Sales Manager's Dilemma: Balancing Short-Term Revenue Goals Research Proposal

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Sales Manager's Dilemma: Balancing Short-Term Revenue Goals with Longer-Term, Sustainable Value Creation

How Reward Programmes and Strategic Sales Force Management Can Be Used to Achieve This

Building efficient sales teams is a difficult challenge for a modern sales manager. Managing these teams in a way that contributes to both short-term goals and long-term strategy implementation is ultimately more difficult. My chosen topic looks at how to fine-tune management techniques for sales forces in contemporary business environments to achieve a workable balance between the conflicting interests of short-term revenue objectives and the implementation of long-term corporate strategies. Primarily this is about creating sustainable customer value. In this context I propose to analyse specifically reward and motivation systems that have been adopted by leading companies with the purpose of resolving their sales teams' permanent dilemma between delivering short-term revenue and profitable results while focusing on implementing corporate strategies and building longer term customer value.

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In rapidly-changing business environments in this digital era, companies are changing or reviewing strategies very frequently. At the same time the least-affected departments are often in sales, and those are the people who direct this new strategy toward the customers. This situation is particularly difficult when a company's sales force is scattered around the region (e.g. Europe). This, on one hand, enables building more close and trustworthy relationships with customers, which facilitates building long-term customer value. On the other hand such a remote sales force structure brings more complexity to the management process. This is especially true in the areas of performance management, reward, and motivation. The goal of my research is to determine the right mix of HR and sales management techniques in the areas of performance management, reward, and motivation so that the short-term vs. long-term dilemma can be resolved.

Research Proposal on Sales Manager's Dilemma: Balancing Short-Term Revenue Goals Assignment

Why is it important? -- Why is this an important topic to investigate from a theoretical and/or practical perspective? State how the dissertation will help your personal development objectives; career development objectives; your organisation's objectives (where appropriate) and meet the Business School objectives. (approx 300 words)

The area of strategic sales force management is particularly interesting and important in the contemporary business environment from the standpoint of both short-term revenue and long-term value creation.

Having spent twelve years in sales in different roles, I have reached my current position of Director of Sales EEMEA at one of the largest global Computer Hardware manufacturers. Based on my experience and academic knowledge in the field of sales management, I am confident that building efficient sales teams is the ultimate challenge for any manufacturing, distribution, and service organization. Few companies in my experience actually measure sales teams by balancing the criteria of short-term revenue results and long-term customer value creation. That is where I believe many organizations make management mistakes by undervaluing the importance of long-term objectives for the sales teams. Overlooking or underestimating the contribution of corporate sales departments to strategic customer value creation may lead to deteriorating corporate performance in the long run.

Many sales managers struggle to design the strategic goals in their sales departments to achieve a balanced approach to securing short-term goals and long-term value realization. In this area reward and motivation systems are often considered as a sort of "legacy we have to live with" but they can be an important part of a sales manager's strategy. To create productive sales departments, companies should not only build the team itself. They should also assure that the right internal policies are implemented to properly motivate and reward not only the results, but also the behaviours that lead to those results where both short- and long-terms goals are addressed, and this is ultimately much more challenging.

Strategic changes often require changes in the company's HR tools and procedures, and these spill over into sales management. One of the most difficult managerial tasks is to design effective performance management techniques to assure sales people focus not only on short-term revenues, but nurture and develop long-term partnerships with the company's customers. A modern shift to more remote sales force management adds to the overall complexity of the issue.

2. Literature Review

Summary of key findings and ideas from your initial literature search. How does the literature link to your research question and provide support for your proposed research? (approx 250-300 words)

The initial literature review proved the importance of and increasing interest in the proposed subject. There are multiple aspects related to sales management in organizations. For example, Harvard Business Review offers a regular update on strategic sales management which discusses different aspects related to sales management with a focus on how to reduce disconnect between the sales force and the corporate strategy. One element that is also discussed is Behaviour Control (BC) vs. Outcome Control (OC) systems. The latter management technique focuses on concentrating a sales manager's efforts on delivering revenue numbers (outcome) from his sales people. This indisputably shifts the focus of sales people toward customers and away from the voice of their own managers. This is the negative side of OC systems. Companies adopting the BC approach focus the entire sales management concept on developing, motivating, and rewarding behaviours which lead to those outcomes mentioned in the OC systems. The BC type of sales management assures that employees are more management-concerned in their daily work (i.e. they listen and implement what the managers want from them). Authors argue that the BC approach secures the company's long-term success, while the OC systems concentrate only on short-term results.

In the book "Rethinking the Sales Force," Neil Rackham and John DeVincentis write convincingly about the need for sales forces to change with the rapidly changing times, and about how they can successfully adapt. The book takes a solid look at what it takes to sell in today's market. The idea of a two-tier sales force reflects the separation between long-term strategic objectives and short-term revenue goals. It gives plenty of strategies and corporate examples, all focused on how the sales force can create value, as opposed to just communicating it to customers.

I found also useful "Sales Management" by Robert J. Calvin. Calvin discusses securing balanced, workable solutions for sales forces and delivering short-term goals while assuring long-term strategy implementation is an ultimate challenge for a sales manager. The author argues that it can be done only through implementation of an entire sales management cycle starting with hiring the best people, training and coaching them, deploying a sales force, motivating them and automating their performance and then designing compensation plans which reward the behaviours and results the company wants to achieve.

Initial bibliography: Provide at least 10 key academic literature references in your reference list and attach at Appendix a.

3. Research Question(s)

Specific research question(s) Your literature review should culminate in a specific statement of the research question(s) that your dissertation will investigate. (approx 50-100 words)

My research focuses on what best practises are adopted today by manufacturers of different products in sales management to assure that their sales teams' have steady productivity growth while keeping their focus on both short- and long-term corporate goals and strategy implementation. The objective is to analyse what strategic sales management practises, particularly in the area of reward and remuneration, work and what does not, and to determine what has the greatest impact either alone or in combination with one other.

My primary research question is: "What strategic sales management practises with regard to reward and remuneration are appropriate and effective for companies in managing their sales forces?"

My secondary research question is: "Do the practises discovered in question one enable companies to effectively manage the sales persons' dilemma of delivering short-term revenues while not overlooking long-term customer value creation, and what is the most effective mix of management techniques to affect this?"

To answer the above two questions, I will use a survey questionnaire attached to this document:

4. Research Design

Research design and data collection plan. What research method will you use and why? Explain how you will collect the data and identify any practical issues. Give details of your proposed sample and how you will access it. (200-250 words)

For the purpose of deeper and unbiased findings, I am planning to use a quantitative methodology. The dissertation topic is constantly evolving and there are several management schools of thoughts co-existing on a global scale. To gain a deeper insight into my topic I plan to interview manufacturers and also distributors who have regional sales coverage regarding the methods, tools, and processes that they utilize in their strategic sales force management. This is of particular interest to me with regard to the sometimes-conflicting objectives of short-term revenue and long-term customer value creation as it relates to the implementation of strategy.

The research questionnaire is designed to collect original data about what and how reward and remuneration techniques based on performance are used in sample companies. The questionnaire should not take a respondent more than 10 minutes to complete. Most of the questions will be closed with an open-question… [END OF PREVIEW] . . . READ MORE

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