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EFFECTIVENESS MANAGEMENT
Accelerate Sales Force Productivity and Improve Your Sales Results by
Aligning Sales Activities with Company Objectives
Origin Source by David Cichelli
Visi Pramudia
Structure
Management
12345678
Sales
Segments
&
Objectives
Coverage
Model
Sales
Process
Job Design
&
Organization
Structure
Resource
Deployment
Sales Talent
&
Supervision
Performance
Metrics
Quotas
&
Sales
Compensation
Visi Pramudia
Grow
Really Fast
Launch New
Products
Control
Pricing
Grow
Grow
Select
Markets
Reduce
Cost
Reposition
Re-Think
Product & Market
Strategy
Low
Objectives Top Line Growth
Sales
Issues Territory Sizing
Quotas
Phase IV
Optimization
Grow; Keep
Customers
Growth
Base
Phase III
ReEvaluation
Phase II
Volume
Growth
Revenue Mgt
Get New
Customers
Keep Customers
New Products
Price Mgt
Protect Base
Price Mgt
Reduce Costs
Segment Gowth
New Value
Proposition
New Markets
Specialization
Visi Pramudia
Phase IV
Optimization
Phase III
ReEvaluation
Re-Evaluation
Phase II
Volume
Growth
Volume Growth
Optimization
SBUs
Sales
Strategy
Survive
Big Market
Lower Costs
Insufficient
Insufficient
Customer
Customer
Coverage
Coverage
Many Products/
Markets
Hold Share
Failure
Failuretoto
Support
SupportMultiMultiProduct
Product
Strategy
Strategy
Segment
Management
Optimize for
Returns
Obsolescence
One Product
Certain
Business
Obsolescence
Marketing
Strategy
What
Business?
More Business
Obsolescence
Any Business
Obsolescence
Business
Strategy
Too Many
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Dissimilar
Dissimilar
Price Erosion
Too Many
Price Erosion
Products
and
FUNtastic Enthusiasms
to you!
Products
and
Customers
Customers
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Business
Strategy
Any Business
More Business
What
Business?
Certain
Business
Marketing
Strategy
One Product
Sales
Strategy
Survive
Recruiting
Recruiting
On-boarding
On-boarding
Messaging
Messaging
Executing
Executing
Testing
Testing
Big Market
Lower Costs
Acct
AcctStratification
Stratification
Multiple
MultipleMessages
Messages
Acct
AcctMgt
MgtSkills
Skills
Hunters
Hunters
New
NewProducts
Products
Market
MarketShare
Share
Many Products/
Markets
Hold Share
Transformation
Phase III
Re-Evaluation
Transformation
Phase II
Volume Growth
Transformation
Phase I
Start-Up
Segment
Management
Optimize for
Returns
Customer Segments
Customer Segments
Fewer
FewerSegments
Segments
Multiple Channels
Multiple Channels
Simpler
Channels
Simpler Channels
Sales Specialization
Sales Specialization
Intense
Customer
Intense
CustomerFocus
Focus
Rules
RulesofofEngagement
Engagement
High
Productivity
High Productivity
Margin Maintenance
Margin Maintenance
Low
LowChurn
Churn
Customer De-selection
Customer De-selection
Good
Margin/
Cash
Flow
FUN
tastic
Enthusiasms
to
you!
Good
Margin/
Cash
Flow
Productivity
Productivity
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Phase II
Volume Growth
Phase III
Re-Evaluation
Phase IV
Optimization
New
NewMarket
Market
Access
AccessSelling
Selling
Successful
SuccessfulGrowth
Growth
Scaling
Scaling
Core
-Market Selling
Core-Market
Selling
Proficiency
Proficiency
Multi
MultiSegment/
Segment/
Solution
SolutionSelling
Selling
Visi Pramudia
Structure
Management
12345678
Sales
Segments
&
Objectives
Coverage
Model
Sales
Process
Job Design
&
Organization
Structure
Resource
Deployment
Sales Talent
&
Supervision
Performance
Metrics
Visi Pramudia
Quotas
&
Sales
Compensation
Sales Segments
Sales must do marketing
Sales Segments
Product
Customer
Channel
Visi Pramudia
Buyer
BuyerProfile
Profile
Buyer
BuyerGroup
Group
Attractiveness
Attractiveness
Targeted
Targetedand
and
Actionable
ActionableSegments
Segments
Value
Valueproposition
proposition
Visi Pramudia
10
Coverage Model
Sales Management System
Strategy
Structure
Management
12345678
Sales
Segments
&
Objectives
Coverage
Model
Sales
Process
Job Design
&
Organization
Structure
Resource
Deployment
Sales Talent
&
Supervision
Performance
Metrics
Visi Pramudia
Quotas
&
Sales
Compensation
I
Start-Up
II
Volume Growth
III
Re-Evaluation
Customer Size/
Value
Specialization
Vertical Market
and Product
Specialization
IV
Optimization
V
SBUs
Deployment
Model
Geographicbased coverage
Action Plan
12
Channel
Specialization
Channel Bus
Unit
Field Bus Unit
Market Bus Unit
Strategic
Business Unit
Account
Stratification
Account
Segmentation
Buyer
Segmentation
Market
Segmentation
Size
Value
Product
Industry
Channel
New Access
New Market
New Buyer
Access
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Access
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Coverage Comments
Team Selling Model
Corporate Accounts
Major Accounts
Channel Management
Inbound only
Customer Service
E Commerce
E-Channel
13
Visi Pramudia
Sales Process
Sales Management System
Strategy
Structure
Management
12345678
Sales
Segments
&
Objectives
Coverage
Model
Sales
Process
Job Design
&
Organization
Structure
Resource
Deployment
Sales Talent
&
Supervision
Performance
Metrics
Visi Pramudia
Quotas
&
Sales
Compensation
Types of Selling
Product Focus
Selling
Also Known As
Need satisfaction
selling
Applications
Selling
Design-in selling
Thought
Leadership
Selling
Solution
Selling
Consultative selling
Visionary Selling
Primary Objectives
Obtains approved
supplier status
Maximizes volume
Maximizes volume
and price
Achieves desired
product mix
Maximizes gross
margins
Obtains/ retains
target accounts
Establishes and
grows long-term
relationships
Meets growth goals
in volume and
profitability
Leads customer
toward solutions that
result in attainment
of volume and profit
goals
Salespersons
Activities
Responds to RFPs
Submits bids
Differentiates
products based on
delivery, price
Differentiates on
basis of product
characteristics
Mathes products to
customers needs
Overcomes
objections
Adds value through
product knowledge
Focuses on use of
product in
customers
environment
Engineers product to
fit customers
requirements
Typically repetitive
solutions to
standard, recurring
issues
Focuses on
economics of
customers
operation
Proactively identifies
ways to improve
business results
Sell solutions that
improve market
share, profitability,
customer retention,
etc.
Articulates vision
regarding where
industry and
customer are going
and can go in the
future
Guides customer
toward solutions
with long term
implications
Selling Technique
Price/ performance
comparison
Justifies higher
prices through
superior product
and/or ability to
meet needs
Value added
through application
expertise
Establishes
exclusive
partnership with
customer
Engages in joint
planning with
customer; lead their
thinking
Geographic
Deployment
15
Vending
Feature/ Benefit
Selling
Geographic
Narrowly defined
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Select accounts
Qualify
Lead
Conduct
Needs
Analysis
Design
Solution
Propose/
Negotiate
Close/
Fulfill
10
Effort (hours)
1.5
15
32
18
24
18
8 = 115
Duration
Avg. Sales Value
3,5 months
$ 90K
Return on sales effort = $90,000/115 = $780/hour
How can we minimize attrition late in the sales process?
How can we increase speed to close?
Visiyield?
Pramudia
How can we improve the close rate and pipeline
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How can we increase transaction size?
16
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Selling
Time
50-60%
Total
Time
On-Site
Contact
33%
World Class
Other
Selling
22%
Service
10-20%
NonSelling
Time
40-50%
Administration
10-20%
Travel
15-20%
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17
Sales Time
Non-Sales Time
3%
7%
9%
10%
Customer Service
Implementation Problems
9%
9%
15%
18%
12%
8%
Visi Pramudia
18
Structure
Management
12345678
Sales
Segments
&
Objectives
Coverage
Model
Sales
Process
Job Design
&
Organization
Structure
Resource
Deployment
Sales Talent
&
Supervision
Performance
Metrics
Visi Pramudia
Quotas
&
Sales
Compensation
VP
VP
Verizon
AT & T
Qwest
SBC
Bellsouth
Wireline
Wireline
Dedicated Resource
Dedicated Resource
Sr.
Sr.AM
AM
AM
AM
AM
AM
National
Accounts
HQ
HQ
OEM
OEM
Wireless
Sr. AM
Sr. AM
AM
AM
AM
AM
Other
Accounts
20
Director
Director
VP
VP
IP Cable
Connectivity
Sprint
Level 3
Cisco
Nortel
Others
Field
FieldSales
Sales
Services
Services
Dedicated Resource
Dedicated Resource
Large
Accounts
Connectivity
Connectivity
Dedicated Resource
Dedicated Resource
Entertainment
Entertainment
Sr. AM
Sr. AM
AM
AM
AM
AM
VP Connectivity
VP Connectivity
Sr. AM
Sr. AM
AM
AM
AM
AM
GOV
GOV
Sr. AM
Sr. AM
AM
AM
AM
AM
VP IP Cable
VP IP Cable
Sr. AM
Sr. AM
AM
AM
AM
AM
Sr. AM
Sr. AM
AM
AM
AM
AM
VP Wireless
VP Wireless
Sr. AM
Sr. AM
AM
AM
AM
AM
Visi Pramudia
Resource Deployment
Sales Management System
Strategy
Structure
Management
12345678
Sales
Segments
&
Objectives
Coverage
Model
Sales
Process
Job Design
&
Organization
Structure
Resource
Deployment
Sales Talent
&
Supervision
Performance
Metrics
Visi Pramudia
Quotas
&
Sales
Compensation
22
Step I
Step II
Step III
Step IV
Step V
Step VI
Step VII
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Structure
Management
12345678
Sales
Segments
&
Objectives
Coverage
Model
Sales
Process
Job Design
&
Organization
Structure
Resource
Deployment
Sales Talent
&
Supervision
Performance
Metrics
Visi Pramudia
Quotas
&
Sales
Compensation
Assessment Tools
Skill Assessments
(Implementation)
Training Curriculum
Ongoing Development
Plan
24
Visi Pramudia
Performance Metric
Sales Management System
Strategy
Structure
Management
12345678
Sales
Segments
&
Objectives
Coverage
Model
Sales
Process
Job Design
&
Organization
Structure
Resource
Deployment
Sales Talent
&
Supervision
Performance
Metrics
Visi Pramudia
Quotas
&
Sales
Compensation
Qualify
Lead
Conduct
Needs
Analysis
Design
Solution
Propose/
Negotiate
Close/
Fulfill
10
Effort (hours)
1.5
15
32
18
24
18
8 = 115
Duration
Avg. Sales Value
3,5 months
$ 90K
Return on sales effort = $90,000/115 = $780/hour
Visi Pramudia
26
Sales Compensation
Sales Management System
Strategy
Structure
Management
12345678
Sales
Segments
&
Objectives
Coverage
Model
Sales
Process
Job Design
&
Organization
Structure
Resource
Deployment
Sales Talent
&
Supervision
Performance
Metrics
Visi Pramudia
Quotas
&
Sales
Compensation
Visi Pramudia
28
29
Factor
Description
Methods
I. Leadership
Corporate Vision
Communication
II. Accountability
Measurement
Engagement Management
Appraisal Process
Program Execution
Reporting
III. Self-Accomplishment
Career Progression
Recognition Programs
Training
IV. Remuneration
Cash
Security Programs
Incentives
Base Pay
Benefits Stock
Incentive Compensation
Speeches
Learning
Orientation
Leadership Conferences
Visi Pramudia
Gainsharing
AddAdd-On
2x Capped
Straight
Commission
3x Uncapped
Target
Total
Compensation
30
Visi Pramudia
Value Created by
Account Owner
Basis of Pay
Examples
31
Income
Producers
Sales
Representatives
Seller
(Relationship)
Company
(Product/Services)
Sales
Person
Company
Percent of Revenue
(Unlimited)
Real Estate
Traders
Independent Agents
Multi Tier Marketing
Territory Rep
Account Manager
Chanel Manager
Product Specialist
Visi Pramudia
W-2 Earnings
Income Producers
Low
Low
High
32
Visi Pramudia
Sales Representatives
W-2 Earnings
Low
Low
High
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Income Producers
Sales Representatives
Sales Support
Straight Commission
Target Rate - Unlimited
Company Accounts
Promote Solution/ Value
Visi Pramudia
34
Target
TargetTotal
TotalCash
CashCompensation
Compensationisisthe
thepreferred
preferredannual
annualpay
payfor
forachieving
achieving
goal:
lower
pay
for
less
than
goal;
higher
pay
for
exceeding
goal.
goal: lower pay for less than goal; higher pay for exceeding goal.
Visi Pramudia
35
Intrinsic Rewards
Special Compensation
Contests
Focused Efforts
Overtarget
Incentive
Pay
Outstanding Pay
Target
Incentive
Pay
At Risk Pay
Salary
Retention/
Non-Sales Pay
Performance- Based
Compensation
Sales Compensation
Fixed Compensation
Benefits
Security Needs
Sales
Expenses
Reimbursement
Visi Pramudia
36
Upside Earnings
Target Compensation
Target
200
160
120
100%
10
90
30
70
50
50
0%
Low
Influence of
Salesperson
High
Extent of Upside Potential
Visi Pramudia
37
Performance Measures
Required
Avoid
Accountable
Accountable
Assigned
AssignedtotoaaSalesperson
Salesperson
Observable
Observable
Measurable
Measurable
Accurate
Accurate
Reportable
Reportable
Bad
BadMeasures
Measures
Corporate
CorporateGalactic
GalacticMeasures
Measures
Compliance
ComplianceMeasures
Measures
Input
Measures
Input Measures
Cant
CantMeasure
MeasureMeasures
Measures
Visi Pramudia
38
Sales
SalesRevenue:
Revenue:purchase,
purchase,continuing,
continuing,estimated
estimated
Profit:
gross
margin,
contribution
margin
Profit: gross margin, contribution margin
Items:
Items:units,
units,contracts,
contracts,design
designwins
wins
Sales Effectiveness
Products:
Products:balance,
balance,mix,
mix,launch,
launch,cross-sell,
cross-sell,packages
packages
Accounts:
new,
retention,
penetration,
growth
Accounts: new, retention, penetration, growth
Orders:
Orders:close
closerate,
rate,size,
size,length,
length,receivable
receivable
Price
PriceManagement:
Management:discount,
discount,rebates,
rebates,realization,
realization,percent
percent
Customer Impact
Sales
SalesSatisfaction:
Satisfaction:surveys,
surveys,complaints
complaints
Loyalty:
persistency,
share
Loyalty: persistency, share
Resource Use
Productivity:
Productivity:cost
costper
perorder
orderdollar,
dollar,sales
salesloading
loading
Channels:
partner
success,
outlet
performance
Channels: partner success, outlet performance
Personnel:
Personnel
Personnel:balance
balanceperformance,
performance,turnover,
turnover,ramp
ramprate
rate
Visi Pramudia
39
Quota Difficulty
60% to 70%
of Sellers
# of Salesperson
30% to 40%
of Sellers
Bottom 10%
of Sellers
Top 10%
of Sellers
Minimum
Target
100%
Quota Performance
40
Excellence
Visi Pramudia
TITI- -CF
CF
Target Incentive
Bonus Formula
TITI- -BF
BF
Target
TargetEarning
Earningare
arePre-Established
Pre-Established
Expected
ExpectedVolume
VolumeisisKnown
KnownSame
Samefor
forAll
AllTerritories
Territories
Commission
Formula
Rate
Pay
Percent
of
Production
Commission Formula Rate Pay Percent of Production
totoAchieve
Achieveand
andExceed
ExceedTarget
TargetEarnings
Earnings
Target
TargetEarning
Earningare
arePre-Established
Pre-Established
Expected
Volume
is
Expected Volume isKnown
KnownDiffers
Differsby
byTerritories
Territories
Bonus
Formula
Rate
Pay
Percent
of
Target
Bonus Formula Rate Pay Percent of TargetPay
Payfor
for
Percent
of
Goal
Achievement
to
Achieve
and
Percent of Goal Achievement to Achieve and
Exceed
ExceedTarget
TargetEarnings
Earnings
Visi Pramudia
41
Flat Commission
Features
Commission Graph
Illustration
Flat Commission
Rate on Revenue
3%
Commission
Dollars
3%
Sales Volume
Comments
42
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Ramped Commission
Features
Commission Graph
4%
Illustration
Commission
Volume
Rate
To $3M
2%
$3M & Over 4%
Commission
Dollars
2%
Sales Volume
Comments
43
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Bonus - Steps
Features
I. Base Salary
Illustration
Comments
44
Bonus Schedule
(% of Base Salary)
% to
% of
Quota
Base
<85%
0%
85%
5%
90%
15%
100%
25%
105%
40%
110%
55%
>115%
75%
Visi Pramudia
I. Base Salary
Illustration
Comments
45
% to
Quota
<96%
98%
100%
102%
104%
106%
>108%
Dollar
Amt
$1,500
$3,000
$5,000
$7,500
$10,000
$12,500
$15,000
Visi Pramudia
I. Base Salary
Illustration
Comments
Excellence
Volume
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46
Thank You
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