While recently looking for information on the cost of sales training,
I ran into an article that ran recently in CIO Magazine (Aug. 1, 2002)
title "It All Began with Drayer."
Ralph Drayer tells the story of developing automated links between
Procter & Gamble and Wal-Mart. It's really the story of "customer
relationship management" or CRM -- and how it changed P&G's
marketing/sales management.
It started in 1987 when the-late Sam Walton said to P&G, "The way we
do things is way too complicated. You should automatically send me
Pampers, and I should send you a check once a month. We ought to get
rid of all this negotiation and invoicing."
It developed into a continuous replenishment process that had unique
results:
* it gave P&G access to Wal-Mart inventory for the first time
* it eventually gave the supplier access to retail point-of-sale
information
* just-in-time delivery to stores -- avoiding warehouses
The impact on the sales organization was that "we almost became
consultants to our retailers," says Drayer. "In fact, just to give
you an idea of how far that went, we eliminated the sales quota."
Sales reps became category managers, business consultants, marketing
consultants.
You can find the Drayer article and other resources in the Supply
Chain Management Resource Center at the CIO Magazine website:
http://www.cio.com/research/scm/
CIO Magazine also and an ERP Resource Center and other articles that
may add to your analysis:
http://www.cio.com/archive/100100_four.html
http://www.cio.com/research/erp/
Early sales force automation projects were aimed at increasing actual
selling time. A seminal Pfizer study showed that its sales force
spent 20% of its time traveling and in administrative duties; 40% of
its time seeking information ("what's the status of my order?"); and
less than 40% of its time in selling activities. It to reduce the
time servicing the customer's information needs that Pfizer initially
equipped its pharmaceutical sales reps with portable computers.
The Journal of Personal Selling & Sales Management published an
interesting analysis of what's really happening with sales force
automation projects. Titled "An Exploratory Study of Sales Force
Automation Practices: Expectations and Realities" (Sprint, 2001)
authors Robert Erffmeyer and Dale Johnson studied of 56 direct sales
organizations, finding that most spent $10,000 - $12,000 for their
automation activities. They found:
BENEFITS TO SALES FORCE:
improved access to information: 80% of companies
more efficient: 35%
more time with client: 15%
BENEFITS TO CLIENT:
improved access to information: 60%
faster turnaround: 50%
improved service/quality: 45%
POSITIVE OUTCOMES:
Improved communication/customer: 65^
More efficient sales force: 51%
Faster revenue generation: 27%
Better monitoring/forecasting: 16%
The Erffmeyer/Johnson study is not available on the Internet, though
if your local library has access to the "Expanded Academic ASAP," the
full text of the journal article is available.
Google search strategy:
"sales" + costs + trends
sales + technology + trends
"sales force automation"
Best regards,
Omnivorous-GA |
Request for Answer Clarification by
blakepiper-ga
on
11 Oct 2002 21:42 PDT
Tks for u answer omnivorous.. could you please give me some general
theories about this question too? Tks
|
Request for Answer Clarification by
blakepiper-ga
on
11 Oct 2002 21:51 PDT
could you please provide some academic theory/context about this question.. tks
|
Request for Answer Clarification by
blakepiper-ga
on
11 Oct 2002 21:55 PDT
pls provide some theory about this question and you or someone
experience about this queation..tks
|
Clarification of Answer by
omnivorous-ga
on
12 Oct 2002 06:23 PDT
Traditional marketing/sales positioning has been that the four P's
govern the sales process:
* product
* price
* position
* promotion
The sales person has always been the direct feedback loop for a
company to know how it's doing in each area. Traditionally, the
direct sales person provided a 5th P -- presence.
Beginning with direct marketing in the 1970s, it became apparent that
catalogs could supplement the sales person by providing wider and more
frequent contacts. Small accounts could be addressed economically for
the first time.
The rise of telemarketing people -- using technology -- in the 1980s
extended the reach of a sales organization. Using organization
techniques like Dell Computer has, a large account could be managed by
a single direct sales person who was supplemented by inside sales
people. These inside sales people, who were called 'sweepers' or
'account managers', would maintain day-to-day contact via telephone
and extend the reach of the sales staff at lower cost.
The presence of the Internet and systems such as CRM simply extends
the ability to provide all 5 P's; provide them in uniquely customized
positions; provide them at lower cost; and eliminate layers between
supplier and the ultimate end-user.
Best regards,
Omnivorous-GA
|
Request for Answer Clarification by
blakepiper-ga
on
13 Oct 2002 19:44 PDT
Tks very much.. you are a excellent researcher...
|
Request for Answer Clarification by
blakepiper-ga
on
13 Oct 2002 20:14 PDT
Dear Omnivorous
Could you please talk about more how the new technology effect the
tradition sales process....and give me some example of this.. could be
you experience or someone's experience... TKS
|
Clarification of Answer by
omnivorous-ga
on
14 Oct 2002 09:48 PDT
Each new technology brings its own benefits. In the 1980s, with the
advent of cellphones, a Hewlett-Packard division manager told me that
they'd seen sales productivity improve by 10% with no other changes.
He attributed it to the cellphone and the ease with with direct sales
and client could stay in contact.
Adding personal computers to a sales environment made more significant
changes, allowing customers direct access to information; giving sales
staff more tools for customer service -- as noted above.
With the advent of the Internet, access to multimedia became
standardized and nearly universal. With my last company, frequently
the first contact was with the website. Before even contacting a
sales person, the customer had an excellent idea of what our products
were; how they were sold; a sense of price; and many of the key
features and benefits were.
For sales people comfortable with using new technologies and tools, it
makes their job easier and more enjoyable. Once you've confirmed that
the customer understands your product, you can move on quickly to
fitting it to their needs. And with the Internet, there are tools to
demonstrate the product; stay in close touch with the customer; and
provide analytic tools (or simple financial analyses) to prove value.
In at least one case, we were able to complete the sales cycle without
ever meeting the customer. It was only at contract signing that our
sales execs finally met the customer, despite hours on the phone and
in Internet demonstrations.
I hope this helps!
Best regards,
Omnivorous-GA
|
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