Salesforcetrainingatarrowelectronics Caseanalysis 140622125845 Phpapp01

8/10/2019 Salesforcetrainingatarrowelectronics Caseanalysis 140622125845 Phpapp01

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case analysis

Sales force training atarrow electronics Aashita Jain 081Aniruddh Choks

AnuRadhakrishAritrika Das 096KV Saurabh KaNikhil Saraf 124Paarmi Modi 12Saarini Bagga 1Surabhi Anand 1Vasundhara Adu


2/20


3/20

Sales force

expectation

30 40 year old

No collegedegree/technical training

High energy

Highly aggressive

Monetary motivation

Relation based selling

Did their own thing difficult to inject new idea

Achieve sales goals and deliver goperformance

Manage the territory

Understand the customer strategy : Knoabout company, products in pipeline, dem

creation for the same , need analysis of coand supplier

Make cold calls

Overcome objections and persuad

Close the sale

profile


4/20

Branch GeneralManager

Area SalesManager

(1-3)

MarketingManager

AdminManager

AdminPersonnel

Field Sales Reps (6-8) Sales & Mktg Reps (6-12)

Product Manager (3-6)

Earns $300 weekly Yearly Avg: $60k-$80k Max Earning: $150k-$200k

Yearly Avg: $35k-$75k Commission: 25% of GrossMargin

Yea Ma ComGro

Comm: 25% of Gross Margin Yearly Avg: $35k-$75k

Comm: 4%-5% of Gross Margin Yearly Avg: $40k-$50k

Structure Yearly Avg: $60k-$120k Commission: 35% of BranchOperating Profit

Sales force


5/20Sales force

Problems

Lack of sales personnel

Hiring by and from competition

No employee loyalty

Sales were tied to personal relationships

Attrition of employees lead to losing customers

Sales people from competitors are hired for theirloyal customers

High Turnover Rate

ConNo Standard

Training


6/20Sprouts Program

Hire students from college campuses and train them to sell the way modern salespeopleshould sell.

3 fold objective

Needed more salespeople

Only 300 people beforeSprouts started

Change the make-up ofthe salesforce

No quality in hiring fromcompetitor, people lowerdown in arrow had even

less rich backgrounds

Improve the cult

Move them t

managerial positiondue time

Brief


7/20

Sell ing based on relat ionship Sel ling based on what thecustomer needs now and in the

near future

Selling parts selling solutions to customerbusiness problems

Personal relationship with buyer Relationship with the wholecustomer

Having relationships andproduct knowledge in tool kit

Well equipped tool kit withterritory management,

understanding strategy, makingcold calls, overcoming

objections, how to close saleetc.

Sprouts Program

Changes sought

Kind of peop

SELF STARTERS BUS

GOAL OR

PEOPLE SKILLS

NO TOP GPA

NEW 1st YEAR

Compensation

$18,500 $24,000


8/20Sprouts Program

HIRING

Field office[6 months]

Warehouse[2 weeks]

Headquarters[1 week] He

Hire graduates right outof college to join thesales force through astructured interview

process

Taught about Arrowshistory and values,

basics of the industryand electronic

components

How to pick orders offshelves, track inventory,

operate systems

Exposing recruits to sales,customer support,

marketing, shipping, work

with FSR and SMRs, productmanagement assistance

Sales skill trai ning

Training period over;instated aspermanent

employees at fieldofficeSprouts training

process


9/20Sprouts 2 0

Varied results across branches

Field organization didn't have time totrain people

Friction between Sprouts andmanagers

Programme needed to be moreformal

Why? IROC Idiots Right Out of College

Some of the managers just werent good trainers Sprouts had different expectations Sprouts given ROW (Rest of the World AccountNot wise as it required best selling skills ) Used as Clean up staff

HIRING Xerox facility[13 weeks]

Xerox facility[3 weeks]

Field office[13 weeks]

changes Create common bond: espirit de corps Like an MBA program Demanding workload Understanding of real time computer systems

process


10/20Industry Training Ground

For better compensation: Sprouts who were in first year were offered guaranteed annual salary of $30,0by the competitors. And those in their second year and had their own sales territory (with a salary of $25000- $30,000) were offered $40,000 to $45,000

To move up the management ranks: Since sprouts were fresh out of college, their career advancemen

management positions was slow. However, other competitors recognised their management potential andSprouts were offered faster career growth

easons for employees to leave arrow after the sprouts program

Changes made: Results of the changeDeferred Compensation Program:A part of salary was given a commission rate and putto individual accounts, a percentage of which wasgiven out every quarter and at the end of two years.

This did not works as competitors wouldfor the deferred compensation that emwould lose by leaving Arrow

Non Compete Agreement:Employees were made to sign an agreement that theywould not leave to work for a competitor

Arrow continued to lose Sprouts as noncontracts had no legal binding in somsuch as California


11/20


12/20questions

What are the merits and demeritsof introducing the pathwaysprogram?


13/20

It is essential in order to counter the constantlyreducing sales force poolArrow has acquired four of the top ten distributorsand the size of company has increased whichwould need a uniform training programmeAlthough they had a sales force of 1000, their turnover was around 26 30%To attain competitive advantage and becomethe benchmark in salesforce in the industry bycreating a consistent talent pipelineSince the recruits are fresh out of college, it isessential to train and bring energy andprofessionalism

For A rigorous training pattern is making

most sought after sales people in theand hence being offered higher pay pa

and management ranks which in turnattrition Training was an additional cost to com According to Kaufman, its mo

to hire somebody from a competitor atthan to give somebody a 30% increasyour own company. [1985 figures

The compensation set by competitors whigh ($40,000), so an increase in

would require huge investment [1985 f It led to clashes between General M

and newly trained sales force duedifference in their ideologies whichinternal HR issues

Against

Possible solution


14/20questions

What is the wayforward forPathways?


15/20Possible solution

1. Recruitment

College on-campus recruitment

Inter-industry recruitment to break-free from theclutter of the industry

Scout for potential employees from within theindustry

Procedure for efficient recruitment : Hiring profile

Application scrutiny Interview

Psychological testing Reference check

Physical examination Job Offer

2. Training

Expand the scope of Pathways into a protraining program for employees in other ran

organisation. Theoretical frameworks

Scenario based Gamification

Voluntary quality circle

Sales 101 handbook

Recreational activities throughout the prheightened bonding and relaxation in a stress

environment

Two tier integrated program:


16/20questions

What shouldArrow do to retainthe talent?


17/20Possible solution

Differential Recruitment Process Hire from Ivy League and non-Ivy LeagueColleges Differential pay packages

Non-Ivy League graduates expected tostay for longer satisfied with pay and work

Staggered Training Module Avoid excess investment in short span oftime Step-wise Training Program spread overfirst 3 years of FSRs Careers Structure Training programs on basis of

performance

Increase Awards and Recognition Programsover the course of Training

Include Stock Units to employees

Fringe benefits like the following should be Compensation Medi-claim Recreational centers Campus/ hostels during training

Loans with reduced interest rates should be Educational, Home and Car loans

Sabbatical Leaves can be provided

Restructure Recruitment Training and Compensation


18/20questions

Can we restructure thesales forceorganization?


19/20

Giving Area Sales Managers a more focussed approach towards retainingclients by means of regular interactions

This will reduce Arrows dependence on FSRs as the only touch points for Customer Relationship Management

This will also de-risk Arrow from potential loss of Clients when FSRs leave

Possible solution


20/20

Thank

You

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Salesforcetrainingatarrowelectronics Caseanalysis 140622125845 Phpapp01