Part 2

Implementation of the Sales Program

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McGraw-Hill/Irwin

Sales Training: Objectives, Techniques, and Evaluation

Copyright 2009 by The McGraw-Hill Companies, Inc. All rights reserved.

Military Training and Sales Careers

What skills

Can be trained? Must be trained? Are a pre-hire requirement?

What previous training has transferability and value? Managers must focus on critical success competencies
10-4

Source: HR Chally Group (2007).

Identify key issues in sales training Understand objectives of sales training Discuss development of sales training programs Understand training of new sales recruits and experienced salespeople Define topics covered in a sales training program Understand various methods for conducting sales training Discuss how to measure costs and benefits of sales training
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Training Magazines Top Training Companies

10.1

Source: Source: Manage smarter.com October, 2007.

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Sales Training Issues

Who should be trained? What should be the training primary emphasis? How should the training process be structured?

On-the-job training and experience? Formal and more consistent centralized program? Web-based? Instructor-based?
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Sales Training Objectives

Increase productivity Improve morale Lower turnover Improve customer relations Improve selling skills

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10.1 Challenge of Effective Training: Follow-Up

Salespeople are a tough audience Salespeople retain about 50% after five weeks Management issues

Poor training implementation Lack of measureable results Lack of refresher courses/materials

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Source: Half Life of Sales Training, American Salesman 49, no. 1 (2004), p. 23.

10.1 Effectiveness of Follow-Up Strategies

Incentive compensation for new behaviors Manager statement detailing expectations
36%

39%

Follow-up classes

43%

Coaching by manager

46%

Sharing experiences/practices among team

59%

0%

10%

20%

30%

40%

50%

60%

70%
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% Respondents Identifying Strategies as Effective

Source: Half Life of Sales Training, American Salesman 49, no. 1 (2004), p. 23.

Credible Sales Training Development

Allows for adequate development and timely, effective implementation Subjects itself to evaluation and review

Sets specific, realistic, measureable objectives

Modifies to achieve greater effectiveness

Analyses sales force needs

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Obstacles to Introducing Training

Top management not dedicated to sales training Lack of buy-in from frontline sales managers and salespeople Salespeoples lack of understanding of what training is supposed to accomplish Salespeoples lack of understanding regarding application of training to everyday tasks
10-12

10.2 Failure Causes and Cures

Delivering fad vs. function Off the shelf delivery Unreasonable time constraints Little reinforcement

Source: Heather Baldwin, Rethinking Sales Training, SellingPower.com, August 2006 online issue.

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10.2
Analyzing the training needs of the sales force

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Shifts in Training New Sales Recruits

Companies with less than $5 million in annual sales are spending more on sales training per new hire - $5,500 worth of training per salesperson. Training in smaller companies has increased from 3.3 months to 4.4 months. Smaller companies are placing more emphasis on training than several years ago. Companies are spending time and money on training experienced salespeople Companies with more than $5 million in annual sales, are spending less money on training
10-15

Source: Christen P. Heide, Dartnells 30th Sales Force Compensation Survey: (Chicago: Dartnell Corp., 1999)

10.3
Length and cost of sales training for new hires

Source: Christen P. Heide, Dartnells 30th Sales Force Compensation Survey: (Chicago: Dartnell Corp., 1999), p. 143.

10-16

Shifts in Training Experienced Sales Recruits

Experienced sales reps are given, on average, 32.5 hours of ongoing training per year at a cost of $4,032 per rep Continuing increasing amounts of training reflects a commitment to provide ongoing learning opportunities for senior salespeople Companies are spending an increasing amount of time on product training and less on training in selling skills
10-17

Source: Christen P. Heide, Dartnells 30th Sales Force Compensation Survey: (Chicago: Dartnell Corp., 1999)

Length, type, and cost of sales training for experienced reps

10.4

Source: Christen P. Heide, Dartnells 30th Sales Force Compensation Survey: (Chicago: Dartnell Corp., 1999), p. 145.

10-18

Sales Training Topics

Product or service knowledge Market/Industry orientation Company orientation Selling skills Time and territory management Legal and ethical issues Technology Specialized topics
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Product Knowledge Topics

Critical information for rational decisionmaking

Companys product specifications Common product uses/misuses Price Construction Performance Compatibility

Competitive products comparison on

Technical products require more time on product knowledge training

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Market/Industry Orientation Topics

Industry fit into overall economy Knowledge of industry and economy Economic fluctuations that affect buying behavior and require adaptive selling techniques Customers' buying policies, patterns and preferences in light of competition Customers' customers needs Wholesaler and retailer needs
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Company Orientation Topics

Company polices that affect their selling activities

Personnel Structure Benefits

Handling customer requests for price adjustments, product modifications, faster delivery, different credit terms Sales manuals

Hard copy, online Product information Company policy information

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Time and Territory Management

Sales trainees need to learn to manage time and territories Time spent training out of the field is costly 80/20 rule applies:

20% of the customers account for 80% of the business and Require the same proportion of time and attention
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Legal/Ethical Issues

Federal law dictates corporate action or avoidance of action in areas of marketing, sales and pricing Sales personnel need to understand the federal, state and local laws that constrain their selling activities Statements made by salespeople carry both legal and ethical implications Lapses in ethical conduct often lead to legal problems

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10.3 Ethics Training Part of Sales Training

Insurance industry suffers bad reputation of unethical behavior Insurance Marketplace Standards Association (IMSA) created in response IMSA certification requires

Ensuring salespeople pursue ethical practices Ethical practices training for all agents and staff Administering an exam for all sales professionals
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Source: IMSA, www.imsaethics.org, Fall 2007.

Technology

Notebook computers

Home offices eliminate the need to go to another office Salesperson can be almost totally self-sufficient with

Presentations Connecting to company intranet or extranet Delivering documentation quickly and accurately

Effective computer use affords sales personnel more face-to-face customer contact time Effective use requires training
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High-speed network connection Computer Printer Cell phone

10.4 Internet Training

Increased control over content Less costly Comprises 15-20% of all training today Expected to be 50% within 5 years

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Specialized Training Topics

Specialized, job-tailored training most effective Sample topics

Price negotiations Trade show effectiveness Reading body language Addressing SCA

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10.5
Common instruction methods

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10.6

Sales training methods

Source: Christen P. Heide, Dartnells 30th Sales Force Compensation Survey: (Chicago: Dartnell Corp., 1999), p. 141.

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10.5 Creative Sales Training

Effective training can take place beyond the classroom or computer Requirements

Focus on knowledge, selling skills for success Understand deliverables Boot camps Product immersion Cooking classes
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Examples

Keys for Effective OJT

Teaming - bring together people with different skills Meetings - set aside times when employees can get together Customer interaction - include customer feedback as part of learning process Mentoring - provide informal mechanism for new salespeople to learn from more experienced ones Peer-to-peer communication - create opportunities for mutual learning among salespeople
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Source: The Education Development Center (www.edc.org)

Classroom Training

Advantages

Standard briefings in

Disadvantages

Formal training sessions save executive time Interaction among salespeople builds camaraderie
Expensive Time-consuming Too much material = less retention

Product knowledge Company polices Customer and market characteristics Selling skills

Role playing a popular technique

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Electronic Training Methods

Online training $18billion industry (2006) Makes J-I-T information possible IBM plans 35% sales training to be over Internet CD-ROM currently #1 delivery method 30% of server-based training over intranets Effectiveness not well-documented Not likely to eliminate one-on-one training

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Measuring the Costs and Benefits

Sales training consumes substantial time, budget and support resources Relationship between sales training and revenue is difficult to measure Relationship between sales training and other broad objectives difficult to measure
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10.6 Training Road Blocks

Training cant solve the problem Busy, jaded salespeople are not open to learning new skills Conflicting methods and philosophies are taught at each session The training isnt relevant to the companys pressing needs The training format doesnt fit the need E-learning is overused, or used in wrong situations Theres no follow-up after training The trainer cant relate to the sales team
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Sales Training Costs

Training funds are often allocated with little regard for results Results and benefits are difficult to measure Difficult to isolate training impact from

Economic conditions Environmental changes Seasonal trends Competitive activity Etc.

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Evaluation options matrix

10.7
Source: Thomas Atkinson and Theodore L. Higgins, Evaluation Obstacles and Opportunities, Forum Issues, February 1988, p. 22. 10-38

Measuring Broad Benefits

Improved morale Lower turnover Higher customer satisfaction Managements commitment to quality and continuous improvement Measuring changes in skills, reactions and learning assists both new and experienced sales personnel
10-39

10.8
Overall ranking of evaluation measures

10-40