SALES ORGANIZATIONS

purpose of sales organizations

to permit the development of specialist to assure that all necessary activities are performed to achive coordination or balance to define authority to economize on executive time

SETTING UP A SALES ORGANIZATION

Defining the objective
Set both quantitative as well as qualitative objectives Qualitative objectives are indispensable for long-range planning, thus, kept in mind in short range planning also Quantitative objectives are required as operating guideposts

Delineating the necessary activities

Determining the necessary activities & their volume of performance is based on qualitative & quantitative objectives Also helps in determining which activities to be performed in what volume

 grouping activities into jobs or positions

CONTD

activities identified are allocated to different positions activities are grouped so that closely related tasks are assigned to same positions each position must also contain some variations assigning personnel to positions
whether to recruit special individuals to fill the positions or to modify the positions to fit the capabilities of available persons

providing for coordination and control sales executives require means to control their subordinates & to coordinate their efforts they should not be overburdened nor should have too many subordinates

CONTD
coordination & control is obtained through both formal & informal means formal instruments of organizational control: 1. written job description
reporting relationships job objectives, duties & responsibilities performance measurements

2. an organization chart
reduces confusion about individuals role delineates formal relationship

3. organizational manuals
extension of organization chart contains chart for both the company & the department

BASIC TYPES OF SALES ORGANIZATION STRUCTURE

factors affecting the organizational structure

types of organization structure the customers the marketing channelsthe company size the product or product line the practices of competitors personalities & abilities of personnel
line sales organizations

oldest & simplest structure widely used in smaller firms or firms with small numbers of selling personnels, limited geographical area or narrow product line chain of command run from top to down all executives exercise line authority & each sales person is responsible to next in the hierarchy

LINE SALES DEPARTMENT ORGANIZATION

GM

SM

ASSISTANT SM DIV-1

ASSISTANT SM DIV-2

ASSISTANT SM DIV-3

ASSISTANT SM OFFICE

SALES PEOPLE

SALES PEOPLE

SALES PEOPLE

OFFICE STAFF

CONTD
no cross communication between persons at same level greatest use in companies where all sales persons report directly to the chief sales executives

advantages:
problems of discipline & control are small authority & responsibility are clear saves time in making policy changes development of close relationship between superior & subordinate administrative expenses are low

disadvantages
too much dependence on department head insufficient time for policy making & planning inappropriate for rapidly growing firms offers little opportunity to subordinates to acquire management skills

CONTD
line & staff sales organizations

found in large & medium-sized firms employing number of sales persons, selling diversified product lines over wide geographic areas provide top sales executives with group of specialists to assist staff helps in conserving the time & frees executives for other works

staff specialists increases overall effectiveness of department

staff do not have authority to issue orders or directives

LINE & STAFF SALES DEPTT. ORGANIZATION

President Vp marketing Advertising Manager Director Training Sales personel Director Gm sales Assistant Gm sales Manager market research Assistant To Gm sales Sales Promotion Manager

District sales manager

Branch sales manager Sales personnel

CONTD
Advantages
Specialization
planning activities are divided and apportioned to staff members executives concentrate on coordination & control

Disadvantages
increase in administrative expenses difficult to prevent some persons from evading unwanted responsibilities

CONTD
functional sales organization each individual in an organization should have few distinctive duties as possible principle of specialization is utilized to its fullest extent sales people receive instructions from several executive but at different aspects of their work

Advantages improved performance

disadvantages not feasible for small & medium sized firms suitable for large firms with stable operations & with opportunity for considerable division of labour

CONTD
committee sales organization

never a sole basis for organizing a sales deptt. method of organizing the executive groups for planning & policy formulation the agenda must be planned & controlled to avoid wasting time
advantages promote coordination

collective decision making

provide focal point for discussion & for suggestions