International Marketing

14th Edition P h i l i p R. C a t e o r a M a r y C. G i l l y John L. Graham

Personal Selling and Sales Management

Chapter 17
McGraw-Hill/Irwin International Marketing 14/e

Copyright 2009 by The McGraw-Hill Companies, Inc. All rights reserved.

What Should You Learn?

The role of interpersonal selling in international marketing The considerations in designing an international sales force

The steps to recruiting three types of international sales people

Selection criteria for international sales and marketing positions

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What Should You Learn?

The special training needs of international personnel Motivation techniques for international sales representatives

How to design compensation systems for an international sales force

How to prepare Americans for foreign assignments The changing profile of the global sales and marketing manager
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Global Perspective
International Assignments are Glamorous, Right? Job security Adjustment to other cultures Readjustment upon return to U.S.

Will an international assignment really help your career?

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Designing the Sales Force

Relationship marketing and customer relationship management Decisions must be made regarding the numbers, characteristics, and assignments of sales personnel Different market requirements regarding direct sales and customer approach

Territory allocation
Customer call plans
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Recruiting Marketing and Sales Personnel

The largest personnel requirement abroad for most companies is the sales force Expatriates
Numbers are declining Important for highly technical or involved products High cost Cultural and legal barriers Limited number of high-caliber personnel willing to live abroad

Virtual expatriates
Manage operations in other countries but dont live there
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Recruiting Marketing and Sales Personnel

Local nationals
Transcend both cultural and legal barriers Familiar with distribution systems and referral networks Headquarters personnel may ignore their advice Lack of availability Sales positions viewed negatively

Third-country nationals
Expatriates working for a foreign company

Host-country nationals
Work restrictions
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The 20 Most Expensive Cities to Live on the Planet (in order)

Exhibit 17.1

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Selecting Sales and Marketing Personnel

Management must define precisely what is expected of people Prime requisites
Maturity Emotional stability Breadth of knowledge Positive outlook Flexibility Cultural empathy Energetic and enjoy travel

Mistakes can be costly A managers culture affects personnel decisions

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Training for International Marketing

The nature of the training program depends on:
The home culture of the sales person The culture of the business system and foreign market

Continual training is important in foreign markets

Companies should provide home-office personnel with cross-cultural training

The Internet now makes some kinds of sales training much more efficient

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Personal Selling Tips from Brussels to Bangkok

Exhibit 17.2

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Motivating Sales Personnel

National differences must always be considered when motivating the marketing force Individual incentives that work effectively in the U.S. can fail completely in other cultures

Communications are important in maintaining high levels of motivation

A company needs to make clear the opportunities for growth within the firm

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Salespeoples Distribution
of 100 Points among Rewards in Terms of Their Importance
Exhibit 17.3

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Designing Compensation Systems for Expatriates

Fringe benefits Compensations comparisons between the home office and abroad Short-term assignment compensation Using a compensation program to recruit, develop, motivate, or retain personnel

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Global Similarity to U.S. Compensations Plans

Exhibit 17.4

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A Compensation Blueprint
How IBM Pays 140,000 Sales Executives Worldwide
Exhibit 17.5

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Designing Compensation Systems for a Global Sales Force

Involve representatives from key countries Allow local managers to decide the mix between base and incentive pay Use consistent performance measures (results paid for) and emphasis on each measure Allow local countries flexibility in implementations Use consistent communication and training themes worldwide
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Designing Compensation Systems for a Global Sales Force

Dont design the plan centrally and dictate to local offices Dont create a similar framework for jobs with different responsibilities

Dont require consistency on every performance measure within the incentive plan
Dont assume cultural differences can be managed through the incentive plan Dont proceed without the support of senior sales executives worldwide
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Evaluating and Controlling Sales Representatives

In the U.S., emphasis is placed on individual performance
Which can easily be measured by sales revenues generated

In many countries evaluation is more complex

Where teamwork is favored over individual effort

In U.S.
Primary control tool used by sales managers is the incentive system

In other countries
Corporate control and frequent interactions with peers and supervisors are the means of motivation and control
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Preparing U.S. Personnel for Foreign Assignments

Cost of foreign assignments
Typically from 150-400 percent of the annual base salary Cost increases if the expatriate returns home before completing the scheduled assignment

The planning process

Must begin prior to the selection of those going abroad Must extend to their specific assignments after returning home

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Overcoming Reluctance to Accept a Foreign Assignment

Concerns for career
An absence will adversely affect opportunities for advancement

Concerns for family

Education of the children Isolation from family and friends Proper health care The potential for violence

Special compensations packages deal with concerns

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Reducing the Rate of Early Returns

Evaluation of an employees family
75 percent of families sent abroad experience adjustment problems with children or marital discord

Cross-cultural training for families as well as the employee Local ombudsmen

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Successful Expatriate Repatriation

Commit to reassigning expatriates to meaningful positions Create a mentor program Offer a written job guarantee stating what company is obligated to do for returning expatriate Keep the expatriate in touch with headquarters through periodic briefings and headquarter visits

Prepare the expatriate and family for repatriation once a return date is set
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Developing Cultural Awareness

Expatriate failures
Caused by lack of an understanding of cultural differences and their effect on management skills

Cultural skills
Can be learned and developed Provide the individual with the ability to relate to a different culture even when the individual is unfamiliar with the details of that particular culture

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The Changing Profile of the Global Manager

Fewer companies today limit their search for senior-level executive talent to their home countries Some companies believe
It is important to have international assignments early in a persons career International training is an integral part of their entry-level development programs

Many companies are active in making the foreign experience an integrated part of a successful corporate career
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Foreign-Language Skills
Many believe:
Learning a language improves cultural understanding and business relationships To be taken seriously in the business community, the expatriate must be at least conversational in the host language

Many companies are making stronger efforts to recruit people who are bilingual or multilingual

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Summary
The companys sales force is on the front line of a marketing organization The role of marketers in both domestic and foreign markets along with the composition of international managerial and sales forces is rapidly changing The recent emphasis on using local personnel operating in their own lands has highlighted the importance of adapting U.S. managerial techniques to local needs
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Summary
The development of an effective marketing organization calls for careful recruiting, selecting, training, motivating, and compensating of expatriate personnel and their families The most practical method of maintaining an efficient international sales and marketing force is careful, concerted planning at all stages of career development

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