Introduction
Company background
In fiscal year 2018, the company generated approximately €25 billion in revenue and employed 170,000 people, serving customers in over 100 countries They assist clients in managing energy and processes safely, reliably, efficiently, productively, and sustainably Their technology, software, and services enhance the management and automation of operations, ranging from simple switches to complex systems SE provides integrated solutions across various market segments, particularly in the non-residential sector.
Residential Building, Industrial & Machines Manufacturers, Utilities & Infrastructure and Data Centers & Networks Its connected technologies reshape industries, transform cities and enrich lives (1)
SE sells products and solutions through 4 main Business Units in Vietnam (2):
- Building & Partner Business, provided Low Voltage products, systems and solutions, is ranking number one Worldwide in Low Voltage and Building Automation
- IT (Information Technology) Business, provided Critical Power products and solutions, is ranking number one Worldwide in Critical Power and Cooling
- Industry Business, provided industrial automation & drives products and solutions, is ranking number two Worldwide in industrial automation and control
- Energy Business, provided Medium Voltage products and solutions, is raking number one Worldwide in Grid Automation and Medium Voltage
SE has been active in Vietnam since the 1990s, beginning with the Vietnam 500 kV North-South Transmission Project from 1991 to 1993 The company established its first representative office in Ho Chi Minh City in 1994 Currently, SE Vietnam operates two factories in Dong Nai Province and maintains three offices in Ho Chi Minh City, Da Nang, and Hanoi With a workforce of over 1,000 employees, SE collaborates closely with more than 500 partners across the country.
After 20 years doing business in Vietnam, SE has achieved its remarkable performance record in 2017 with double-digits growth of all its business units in the country and become the top growing entity in the entire region (Asia-Pacific & Japan)
Industry Business’s structure & mission
Their market shares were 12%, 9%, and 4% consecutively And their CAGRs were 9%, 3% and 15% consecutively, as showed in Table 1 below:
Table 1 Industrial automation and drives in Vietnam – Market shared and CAGRs analysis 2018 (Source: SE’s internal report 2019)
Schneider Electric Vietnam, through Industry Business, provides a comprehensive array of industrial automation and drive solutions for machine control and manufacturing facilities in Vietnam Their offerings include essential hardware like motion controllers, low-voltage variable speed drives, human-machine interface operator panels, programmable logic controllers, push buttons, signaling devices, and discrete sensors, alongside software for operations management and supervisory control systems.
Low Voltage VSD (IDVSD) is the main product line of Industry Business in Vietnam
Product sales contribute over 60% of the company's revenue, with a consistent annual growth rate of 25-30% (Source: SE’s internal report 2019).
Figure 1 Industry Business products and solutions in Vietnam by product lines (Sources: SE’s Company Profile 2018)
In 2018, the business landscape in Vietnam was organized into three distinct sales teams: the Industry Expert Distributor Sales Team, the OEM & Medium Distributor Sales Team, and the System Integrator & End-User Sales Team, along with a dedicated Pre-sales team.
The Marketing Support Team is dedicated to assisting five primary customer types in the Vietnam market, which include Industry Expert Distributor customers, Original Equipment Manufacturer (OEM) customers, and Medium Distributor customers.
(4) System Integrator customers; and (5) End-User customers
The Industry Expert Distributor (IED) channel serves as the primary transactional sales channel for Industry Business in Vietnam, accounting for approximately 60% of total revenue and experiencing a consistent annual growth rate of 15-20% (Source: SE’s Internal report 2019) This channel is overseen by the Industry Expert Distributor Sales Team, which consists of four Account Managers and one Sales Manager, who collectively manage around 16 official partners across the Vietnamese market.
IDVSD – Low Voltage Variable Speed Drive
IDHMI – Human Machine Interface tot nghiep down load thyj uyi pl aluan van full moi nhat z z vbhtj mk gmail.com Luan van retey thac si cdeg jg hg
Figure 2 Industry Business Organization Chart 2018 (Source: SE’s internal report
The Pre-sales & Marketing Support Team plays a crucial role in assisting all three sales teams by providing technical support through two dedicated Product Application Engineers—one for the IDVSD product line and another for the remaining product lines Additionally, the team offers marketing support via two Product Managers, also divided by product line Managed by a Pre-sales & Marketing Support Manager, the team coordinates with other sales teams to facilitate daily operations and provides consultation to the Sales Director and Sales Manager, ensuring the achievement of both short-term and long-term business goals in the Vietnamese market.
Despite achieving impressive double-digit growth in 2017, Schneider Electric Vietnam's Management Board and the Sales Director of Industry Business expressed dissatisfaction with the current performance in the Vietnamese market While Industry Business typically contributes around 22% to SE's global revenue, it currently accounts for only 10% in Vietnam, indicating significant potential for growth in the country's appealing industrial automation and drives market.
OEM & Medium Distributor Sales Team
Industry Expert Distributor Sales Team
The End-User Sales Team is dedicated to providing exceptional service and support Our business administration graduates are equipped with the latest tools and knowledge to enhance customer experiences For inquiries, please contact us at vbhtj mk gmail.com We are committed to delivering the most up-to-date solutions for our clients.
Sales Director has defined a five-year business plan from the beginning of 2018 to help the business team double its contribution for Schneider Electric Vietnam by 2022
One-year after implementing that business plan, the sales’ growth rate of Industry Business was just nearly a half of the previous year achievement The growth rate in
In 2018, the company's performance in the Industry Business fell short by 1% of the worst-case scenario target established at the beginning of the year, indicating a significant gap from its ambitious goals.
The 2019 internal report from Industry Business reveals a strong positive correlation between the sales growth rate of low Voltage Variable Speed Drive (VSD) products, specifically IDVSD, and the overall business sales growth during 2017 and 2018, as illustrated in Table 2.
Year Sales Growth rate by Product Lines 2017 2018
Table 2 Industry Business – Sales Growth rate by Product lines 2017 – 2018 (Source:
According to SE's internal report from 2019, the IDVSD product is the primary focus of the sales team and is crucial for the sustainable growth of the Industry Business In contrast, other product lines contribute only 20% to 30% of the overall business and are primarily sold through project-based channels such as OEM and SI & EU Consequently, the growth of these product lines reflects short-term business strategies aimed at securing key projects and customers.
Why couldn’t Industry Business achieve its growth target in 2018? What were the potential causes of reducing in sales growth rate of its main product line, IDVSD?
Which channel has been impacted the most in this low sales growth rate of IDVSD?
To enhance business performance and achieve the goal of doubling contributions in Vietnam by 2022, it is essential to address key issues faced by the Industry Business Sales and marketing teams have raised pertinent questions, prompting thorough investigations with all stakeholders involved This research aims to provide accurate answers and practical solutions for the Industry Business team at Schneider Electric Vietnam.
Symptoms
Low Voltage VSD Product line (IDVSD) and Vietnam market
Manufacturers are implementing Variable Speed Drive (VSD) technologies to enhance the efficiency of mechanical equipment that is currently operating inefficiently VSDs optimize electrical motor performance by enabling operation at the ideal speed for varying load conditions, resulting in a significant reduction in electricity consumption—often by 30% to 60%—across many applications.
The growth of the Variable Speed Drive (VSD) market is driven by several key factors, including increased urbanization and industrialization in developing countries, a rising demand for energy efficiency, heightened construction and power transmission activities, and a decrease in VSD production costs The Asia-Pacific region is projected to capture the largest market share during the forecast period, owing to its significant infrastructure and industrial sector Industries such as oil and gas, metals, and mining are increasingly adopting VSD technologies to reduce energy consumption and limit CO2 emissions, further contributing to the market's expansion in this region.
The Vietnam VSD market has a Product Available Market (PAM) valued at approximately €49 million, encompassing optimum, medium, and minimum product categories The accessible market for SE's VSD is around €38 million, focusing on optimum and medium segments However, SE currently holds a market share of only 6.2% to 6.3% According to Ms Thuy, the Product Manager of IDVSD, the attractiveness of the Vietnam market for SE's Industry Business is noteworthy.
The market is experiencing a growth rate of only 10%, and our current market share is minimal Consequently, our management team frequently questions us about strategies to enhance our market share, especially when they analyze the Potential Addressable Market (PAM) compared to our current performance.
The low growth rate of IDVSD sales in 2018
In 2018, IDVSD sales represented 66-67% of the Industry Business revenue, yet their growth rate across all channels was only 15%.
Figure 3 Industry Business sales contribution (%) by product line 2018 (Source: SE’s Internal report 2019)
In Vietnam, IDVSD sales were primarily driven by the Industry Expert Distributor (IED) channel, which generated 73% of product revenue in 2017 However, in 2018, this channel's contribution decreased to 65%, with a growth rate of only 2% for IDVSD products, a significant drop from the 30% growth rate observed in 2017 (Source: SE’s Internal report 2019).
Variable Speed Drives IDPAC - Process Automation Control IDSAF - OEM Safety
IDHMI - Human Machine Interface IDSIG - Control &
IDMOT - Motion Control tot nghiep down load thyj uyi pl aluan van full moi nhat z z vbhtj mk gmail.com Luan van retey thac si cdeg jg hg
Figure 4 Industry Business Sales of Low Voltage VSD by channel 2017 – 2018 (Source: SE’s Internal report 2019)
Problem analysis
Problem identification
It is important to figure out the reasons for the low growth rate of Low Voltage VSD (IDVSD) sales through Industry Expert Distributor (IED) channel and its consequences
After gathering valuable insights from the marketing team, sales team, and IED partner customers, several key factors contributing to the low growth rate of IDVSD through the IED channel have been identified These include a lack of market intelligence, conflicts between distribution channels, ineffective marketing communication from the sales and marketing teams to customers, and weak relationships between sales and marketing in terms of channel support and customer protection.
System Integrator Medium Distributor tot nghiep down load thyj uyi pl aluan van full moi nhat z z vbhtj mk gmail.com Luan van retey thac si cdeg jg hg
3.1.2 Potential problems 3.1.2.1 Lack of market intelligence information Lack of market information about what competitors offers in the market, who are their main end-customers of IDVSD product, etc now are always the concern of the
Product Manager of IDVSD, Ms Thuy suggest that:
I require assistance from the sales team to engage with major competitors' distributors and gather comprehensive information about their operations Specifically, I am interested in the VSD brands they offer, their annual sales volume of VSD products, their top-selling brands, the most popular product ranges, current stock levels, primary market segments, and insights into their project business performance from the previous year.
The absence of market information stems from the product manager's insufficient engagement with existing partner customers When questioned about why she did not approach current IED partners, who also sell competing products, to gather insights on competitor offerings and support, her response highlighted this gap in relationship-building.
I lack the time to engage with this matter and do not interact with them often enough to establish a relationship similar to that of the salesperson responsible for this account, which would allow me to request sensitive information.
Mr Vinh, the Pre-Sales & Marketing Support Manager, is particularly concerned about the insufficient market information from the distribution network, which hinders the ability to provide appropriate support for the sales team and distributors He has outlined the current challenges faced in selling IDVSD to the IED.
We are currently focused on distributing our products to our distributor partners, allowing them the freedom to market these products as they see fit Consequently, we have limited control over the end-market customers and lack visibility regarding the specific locations and individuals purchasing our products.
3.1.2.2 Inter-channel conflict According to Mr Loc, the Sales Director of A&E Engineering, the biggest IED partner of Industry Business, about the new established distribution channel, Medium Distributor, that focus on Medium range of IDVSD product, aka the new product line ATV310 and ATV610, that this strategy of SE not only effect the IDVSD business of A&E, but also effect all other product that currently A&E distribute for SE as: tot nghiep down load thyj uyi pl aluan van full moi nhat z z vbhtj mk gmail.com Luan van retey thac si cdeg jg hg
The current distribution partners of SE, such as A&E, may feel unfairly impacted by the introduction of a new channel aimed at market expansion While SE seeks to grow its reach, this new channel significantly affects the established business of A&E, which has been a long-term collaborator.
Mr Vinh, the Sales Director of Thien Son Technology, whom experience more than
With 15 years of experience in selling SE's IDVSD in the Vietnamese market, the company faces significant challenges in marketing the Optimum VSD These difficulties stem from the presence of medium-tier products and aggressive market dumping by medium distributors, coupled with intense competition among IED distributors.
The competition among SE distributors is highly intense, and while I won't delve into specific details about their actions, it's clear that the rivalry is significant.
Mr Loc, Sales Director of A&E Engineering, expressed concerns over the declining sales of the Optimum VSD He attributed this decrease to the negative impact on the brand image of all SE's VSDs, caused by the new Medium Distributor's marketing strategies This has led end-customers to perceive all SE's IDVSD products as being positioned similarly to medium-range offerings from competitors like LS or Mitsubishi.
This situation was also recognized by the IDVSD’s Product Manager, Ms Thuy, when talking about the current situation of Medium VSD and Medium Distributor channel:
The growth of our medium products has not aligned with our initial expectations at launch This discrepancy may stem from two key factors: first, a portion of the growth is being driven by our optimal product Second, when medium distributors signed their contracts, they agreed to decrease sales of LS products in favor of promoting our medium products However, in practice, their sales of LS products have not diminished as anticipated.
Mr Vinh, the Sales Director of Thien Son Technology, expressed concerns about the lack of support from the IDVSD marketing team in addressing the intense competition from Mitsubishi and INVT, particularly regarding their low-price offers He noted that Mitsubishi's current low pricing is a temporary strategy due to internal competition among their distribution partners, while INVT is providing a minimum product that SE cannot match Vinh emphasized the need for the marketing team to collaborate more effectively with the sales team to enhance support in these competitive situations.
If SE does not address the current competitive landscape, it risks losing market share to its rivals This concern has been escalated to Mr Vinh, the Pre-sales & Marketing Support Manager, who echoed the Product Manager of IDVSD's insights regarding SE's product positioning and hinted at an upcoming strategic shift.
INVT is offering the minimum product that we don’t have the same offers to compete… but their yearly sales around 4-5 million € is very big…
Problem validation
The research identifies three main groups and utilizes secondary data from the Industry Business department, alongside theories in industrial marketing, to examine the collaboration and interaction between sales and marketing in high-technology firms It reveals that the current poor relationship between sales and marketing staff in SE’s Industry Business is a critical issue that requires immediate resolution.
The sales and marketing teams face challenges due to insufficient market intelligence, as they only communicate their requests for competitor information regarding pricing, policies, and end-customer insights To develop effective strategies and enhance support for channel partners, it is crucial to improve the quality of collaboration between these teams Strengthening their relationship can facilitate better information collection and distribution, ultimately leading to increased partnerships and market success.
Inter-channel conflict, often seen as negative, can actually be beneficial in certain contexts According to Webb, this type of conflict, termed "functional conflict," can stem from trust within channel relationships In the absence of conflict, channel members may become complacent and uninspired Thus, conflict serves as a catalyst for channel members to innovate, evolve, and pursue new opportunities.
Webb 14 also stated that if the middlemen (aka sales and marketing managers) and salespeople are in harmony, the company may be getting complacent Indeed, some researchers view channel conflicts as an inevitable cost when a healthy company is trying to extend its market coverage However, because conflict is opponent-centered behavior, it can degenerate into actions designed to destroy, injure, or thwart another member in a channel relationship Such pathological conflict should be avoided at all costs Some researchers have also suggested the possibility of a threshold effect, whereby performance increases along with the amount of channel conflict up to a certain point, after which performance decreases as the level of conflict rises That could be a point that the researcher should take into consideration about inter-channel conflict in the future research to discover in more detail for better channel management solution for the Industry Business, whereas it has more channel beside the Industry Expert Distributor, like Medium Distributor, System Integrator, Original Machine Integrators, etc.,
Webb's research highlights the importance of effective communication for achieving coordination in an efficient distribution system This communication is essential both with external channel partners and internally among business units, such as the Sales and Marketing teams By improving the relationship between sales and marketing, organizations can enhance their communication, which in turn helps them support each other internally and better serve their customers externally Conversely, poor marketing communications can lead to inter-channel conflicts, underscoring the need for stronger collaboration between these teams.
Main problem definition and consequences
Main problem definition
Meunier et al (2010) proposed that sales and marketing should function as a unified entity within marketing; however, there is an increasing awareness that this relationship often lacks optimal efficiency.
The relationship between sales and marketing is crucial for business success, particularly in the case of Schneider Electric Vietnam Key aspects of this relationship include the quality of discussions and information sharing, effective collaboration to support customers, and mutual interaction among team members This research will delve into elements that influence the collaboration between sales and marketing in Schneider Electric's industry, offering alternative solutions to enhance this interface Improving the relationship between these teams is expected to contribute positively to overall business performance.
Main problem consequences
The poor relationship between sales and marketing teams has significantly impacted the business performance of Industry Business in 2018, leading to a notably low sales growth rate for IDVSD product lines through the IED Channel If this issue is not addressed promptly, SE risks losing its market share in Vietnam's Industrial Automation & Drives sector to competitors.
A poor relationship between sales and marketing teams can lead to a decrease in employee engagement within the business team.
21 can be figured out from the company recently survey’s result, SE’s Internal Report
In 2019, the employee engagement index for Industry Business was only 54%, falling below the industry average of 59% and significantly short of the company's target of 64% for top employers in Southeast Asia The survey revealed that 10% of the staff were disengaged in 2018, with the lowest agreement among respondents regarding the statement: "I think that the cooperation between teams and entities is going well."
A recent study by Meunier et al highlights that enhancing collaboration between sales and marketing significantly boosts business performance The research identifies key factors influencing this collaboration, including management attitudes towards coordination, effective communication, interdepartmental conflict, organizational learning, and market intelligence Therefore, fostering a strong relationship between sales and marketing is essential for driving improved business outcomes.
Interviews with the Product Manager, Account Manager, and Sales Director at Industry Expert Distributors have revealed several critical issues in their current relationships that require further analysis and validation These issues include a lack of communication and information sharing between sales and marketing, ineffective collaboration to enhance customer support, and conflicts of interest that hinder mutual support between the two departments.
Cause analysis
Potential causes
The analysis highlights a significant issue within the business team: a poor relationship between sales and marketing, primarily due to insufficient communication and information sharing This lack of collaboration hinders their ability to support business objectives effectively Mr Vinh, the Pre-sales & Marketing Support Manager, emphasized that addressing this communication gap is crucial for enhancing sales performance, particularly in increasing the market share of IDVSD in Vietnam.
To achieve success in increasing VSD sales, it is essential to understand the needs and demands of distributor customers This knowledge enables the formulation of competitive commercial policies tailored for each distributor, while also facilitating the acquisition of additional competitors' distributors.
Salespeople serve as boundary spanners with access to diverse knowledge sources, including customers, competitors, and suppliers However, research by Beverland et al indicates that salespeople often hesitate to share information with marketing, which tends to have a limited perspective on the potential of sales This disconnect can lead to missed opportunities for market growth and effective strategy execution To address this issue, it is recommended that management bridge the gap between sales and marketing by eliminating barriers and ensuring that sales has a strategic voice within the top management team.
The IED Sales Team has faced challenges in communication with the marketing department, as highlighted by Mr Tram, the Account Manager He expressed frustration over the lack of feedback from marketing and support functions like R&D when he attempted to share customer complaints regarding difficulties in selling new products compared to outdated ones This disconnect has hindered effective collaboration and problem-solving within the team.
I believe that while I provide feedback, it primarily serves to guide the R&D team, who ultimately control the product outcomes There are specific factors that drive them to develop new products like this one.
A lack of communication and information sharing between sales and marketing can hinder business growth and customer satisfaction, making it essential to address this issue to enhance the relationship between these two departments.
5.1.2 Ineffective collaboration between sales & marketing to support customer When has been asked about the ideas that could help Thien Son Technology and Industry Business of Schneider Electric to cooperate better, Mr Vinh, the Sales tot nghiep down load thyj uyi pl aluan van full moi nhat z z vbhtj mk gmail.com Luan van retey thac si cdeg jg hg
Director of Thien Son Technology, has suggested about more trust from Industry Business to support them better as below:
We seek greater trust from our suppliers to support us, rather than requiring us to disclose all information We are willing to share what we can, but as our supplier and partner, it is essential that you have confidence in us.
The relationship between his company and the Account Manager from Industry Business remains strong, highlighting the need for increased trust and support from Schneider Electric's marketing team and other functions to effectively bolster his business.
Feedback from the IED partner highlights that ineffective collaboration between the Product Manager (marketing) and the Account Manager (sales) is a significant factor contributing to the poor relationship between sales and marketing, ultimately impacting business performance and customer support.
5.1.3 Conflict of interest between sales & marketing function to support each other
Mr Vinh, the Pre-sales and Marketing Support Manager, emphasizes the importance of collaboration between marketing and sales teams He suggests that both departments should align their efforts with shared team and customer targets, working together to achieve common business objectives.
The sales staff has not taken proactive steps to provide the marketing team with specific information about individual customers, which is essential for developing tailored policies to support these customers effectively.
For the past two years, we have requested that all managed accounts undergo customer platforming and be reviewed annually Each customer platforming will provide sales with recommendations on how to enhance sales with specific partners, necessitating proactive proposals that should be documented in the file.
Cespedes has defined marketing as a long-term, product-oriented approach, contrasting it with sales, which is more short-term and focused on customer relationships This perspective highlights a conflict in direction between marketing and sales, as noted by the Pre-sales and Marketing Support Manager His team is concentrating on specific customer issues to address immediate sales needs, while marketing struggles to provide the necessary support due to conflicting KPIs Mr Trung, the Account Manager of the IED Sales Team, has observed that the current decision-making process fails to meet his and his customers' needs in a timely manner.
The decision-making process involves not just the marketing team but also input from the sales manager and sales director, each with their own priorities such as support and margin preservation Consequently, the outcome often reflects a compromise between my objectives and their KPIs If my customer can accept this compromise, it works; if not, I will explore alternative ways to provide support.
Cause validation
Increased collaboration between sales and marketing can significantly enhance business performance by reducing conflicts and improving interactions According to Meunier et al., finding effective ways to foster this collaboration allows for better sharing of market information and customer support, ultimately leading to more successful outcomes.
The in-depth interviews revealed a significant issue: the lack of effective collaboration between the sales and marketing teams within the business.
25 involving stakeholders, from the salespeople, the marketing peoples and also the customers
Customer interviews summarized in section 9.4 reveal key insights that will enable researchers to develop an effective solution for improving collaboration between sales and marketing teams in this case.
So that researcher suggests choosing ineffective in collaboration between sales and marketing as the main cause to prioritize to solve in this study.
Alternative solutions
Alternative solution 1: Encouraging knowledge sharing between sales and marketing
6 Alternative solutions The main problem of low sales growth rate of IDVSD products via Industry Expert Distributor channel, that effect the overall sales growth rate of Industry Business of Schneider Electric Vietnam in 2018, is the poor relationship between sales and marketing position of the business, especially between the salespeople of Industry Expert Distributor Sales Team (aka the Account Manager) and the marketing people of Pre-sales & Marketing Support Team (aka the Product Manager) And the major cause that lead to this problem, as analyzed and validated above, is ineffective collaboration between sales and marketing staffs that need to find the best solution to be solved So that, this chapter would focus on giving possible solutions to solve this cause, and below would be some alternative solutions that can be applied for enhancing the current relationship between sales and marketing staffs of Industry Business of Schneider Electric Vietnam
6.1 Alternative solution 1: Encouraging knowledge sharing between sales and marketing
Research by Meunier et al highlights that establishing common ground enhances knowledge sharing and collaboration, ultimately improving communication between sales and marketing in B2B organizations Salespeople, as noted by Arnett et al., serve as vital sources of customer and competitor insights due to their unique positions Through their close relationships with key customers, they can acquire both explicit knowledge, such as competitor product information, and tacit knowledge regarding the interplay of customer strategies with their own For this knowledge to be effective, it must be shared across the organization, particularly between sales and marketing, to drive marketing effectiveness and overall business success.
Anaza et al (21) highlight that a lack of motivation, such as rewards and feedback, hinders knowledge transfer among salespeople To enhance knowledge sharing, managers should differentiate between non-sharing and sharing behaviors, recognize the importance of providing both recognition and monetary rewards, and ensure that upper management offers feedback on how salespeople's insights impact strategy development Additionally, managers must prioritize fairness in the management of knowledge transfer between sales and marketing teams.
To foster a culture of knowledge sharing between sales and marketing, the Sales Director of Industry Business should implement a reward system that encourages collaboration This culture should be built on trust among co-workers, effective inter-functional communication, established social networks, and a strong emphasis on valuing knowledge exchange A practical approach to achieving this is by developing a cross-functional selling team dedicated to supporting Industry Expert Distributors in promoting the IDVSD to their target market within three months This team must have clear sales targets and requirements for knowledge exchange, and they should share their achievements with the entire Industry Business team upon project completion.
The estimated cost of establishing and operating a cross-functional selling team, led by the Sales Director and comprising one Product Manager and two Account Managers, is approximately VND 24,000,000, as detailed in Table 3 below.
The Human Resources Business Partner (HRBP) Team at Schneider Electric Vietnam consulted on the logistics costs associated with forming and operating a cross-selling team over a three-month period This initiative is part of a sales and marketing quick action plan aimed at revitalizing sales growth for IDVSD through the IED channel However, it demands significant effort from the Sales team to achieve the desired performance outcomes.
The director actively leads the team by offering essential support and clear guidance, emphasizing that knowledge exchange is crucial for members of this cross-functional sales team, in addition to achieving the required sales targets.
1 1 st meeting to form the team and define action plan (8 hours – 4 peoples)
2 Weekly meeting for action follow up, updating and modification if any (12 meetings, 2 hours/ meeting, 4 peoples)
3 Wrap-up meeting to consolidate the result (4 hours, 4 peoples)
4 Meeting to share the achievement with entire team (2 hours, 20 peoples)
Table 3 Costs for alternative solution 1 (Author synthesis)
The cross-functional selling team offers several key benefits: it fosters social connections and trust between sales and marketing personnel, enhancing collaboration in supporting both the business and its customers Additionally, this collaboration deepens their understanding of the product's market, competitors, and the customer buying process through joint action plans, leading to more informed sales and marketing decisions Furthermore, it promotes a culture of knowledge exchange that drives business performance by boosting innovation, efficiency, and the effectiveness of sales and marketing programs.
Alternative solution 2: Creating an interactive information exchange system between sales & marketing
To enhance collaboration between sales and marketing, senior managers must reduce conflicts of interest, foster effective communication, promote organizational learning, share marketing information, and engage in joint marketing planning, as suggested by Meunier et al Their research highlights the positive correlation between increased collaboration and improved business performance In this context, the Sales Director of Industry Business plays a crucial role in bridging the gap between Account Managers and Product Managers to boost the business performance of IDVSD through the IED channel Meunier et al also propose two strategies for improving this interface: cultivating a supportive culture and securing senior management buy-in The Sales Director should collaborate closely with Account Managers and Product Managers to enhance operational efficiency by establishing effective communication and a learning culture through regular meetings focused on target marketing, sales forecasting, customer account selection, value proposition development, and promotions Additionally, implementing an interactive market intelligence exchange system using Microsoft Office tools, such as Microsoft Teams, can further facilitate collaboration and expertise sharing between the two teams.
Schneider Electric encourages the use of the Yammer application globally to improve business team management and communication, as highlighted in the company's first internal announcement in 2018 This platform allows Product Managers to share updates on competitive analysis, market research, product development, and pricing strategies Additionally, Account Managers can provide timely feedback on market intelligence, personal selling, and after-sales service, specifically for the IDVSD and IED channels in the Vietnamese market.
The new Market Intelligent Exchange System offers significant advantages for all industry business members, including sales and marketing teams, by enhancing collaboration and communication By scheduling more frequent sales and marketing meetings, businesses can improve strategic alignment and drive better results This system fosters a more integrated approach, ensuring that all support functions are aligned with the overall business objectives.
Improving collaboration and expertise sharing among business members, particularly between sales and marketing teams, is essential for enhancing market intelligence collection and sharing This process aids in refining business and marketing strategies, ultimately leading to greater success Additionally, it enables the Sales Director and Management Board to promptly assess performance and implement rewards or corrective actions, fostering effective collaboration and improved outcomes in sales and marketing efforts.
Cost of implementing these initiatives is estimated around VND 55,000,000 as detail in Table 4 below:
A collaborative meeting involving the Sales Director, Sales Manager, Marketing Manager, HR Business Partner, and IT team was held to discuss the vision for implementing the exchange system The session focused on defining the system interface between the Account Manager and Product Manager, as well as establishing the key performance indicators (KPIs) for information sharing required by each group The meeting lasted 8 hours and included 6 participants.
2 Allowance for IT expert/ designer to establish the exchange system via Microsoft Yammer/ Microsoft Team application (5 business days, 2 IT staffs)
3 Communication and Training Cost for using new Exchange system for Product Manager and Account Manager (4 hours, 10 peoples)
4 Cost for 4 collaboration & expertise sharing meetings (1 meeting per quarter) between Product Manager and Account Manager with the supervise of Sales Director &
Sales Manager (4 hours/ meeting, 10 peoples)
Table 4: Costs for alternative solution 2 (Author synthesis)
The HRBP Team at Schneider Electric has provided valuable consultation on costs to support the Industry Business However, it necessitates significant effort from the Sales Director to embrace and consistently apply these concepts in daily team management to enhance business performance.
Alternative solution 3: Re-training sales & marketing staffs to reduce competencies gap and re-
Cespedes 6 defines the marketing role as focused on long-term strategies and product orientation, while the sales role is characterized by short-term goals and a strong emphasis on customer relationships.
Homburg et al explored how the differing roles and perspectives of marketing and sales impact organizational outcomes Their findings indicate that while differing orientations between these two functions positively influence overall market performance, differences in competence have a negative effect This suggests that marketing and sales teams should possess similar competencies but maintain distinct orientations, essentially comprising similar individuals with different missions The study emphasizes the importance of reducing and managing the cognitive differences between sales and marketing staff to foster a high-performance business culture and enhance collaboration.
To ensure that individuals in marketing and sales are well-equipped for their roles, organizations should implement effective training policies for immediate skill development, facilitate job rotation for mid-term experience enhancement, and establish strategic hiring practices for long-term talent acquisition.
To achieve quick wins in the short term, the Sales Director of Industry Business should implement two key actions: first, establish a six-month training plan for sales and marketing staff focused on selling IDVSD through the IED channel to bridge competency gaps and boost performance; second, redesign job descriptions and KPIs for both sales and marketing teams to foster a high-performance business culture.
To effectively bridge the competencies gap between marketing and sales teams in Vietnam, a comprehensive 6-month training plan is essential This plan should focus on enhancing three key areas: market knowledge, product knowledge, and interpersonal skills related to selling IDVSD products and solutions According to Homburg et al., market knowledge refers to the understanding of competitors and customers, while product knowledge encompasses familiarity with the products and internal processes Additionally, interpersonal skills involve the ability to manage conflicts, communicate effectively, and persuade others.
The estimated cost for six days of training, conducted over six consecutive months for eight participants (including two from marketing, five from sales, and the Sales Director for observation), along with the operational expenses for on-the-job training supervised by the HRBP Team of Schneider Electric, totals approximately VND 400,000,000, as detailed in Table 5.
1 Cost for defined the specific training program and the evaluation test (before and after joining the program) targeted audiences (8 hours)
2 Cost for 6 days training date for 8 staffs (8 hours/ date) 360,000,000
3 Allowance for 6-months follow up from the training institute for result evaluation and reporting to the management team
Table 5 Costs for alternative solution 3 - Action 1 (Author Synthesis)
Reducing the gap in competencies between marketing and sales offers several benefits Firstly, it ensures that both Product Managers and Account Managers possess a shared understanding of the IDVSD product, its market, competitors, and customers, enabling them to provide enhanced support to clients and the business Secondly, a unified knowledge of the sales process—including marketing, pre-sales, after-sales support, go-to-market strategies, channel management, and market intelligence—allows these roles to collaborate effectively and deliver consistent feedback to address customer concerns regarding IDVSD Lastly, aligning their interpersonal skills fosters better conflict resolution, communication, and persuasion, ultimately driving the team towards achieving business objectives.
To enhance business performance, the Sales Director should review and update the job descriptions for the Product Manager and Account Manager roles, collaborating with key stakeholders such as the Sales Manager, Pre-Sales & Marketing Support Manager, and Human Resource Business Partner This redesign should focus on efficiently reallocating marketing and sales tasks, ensuring that the updated job descriptions include clear KPIs and an effective bonus scheme By fostering a high-performance culture, marketing professionals will advocate for long-term product profitability, while sales personnel will focus on short-term customer relationship profitability.
Cost was estimated around VND 30,000,000, as detail in Table 6 below, by the HRBP team:
A meeting was held between the Sales Director and the HR Business Partner (HRBP) from SE's HR agency to evaluate the current job descriptions for the Account Manager and Product Manager positions within the Industry Business This session, lasting 8 hours and involving 3-4 participants, aimed to incorporate best practices from the industry as advised by the agency partner.
A meeting will be held to redesign the job descriptions for the Account Manager and Product Manager positions within the Industry Business This session will focus on updating key performance indicators (KPIs) and the bonus scheme, and will involve the Sales Director, HR Business Partner, Sales Managers from three sales teams, and the Pre-sales & Marketing Support Manager The meeting is scheduled for four hours and will include seven participants.
3 Meeting to align and execute the new job description for Account Manager and Product Manager of Industry Business for all business member (4 hours, 20 peoples)
Table 6 Costs for alternative solution 3 - Action 2 (Author Synthesis)
The investment will focus on redesigning the job descriptions for the Account Manager and Product Manager roles within the Industry Business, with input from HRBP and Schneider Electric's HR agency partner, alongside support from the Manager and Sales Manager of the sub-team To realize the anticipated benefits, as detailed below, this initiative will also demand significant effort from the Sales Director and the sales and marketing team to foster a culture of knowledge sharing and establish an effective knowledge exchange system This will enable a swift response to market changes and enhance support for channel partners and customers.
Maintaining distinct thought processes between sales and marketing is crucial for task orientation This differentiation allows for varied goal orientations, enabling each team to focus on their specific objectives and timelines By recognizing these differences, organizations can enhance collaboration and improve overall performance.
The differing orientations of Product Managers and Account Managers can negatively impact the cooperation quality between marketing and sales, yet they can enhance the market performance of the IDVSD product and the Industry business unit The Product Manager should focus on the product dimension, emphasizing IDVSD’s 4P, while the Account Manager should prioritize the customer dimension, facilitating sales through IED and End Customers Additionally, the Product Manager should champion long-term goals such as yearly sales, market share, and go-to-market strategies, whereas the Account Manager should concentrate on short-term objectives like monthly and quarterly sales and gathering market feedback By fostering a culture of knowledge sharing between Product Managers and Account Managers, the team can obtain more accurate market intelligence and customer feedback, enabling timely and informed decision-making regarding the IDVSD product and solutions.
Solution justification
implementing the third alternative solution in 2020 and onward
The optimal approach involves forming a "Cross-Functional Selling" team that facilitates knowledge sharing between sales and marketing members, aimed at enhancing IDVSD sales through the IED Channel in the fourth quarter.
In 2019, the "Cross-Functional Selling" team developed and implemented the interactive "Market Intelligence Exchange" system to enhance sales and improve the marketing interface and decision-making process This initiative aimed to support the IED Channel in selling the most IDVSD in the market during the fourth quarter of 2019 The estimated cost for this solution is approximately VND 62,000,000, as detailed in Table 7.
A Forming & Running the “Cross-Functional Selling”
Team via Team meeting and “Market Intelligence Exchange” System
1 1 st meeting to form the cross-functional selling team and define action plan (8 hours – 4 peoples)
2 Weekly meeting for action follow up, updating and modification if any (12 meetings, 2 hours/ meeting, 4 peoples)
3 Team wrap-up meeting to consolidate the result and 1 st collaboration & expertise sharing meeting in using
“Market Intelligence Exchange” System (8 hours, 8 peoples)
4 Meeting to share the achievement with entire Industry Business about the cross-functional selling team result & the “Market intelligence Exchange” System (4 hours, 20 peoples)
B Developing & Applying “Marketing Intelligence Exchange” System to be used by the Cross- Functional Selling Team
A collaborative meeting involving the Sales Director, Sales Manager, Marketing Manager, HR Business Partner, and IT team was held to discuss the vision for implementing the exchange system The session focused on defining the system interface between the Account Manager and Product Manager, as well as establishing the key performance indicators (KPIs) for information sharing required by each group The meeting lasted 8 hours and included 6 participants.
2 Allowance for IT expert/ designer to establish the exchange system via Microsoft Yammer/ Microsoft Team application (5 business days, 2 IT staffs)
3 Communication and Training Cost for using “Market Intelligence Exchange” system for cross-functional selling team (4 hours, 4 peoples)
Table 7: Costs for the best solution (Author synthesis)
The costs are consisted of (A) investment cost around VND 30,000,000 for new
The "Market Intelligence Exchange" system will be utilized daily by the "Cross-Functional Selling" team, which has operational costs estimated at VND 32,000,000 This budget covers the formation and operation of the selling team, as well as expenses for team meetings aimed at sharing best practices with all members of the Industry Business upon project completion.
The Sales Director should prioritize allocating additional resources to sustain the "Market Intelligence Exchange" system for the entire Industry Business sales and marketing teams in 2020 and beyond This system facilitates essential knowledge and market intelligence sharing, which is integral to their daily operations Additionally, forming a "Cross-Functional Selling" team may be beneficial to enhance the performance of various product lines.