1. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.1 Identify the key issues in sales training for the 21st century Understand the objectives of sales training Discuss the development of sales training programs Understand the training of new sales recruits and experienced salespeople Define the topics covered in a sales training program Understand the various methods for conducting sales training Discuss how to measure the costs and benefits of sales training Learning Objectives

2. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.2 Sales training analysis Role playing On the Job Training (OJT) Electronic training methods Sales training costs Key Terms

3. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.3 Meg Kerr and Bill Burzynski, “Missing the Target: Sales Training in America,” Training and Development Journal, (July 1988), p. 68. SOURCE: (percent of all characteristics cited; multiple responses were possible) Sales Record Committed to quality and customer service, aggressiveness, persistent, self-confident 48% Sales, problem-solving, communication, time management 25% Product, industry, market Meets objectives Completes paperwork, political acumen 13% 11% 4% Other Knowledge Skills Attitude Characteristics of a Successful Salesperson

4. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.4 25% Characteristics of Success* Program Content: New Hires Program Content: 1-3 Years Seniority 13% 48% 56% 43% 1% 65% 35% 0% *See Exhibit 1 for additional characteristics. Meg Kerr and Bill Burzynski, “Missing the Target: Sales Training in America,” Training and Development Journal, (July 1988), p. 69. SOURCE: Knowledge Skills Attitude Program Content Versus Characteristics of Success

5. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.5 When determining sales training needs, three issues that must be considered: Who should be trained? What should be the primary emphasis in the training program? How should the training process be structured: on-the-job? formal centralized program? field initiatives and participation? Sales Training Issues

6. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.6 Increase Productivity: Provide trainees with the necessary skills so their selling performance makes a positive contribution to the firm. Improve Morale: Prepare trainees with “how to” instruction on perform tasks so their productivity increases as quickly as possible. Lower Turnover: Improve morale and increase job satisfaction through effective training. Improve Customer Relations: Create continuity in customer relationships, build productive partnerships and increase customer satisfaction through more skillful performance. Improve Selling Skills: Time and territory management. Sales Training Objectives

7. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.7 Top management is not dedicated to sales training. Sales training programs are not adequately funded. Salespeople are apathetic about sales training. Salespeople resent training's intrusion on their time. Salespeople resist changes suggested by training programs. Obstacles to Introducing a Sales Training Program

8. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.8 Analyze sales force needs. Set specific, realistic, and measurable training objectives. Allow adequate develop and timely, effective implement of the program. Subject itself to evaluation and review. Modify any aspect of the program to achieve greater effectiveness. A Well-Designed Sales Training Program will:

9. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.9 Analyze needs Set specific, realistic, and measurable objectives Develop and Implement Program Evaluate and Review Program ObjectiveInformation Sources and Processes Job analysis, job description, etc Review needs, consider short-term and long-run issues, compare training objectives with company goals Evaluate previous training methods, consider cost/benefits of various training programs Develop monitoring system, monitor and revise Analyzing the Training Needs of the Sales Force

10. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.1010 Most larger companies train new sales recruits in programs differing in length and content because... Training needs vary from firm to firm and even within a firm to because of differing specific needs. Training needs vary because of differences in the needs and aptitudes of the recruits. Variation in the length of training programs occurs due to company philosophy. Training New Sales Recruits

11. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.1111 Most larger companies provide training programs for experienced personnel because... Time erodes the value of earlier training. Marketplaces change and knowledge become obsolete. Management endorses the “lifelong learning” concept. The best performers find value in refresher sessions. Corporate culture, morale and job satisfaction can be influenced and improved. Training Experienced Sales Personnel

12. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.1212 Program content for training new sales personnel tends to remain constant over time within a firm. Topics include... Product or service knowledge, Market/Industry orientation, Company orientation, and Selling skills. Sales Training Topics

13. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.1313 Product knowledge ranks among the most important topics. However, knowing when and how to discuss the subject in a sales call ranks even higher. Companies that produce technical products spend a greater amount of time on product knowledge than do manufactures of non-technical products. Product knowledge involves... Knowing how the product is made How the product is commonly used, and How it should not be used. Product Knowledge

14. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.1414 Customers often want to know how competitive products compare on... price, construction, performance, and compatibility with each other. Product knowledge enables a salesperson to provide prospects and customers with the critical information for rational decision-making. Product Knowledge

15. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.1515 Salespeople need to know how their particular industry fits into the overall economy. Forecasting sales and setting quotas requires knowledge of the industry and the economy. Economic fluctuations affect buying behavior and requires adaptive selling techniques. Salespeople need to understand customers' buying policies, patterns and preferences in light of competition. Sales reps need to be knowledgeable about their customers' customers and what satisfies them. Missionary salespeople must know the needs of both wholesalers and retailers. Market/Industry Orientation

16. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.1616 Sales trainees must be aware of company polices that affect their selling activities. Sales representatives can expect customers to request price adjustments, product modifications, faster delivery and different credit terms. How are these handles? Major corporations provide the sales force with sales manuals that cover product line information and company polices. A well-prepared sales manual gives a sales representative quick answers to a customer's questions. Company Orientation

17. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.1717 Sales trainees need assistance to learn how to manage their time and territories to be maximally productive. The familiar 80/20 rule applies. 20% of the customers account for 80% of the business and Require a direct proportion of time and attention. The need to be more effective in time and territory management has led to greater telephone usage with appropriate telemarketing sales training courses. Time and Territory Management

18. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.1818 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 will constrain their selling activities. Statements - or rather, misstatements- made by salespeople carry both legal and ethical implications. Lapses in ethical conduct often leads to legal problems. Legal/Ethical Issues

19. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.1919 Many companies issue salespeople laptop computers for presentations, connecting to the company intranet or extranet and for delivering documentation quickly and accurately. Some companies create "home offices" for their sales force, thus eliminating the need to go to another office. Armed with high-speed network connections, laptop or desktop computer, printer, and cell phone, a salesperson can work independently and be almost totally self- sufficient. Technology

20. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.2020 In some cases, a sales rep can access the company's... Decision support system (DSS) to learn what products selling well in an area or to a specific customer. Production schedule to check delivery times. Customer relationship database to gather background and history on a customer or prospect. Companies find that effective computer use affords sales personnel more face-to-face customer contact time and improved customer service through information availability. Technology (continued)

21. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.2121 Method% of firms offering 0 25 50 75 100 On-the-job 84.3 Individual Instruction 69.8 In-house classes 60.8 External seminars 71 Home assignments 17.7 Other 6.7 Methods Used in Sales Training

22. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.2222 Instructional Delivery Method Classroom with instructor100% Workbook/manuals98% Public seminars93% Videotapes92% CD-ROM87% Self-Assessment82% Role-play81% Non-computer, self study79% Case Studies78% Internet74% Non-computer-based games72% Computer-based games57% Audiocassettes55% Teleconferencing 53% Videoconferencing groups41% Methods Used in Sales Training

23. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.2323 Some folks find thought of "learning by doing" (OJT) psychologically uncomfortable. OJT should be a carefully planned process affording new recruits the opportunity to learn by doing, while earning and being productive. A good OTJ program contains established procedures for evaluating and reviewing a trainee's progress Research over the last three years suggests that informal on- the-job training is a very effective way of learning for salespeople On-the-job training and coaching often occur together On-the-Job Training

24. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.2424 Formal classroom training represents an indispensable part of sales training but very few companies rely solely on it... A trainee receives standard briefings in product knowledge, company polices, customer and market characteristics, and selling skills. Formal training sessions avoid wasting executive time meeting and briefing an entire group of trainees at once. Classroom sessions permit the use of audiovisual materials such as movies and videotapes and technical resources like computers and databases. Interaction between sales trainees builds camaraderie. Classroom Training

25. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.2525 The Internet, especially the World Wide Web and its graphics, revolutionized delivery of training. Quality learning experiences can be delivered to staff and customers over the Internet. Online universities offer a wide array of courses through the doctoral level. Online training continues to grow exponentially. Training can also be delivered via CD-ROM and DVD. Electronic Training Methods

26. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.2626 Sales training consumes substantial time, budget and support resources. It’s very costly activity The relationship between sales training and revenue lies obscured in a complex process with delayed payoffs. Pinning down the relationship between sales training and its financial benefits requires thought and effort. Most sales organizations express blind faith by assuming that their sales training programs succeed. Measuring the Costs and Benefits

27. Chapter Ten McGraw-Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved. 10.2727 Broad benefits of sales training include... Improved morale, Lower turnover, Higher customer satisfaction, and Demonstrate management’s commitment to quality and continuous improvement. Measuring change in skills, reactions and learning assists both new and experienced sales personnel. Measuring Broad Benefits