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Sales Force Productivity Conference ● 15-17 October 2018 ● Ritz-Carlton, Atlanta ● © 2018 The Sales Management Association. All rights reserved.
SALES TERRITORY DESIGN
Presented by :
ADAM ECHTERSimon-Kucher & Partners
BOB KELLYSales Management Association
KEN KRAMERTerrAlign
ANDY WILLIAMSBoehringer IngelheimAnimal Health
2Sales Force Productivity Conference© Copyright 2018 The Sales Management Association. All rights reserved.
OUR PRESENTERS
ADAM ECHTER BOB KELLY KEN KRAMER ANDY WILLIAMS
Senior Director
Simon-Kucher & Partners
Chairman
Sales Management Association
President
TerrAlign
Director, Head of Training & Sales Excellence
Boehringer IngelheimAnimal Health
Introduction to Territory Management
A Journey
Territory Management: The Basics
© Copyright 2018 The Sales Management Association. All rights reserved.5
Territory management:
What is it?What activities are included?
© Copyright 2018 The Sales Management Association. All rights reserved.
Territory Management
6
A systematic structuring of sales organization assignments for the purpose of optimizing one or more deployment objectives.
© Copyright 2018 The Sales Management Association. All rights reserved.
Key Management Activities
7
• Clarifying objectives - what to optimize• Defining organizing principles for sales assignments • Calibrating measures• Setting assignments• Administering changes
© Copyright 2018 The Sales Management Association. All rights reserved.
Salesperson Assignment Criteria
8
The Benefits of Optimized Territories
© Copyright 2018 The Sales Management Association. All rights reserved.
Territory Management: Benefits
10
• Substantial performance advantages accrue to organizations that optimize territories.
• These firms’ sales objective achievement is 14% higher than other firms.’
• Similarly, organizations ineffective in territory design underperform by a 15% negative variance in sales objective achievement.
Source: Sales Management Association research Optimizing Sales Territory Design, May 2018. This analysis compares the average rates of sales objective achievement in 100 firms, separating them into three categories, based on their sales territory design effectiveness. “Effective” firms are those with a sales territory design effectiveness rating of 5, 6, or 7 on a seven-point scale, where 1 is not at all effective, 4 is somewhat effective, and 7 is extremely effective. “Ineffective” firms are those with a rating of 1, 2, or 3. Firms rated “somewhat effective” outperform others by 2%.
© Copyright 2018 The Sales Management Association. All rights reserved.11
What are the benefits of optimized territories?
Defining Terms
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Workload
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Capacity
15Sales Force Productivity Conference© Copyright 2018 The Sales Management Association. All rights reserved.
Calculating Capacity: Example from Cox Automotive
Determining true salesperson capacity by converting
activities into time
Manheim Cox Automotive. 2017 Sales Force Productivity Conference presentation: Territory Optimization: A Critical Component to Manheim’s Sales Strategy Evolution
© Copyright 2018 The Sales Management Association. All rights reserved.16
Potential
© Copyright 2018 The Sales Management Association. All rights reserved.
Relationship Between Potential and Sales
17
Sales Force Management: An Analytical Approach; 2018 Kissan Joseph, McGraw Hill Education
© Copyright 2018 The Sales Management Association. All rights reserved.
Relationship Between Potential and Sales
18
Sales Force Management: An Analytical Approach; 2018 Kissan Joseph, McGraw Hill Education
© Copyright 2018 The Sales Management Association. All rights reserved.19
Where does TM fit in the context of broad SPM activities?
Establishing Territory Management Objectives
© Copyright 2018 The Sales Management Association. All rights reserved.
What’s Important?
21
© Copyright 2018 The Sales Management Association. All rights reserved.
Where are firms effective?
22
© Copyright 2018 The Sales Management Association. All rights reserved.
Improvement Priority: Balancing Workload
23
© Copyright 2018 The Sales Management Association. All rights reserved.24
How do firms manage multiple territory management objectives?
Analytical Foundations
© Copyright 2018 The Sales Management Association. All rights reserved.
Balancing “Work”
26
Adapted from TerrAlign’s presentation for the Sales Management Association Managing Sales Territories for Maximum Sales Force Productivity, October 2012.
© Copyright 2018 The Sales Management Association. All rights reserved.
Balancing “Work”
27
Adapted from TerrAlign’s presentation for the Sales Management Association Managing Sales Territories for Maximum Sales Force Productivity, October 2012.
© Copyright 2018 The Sales Management Association. All rights reserved.
Balancing “Work"
28
Adapted from TerrAlign’s presentation for the Sales Management Association Managing Sales Territories for Maximum Sales Force Productivity, October 2012.
© Copyright 2018 The Sales Management Association. All rights reserved.
Balancing “Work”
29
Adapted from TerrAlign’s presentation for the Sales Management Association Managing Sales Territories for Maximum Sales Force Productivity, October 2012.
Average Capacity
© Copyright 2018 The Sales Management Association. All rights reserved.
Balancing “Work”
30
Adapted from TerrAlign’s presentation for the Sales Management Association Managing Sales Territories for Maximum Sales Force Productivity, October 2012.
© Copyright 2018 The Sales Management Association. All rights reserved.
Spreadsheet Tool
31
Average Capacity
Average Capacity
Average Opportunity
Download it from salesmanagement.org
© Copyright 2018 The Sales Management Association. All rights reserved.
Normal Performance Curve
32
Sales Force Management: An Analytical Approach; 2018 Kissan Joseph, McGraw Hill Education
© Copyright 2018 The Sales Management Association. All rights reserved.
Efficient Frontier
33
Sales Force Management: An Analytical Approach; 2018 Kissan Joseph, McGraw Hill Education
Key Challenges
© Copyright 2018 The Sales Management Association. All rights reserved.
Few firms are effective at territory design, …
35
© Copyright 2018 The Sales Management Association. All rights reserved.
… and few salespeople find territories equitable.
36
© Copyright 2018 The Sales Management Association. All rights reserved.37
Overcoming flawed or incomplete data
© Copyright 2018 The Sales Management Association. All rights reserved.38
Measuring workload, capacity, activity, and potential: where to start?
© Copyright 2018 The Sales Management Association. All rights reserved.39
Other challenges?
Technology
© Copyright 2018 The Sales Management Association. All rights reserved.
Leveraging tech: few firms are effective
41
© Copyright 2018 The Sales Management Association. All rights reserved.
Effective tech usage, effective territories
42
© Copyright 2018 The Sales Management Association. All rights reserved.43
How can technology support territory design?
44
Q & A PLEASE BE SURE TO SPEAK INTO THE MICROPHONE. WE’RE RECORDING!
© Copyright 2018 The Sales Management Association. All rights reserved.
ADAM ECHTER
Senior Director
Simon-Kucher & Partners
BOB KELLY
Chairman
Sales Management Association
KEN KRAMER
President
TerrAlign
ANDY WILLIAMS
Director, Head of Training & Sales Excellence
Boehringer Ingelheim Animal Health
adam.echter@simon-kucher.comsmassoc.org/echter
kramer@terralign.comsmassoc.org/kramer
rjkelly@salesmanagement.orgsmassoc.org/rjkelly smassoc.org/awilliams
andy.wiliams@boehringer.com
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