B. has a highly defined and stable customer base
C. emphasizes selling over service
D. has decentralized its selling effort
E. has a small percentage of the market in a growth industry
D
309-310
13-25 For which of the following selling jobs is the straight salary compensation plan LEAST
appropriate?
A. pharmaceutical salesperson
B. the person who stocks the novelty racks at a convenience store
C. the person selling supercomputers that are used to track weather systems
D. established insurance salesperson
E. a Frito-Lay route person
A
310
13-26 Keisha Brown sells encyclopedias door-to-door. Last week she received no pay because
she was unable to sell any books. Under what compensation system does Keisha work?
C. unproductive commission
D. straight salary
E. salary and bonus
E
310
13-27 Misha sells garden benches, birdbaths, statuary, etc. to garden supply companies. She
receives an advance against the commissions she is expected to earn in the coming
month. This payment is called a ______ against commission.
A. recession
B. prepaid evaluation
C. bonus
D. regression
E. draw
C
310
13.28 Under a(n) _____ commission plan, Marvela would receive a 10 percent commission on
her first $100,000 sales, and an 8 percent commission on all sales over $100,000.
A.
progressive
B.
drawing
C.
regressive
D.
evaluative
E.
reversionary
D
310
13-29 Guaranteed drawing accounts:
A. are used exclusively in industries where selling requires extensive missionary selling
B. are actually straight salary compensation plans
C. can be used effectively in routine selling jobs
D. are actually a salary plus commission compensation plan
E. are methods of doling out prerequisites as they are needed by the individual
salesperson
E
310-311
13-30 Which of the following describes an advantage a straight commission compensation plan
has over a straight salary plan?
A. the level of after the sale service provided to buyers
B. the level of company control over salesperson activities
C. the level of financial security provided to salespeople
D. the level of recruiting costs
E. the level of incentive provided for the salesperson
A
311
13-31 A new firm with limited capital resources needing a large number of salespeople would
most likely adopt which method of compensating its sales force?
C. structured commission
D. straight salary
E. salary and bonus
B
311
13.32 Under a straight commission compensation plan,:
A. salespeople are typically eager to change or split territories
B. selling costs are greater even though a greater sales volume is produced
C. salespeople develop a great loyalty for their employer
D. high-pressure sales techniques do not occur
E. job turnover is low and job satisfaction is high
E
312 (Table 13.2)
13-33 A company that successfully uses a straight commission compensation plan most likely:
A. sets challenging quotas for its salespeople
B. has a clearly defined customer base
C. uses a customer-oriented business strategy
D. has a dominant share in a mature industry
E. is accurately described by none of the above
E
312
13-34 A straight commission plan is appropriate when:
A. the company uses a lot of part-time salespeople
B. there is little missionary work involved
C. the company wants selling costs to be directly related to sales
D. the company cannot afford to pay salaries
E. any of the above are true
C
312
13-35 Irina is a sales manager who is in the process of setting up a salary-plus-incentive plan.
She needs to determine:
A. whether to include unemployment compensation in the plan
B. how top-level management is compensated
C. when incentives should be paid
D. whether to include social security payments in the plan
E. all of the above
B
313
13-36 Under a combination salary plan, the incentive pay is typically calculated:
A. as an end-of-year bonus
B. only on sales beyond some predetermined quota
C. on all gross sales
D. on all net sales
E. using none of the above
C
314
13.37 _____ results when more than one person or department is involved in a sale, and all
parties receive a portion of the incentive pay.
A.
A draw account
B.
Incentive-oriented commission
C.
Split credit
D.
A short-term compensation plan
E.
A spiff
D
314
13-38 Of the following individuals who work for a drill bit manufacturer, who should receive
incentive payments?
A. Milt Glisson, the design engineer
B. Ron Self, the legal advisor
C. Janet Fugue, the proposal preparer
D. Betsy Patchett, the salesperson
E. Jason McMillen, the applications engineer
C
314
13-39 Which of the following is NOT one of the more popular combination salary plans?
A. salary and group bonus
B. salary, commission, and bonus
C. commission plus contest
D. salary and individual bonus
E. salary and commission
D
315
13.40 At the end of the year, Leonora Gonzalez received a $300 Christmas bonus. This is an
example of a(n):
A. productivity bonus
B. administered drawing account
C. drawing account dividend
D. nonproductivity bonus
E. installment commission
A
315
13-41 At the end of his company's fiscal year, Arvin Wilson was awarded $450 on the basis of
the number of new accounts he has acquired during the year. This is an example of a(n):
A. productivity bonus
B. fringe benefit
C. drawing account dividend
D. nonproductivity bonus
E. installment commission
B
315
13-42 Productivity bonuses can be based on all of the following EXCEPT:
A. number of units sold
B. number of years with the company
C. gross margins on products sold
D. number of new accounts acquired
E. sales performance appraisal by the sales manager
B
315
13-43 The real estate industry's "Million Dollar Club" is an example of a _____. It is offered, in
addition to regular compensation, in order to make the salespeople work harder and earn
the annual rewards.
A. fringe benefit
B. sales contest
C. pay increment
D. severance pay
E. drawing account
A
315
13-44 Which of the following statements describes an advantage that can be gained through the
use of sales contests?
A. Sales contest are an effective motivational method to intensify salespeople's work
efforts.
B. Sales contest are easily measurable in objective terms.
C. Sales contest encourage salespeople to use high pressure selling tactics.
D. Sales contest always boost morale because everyone likes a good competition.
E. Sales contests are an excellent example of a long-term compensation plan.
E
316
13-45 It is generally effective to allow first-line field sales managers (like district managers) to
participate in the company's incentive program. The compensation awarded to these
managers should be based on (1) total district performance, and (2):
A. product knowledge
B. expense control
C. number of years in a management position
D. total number of years with the company both as a salesperson and a manager
E. the performance of the individual members of the sales force supervised by that
manager
E
317
13-46 According to the text, an effective expense plan should be:
A. understandable
B. cost effective
C. convenient
D. fair for the salesperson and the company
E. all of the above
A
317
13-47 Freeborn Manufacturing Company requires its salespeople to pay all their own expenses.
What kind of problems may this type of plan present for Freeborn Manufacturing?
A. a loss of control over the activities of its salespeople
B. a potential confrontation with IRS
C. a need for a list which defines items which can be expensed
D. an increase in fixed expenses
E. all of the above are potential problems
E
318
13-48 A company that decided to partially pay its salespeople's expenses would discover that
compared to other approaches to handling expenses, under this plan:
A. it is easier to project selling expenses over time
B. they have increased control over the activities of their sales force
C. it is easier to budget for selling expenses
D. there is less conflict over what is and what is not an appropriate expense
E. all of the above are true
E
318
13-49 Which of the following describes a disadvantage of the partial payment of expenses plan?
A. The partial payment of expenses plan does not consider geographical differences.
B. The partial payment of expenses plan is inflexible.
C. The partial payment of expenses plan requires time to administer.
D. The partial payment of expenses plan may not reimburse the salesperson for expenses
that were necessary.
E. All of the above are disadvantages of the partial payment of expenses plan
A
319
13-50 Which of the following is an example of a fringe benefit that is required by law?
A. worker's compensation
B. retirement program
C. profit-sharing plan
D. vacation time
E. life insurance
E
319
13.51 Which of the following is NOT an example of a fringe benefit a salesperson can
legitimately expect to receive?
A. financial counseling
B. health insurance
C. unemployment compensation
D. retirement programs
E. drawing account
D
319
13-52 Rarely does a firm make a complete shift from one type of compensation package to
another. When it does, it is usually because:
A. the government was concerned about potentially illegal pay practices
B. the company no longer wants to use compensation as a motivational tool
C. the company has added a new product line and wants to make salaries a controllable
expense
D. the company wants to implement a salary-plus-incentives plan to gain more control
over its sales force
E. the competition modified its compensation plan
E
319-320
13-53 When an organization is planning to modify its compensation plan, it needs to collect
information concerning:
A. which product lines are the most profitable
B. what activities the sales force typically perform
C. the minimum, median, and maximum compensation paid by the competition
D. any and all problems its sales force must deal with on a regular basis
E. all of the above
C
320
13-54 A compensation plan can become obsolete if:
A. bonuses are based on the relative profitability of products
B. the bonus structure is based on cost-of-living adjustments
C. the bonuses are pooled, and all members of each district receive the same size bonus
D. total pretax compensation is adjusted to keep pace with inflation
E. any of the above are true
B
321 (Table 13.5)
13-55 A possible sales compensation problem exists if:
A. the company has too many key accounts
B. salespeople are exhibiting uneven sales performance
C. salespeople are concentrating on achieving organizational goals
D. the company is experiencing low sales force turnover
E. any of the above occurs
T
301
13-56 The most important means of motivating a sales force is a sales reward system.
T
301
13-57 Compensation provides sales personnel with a means of bridging the gap between sales
force objectives and the individual salesperson's expectations and aspirations.
T
302
13-58 Any good compensation program should help in recruiting and hiring qualified
salespeople.
T
303
13-59 A productivity bonus of $500 is an example of how compensation can be used as
feedback.
T
303
13-60 An effective reward system must always begin with developing objectives.
F
305
13-61 Long-term compensation plans include bonuses and contests.
F
305
13-62 If pay is going to influence salespeople's performance, the organization must make sure
the most successful salespeople get the best territories.
T
307
13-63 The straight salary plan can provide a sense of security that a person may require for
effective selling because it ensures a regular income.
F
309
13-64 Straight salary compensation has a tendency to increase work norms.
T
309
13-65 When sales decline, a firm using the straight salary method of compensation most often
cuts its sales expenses by dismissing its newly hired salespeople.
T
310
13-66 The three basic elements of a straight commission plan are the level at which
commissions begin, the percentage rate of commission, and which performance unit to
use.
F
310
13-67 A regressive commission plan increases commission rates as sales increase.
F
310
13-68 Drawing accounts are used exclusively in industries where sales jobs require extensive
missionary selling.
T
310
13-69 Many sales managers believe a straight commission payment plan provides maximum
incentive for their salespeople.
F
311
13-70 Salespeople under a straight salary plan are more reluctant to split territories or move
from their present territory to a new territory than are salespeople paid under other
compensation systems.
T
312
13-71 The issue of how to handle returned goods and bad debts is more of an administrative
problem for firms that pay using a commission than for firms paying a straight salary.
F
313
13-72 For the purposes of equity, incentives should always be calculated as a percentage of base
salary.
T
314
13.73 Effective salary administration is just as important under an incentive plan as it is under a
straight salary compensation plan.
T
315
13-74 A bonus is something given in addition to what is usually earned over an extended period
of time.
F
315
13-75 Sales contests are typically not considered to be a part of a compensation plan.
F
317
13-76 When the expense plan calls for the company to pay all of a salesperson's expenses, the
company never has to encourage its salespeople to economize.
T
317
13.77 When the expense plan calls for the company to pay all of a salesperson's expenses, the
company retains little control over that salesperson's activities.
F
319
13-78 Fringe benefits that are legally required include unemployment compensation, paid
vacation, retirement programs, and worker's compensation.
T
320
13-79 In designing a new compensation program, a sales manager should collect information on
competitors' plans, product profitability, and sales force activities.
F
321
13-80 New compensation plans cannot be pretested.

13.81 What are the four basic compensation decisions that affect how compensation is structured
for the sales force at the corporate level?
Ans: wage level, wage structure, salesperson's individual wage, and administration procedures
Page: 304
13.82 From a sales manager's point of view, what is the primary disadvantages of a straight salary
compensation plan?
Ans: the lack of direct monetary incentive to sell
Page: 309
13.83 What are the two basic types of commission compensation plans?
Ans: straight commission plan and draw against commission
Page: 310
13.84 What are the two types of bonuses discussed in the text?
Ans: nonproductivity and productivity bonuses
Page: 315
13.85 What are the two basic methods that companies use to partially pay the expenses
salespeople incur while selling?
Ans: give the salesperson a lump sum to be spent over a specified period of time or set a
maximum amount of reimbursement
Page: 318
13.86 The sales manager for Humphry Industries has developed a new compensation plan, which
she is planning on introducing at the start of the next fiscal year. What three activities
does she need to plan to do if the new compensation plan is to succeed?
Ans: pretest the plan, sell the plan to the sales force, and constantly evaluate the plan
Page: 321-322
Chapter 14
Leading the Sales Team
A
14-1
332
Leadership is the ability to:
A. influence other people toward the attainment of objectives
B. sell
C. find new sales prospects and turn them into customers
D. perform administrative tasks
E. use computer-based inventory control systems
E
14-2
332
The attainment of organizational goals in an effective and efficient manner through
planning, organizing, staffing, directing, and controlling organizational resources is
called:
A. delegation
B. power assignment
C. leadership
D. marketing
E. planning
B
14-3
332
A traditional leader using traditional management techniques:
A. creates an atmosphere of change
B. will often stress the impersonal aspects of performance
C. has more commitment to his or her subordinates than to the firm
D. tends to be less predictable and may not conform to organizational norms
E. motivates people to do more than normally expected
C
14-4
333
According to the text, leaders do NOT possess:
A. a strong sense of purpose
B. the ability to learn
C. a strong risk-avoidance mechanism
D. a self-knowledge
E. an ability to establish human relationships based on trust, respect, and caring
E
14-5
333
Effective leaders are:
A. risk-avoiders
B. self-centered
C. easily distracted
D. inefficient communicators
C
14-6
333
The study of leadership has identified six factors important to the attainment of
acceptable levels of performance. Which of the following is one of those factors?
A. the organizational mission
B. the type of organizational structure
C. the sales manager himself or herself
D. the reward system
E. the number of staff people involved
B
14-7
334
_____ is the ability to influence the behavior of others.
A. Motivation
B. Power
C.
Control
D.
Authority
E.
Delegation
B
14-8
335
Legitimate power is based on an individual's:
A. ability to recommend punishment or bestow rewards
B. formal position in the organization
D. special skill regarding the task performed by followers
D. personality
E. ability to command respect and admiration from his/her subordinates
B
14-9
335
To help meet your college expenses, you have taken a job flipping burgers at a fast-food
restaurant. Your boss is a 17 year old high school junior who has worked there almost
two years. You are expected to take orders from this younger person because she has
_____ power.
A. reward
B. expert
C. coercive
D. observable
E. referent
A
335
14-10 One of your teachers offers a participation bonus in her class. You really don't like to
take part in class discussions, but you need the points, so you talk. Your behavior is
being influenced by _____ power.
A. reward
B. legitimate
C.
coercive
D.
expert
E.
referent
C
335
14-11 If Max Avram does not met his sales quota this month, his sales manager has the _____
power necessary to fire him.
A. reward
B. leadership
C.
coercive
D.
expert
E.
referent
D
335
14-12 Deanna Stein is a "superstar" salesperson in her region. She has demonstrated skill and
knowledge in her work. The other salespeople often go to her for advice on how to close
a sales. Deanna has _____ power.
A.
reward
B.
legitimate
C.
coercive
D.
expert
E.
referent
E
335
14-13 _____ power is based on the followers' respect and admiration toward the leader.
A. Reward
B. Legitimate
C.
Coercive
D.
Expert
E.
Referent
D
335
14.14 _____ is the most likely behavioral outcome when leaders rely on reward and legitimate
powers.
A.
Negativity
B.
Empathy
C.
Resistance
D.
Compliance
E.
Rebellion
E
336
14-15 Which of the following has a direct influence on the sales manager's natural leadership
style?
A. his or her personality characteristics
B. his or her needs and motives
C.
the amount of power the sales manager possesses
D.
his or her past experiences
E. all of the above
D
336
14-16 A leader who describes the duties and responsibilities of an individual or group is
exhibiting _____ behavior. This includes telling people what to do, how to do it, when to
do it, and who is to do it.
A. achievement-oriented
B. relationship
C. instrumental
D. task
E. referent
D
336
14-17 As a sales manager, Sawyer Kingston tells his sales force which customers to call on,
when they call on them, and how they should make their sales presentations to individual
prospects. In addition, he often uses various techniques to determine that they have
followed his instructions. Sawyer is exhibiting _____ behavior.
A. achievement-oriented
B. relationship
C. instrumental
D. task
E. referent
B
336
14-18 _____ includes listening, providing clarification, getting to know the individual's motives
and goals, and giving positive feedback to help reinforce a person's self-image.
A. Achievement-oriented behavior
B. Relationship behavior
C. Instrumental behavior
D. Task behavior
E. Referent behavior
B
336
14-19 Amos Whiting is a recent marketing graduate of a small state college. He has just been
hired by Freeport Manufacturing Company as a salesperson. Because he is new at selling
and did not have a sales course in college, the appropriate leadership behavior for his
sales manager to adopt when dealing with Amos is:
A. persuading
B. telling
C. consulting
D. delegating
E. joining
A
336-337
14-20 Wilberforce Company's sales manager Sonia Nijisky is training Travis Lee, her new key
account salesperson. Travis has been recently promoted to the job, and is not yet
completely able to carry out the tasks of his new assignment. Sonia has decided how
Travis should handle his job, and is seeking his cooperation by explaining how to handle
these accounts and why her approach is the right one. Her appropriate leadership style is:
A. persuading
B. telling
C. consulting
D. delegating
E. joining
B
337 (Figure 14.4)
14-21 Andrea Ling is a task-oriented sales manager who likes to make all decisions for the
members of her sales force. Which leadership style would she be most likely to use?
A. persuading
B. telling
C. consulting
D. delegating
E. joining
B
337 (Figure 14.4)
14-22 Four basic leadership styles form the leadership continuum. It includes all of the
following EXCEPT:
A. tells
B. controls
C. delegates
D. persuades
E. participates
C
337 (Figure 14.4)
14-23 Which of the following leadership styles is most typical of a sales manager who has
chosen to use the relationship-oriented leadership approach and has a low task
orientation?
A. persuading
B. telling
C. participating
D. delegating
E. joining
E
337 (Figure 14.4)
14-24 Which quadrant of the leadership style matrix is characterized by the salesperson and the
sales manager making decisions together?
A. tells
B. controls
C. delegates
D. persuades
E. participates
C
337-338
14-25 Rory Jackson has worked as a sales rep for a pharmaceutical company for 22 years and is
highly self-motivated. Which of the four basic leadership styles from the leadership
continuum should his sales manager use when dealing with Rory?
A. tells
B. controlls
C. delegates
D. persuades
E. participates
D
338
14-26 How does a sales job differ from a production manager job or a financial analyst job?
A. Only the sales job is a line position.
B. The production manager is not affected by group norms.
C. The salesperson needs the highest level of technical skills.
D. The salesperson operates will little or no direct supervision.
E. The salesperson is unaffected by the corporate culture.
A
338
14-27 A sales manager who is actually overseeing and directing the day-to-day activities of
salespeople is engaged in:
A. supervision
B. counseling
C. encumbering
D. detailing
E. coaching
A
338-339
14-28 Which of the following is a direct supervisory method?
A. sales meetings
B. expense reports
C. sales analysis reports
D. compensation
E. call reports
B
338-339
14-29 Sales managers have several methods to directly supervise their subordinates. Which of
the following is an example of a direct supervisory method?
A. call reports
B. the telephone
C. sales analysis reports
D. compensation
E. expense reports
E
339
14-30 _____ is defined as intensively training someone on the job intensively through
instruction, demonstration, and practice. One of its main elements is the joint sales call.
A. Supervision
B. Counseling
C.
Encumbering
D. Detailing
E. Coaching
D
339
14-31 The main element of the coaching activity is the:
A. presession preparation
B. summary and critique
C. postcall discussion
D. joint sales call
E. precall customer analysis
E
339
14.32 Coaching:
A. is specifically planned for strengthening selling skills
B. is the most important link in the continuous sales training process
C. is designed to help a person become more efficient
D. has been described as the single most important training technique available to a sales
manager
E
339-340
14-33 A coaching fact sheet should include:
A. a description of the session itself
B. the coaching objective
C. a written record of what action is deemed necessary as a result of the session
D. a brief description of the situation that prompted the coaching
E. all of the above
E
341
14-34 Throughout the joint sales call, the sales manager should be making notes about:
A. the salesperson's attire
B. the condition of the salesperson's car
C. the loudness of the salesperson's voice
D. how well the salesperson is groomed
E. all of the above
D
341
14-35 On a joint sales call the sales manager's primary responsibility is to:
A. do the selling, so the salesperson can see the proper way to handle a sales call
B. close the sale
C. become involved only if the salesperson begins to have trouble
D. be an observer, so the salesperson can increase his or her own effectiveness
E. avoid giving the salesperson specific ideas on the handling of tough customers
because it reduces the salesperson's training benefit
A
343
14-36 Jake Moody and his sales manager Whitney Lovell have just completed a joint sales call
during which Jake made what Whitney believes are two serious but easily corrected
errors. In the car, immediately after the sales call, Whitney should hold a(n) _____ with
Jake.
A. curbstone conference
B. sales culture discussion
C. corrective appraisal
D. instructional monologue
E. revisionary dialogue
A
343
14.37 A(n) _____ is a brief post-call discussion between a sales manager and a salesperson. It is
usually held in the car.
A. curbstone conference
B. sales culture discussion
C. corrective appraisal
D. instructional monologue
E. revisionary dialogue
B
344
14-38 The sales manager uses _____ to help the salesperson become a better-adjusted human
being in the workplace.
A. supervision
B. counseling
C. acculturation
D. group norms
E. coaching
B
344
14.39 The purpose of _____ is not merely to deal with the immediate problem but to help the
employee learn methods for coping with future difficulties.
A. supervision
B. counseling
C. group norms
D. coaching
E. acculturation
B
345
14.40 Which of the following activities can be called negative counseling?
A. directive guidance
B. exhortation
C. giving suggestions
D. reassurance
E. social reinforcement
E
346
14.41 Bill is having problems dealing with a new purchasing agent in his territory. The agent has
been hired to work for a company that was once one of Bill's biggest accounts. Bill is
convinced that the purchasing agent does not like him, and therefore, he will never be
able to sell to that particular business again. Bill's sales manager called Bill into the sales
office and began asking him a number of open-ended questions, such as "What does the
agent do to make you think he does not like him?", "How have you responded to what the
agent has said to you?", "Do you think the agent is feeling stress from his new job?", and
so forth. What kind of counseling is Bill's sales manager using?
A. social reinforcement
B. directive guidance
C. career counseling
D. directive guidance
E. nondirective guidance
D
346
14-42 Louse is the newest member of the sales force. Her sales manager is working to make
her feel a part of the group. He is spending a great deal of time trying to build a cohesive,
cooperative work team with Louise as one of its important members. He is engaged in
_____ counseling.
A. performance
B. career
C. personal adjustment
D. social adjustment
E. organizational
C
346
14.43 Lorenzo's work is suffering from depression, which is the result of his recent separation
from his wife. His sales manager has advised Lorenzo to seek out the services of a
marriage counselor and has even found ways to let Lorenzo attend the sessions in the
middle of the workday without the time lost adversely affecting Lorenzo's performance.
Lorenzo's sales manager is engaged in _____ counseling.
A. performance
B. career
C. personal adjustment
D. social adjustment
E. organizational
A
347
14-44 In deciding what leadership style to adopt, the sales manager must consider the individual
characteristics and behavioral patterns of the individual salesperson. Which is the most
important of these individual characteristics and patterns?
A. the individual's performance level
B. the individual's personality characteristics
C. the level of past experience the individual has
D. the amount of power individual has
E. the level of needs the individual is trying to fill
A
348 (Table 14.2)
14-45 What leadership style would be appropriate for use with a new salesperson who has not
yet developed high ability or high motivation?
A. tells
B. controls
C. delegates
D. participates
E. persuades
E
348 (Table 14.2)
14-46 What leadership style would be appropriate to use with a highly motivated recent college
graduate who has no experience in or knowledge of sales?
A. tells
B. controls
C. delegates
D. participates
E. persuades
B
351
14-47 Which of the following statements about group norms is true?
A. Norms are standards established by the organization.
B. All groups develop norms that serve to regulate members' behaviors.
C. Norms tend to move the individual members of the group towards a degree of
nonconformity.
D. Norms typically do not define what is appropriate behavior.
E. The more important a norm is to a group, the less likely a member's behavior will be
guided by that norm.
C
351
14-48 Because Tom Yeats sold three times as much as his sales quota required him to sell, the
other members of the sales force ostracized him. He was not invited to their Christmas
party and is never included in the group's football pool. It is obvious that Tom violated
the sales force's _____ when he sold so much more than his quota.
A. preconceived notion of efficiency
B. reward power
C. norm
D. formalized organizational policy
E. expert power
E
352
14-49 All of the following are situational factors that can directly influence the sales manager's
behavior and effectiveness EXCEPT:
A. time pressure
B. factors within the organization itself
C. the problem faced
D. the task being faced
E. a competitor's change in its organizational structure
E
352
14-50 The top management of Whitbury Equipment Company is concerned about the
company's falling sales. The division sales manager has been told that her division must
increase its market share by 5 percent during the next quarter. What style of leadership
would be appropriate for her to use?
A. laissez-faire
B. democratic
C. participative
D. relationship
E. task
T
332
14.51 A sales manager uses leadership to attempt to influence the activities of salespeople to
carry out work requirements that allow them to reach their goals.
F
334
14-52 A true leader is able to put his or her own needs and motives out of the picture when
deciding what leadership style to adopt.
F
335
14-53 Legitimate power is based on an individual's personality characteristics that command
subordinates' respect.
T
335
14-54 An individual's choice of leadership style is influenced by the type of leaders for whom
he or she has worked in the past.
F
336
14-55 The tells leadership style is characterized by above average amounts of both task
behavior and relationship behavior.
T
337 (Figure 14.4)
14-56 Quite often the sales manager's leadership style is based on the salesperson.
F
338
14-57 Supervision is described by the text as the most important training technique available to
the sales manager.
T
339
14-58 Coaching refers to training someone one the job intensively through instruction,
demonstration, and practice.
F
341
14-59 The primary responsibility of a sales manager on a joint sales call is to close the sale.
T
344
14-60 A sales manager can use counseling to help the members of his or her sales force become
better-adjusted human beings within the work environment.
F
345
14-61 The most effective form of counseling for a salesperson is the lecture.
F
347
14-62 While the sales manager's leadership style is unaffected by the individual salesperson's
performance level, it is affected by the manager's own personality, needs and motives,
power, and past experiences.
F
348
14-63 Once a sales manager finds a leadership style that works, he or she should keep it,
regardless of changes in the work environment.
T
349
14-64 Due to the lack of challenge, motivation, knowledge, and skills, some experienced
salespeople often reach a performance plateau.
F
350
14-65 Salespeople with lower performance levels usually require a "tell" or "delegate"
leadership style.
T
351
14-66 Group norms can influence how effective a sales manager is at performing his or her job.
F
352
14-67 A relationship leadership style works best when the home office tells the sales force
members they must increase sales by 20 percent within the next six months.
F
353
14-68 Time pressures should have no effect on the type of leadership style used.
14.69 What is leadership?
Ans: the ability to influence other people toward the attainment of objectives
Page: 332
14.70 What type of leadership style is characterized by high task and high relationship behavior?
Ans: persuades
Page: 336-337
14.71 What are the three most common methods for directly supervising employees?
Ans: the telephone or e-mail, sales meetings, and working with each salesperson
Page: 338-339
14.72 List the four activities that are part of coaching.
Ans: (1) presession preparation, (2) the joint sales call, (3) post-call discussion, and (4)
summary and critique
Page: 339
14.73 What kinds of counseling is occurring when the sales manager talks to a salesperson about
how his need for over-achievement is hurting his relationship with his family?
Ans: performance and personal adjustment
Page: 346-347
14.74 What kind of leadership behavior is appropriate with a salesperson with both low ability
and low motivation?
Ans: tells
Page: 348
Chapter 15
Analysis of Sales and Marketing Costs
D
15-1
364
Which of the following statements about a marketing audit is true?
A. The marketing audit does not affect the methods of marketing used on the corporate
level.
B. The marketing audit is accomplished at a single point in time.
C. The marketing audit evaluates each individual department and program.
D. The marketing audit is usually performed by persons without direct control or
responsibility for marketing activities.
E. All of the above statements about the marketing audit are true.
C
15-2
364
Which of the following statements about a marketing audit is true?
A. The marketing audit should be performed by the marketing department because that is
the department responsible for carrying out the marketing activities.
B. The marketing audit appraises the entire industry in a systematic manner.
C. The marketing audit evaluates the degree of integration of the marketing functions
with company operations.
D. The marketing audit should be accomplished in a month.
E. The marketing audit is designed to correct sales forecasting errors.
D
15-3
364-364
The sales force audit:
A. is another name for an internal SWOT analysis
B. should be done randomly to catch any problems with the system
C. requires a sales forecast be done at the same time
D. involves the same six factors as the marketing cost audit
B
15-4
365
The 80/20 principle states that:
A. the majority of the company's sales will come from cold calls
B. the majority of the company's profits may come from a very small number of the
company's accounts or products
C. 80 percent of a salesperson's time should be spent in selling activities with the
remaining 20 percent allotted to nonselling activities
D. the majority of the accounts in any geographical area are located in a close proximity
to each other
E. smaller accounts require 80 percent more time and energy that larger accounts
E
15-5
365
The 80/20 principle:
A. is a territorial management concept that favors the salesperson putting 80 percent of
his time on planning and 20 percent on action
C. indicates that no matter what a salesperson tries, 80 percent of a customer's potential
business ends up going to competitors
D. is a concept of territorial management which favors the salesperson putting 80 percent
of her time on action and 20 percent on planning
D
15-6
366
Why do some companies carry product lines that have comparatively low sales and are
generally unprofitable?
A. in order to increase fixed costs
B. the product can be sold for less than the variable cost of making the product line
C. to decrease the number of shares of corporate stock
D. to enhance a selling feature in the more profitable selling areas
E. to test the efficiency of the marketing department
D
15.7
366
The _____ refers to the effect that averaging, summarizing, and aggregating data can
have on presenting the true sale or profit picture and underlying problems.
A. 80/20 principle
B. profit margin analysis
C. profit/sales effect
D. iceberg principle
E. net sales volume analysis
C
15-8
368
Hunter is the sales manager for a company that sells retail store fixtures. He lost all track
of time when he began a detailed examination of his company's sales data--assimilating,
classifying, comparing, and drawing conclusions. Hunter was engaged in a(n):
A. marketing audit
B. profit margin analysis
C. sales analysis
D. iceberg principle
E. sales force audit
A
368
15.9 Sales data may be classified into many categories that serve as a basis for management's
analysis. The classification system selected should be based upon:
A. what breakdown will provide the most relevant and meaningful sales information to
management
B. whether the customers can be identified by name and classified
C. how many product lines the company is selling
D. how the sales are made and the type of salespeople used by the company
E. the order size and the number of product lines
E
369
15-10 Sales analysis can be used to:
A. modify the sales territory structure
B. evaluate the market position
C. evaluate the channels of distribution
D. plan sales force activities
D
369
15.11 Sales analysis CANNOT be used to:
A.
develop sales force measures
B.
establish sales forecasting systems
C.
modify sales territory structure
D.
create group norms
E.
modify channels of distribution
D
369
15-12 The first indication of how well a firm is doing in the marketplace is:
A. sales by territory
B. net profit
C. gross margin
D. total sales volume
E. net sales volume
B
369
15-13 A net sales volume analysis begins with a(n):
A. net profit margin analysis
B. look at the total volume of sales for the company
C. analysis of the consumer price index
D. study of the effect of the 80/20 principle on company sales
E. marketing audit
A
370
15-14 The retail sales index:
A. is a relative measure of the dollar volume of retail sales that normally occur in a
particular district
B. is based on the consumer price index
C. is done annually by the U.S. Department of Consumer Affairs
D. should not be used to uncover an iceberg effect
B
372
15-15 Which of the following statements about marketing cost analysis is true?
A. The marketing cost analysis is the analysis of costs that affect the calculation of sales
forecasts.
B. The marketing cost analysis is an integral part of the decision-making process
concerning adjustments in the marketing mix.
C. The marketing cost analysis is the analysis of costs that affect sales volume in order to
minimize distribution costs.
D. One primary reason for performing a marketing cost analysis is to support the iceberg
principle.
E. The marketing cost analysis is also called the promotional cost analysis.
A
15.16
372
The _____ is the analysis of costs that affect sales volume, with the purpose of
determining the profitability of different segment operations.
A. marketing cost analysis
B. segmentation analysis
C. sales volume audit
D. environmental assessment
E. SWOT analysis
D
372-373
15.17 Marketing cost analysis can be invaluable in determining the answers to all of the
following questions EXCEPT:
A. Which customers are unprofitable because of order size or geographic location?
B. What profit contribution does each salesperson make?
C. What is the minimum order size that can be filled profitably?
D. What services do customers want that they are not now receiving?
E. What distribution channel will be the most profitable for the company to use?
E
373
15-18 Marketing cost analysis can serve as the basis for management decisions about:
A. salespeople
B. products
C. physical distribution
D. optimum order sizes
E. all of the above
A
373
15.19 Production costs:
A. are incurred in processing a product from its raw elements to a finished state
B. are incurred in channeling a product into the ultimate consumer's hands
C. include costs incurred in getting orders but not in filling the orders
D. include the costs of shipping, distribution, warehousing, and material handling
E. are described by all of the above
B
374
15-20 Marketing costs are often referred to as _____ costs.
A. natural
B. distribution
C. structural
D. activity
E. planning
E
374
15-21 Which of the following is an example of a distribution cost for a manufacturer of garden
equipment?
A. the money spent to mail promotional literature to interested dealers
B. the cost of shipping an order to a retailer
C. the cost of extending credit to a retailer
D. the expense incurred with holding newly manufactured equipment in a warehouse
E. all of the above are examples of distribution costs
A
374
15.22 Which of the following is an example of a marketing cost for a manufacturer of camping
equipment?
A. the cost of a sales promotion aimed at sporting goods retailers
B. the purchase of the fabric to make tents
C. the cost of the labor needed to manufacture a sleeping bag
D. the cost of operating the manufacturing facility
E. the cost of maintaining the manufacturing equipment
E
374
15-23 Why has more attention been paid to controlling the costs of production and not to
controlling marketing costs?
A. Accountants are primarily concerned with controllable areas for which standards have
been set; marketing efforts are not that predictable.
B. There has traditionally been a lack of communication between marketing
management and accountants.
C. Conventional methods of cost analysis are inapplicable to marketing.
D. Comprehensive analysis of marketing data was unavailable prior to the advent of the
computer.
E. All of the above are reasons why there has historically been little control over
marketing costs.
D
375
15-24 In performing a marketing cost analysis, management finds it necessary to allocate
marketing costs to different various functional marketing categories. Another name for
these categories is:
A. iceberg centers
B. the marketing mix
C. indirect costs
D. functional marketing groups
E. natural cost groups
C
375
15-25 Warehousing, advertising, general administration, and sales promotion are all examples
of:
A. natural accounts
B. direct costs
C. functional marketing groups
D. marketing subsets
E. indirect costs
E
375
15.26 Which of the following would be an example of a natural account for a manufacturer of
mobile homes?
A. wooden trusses
B. leasing of trucks for hauling mobile homes to retail sites
C. commissions for salespeople
D. office supplies
E. all of the above
E
375
15-27 The full cost approach to determining profitability is also called the:
A. iceberg approach
B. contribution margin approach
C. ROI procedure
D. liquidity technique
E. net profit approach
B
375-376
15-28 There are two methods of determining corporate profitability. They are the:
A. marketing audit and the sales force audit
B. full cost approach and the contribution margin approach
C. controllable cost analysis and sales volume analysis
D. net profit approach and the net sales approach
E. variance analysis and the full cost approach
E
376 (Table 15.8)
15-29 When doing a marketing cost analysis by region, management would consider the
expense account of salespeople in the region as a(n) ______ cost.
A. production
B. standard
C. direct
D. uncontrollable
E. controllable
B
376 (Table 15.8)
15-30 A marketing cost analysis is being done regionally. A sales promotion for a company's
line of hand gardening tools would be an example of a(n) _____ cost.
A. fixed
B. indirect
C. direct
D. standard
E. external
A
376 (Table 15.8)
15-31 The marketing manager's salary is an example of a(n):
A. fixed cost
B. direct cost
C. standard cost
D. indirect cost
E. variable cost
B
602 (Table 15.8)
15-32 The estimated cost of producing one yard of grosgrain ribbon is $.13. This cost is an
example of a(n) _____ cost.
A. controllable
B. standard
C. indirect
D. variable
E. external
D
376
15-33 What is the basic shortcoming associated with the full cost approach to determining
marketing profitability?
A. The full cost approach fluctuates in relation to level of activity that actually occurs.
B. The full cost approach omits production and nonproduction costs.
C. The full cost approach can be used to determine the profitability of identifiable
segments.
D. The full cost approach includes costs that are not controllable by the marketing
division manager.
E. The full cost approach includes the direct costs but not the indirect costs.
D
381
15-34 ROI is a measurement used to determine how effectively the assets of a given operation
are being used. The letters ROI stand for:
A. rate of investment
B. rate of income
C. risk of interest
D. return on investment
E. return on income
A
381
15.35 Return on investment (ROI) is:
A. also called return on assets
B. calculated by dividing total assets used by net profit
C. used to determine how well a company is turning its inventory
D. calculated by multiplying contribution margin by total assets used
E. also called net contribution
B
382
15.36 Which three ways of increasing marketing productivity were identified by the text?
A. increase sales, reduce fixed and variable costs, increase profit margin
B. increase sales, reduce costs, eliminate unprofitable products
C. modify sales territories, reduce distribution costs, reduce marketing costs
D. increase sales, reduce fixed costs, increase profit margin
E. increase sales, reduce costs, increase control over external factors
E
382
15-37 The effectiveness of cost analysis is often limited by:
A. unclear cause-effect relationships
B. how difficult it is to isolate certain variables
C. the marketing manager's ability to request and appropriately use data
D. how expensive and time-consuming it can be
E. all of the above
C
382-383
15-38 Variance analysis would be most suitable for which marketing costs?
A. regional advertising expenses
B. sales force commissions
C. order-filling costs
D. sales force salaries
E. variance analysis is equally suited for any marketing costs
D
383
15-39 Variance analysis identifies:
A. factors that make the full cost approach to determining corporate profitability more
effective than the net profit approach
B. problems with territorial size
C. products that are unprofitable
D. the factors that cause the discrepancy between standard and actual costs
E. the factors necessary to make an accurate sales forecast
F
364
15-40 The marketing audit should be performed by the marketing department because it is
responsible for carrying out the marketing activities.
T
364
15-41 A sales force audit involves the same six factors measured by a marketing audit.
F
365
15-42 The iceberg principle refers to the tendency of a company to earn most of its profits from
a minority of its customers.
T
366
15-43 The marketing effort must be based on the actual or potential sales volume, gross margin,
or profit, not directed arbitrarily by territory, customer, or product.
F
366
15-44 The iceberg principle states that organizations typically ignore the 20 percent of their
customers who provide them with 80 percent of their business unless a marketing cost
analysis is performed.
T
368
15-45 The major use of sales analysis is to detect strengths and weaknesses in the sales effort.
T
369
15-46 Sales analysis can be used to evaluate and modify channels of distribution.
T
371
15-47 Even though a sales analysis shows a particular salesperson has been failing to achieve
his sales goals, it may not be his or her fault.
F
371
15-48 The success of a given marketing program should be evaluated solely by the level of total
sales volume generated.
F
372
15-49 The ultimate goal of all marketing managers is to maximize sales volume.
F
373
15-50 A marketing cost analysis should not be used to determine optimum order size or
inventory level because those are correctly determined by a customer analysis.
T
374 (Figure 15.1)
15-51 Marketing costs should be broken down into two categories: order-getting and orderfilling costs.
F
375
15.52 Another name for the full cost approach for determining profitability is the net contribution
approach.
T
376
15-53 The basic shortcoming of the full cost approach to determining overall corporate
profitability is that it includes costs that do not affect marketing decisions and is not
controllable by the marketing division manager.
F
376
15-54 A direct cost is also classified as an uncontrollable cost.
T
376-377
15-55 With the contribution margin approach to determining the profitability of identifiable
segments, nonassignable costs and fixed costs are not allocated to the segments.
F
381
15-56 Return on investment (ROI) is also called net profitability.
F
382
15-57 The only way a firm has for determining whether it should continue to carry unprofitable
divisions or products is a marketing audit.
T
383
15-58 Generally in cost analysis, standard costs are established as bases for comparisons with
actual costs, but marketing costs are somewhat difficult to standardize because they are
often generated from nonrepetitive activities.
15.59 What is another name for the marketing cost analysis?
Ans: the distribution cost analysis
Page: 372
15.60 In terms of a marketing cost analysis, what kind of costs are order-getting and order-filling
costs?
Ans: marketing or distribution costs
Page: 374
15.61 What is another name accountants give to functional marketing groups?
Ans: activity groups
Page: 375
15.62 List the two basic approaches for determining both the overall corporate profitability and
the profitability of identifiable segments?
Ans: the full cost (or net profit) approach and the contribution margin approach
Page: 375-376
15.63 What do the letters ROI represent?
Ans: return on investment
Page: 381
15.64 What does a variance analysis reveal to sales and marketing managers?
Ans: the factors that cause the discrepancy between standard and actual costs
Page: 383
Chapter 16
Evaluation of Salespeople's Performance
B
16-1
390-391
Performance appraisals can be used for all of the following EXCEPT:
A. to strengthen individual weaknesses
B. to understand environmental factors that might adversely affect performance
C. to provide a format for dialog between manager and salesperson
D. to influence decisions on demotions
E. to help establish the validity of employment decisions
E
16-2
390-391
Performance appraisals can be used to:
A. help determine equitable salary and bonus incentives based on merit or results
B. influence decisions on demotions, firings, and layoffs
C. outline what is expected from salespeople
D. help establish the legal validity of employment decisions
E. accomplish all of the above
D
16-3
391
The many purposes for performance appraisal can be condensed into two general
categories:
A. authoritative and participative
B. extrinsic and intrinsic
C. controlling and planning
D. evaluative and developmental
E. quantitative and qualitative
A
16-4
391
Which of the following is one of the evaluative purposes of performance appraisals?
A. decisions on legal compliance
B. goal setting
C. motivation
D. training
E. employee feedback
C
16-5
391
Which of the following is one of the developmental purposes of performance appraisals?
A. promotions
B. compensation
C. goal setting
D. legal compliance
E. penalties
B
391 (Table 16.1)
16.6 The _____ aspects of performance appraisals include the use of management by objectives
(MBO) and self-learning.
A. procedural
B. developmental
C. expectancy
D. participartive
E. evaluative
A
16-7
391 (Table 16.1)

Which of the following methods would be used in the developmental method of
evaluating performances?
A. management by objectives (MBO) approach
B. expectancy theory
C. SWOT analysis
D. equity approach
E. affirmative action
B
16-8
391 (Table 16.1)

Which of the following methods would be used in the evaluative method of evaluating
performances?
A. SWOT analysis
B. graphic appraisal scale
C. on-the-job training
D. total quality management
E. role playing
E
16-9
392
The performance level a salesperson attains results from a combination of the individual's
efforts and ability. Ability reflects:
A. the individual's skills
B. the individual's information
C. the individual's training
D. the individual's talents
E. all of the above
A
392
16-10 After job analysis, a job _____ is developed which states the specific nature,
requirements, and responsibilities of the specific job.
A. description
B. narration
C. depiction
D. specification
E. explanation
D
392-393
16-11 A _____ converts job descriptions into the people qualifications the organization feels are
necessary for successful performance of the job involved.
A. task delineation
B. job map
C. job analysis
E. needs assessment
A
392-393
16-12 _____ for a sales position might include people skills, selling experience, education, and
other abilities.
A. Job specifications
B. Needs assessments
C. Job evaluations
D. Job analyses
E. Job descriptions
B
393
16-13 Charles, a political science major, has been hired to sell refrigeration equipment. He
knows you are taking a sales management course, and he wants you to tell him who will
be responsible for evaluating his performance. You tell him:
A. a professional evaluator from the human resources department
B. his immediate superior, the sales manager
C. an outside consultant
D. the head of the human resources department
E. any of the above may appraise his performance because who should to do the
evaluation differs from situation to situation
A
394
16-14 A salesperson should be evaluated at the end of every:
A. performance cycle
B. fiscal cycle
C. standard cycle
D. quota period
E. sales criteria period
B
395
16-15 What is the longest period of time that can pass before a greeting cards salesperson
should undergo her next formal performance evaluation?
A. two years
B. one year
C. six months
D. three months
E. two months
E
395
16.16 Performance criteria should be:
A. measurable
B. discriminating
C. practical
D. relevant
E. all of the above
B
395
16.17 Performance criteria should be:
A. subjectively determined
B. practical and relevant
C. dynamic
D. general as opposed to specific
E. non-discriminative
A
395
16.18 Is there anything wrong with a company whose primary performance criteria revolve
around its sales force adhering to "The Golden Rule?"
A. Yes, it is not measurable.
B. Yes, it is not relationship-oriented.
C. Yes, it is not discriminating.
D. Yes, it is not sales-oriented.
E. No, there is nothing wrong with this performance criterion.
C
397
16-19 Which of the following is an example of quantitative performance criteria?
A. sales skills
B. territory management
C. quotas obtained
D. team spirit
E. self-improvement
D
397
16-20 Which of the following is an example of qualitative performance criteria?
A. daily number of orders
B. average sales calls per day
C. ratio of selling costs to sales
D. territory management
E. goods returned
E
397
16-21 The text identifies _____ as examples of performance appraisal forms.
A. graphic appraisal scales
B. descriptive statements
C. behaviorally anchored rating scales
D. management by objectives
E. all of the above
E
398
16-22 Which of the following is the most commonly used form for evaluating salespeople's
performance?
A. management by exception
E. graphic appraisal scales
E
398
16.23 This morning Barrett's supervisor is filling out the appraisal form on how well Barrett has
done over the last six months. The supervisor is rating Barrett's selling skills on a scale
of 1 to 5 with 1 being poor and 5 being excellent. With this information you know that
Barrett's supervisor is using a _____ performance rating form.
B
398-399
16-24 Lucky Lady, Inc. manufactures women's lingerie. It has only 5 salespeople. Which of
the following methods for evaluating its salespeople's performance could the company
use more efficiently than its competitor Hanes, a large manufacturer of women's lingerie?
D
399
16-25 _____ is a results-based evaluation program. Salespeople are given goals, and their
results are compared with their objectives to evaluate performance on a performance
index.
A. Management by exception
B. Descriptive statements
C. Behaviorally anchored rating scales
D. Management by objectives
E. Graphic appraisal scales
C
16.26
399
The _____ method of performance appraisal represents an attempt to improve evaluations
that use descriptive cues or adjectives by providing evaluators with detailed explanations
of exactly what each rating means.
A
399-400
16-27 The behaviorally anchored rating scales method of performance appraisal:
A. reduces the probability of rating errors
B. is less reliable than other appraisal methods
C. provides poor feedback for salespeople
D. limits the appraiser's ability to explain his or her evaluative system
E. is less valid than other appraisal methods
E
400
16.28 The behaviorally anchored rating scales method of performance appraisal:
A. provides good performance feedback to the salesperson on what job factors are being
evaluated
B. lets the salesperson know what is expected to achieve a high rating
C. makes sure the salesperson knows how he or she was rated
D. makes managers more comfortable when they are rating subordinates' performances
B
401
16-29 Anna is a sales manager who is reluctant to evaluate any one salesperson as being much
better or much worse than the others. She likes to rate all her salespeople at about the
same level. She is guilty of the:
A. halo effect error
B. central-tendency error
C. averaging error
D. error of leniency
E. masking tendency error
E
401
16-30 With which of the performance appraisal methods is the central tendency error most
likely to occur?
D
401
16-31 Travis supervises 15 salespeople. Because he wants everyone to like him, he usually
rates all of his salespeople as either superior or outstanding on their performance
appraisals. Travis is guilty of the:
A. halo effect error
C. averaging error
E. masking tendency error
C
401-402
16-32 Jason Goodrich's sales manager worked with him last week and was very impressed with
Jason's customer relations. Jason has a high sales-expenses ratio and a low customer call
average. However, because of the good experience the sales manager had with Jason,
these shortcomings are overlooked. This is the result of the:
A. error of leniency
C. halo effect
D. error of strictness
E. mirroring effect
C
401-402
16-33 Fiona is the only retail sales clerk in a medium-sized department store that has not been
the subject of a customer complaint. Even though her sales are some of the lowest, she
continually receives high performance appraisals from the store manager. The store
manager's judgment is being affected by the:
A. error of leniency
C. halo effect
D. error of strictness
E. mirroring effect
B
401-402
16-34 When a sales manager gives a subordinate high ratings on all aspects of the evaluation
form on the basis of a single positive experience, a _____ is said to have occurred.
A. recent performance error
B. halo effect
C. central-tendency error
D. symbolic effect
E. phoenix effect
C
403
16-35 Within the last performance cycle, Arabella was transferred from her old sales territory
that she had covered for ten years and moved to a new territory. As a result of having to
learn her territory, her sales were down, but her sales manager did not consider any
extenuating circumstances when evaluating her. Her sales manager gave Arabella a low
appraisal and is guilty of a:
A. central-tendency error
B. halo effect
C. recent performance error
E. error of strictness
E
16.36
403-404
When a supervisor is reviewing a subordinate's performance appraisal with him or her,
the supervisor should:
A. be objective
B. set goals and standards
C. be honest
D. be consistent
A
16.37
403-404
When a supervisor is reviewing a subordinate's performance appraisal with him or her,
the supervisor should:
A. follow company policy
B. do it quickly
C. avoid saying anything negative about the subordinate
D. wait till a later time to set up goals for the next performance period
E. rely on vague references if that is all that is available
T
391
16-38 The evaluative purposes of performance appraisal includes compensation, promotion, and
legal compliance.
T
391 (Table 16.1)
16-39 When the purpose of the performance appraisal is developmental, it's concerned with the
future performance of the employee.
F
393
16-40 The primary evaluator of a salesperson should be a trained evaluator from the human
resources department.
F
395
16-41 A maximum of one formal evaluation should be completed yearly for each salesperson.
T
395
16-42 The problem with using communications skills as part of performance criteria is that
communications skills are not measurable.
T
395
16-43 Each criterion used in a performance appraisal should be relevant to job performance.
F
396-397
16-44 A salesperson's results and activities should not be used as performance criteria because
he or she can control their outcome and level of influence.
T
397
16-45 An excellent example of a qualitative performance criterion is the salesperson's ability to
find selling points.
F
398
16-46 The graphic appraisal scale evaluation form typically requires the sales manager to
provide detailed, written descriptions of each salesperson's performance.
F
398
16-47 The descriptive method of performance appraisal is would be easier for a company with a
sales force of 20 to use than with a sales force of five.
F
399
16-48 The management by objectives method is the most commonly used form for evaluating
salespeople's performance
F
399
16-49 Behaviorally anchored rating scales are also called descriptive talent-skills tables.
T
401
16-50 The central tendency error occurs most often when graphics rating scales are used.
F
401
16-51 When a sales manager gives a subordinate high ratings on all aspects of the evaluation
form on the basis of a single positive experience, a masking error is said to have
occurred.
T
403-404
16-52 When appraising a subordinate, a supervisor should be consistent, honest, and follow
company policy.
F
407
16-53 The final step in the performance evaluation process is to develop mutually agreed upon
objectives.
T
407
16-54 A consistent performance-evaluation system can protect an employer from a charge of
discrimination.
16-55 The main purposes of performance appraisals can be condensed into two general
categories. What are they?
Ans: evaluative and developmental
Page: 391
16-56 Who should be the primary evaluator of any salesperson?
Ans: his or her direct supervisor
Page: 393
16-57 When should salespeople be evaluated?
Ans: at the end of each performance cycle, whether it's related to a specific goal or job activity
Page: 394
16-58 What is the most commonly used form for evaluating salespeople's performance?
Ans: the graphic appraisal scale
Page: 398
16-59 What is another name for the behaviorally anchored rating scales (BARS)?
Ans: behavioral expectation scales
Page: 399
16-60 What type of error is occurring when a supervisor rates all of his or her employees as
average on all performance criteria?
Ans: central tendency error
Page: 401
SECTION X
TRANSPARENCY MASTER

Sales Management - Teamwork, Leadership, and Technology 6th Ed. Instructor's Manual

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CONTENTS

Chapter 13 Compensation for High Performance.............................................................48

Controlling the Sales Team

Chapter 15 Analysis of Sales and Marketing Costs..........................................................55

R. J. Reynolds: Selecting the Best Sales Team..................................................113

Section VI: End of Textbook Salesforce Experiential Exercises..145

Zenith Computer Terminals, Inc. (A): Development of a Total Business Plan175

Professor Futrell Online!

Salesperson Information Sheet

When will you graduate?_________

I give Professor Futrell permission to use my

Overall grade point:____________

Are you presently working? __Yes__No

What work experience have you had?____________________________________________

Are you interested in a sales career?_____Yes_____No______Maybe

Other information you would like to share with me________________________________

What grade do you have to make in this class?_____A_____B_____C_____D. Why?

What are topics you want covered in this course?___________________________________

Shadow's Bonus Project --Working With Salespeople

50 points for 3 sales calls with a salesperson.

40 points for 2 sales calls with a salesperson.

30 points for 1 call with a salesperson.

Brief background on:

Products sold and to whom

What does it take to be successful in sales?

How do you prepare for a sales call?

How do you prepare for a sales presentation?

Does nonverbal communication play a part in sales?

What's the best way to start a presentation?

What's involved in giving a good presentation?

How do you handle objections?

What's the best way to ask for the order?

Sales Diary Bonus Project

WHAT IS SALES MANAGEMENT?

THE FIVE FUNCTIONS OF SALES MANAGERS

MAJOR PARTS OF AN ORGANIZATIONAL SYSTEM

TYPES OF SALES MANAGERS

HOW DOES ONE BECOME A SALES MANAGER?

SALES MANAGEMENT SKILLS

Conceptual And Decision Skills

PROMOTION FROM SALESPERSON TO SALES MANAGER

Job Skill Requirements Change

WHAT IS IT LIKE TO BE A SALES MANAGER?

First-Line Sales Management

The Promotion Experience

Phase 2-Minimization or denial of change

Phase 4-Acceptance of reality

Phase 6-Search for meanings

Problems New Managers Experience

Making A Successful Transition To Management

Technology Sales Personnel Use

LEARNING TO BE A SALES MANAGER

THE BOTTOM LINE

MANAGEMENT'S SOCIAL RESPONSIBILITIES

An Organization's Main Responsibilities

How To Demonstrate Social Responsibility

WHAT INFLUENCES ETHICAL BEHAVIOR?

The Individual's Role

The Organization's Role

MANAGEMENT'S ETHICAL RESPONSIBILITIES

What Is Ethical Behavior?

What Is An Ethical Dilemma?

ETHICS IN DEALING WITH SALESPEOPLE

Are you presently working? YesNo

Are you interested in a sales career?___Yes_No____Maybe

What grade do you have to make in this class?___A_B_C___D. Why?