Page 131 - DMGT205_SALES_MANAGEMENT

Unit 9: Motivating and Compensating Sales Personal

Sales Targets or Quotas Notes

If a sales target or quota is to be effective in motivating a sales person, it must be regarded as fair
and attainable and yet offer a challenge to him. Because the sales person should regard the quota
as fair, it is usually sensible to allow him to participate in the setting of the quota. However, the
establishment of the quotas is ultimately the sales manager's responsibility and he will inevitably
be constrained by overall company objectives. If sales are planned to increase by 10 per cent,
then salesmen's quotas must be altered in a manner consistent with this objective. Variations
around this average figure will arise through the sales managers knowledge of individual sales
person and changes in commercial activity within each territory; for e.g., the liquidation of a
key customer in a territory may be reflected in a reduced quota. Quotas can be set on rupee sales,
unit volume, margin, selling effort or activity and product type. The attainment of a sales target
or quota usually results in some form of financial benefit to the sales person.
Sales Contest

The sales contest is an important tool to motivate sales persons. The purpose of sales contest
varies widely. It may encourage a high level of sales in general to increase the sales of a slow-
moving product or to reward the generation of new customers. It provides an incentive to show
better performance and secure more satisfactory results. However, sales contest has a few
disadvantages. One such disadvantage is that it can encourage cheating. For e.g., in one company
which used a sales contest to promote sales at a series of promotional events around the country
with its dealers, sales persons "stored up" orders achieved prior to the event in order to increase
the apparent number of orders taken at the event. Also, contests, by pitching sales person
against sales person, militate against the spirit of mutual help and cooperation which can improve
sales force performance.

Sales Conventions and Conferences

These are the devices of group motivation. They provide opportunities for sales persons to
participate, gain social satisfaction and express their views on matters directly affecting their
work. They promote team work, dissolve social barriers, inspire and raise sales person's morale.
Most of the companies in India are now a days adopting this method to motivate their sales
force.

Positive Effect

The positive effect method is also an important technique for motivating the salesforce to their
best.
The proper application of praise, positive feedback, and human warmth and understanding can
impel others to perform up to their capabilities. This must be done in a genuine way and not be
perceived as overtly self serving.
Another form of motivation through positive effect occurs via a small group and peer relations.
Friendship, support and comradeship frequently serve as vehicles for creating positive feelings
towards company and job.

Leadership Style of the Manager

Leadership style of the manager plays an important role in motivating the sales person.
Inspirational leadership refers to influence through referent power. Identification of charismatic

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