Internal Assignment for September 2023 Examination

Subject: Sales Management

(Q. 1) Answer:
Introduction-

Selling is one of the most important marketing activities in most organizations. The scope for
selling has increased substantially during the past few decades due to growth in the industry.
Persuasive selling skills are being used not only by organizations whose objective is to earn
profit but also by non-profit organizations because of this varied nature selling has developed
into a specialized area of management.

As Art is a science applied, it involves actual doing. It is the practical application of

knowledge or natural ability. One might have a broad knowledge of the science of medicine
and possess, or develop, but indifferent ability in applying it. It may be said, speaking
generally, that knowledge of a science is gained by study; proficiency in an art by practice.

Selling is definitely an Art. But Art is an applied Science. It is the practical application of
knowledge or natural ability. It is possible to make a study of the sales process and the
experience and methods of successful salesmen. Because of the many unmeasurable human
elements involved, it will always remain, to some degree, an inexact science.

Concept-

In a survey of 173 marketing executives, 46 percent perceived selling as an art, 8 percent as a

science, and 46 percent as an art evolving into a science.9 The fact that selling is considered
an art by some and a science by others has produced two contrasting approaches to the theory
of selling.

Sales as an Art

Some call sales an art because it requires the salesperson to influence the buying decisions of
their customers. To do this, a good salesperson uses their emotional intelligence to strike
a rapport with the buyer to establish a trust-based relationship.

Prof. Ben Shapiro and John J. Sviokla in their (Harvard Business Review) book, “Despite the
tremendous contributions of information and communications technology, selling is still
largely a function of interpersonal relations, which are guided by the artful ability to
recognize motivations, needs, and perceptions.”
Such evidence points towards the idea that sales are an art.

But the evidence that sales is science is considerable too.

First, while the ability to start meaningful conversations is considered an art—an innate
gift — over time, we’ve learned that there are patterns to such conversations.
Today, you can learn to talk and behave in ways that can make you more employable. You
can take courses to learn intonations and gestures that can improve your love life.
Leaders are trained to emulate certain words and actions that can make them more influential.
Since all these conversations can be scientific, it is no surprise then that salespersons too can
employ science to do their job well.
Successful sales reps use science-based formulae that combine social psychology,
neuroscience, and behavioural economics when they engage with buyers. These sciences
explain how and why people react the way they do.
So, it is not the higher EQ or IQ alone that makes salespeople successful. The idea of Sales as
a Science comes from these scientific processes, methods, and approaches employed to close
deals.
But the thing that tips the scales in the favour of sales being a science is technology.
Because the art of selling can be codified to make the buyer know, like, and trust the salesperson
enough to buy from them ultimately, sales can be called science. Even the innate gift of
starting a meaningful conversation has been codified in science-based tools, such as Neuro-
Linguistic Programming, for salespeople to influence their prospect’s buying decisions.
Secondly, sales can be considered a science because it gets more right or less wrong over time,
just like Edison said - “I have not failed. I’ve just found 10,000 ways that won’t work.”
Businesses have been spending even more on sales training, which is paying off – a recent
report shows that every $1 spent on sales training returned $29 in incremental revenue. As there
are controllable factors at play, science helps salespeople get better at their jobs. Science
gives sales leaders (like you) tools to invest in their sales teams’ performance development to
make improvement possible.
So, sales are a science. But are we being scientific about it?
There are two primary reasons that current methods for assessing and improving sales
reps’ performance are flawed.
As a sales leader, you may have mostly used activity metrics, deal progression, and customer
retention as your team’s KPIs. While these are necessary to discover the ‘when’ and ‘what’ of
performance, they do not provide a holistic evaluation. To be able to discover the causes
(the hows and whys), these metrics fall short.
Storing sales calls to search through and listen to them for notes to feedback while coaching
the team. However, you know that the manual process is not sustainable. Can’t run this on a
large scale alongside your packed schedule and responsibilities.
Conclusion-
These new ways of measurement often result in surprising insights about selling. For
example, it was once widely assumed that sales professionals who are highly successful at
one type of selling will be equally successful at some other type of selling. However, when
sales performance is actually measured, it becomes clear that a top performer is less likely
than an average performer to be successful at a different sales environment.
When it comes to measuring themselves, sales teams (and their management) are prone to
measure success and then attempt to strengthen or replicate the behaviours that created that
success. That’s why the vast majority of sales training and sales technology is positioned as a
way to implement “best practices” or “what the best salespeople do.”
However, the behaviour of the top salespeople may be something that’s inherent rather than
teachable. Top salespeople may, in fact, be near savants who are uniquely talented and
peculiarly well-suited to a certain kind of sales task and may not be able to articulate what
they’re doing or why it works.

(Q.2) Answer:
Introduction-
Head and Shoulders has identified its target market as young adults aged 25 to 45, who are
looking for a shampoo that is effective and affordable.
The company has positioned itself as a reliable brand that is dedicated to providing superior
results. To remain competitive, they have adopted a multi-channel approach to marketing,
which includes both traditional and digital media.
The company’s objective is to create a strong emotional connection between the brand and its
customers. To achieve this, they are leveraging their core values of trust, reliability, and
quality to create an aspirational brand image.
As the Vice President- Sales of the company, will discuss with my team related to strategic
policies for product (Head & Shoulders) relaunch in the new place.
Marketing Strategy of Head and Shoulders analyses the brand with the marketing mix
framework which covers the Product, Price, Place. These business strategies, based on Head
and Shoulders marketing mix, help the brand succeed in the market. Let us start the Head and
Shoulders Marketing Strategy to understand its product, pricing, & distribution policies:
Product policies (Head & Shoulders):
Head and Shoulders is a leading haircare brand making shampoos & hair conditioners. Head
and Shoulders started with Proctor and Gamble scientists spending 10 years finding the
magic formula to solve the widespread problem of dandruff. Post the research, they started
using Zinc Pyrithine in their formula. It was very effective against dandruff due to its anti-
fungal properties. Head and shoulders has gained the trust of consumers by providing quality
products. The product promises to remove dandruff and give clean, healthy hair to users.
Head & Shoulders have a distinctive target market to which they direct their campaigns. I
recommend our clients assess their target market and their tastes and preferences.
After all, the general rule of marketing is to create a more customer-centred approach to
campaigns. Understanding what the customers like and their choice of lifestyle will allow the
brand to leverage these characteristics in order to capture the market’s attention.
It has the best dandruff cleaning formula to eradicate even the thinnest shred of dandruff from
the scalp. The packing of Head and Shoulders constitutes of tactfully shaped white bottles
with elements that resemble the essence of freshness in the minds of the viewers. The brand
sells hair care products that caters to men and women, with a promise to solve problems
related to dry hair, itchy scalp, dandruff and severe scalp conditions. The product portfolio in
its marketing mix includes shampoos like Anti dandruff, anti-hair falls, silky black, lemon
fresh, cool menthol, cool blast, dry scalp care with almond oil, smooth and silky and hair
retain. Conditioners of the variant Smooth and silky and anti-dandruff.
Distribution policies (Head & Shoulders):
Head and Shoulders was successful in establishing itself as a reliable brand in the Indian
market. Meanwhile the brand has been capturing markets and spreading its presence in
several countries across the world. It has significant market share in Pakistan, Canada, and
Bangladesh apart from India. Being a subsidiary of P&G, Head and Shoulders enjoys the
advantage of having a strong distribution network. The products travel from factory to
distributor to whole-seller to retailer and finally to the consumer.
Pricing policies (Head & Shoulders):
Below is the pricing strategy in Head and Shoulders marketing strategy:
Head and Shoulders has always been pricing its products competitively keeping in mind its
closest competitor Hindustan Unilever. Its approach has been penetrating pricing in the past
so it can sell high volumes and reach a large customer base.
The prices are kept reasonable to retain its existing customers and attract new customers.
Head and Shoulders products are available in different sizes ranging from 3 ml sachets
available at 3 rupees to 675 ml packs available at 370 rupees. This makes them accessible to
different kinds of users who can buy quantities according to their needs. The brand also does
promotional pricing in its marketing mix during the summers when it provides discounts on
its product range. This further increases the sales and leads to higher revenues.

(Q. 3a) Answer:

Introduction-
NEC is a leader in the integration of IT and network technologies and brings more than 100
years of expertise in technological innovation to provide solutions for empowering people,
businesses and society.
Headquartered in Japan, NEC started operations in India in the 1950s, accelerating its growth
through the expansion of business to global markets. NEC in India expanded its business
from telecommunications to public safety, logistics, transportation, retail, finance, unified
communication and IT platforms, serving across governments, businesses as well as
individuals. With its Centre of Excellence for analytics platform solutions, big data,
biometrics, mobile and retail.
NEC in India offers innovative new services and solutions for India and global markets.
NEC operates across India with offices in New Delhi (head office), Ahmedabad, Bengaluru,
Chennai, Mumbai, Noida and Surat.
There are three types of sales organizational structure namely line sales organization, line and
staff sales organization and functional sales organization. As a Vice President – Sales, I
would recommend line & staff organization structure for sales force for NEC considering
that will be selling to both the B2B and B2C segments.
I am recommending for this organizational structure that’s why-

1. Relief to line of executives- In a line and staff organization, the advice and
counselling which is provided to the line executives divides the work between the
two. The line executive can concentrate on the execution of plans and they get
relieved of dividing their attention to many areas.
2. Expert advice- The line and staff organization facilitates expert advice to the line
executive at the time of need. The planning and investigation which is related to
different matters can be done by the staff specialist and line officers can concentrate
on execution of plans.
3. Benefit of Specialization- Line and staff through division of whole concern into two
types of authority divides the enterprise into parts and functional areas. This way
every officer or official can concentrate in its own area.
4. Better co-ordination- Line and staff organization through specialization is able to
provide better decision making and concentration remains in few hands. This feature
helps in bringing co-ordination in work as every official is concentrating in their own
area.
5. Benefits of Research and Development- Through the advice of specialized staff, the
line executives, the line executives get time to execute plans by taking productive
decisions which are helpful for a concern. This gives a wide scope to the line
executive to bring innovations and go for research work in those areas. This is
possible due to the presence of staff specialists.
6. Training- Due to the presence of staff specialists and their expert advice serves as
ground for training to line officials. Line executives can give due concentration to
their decision making. This in itself is a training ground for them.
7. Balanced decisions- The factor of specialization which is achieved by line staff helps
in bringing co-ordination. This relationship automatically ends up the line official to
take better and balanced decision.
8. Unity of action- Unity of action is a result of unified control. Control and its
effectivity take place when co-ordination is present in the concern. In the line and
staff authority all the officials have got independence to make decisions. This serves
as effective control in the whole enterprise.

(Q. 3b) Answer:

Introduction-
Straight Salary plan- The straight salary is the simplest compensation plan. Under it,
salespersons receive fixed sums are regular intervals (usually each week or month but
sometimes every two weeks), representing total payments for their services. The straight
salary was once the most popular sales compensation plan, but it has been declining in
importance. Such plans are more common among industrial-goods companies than among
consumer-goods companies. Firms that formerly used the straight salary have tended to
combine a basic salary with a variable element-that is, they have switched to combination
plans.
Straight-salary plans are commonly used for compensating salespeople heavily engaged in
trade selling. These jobs, in which selling amounts to mere order taking, abound in the
wholesale and manufacturing fields, where consumer necessities are distributed directly
to retailers Frequently, too, the straight- salary method is used for paying driver-salespersons
selling liquor and beverages, milk and bread, and similarly distributed products.

Straight Commission plan- Straight-commission plan is that individual sales personnel

should be paid according to productivity. The assumption underlying straight-commission
plans is that sales volume is the best productivity measure and can, therefore, be used as the
sole measure.
There is a general away from the straight –commission plan, and today no more than 6 or 7
percent of all companies use such plans. The straight commission plan is used in situations
where no selling duties are relatively unimportant and management emphasizes order getting.
Straight–commission plans are common in clothing, textile, and shoe industries and in drug
and hardware wholesaling. Firms selling intangibles, such as insurance and investment
securities, and manufacturers of furniture, office equipment, and business machines also are
frequent users of straight –commission plans.

Drawing accounts plan- It is an improved method of the straight Commission plan. Under
this method, a drawing account of every salesman is opened. The company credits the
Commission accrued in favour of each Salesman, in his account, every month. The salesman
withdraws a certain permitted amount from this drawing account. The money so drawn is
debited in his account.

The limit prescribed for withdrawal during the month shall be deemed to be his total
compensation for the month. The purpose of this plan is to allow the salesman to draw up to
the permitted limit from his drawing account even when a salesman is not able to get a
reasonable sell during a month and his commission comes to a relatively small amount. The
money overdrawn is not adjusted against the commission of any other months. If salesperson
becomes greatly overdrawn, they may lose the incentive to produce, because earned
commissions are used to reduce the Indebtedness.

Some sales personal become discouraged with the prospects of paying back overdrawn
accounts and quite the company.

Salary plus Commission plan- Salary plus commission sales compensation plans are
possibly the most common plans used today. They’re structured in a way that sales people
receive a lower base salary along with commission pay that makes up the majority of the total
compensation.
As a VP-Sales of the company, I will use of this compensation plan for my sales team,
because-

1. There are opportunities to support all sales people on this structure and when there are
proper metrics in place for tracking sales to ensure that the splits are fair and accurate.
2. It offers motivation to increase productivity and to achieve goals. It also offers more
stability—sales people will still get some type of pay even if they’re in training, when
sales are low during certain months, or if market conditions get volatile.
The company may have a base salary plus Commissions. This plan provides incentive and
flexibility elements.
This plan can be used to promote the sale of individual products or to intensify efforts
among specific market segments.
Commissions are usually paid monthly, providing almost immediate reinforcement for the
salespersons’ efforts. Such plans, however, are costly to operate.
Also, the addition of incentive features at the expense of the salary can reduce managerial
control over the Salesforce.