Luận văn a study on sales force management the case of toyota giai phong from 2002 to 2006

VIETNAM NATIONAL UNIVERSITY, HANOI HANOI SCHOOL OF BUSINESS Luu Thi Diep Anh ASTUDY ON SALES FORCE MANAGEMENT THE CASE OF TOYOTA GIAI PHONG FROM 2002 TO 2006 MASTER OF BUSINESS ADMIN

VIETNAM NATIONAL UNIVERSITY, HANOI

HANOI SCHOOL OF BUSINESS

Luu Thi Diep Anh

ASTUDY ON SALES FORCE MANAGEMENT

THE CASE OF TOYOTA GIAI PHONG

FROM 2002 TO 2006

MASTER OF BUSINESS ADMINISTRATION THESIS

Hanoi - 2007

VIETNAM NATIONAL UNIVERSITY, HANOT

HANOI SCHOOL OF BUSINESS

Luu Thi Diep Anh

ASTUDY ON SALES FORCE MANAGEMENT

THE CASE OF TOYOTA GIAT PHONG

1.3.4 Designing compensation and incentive programs

1.4.1 Measuring Sales Force Productivity Drivers

1.4.5 Measuring Company Results

CHAPTER 2: ANALYSIS OF SALES FORCE MANAGEMENT

TOYOTA GIAI PHONG

2.1 INTRODUCTION OF TOYOTA GIA] PHONG

2.1.1 TGP history and development

2.1.2 Toyota Giai Phong’s organization structure

2.1.3 Toyota Giai Phong’s financial competency and facilities

2.1.4, TGP’s business perlormance [rem 2002 to 2006

2.2, TIE SALES FORCE MANAGEMENT AT TGP

2.2.2 implementation of sales force management at ‘GP

2.3 MEASURING SALES FORCE PRODUCTIVTIES

2.3.1 Sales results

1 a

2.3.4 Company results 52

CILAPTER 3: SOLUTIONS FOR IMPROVEMENT OF SALES FORCE

3.1.1 The Vietnam’s automotive market trend 55

3.1.2 The Vietnam automotive consumer’s trend - $6

Sales Organization with Product-Specialized Sales Force 10 Sales Organization Specialized by Type of Customers

Organization Structure of Toyola Giai Phong 31

Sales force structure al Toyota Giai Phong 36 TGP’s sales organization specialize by type of customers .57

TGP’s commission table TGP’s Sales record in 2006

Average sales volumes por salesperson

TGP Customer satisfaction results from 2002 lo 2006 'TTGP”s types oÍ cus†OITS

‘TGP’s sources of customers

TGP’s revenues vs profit from 2002 to 2006

vi

un me

Sales volumes per salesperson

TGP’s Customers Satisfaction results from 2002 to 2006

INTRODUCTION

1 THE PROBLEMS:

Sales force is a powerful asscl of selling organivations Ti is a crucial factor

contributes to the success and stable development of the firm A good sales

force management can help the company to inc

© productivitics as well as

its competitive advantages In Vietnam auto market, the tough competition

between well-known brand such as Toyota (Japan), Ford (America),

Mitsubishi (Japan), Mazda (Japan), Isuzu (Japan), Suzuki (Japan), Daihatsu

(Japan), Honda (Japan), Mercedes (Germany), BMW (Germany), Kia

(Korea), GM-Daewoo (Korea), besides, there are local manufacturers: Truong

Hai, Xuan Kien auto and Chinese low-cost imported cars make the auto

dealers face many difficulties Toyota Giai Phong, 1 of 5 dealers in the North

and 1 of 15 dealers of Toyola in Viel Nam, has three main functions: Toyota

car sales — introduction, warranty, maintenance, repair service supply and

genuine part supply It is tougher for Toyota Giai Phong because it compete not only with other brands dealers, but also wilh 14 other Toyola dealers in Viet Nam

After 8 ycars operation, Toyota Giai Phong has significant achicvemonts but

vả

it usually in the 3“ rank of Toyota Vietnam’s dealers Customer satisfaction is

not as high as expected, sometime it is lower than average scores

The thesis “A study on sales force management — the case of Toyota Giai Phong from 2002 to 2006” is aimed to study and propose solutions to

improve sales force management at Toyota Giai phong and can be applied for

other dealers of Toyota Vietnam

2, OBJECTIVES AND AIMS:

Literature review about the sales force management like: designing sales force strategy and structure, recruiting and selecting, training, evaluating,

compensating, and measuring sales force productivity

Base on Toyota Giai Phong’s sales force performance analysis, the thesis

propose solutions for improvement of sales force management at ‘oyota Giat Phong

3 RESEARCH QUESTION:

The thesis uses some questions as follaws to make clear the situation of

Toyota Giai Phong and propose solution

- What Toyota Giai Phong has been done so far?

- What Toyota Giai Phong can do to develop sales force management?

- What conditions need to make ‘loyota Giai Phong improve Sales

force management?

4 SCOPE OF WORK:

The thesis siudics on sales lorec management process as well as [actors

influence and measurements sales force productivity at Loyota Giai Phong,

from 2002 to 2006

5 DATA SOURCES:

The thesis bases on lextbook of sales force management, human resouree

Management, and some websites related to this topic also use to collect

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information for theory part To analyze sales force performance at Toyota Giai Phong, this thesis uses documents of ‘Toyota Giai Phong and ‘Toyota Viet

The thesis study and analyze sales force management at Toyota Giai Phong to

propose solutions lo dovelup sales Loree management at Toyota Giai Phong,

Propose solutions to build a perfect sales team for ‘Toyota Giai Phong, it can

‘be applied for other Toyota dealers in Vietnam

8 LIMITATION:

The thesis only study at sales department of Toyola Giai Phong The data and information are collected from Ioyota Giai Phong and Ioyota Vietnam

9, EXPECTED RESULTS:

Study on sales force management theory and analyze the case of Toyota Giai

Phong to propose solutions in order to improve sales force management at

Toyota Giai Phong and make it become the leadmg dealer of ‘Toyota

Vietnam.

10 OUTLINE:

Excluding introduction, conclusion and reference part, there are 3 parts in this

thesis:

Chapter 1: Theory on sales forces management

Chapter 2: Avalysis of sales forces management ut Toyota Giai Phong

Chapter 3: Solutions to improve sales force management at Toyota Giai

Phong.

CHAPTER 1: SALES FORCE MANAGEMENT

MANAGEMENT

“A sales force is a group of salespeople or sales representatives responsible

for the sales of cither a single product or the entire range of an organization's

products” (hilp:/www-markelingpower.com/dictionary) A sales Loree

normally reports to a sales manager A strong and efficient sales force is a

vilal asscl to an organization It helps in the smooth realization of sales largcts

and ensures perennial sales productivity

Sales force management managing the sales force itself involves a number of

key areas including, performance measurement, selection and training of

salespeople, and motivational methods Sales-foree management involves

three different tasks Firstly, it is the methods for selling and managing a sales territory There are no prescriptive methods for doing this and, if anything, an

adaptive approach lo sclling is probably best Sccondly, it is the supervision

by management which should include valid performance measurement and suilable mvlivational methods The third task im concerned with the setting

up of a sales force in terms of its organization Key changes in the future are

likely to be concerned with technological advancements and information

handling The organization and structure of the sales foree depends on several factors [Different business scenarios require different types of sales force

organization It may be possible to increase sales productivity by attempting new methods of sales allocation The new modcls of sales allocation arc: Segment-based sales force, Functional sales force, Consultative sales force, Enterprise sales force, Transactional sales force Ilybrid/Queuing sales force

The activity of sales im an organizaHion is carried oul by the saÌles force A

highly motivated sales force is instrumental in increasimg the sales

productivity of the organization This increases the significance of sales force

management With sales force management, a salos tam will produce better

ROI analyses for its customers, and improved sales proposals that are

customer-focused

1.2.1 Sets goals and objectives

To establish sales force goals and objectives, a company must determine the

current status of the selling organization Goal sclting methods are roolcd in

approaches for identifying market potential and other key drivers that impact

performance Goals are based upon three key factors: markeling’s view of

customer potential, the sales organization’s view of what is possible, and management’s insights and expectations SFM create a top-down, bottom-up

analytical approach and develop goals thal link to the company’s expectations

as well as gain the buy-in of all key stakeholders A typical goal setting will consist of an in-depth analysis of customer base, followed by a rigorous

analytical development of potential estimation

1.2.2 Demand estimation

1.2.2.1 important of sales forecast

In sales management, sales forecast is very important because inaccurate demand estimation can be costly The firms not only need to identify market

opportunitics but they also necd to produec accurate estimates of demand for

products the result from this activity

Market opportunity analysis involves

“~ Estimation of market potential or the expected sales of a

commodity by the entire industry servmg the market durmg a stated period

+ Fistimation of sales potential or the share likely lo be realized by

the company

“ Preparation of the sales forecast or the estimate of sales for a

specified future period under an assumed marketing plan

1.2.2.2 Methods for sales forecasting

Users’ expectations: this method is also known as the buyers?

intentions method because it relies on the answers of customers

about their expected consumption or purchases of the products

Sales force composite: this method requires every salespeople to

estimates Iheir oxpected sales These oslimations are discussed,

revised, and then pooled to other levels of the sales organization hierarchy

Jury of executive opinion: this method is also called expert

opinion method It pools the top executives of the company to

assess the sales possibilities for next period ‘The forecast may be

done by average the individual judgment or by group discussion

Besides, Delphi technique is also used, in this procedures cach

one in the group submits a forecast to the group coordinator ‘The estimation summary is prepared by coordinators and distributed

to the ones who submit forceasts Then their estimates are revised

by them if necessary The process continues until a reasonable

+4» Slatisucal demand analysis: relationship belween sales and the

important factors affecting sales is determined to forecast the

future

Depend on the business field of the firm, Sales manager will choose the most

suilable one to apply

1.2.3 Determines sales force size and structure

1.2.3.1 Purpose of sales force organization

Organizing the sales force makes the company to achieve the sales objectives

in a more effective way It helps to realize sales targets smoothly and ensures

sales productivity for long time A sales force should be built in specialized

groups and make the sales increasing, stably and continuously ‘here are many

factors influence to the sales force’s organization and structure Different

business scenarios require dillerent lypes of sales force organization

1.2.3.2 Haw to design a sales force organization

‘ Principles for designing sales force organization

V Organizatonal structure should reflect a marketing

orientation

Y Organization should be built around activities, not around

people

Responsibility and authority should be related properly

Span of executive control should be reasonable

Organization should be stable but not flexible

Activities should be balanced and coordinated

** Horizontal structure of the sales force

There are four common types of horizontal organization, structured base on

selling function, geography, type of product and type of customer

Figure 1.1: Functional Sales Organization

Salespeople

(Source: The McGraw-Hill Companies, Inc.2003)

Figure 1.2: Geographical Sales Organization

Chief Marketing Executive

Advertising) | were General Sales | & a | Sales

I

‘Western Regional Eastern Regional

ha” |Research | Soa Sales || Promotion Relation

]

Sales Manager Sales Manager Sales Manager

Product A Product B Product C

Product A Product B Product C

(Source: The McGraw-Hill Companies, Inc.2003)

Figure 1.4: Sales Organization Specialized by Type of Customer

A Noes | Research | Saad sae | Promotion Relation

Sales Manager Sales Manager Sales Manager

‘Transportation Steel Industry Petroleum Industry

(Source: The McGraw-Hill Companies, Inc.2003) 1.2.4, Sales territories

1.2.4.1 The need for sales territories

A sales territory is a group of potential customers assigned to salespersons to contact and sales products The customers and geographic boundaries are the key to design sales territory but the key is distinguishing component is

customers Good sales territories are made up of customers who have money

and willing to spend it Good sales territory design can positively influence individual’s interest and morale, it also can improve market coverage and evaluation and control selling field of the firms

1.2.4.2 Sales force size

Sales force is a productive asset of the firm what brings most profit but it’s

also costly Increasing salespeople will increase sales volume and cost

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relatively It is necessary lo decide sales force size before design territories for salespeople ‘here are three popular methods for determining the size of

* Workload method: This method rests on the assumption that all

sales personnel should responsible for an equal work amount

Management estimates total work required to serve the market,

calculates the number of customers, total time to contact them

and the time available for one salesperson Base on this forecast,

manager determine total number of sales force

‘@ Incremental method: This is the most difficult method to implement because this methed base on basic premise underlying

the incremental method It means that sales representatives

should be added so long as the incremental profit produced by their addition exceeds the incremental cost

1.2.4.3 Sales territories design

One the number of territories is determined, the sales manager can design the

individual territories The gencral process might be expected to follows

* Select the basic control unit,

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“ Estimate market potential im each control unit Combine contro] units into tentative territory

+ Perform a workload analysis for each territory

* Adjust tentative territories to allow for sales potential and

coverage difficulty differences

+ Assign salespcople to territories

1.2.5 Quotas selling

1.2.5.1 Purpose of quotas

A sales quota is the sales goal assigned to a marketing unit in a specified

period Sales quotas may be high or low depend on customer, product and market situation ‘The quota plan is a full set of quota assignments

Salos quolas are uscd Lo motivate salespeople, cvaluate their performance, and

control their efforts For a quota plan to produce its potential benefits, the quolas must be attainable with normal effort, easy to understand, and

complele

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2 Quotas-setting process

% Select iypes of quotas: This choice entails determining whether

the firm will usc quolas thal emphasize

* Sales or some aspect of sales volume

* ‘the activities in which salespeople are supposed to engage

* Financial criteria such as gross margin or contribution to

overhead.

$* Determine relative importance of each type: Most firms seck

some mechanism for combining the individual quotas im to a

single summary measure that serves as the standard for each

rupresontative’s performance Often a lincar combination or

weighted average is used in which the weight reflect the importance af cach component lo management,

+ Determine the level of each tvpe of quota: in this step the sales

manager need to delermine the level at which each type of quota

is to be set In establishing level, sales manager must balance a

number of factors, including the potential available in the

torritory, the impact of the quola level on the salesperson’s

motivation, the long term objectives of the company, and the impact on short-term profitability

1.3.1 Sales force recruitment and selection

Recruitment is the most important function sales manager performs No

matter how good you are at training, motivating, evaluating, and planning, all

that applied to mediocre salespeople produces mediocre results Cast the play

well and it becomes easier Lo direct

13.11 Establish policy concerning responsibility for recruitment

and selection

The first decision is who in the company will have the responsibility for

hiring the salespeople Two factors influence this issue is: (1) the size of the

sales force, and (2) the kind of selling involved In small firm, sales manager

in charged of recruitment and selection In larger one, like multi level firm,

the authority is delegated to lower levels

13.1.2 Analyze the job and determine selection criteria

There are three sleps in recruitment and selection procedures: (1) a job analysis and description, (2) the recruitment of a pool of applicants, and (3)

the selection of the best applicants form the available pool

‘The job analysis and description phase includes a detailed examination of the

job to determine what activities, tasks, responsibilities and environmental influences are involved Salus manager or job analysis specialist can

conducted this analysis It is important for who prepare a job description that

detail in the findings of the job analysis Job description is used to develop a

siaicment of job qualifications, which list and describes the personal trails and

abilities a person should have to perform the tasks and responsibilities involved

1.3.1.3 Find and attract a pool of applicants

There are some sources of recruitment both internal and extemal

~ Pcople within the company

% People in other firms

%* Educational institutions + Advertisements

“Internet recruiting

%* Employee referrals

Dmployment agencies

Each source has its own advantages and disadvantages The matter is that sales manager needs determine which source or combination of sources is

likely to produce the largest pool of good, qualified recruit

1314 Develep and apply selection precedures to evaluate

applicants

‘The final of recruitment is to evaluate each applicant through personal history

information, interviews, reference checks, and formal test The purpose is to find the best applicent who mecls the qualifications and requirements of the

firms

1.3.2 Sales training

A formal or informal program designed lo educate the sales force and convey

management expectations of job responsibilitics Sales training provides

managers with the opportunity to communicate high performance

expectations lhrough traming and to cquip the sales force with the skills

needed to reach high performance levels A well-designed training program

moves beyond passive leaming techniques and shows the sales force how to scl]

13.2.1 Determine objectives

Salespeople are not born, but are made Every organization should have a

sound sales taming and development program to train salespeople Training

sales force well not only increases their productivity and capacity but also improves sales force confidence and enthusiasm, reduce tumover, improve

customer relations, and product better management of time and Lerrilory

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1.3.2.2, Develop and implement program

‘~ Training program is designed to train both new and experienced

salespeople The topics should contain in training program are product knowledge, competitive knowledge and advantage,

customer knowledge and profile, selling skill

+ Training courses on theory are normally held at the

olTicc/mecling room but some courses necded application, hand-

on and experience training, so salespeople need to work at or

tour their factory/other depts./customer’s location to understand

more about what they have leamt

Media use in sales waining: Classroom with Instructor (77%), Workbuok/manuals (54%), Role plays (44%), CD-ROM (39%), Audiocassettes (34%), Internet (32%) [Rosann Spiro, 2000, p83] 1.3.2.3, Evaluate and review program

At the end of cach raining session, the salespeople will be asked by interview

or survey if they are satisfied with the course (perception of training, course

evaluation and instructor evaluation) Base on these evaluations, the

corrective action will he taken for future improvement Every six months, all

salespeople will be tested on product, competitor, customer knowledge, and selling skill The score will be compared with previous test and benchmarked

against peers ‘his presents a reality check for both the salesperson and sales

manager and identifies areas where each salesperson needs more training

1.3.3 Sales Motivating

Sales motivation is a factor make sales success because the salesperson’s

ctforts to their job activitics related closcly to job motivation The impacts on motivation are: salesperson’s personal characteristics, environmental

conditions and organizational variables

1.3.3.1 The impact of a salesperson’s personal characteristics on

motivation

Bach salesperson with personal characteristic has different perceptions of the

links between cfforl and performance (expoclancies), and belween

performance and rewards (instrumentalities) ‘(hey are also likely to have

different valences for the rewards they might obtain through improved jub

performance The personal characteristics the allccl motivation include (1)

individual’s satisfaction with current rewards, (2) demographic variables, (3)

job experiences, and (4) psychological variables-particularly the salesperson’s personahty traits and attributions about why performance has been good or

bad

1.3.3.2 The impact of environmental conditions on motivation

Fnvirenmental factors such as variations in territory potential and strength of

competition can constrain a salesperson’s ability to achieve high levels of performance Such environmental constraints can cause substantial variations

in performance across salespeaple

1.3.3.3 The impact of organizational variables on motivation

The company policies like incentive and compensation and characterislics can dircetly facilitate or hinder a salesperson’s elfvctivencss Organizational

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variable like leadership, span of control and supervisory variables also

influence salespeople’s performance indirectly by affecting their valences for

company rewards and the size and accuracy of their expectancy and

instrumentality estimates

1.3.4 Designing compensation and incentive programs

Compensating sales force presents a particular challenge because packages

musl be extremely compelitive and should provide adequate incentives to motivate employees to do their best and allow company to achieve maximum

profitability The framework to use when designing compensation and incentive as follows:

13.4.1 Assessing the firm's situation and sales objectives

Purpose of sales compensation program is to influence the sales force to reach

the targel manager sel The requirements they made are largely dictated by the firm’s marketing and sales objectives and account management policies

13.4.2 Determining which aspects of job performance to reward

It is necessary to design 4 sales compensation and incentive package to

determme salespeople’s current valences or various rewards When the

firm’s objectives and time allocation of salespeople is not matched, the

compensation and incentive program can be redesigned to reward desired

activitics or performance outcomes more strongly, the motivating the sales

reps to redirect their effort Because people’s need for a particular reward

vary, depending on their personalities, demographic, characterislics, so

diversification compensation program is needed.

1.3.4.3 Deciding on the most appropriate mix af compensation

The decision about how much total compensation (basic salary plus

commissions or bonuses) a salesperson may cam is crucial in designing affective motivation program Overpaying and underpaying, are not good for

compensation program Overpaying can cause resentment and low morale

among the firm’s other employees and executive when the salespeople can

eam more money than even top management Underpaying is likely to make

the firm have high tumover, with higher cost [or recruiting and taining replacement and lost sales

13.44 Financial incentives: choosing the most effective form of

combination (basic salary ~ incentive- commission) The base salary

provides the salesperson with a slable income while allowing the company to reward its salespeople for performing tasks not directly related to short-term

sales The incentive portion of combination plans provides direct rewards to

motivate salespeople to extend effort to improve their sales vole or

profitability ‘lo be effective, the incentive pay portion of the combination

plan has to be large enough lo generale the necessary interest among salespeople

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1.3.4.5 Sales contest

Sales contest is a part of the incentive portion of compensation system But it

is short-term program to motivate salespcople to get salcs target To be

successful, a sales contest needs to have (1) clearly defined, specific

objectives, (2) an exciting theme, (3) reasonable probability of rewards for all

salespeople, (4) attractive rewards, and (5) the necessary promotion and

follow through

1.3.4.6 Nonfinancial rewards

Nonlinancial incentive plays an important role in a firm's compensation

system Advancement and promotion opportunity are one of effective

motivations Because all salespeople cannot possibly move imlo sales

management positions, some companies have dual carcer paths to maintain

the motivating potential of promotion and advancement One leads to

posilions im the sales management hicrarchy, and cthcr leads to groator responsibility in selling itsclf, such as a bettor territory or key account sales

To recagnize if programs are effective, the salesperson’s peers and superiors

need to realize outstanding performance of the representatives This can be done through a formal recognition program at a sales meeting, publicity in the

local press, announcement in the company’s internal newsletter, or in other

desirable ways

13.4.7 Reimbursement of selling expenses

Since different reimbursement plans have an impact on the effective financial

compensation received by, and the motivation level of, firm salespeople,

however, some of the relative advantages and limitations of altemative plans

and policies as follows

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“9 Direct reimbursement plans: the most popular type of expense

reimbursement is direct and unlimited reimbursement of all

“allowable and reasonable” expenses In order to get

rommbursement, salespeople have to submut all receipts or retail

records justify expense claims and the company agrees to pay

75% of all the salesperson’s cnicrtaimment, travel and

telephone expenses Salespoople and company share the

expenses -> it make salespeople have more responsible and save

expenses,

%* Limited reimbursement plans: Some firms limit the total amount

of expense reimbursement, either by sclting the maximum limits

for each expense item (e.g., $40 for lodging and $50 for food)

Both arrangements must vary dollar amounts to accommodate

different cxpenses in different terrilorics The fat monthly allowance allows you to accurately forecast this expense item

% No reimbursement plans: all necessary expenses of salespeople

are included in the financial compensation This kind of plan is

mosL commonly associated with “straight commission”

compensation plan involving high percentage commission ‘lhe

rationale is that salespeople will be motivated to spend both the effort and money ne

To evaluate sales force productivity, it is necessary to base on five

dimensions: (1) productivity drivers (2) people and culture, (3) sales

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activities, (4) customer results, (5) company resulls Each component of a

selling organization is used to measure some scopes Sales force investment,

sales force activity, customer results, and company results are easy to

measure Cost, sales, and profil data arc kepl im the accounling system

Activity data can be collected from customer surveys, or sales managers, or through self-reporting Many firms search for customer feedback to supervise

thoir operations and to get information that they can use for improvement

The following sections describe how each component is measured

1.4.1 Measuring Sales Force Productivity Drivers

“*

”

‘Lo measure sales force productivity drivers, sales management

decisions or processes are needed to be examined Among many drivers, competency and impact are the two useful measures of

these productivity drivers Each decision or process is assessed in

terms of how good the selling organization is al that decision or process Morcover, cach decision or process is also appraiscd in

terms of its impact on the selling organization's ability to

succeed

Compelency and impact can be evalualed by quantitative and

qualilative measures Territory-level analysis is very uscful

measure among many quantitative ones to evaluate sales force

productivity drivers Salespeople’s larget nocds to be improved if they do not allocate their time ctfectively Tho compensation

plan needs to be revisited if high performers are underpaid and

low performers are overpaid The sales torritorics need to be

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*

rebalanced if some sales terrilories have significant workload and

others do not have enough work to do Qualitative Measures of the Sales Force Productivity Drivers

Qualitative data can be used to evaluale both the impact of

productivity drivers and the organizalion’s current competency

Qualitative data can be collected by interviewing with

salespeople and managers in the fickd with salespeople or in the workshop sessions with experienced sales and marketing

managers Managers hear the results of field interviews and are

presented with quantitative data Then they are asked to assess the organization’s competency and the impact of their sales force

productivity drivers

Another Qualitative Benchmark: Result of a research on the

impact on the ability of the salos Loree to succeed which run by the authors at the Kellogg Graduate School of Management

shows that recruitment, training, and the first-line sales manager are crucial factors influence sales [orce succced These arc the

“people” drivers from Sales Force Productivity Framework

JAndris A Zoliners, 2001, Page 47]

1.4.2 Measuring People and Culture

Selling organization contains different people, and it causes the

differences between sales forces Some have good performance

bul some have nol The best way to evaluate salespeople is

testing Krom the test, knowledge and skill levels of the sales

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force are known Tumover is a good measure of motivation and

compensation policy + Sales managers also need to be cvaluated Normally, companics

base on sales results to assess sales management It is valuable to determine how managers contribute to salesperson growth,

culture formation, and customer satisfaction A good

measurement tool to evaluate sales managers is peer and

subordinate reviews

“* The culture is the core of the organization It is the unwritten

rulcs that guide the behavior of salespeople and sales managers

in the firm when they face familiar or new situations Culture is norms, values, and the way people treat to each other within the

company to make their works more effectively Each selling

organization has distinct culture Some are empowering: others

are controlling Some are focused on short-term results; others are focused on long-term results In spite of these cultural

differences, many selling organizations have been successful in this industry However, some cullurcs are more successful than others because of factors influence to its culture like marketplace

and competilive environment

1.4.3 Measuring Activity

+ In order to reach the sales target, salespeople need to de the right

things It is up to their business field, there are various ways to

influence customers and prospects They can make a phone call

or arrange an appointment to see customers or prospects They

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make quotations, prepare contract, bid on business, write

proposals and letters, take orders and service customers,

demonstrate their products or leave selling aids; they may even

work with customers lo micgrate their producls into the

customers’ products and processes ‘hey target accounts and call

on the appropriate individuals in a cuslomer’s organization Sales

forec activity can be monitored to know if the sales force ts doing the right things and right directions

# ‘lhere are some ways to measure sales activity, Some sales

managers want to control all activities of salespeople They need

lo report in delail what they do to their salos manager such as

customer information, how to contact, stage of the process ‘his

method makes sales manager know exactly sales activities so

they can adjust in time Tn contrasi, some sales managers just

focus on the sales results They think that the sales force should

be completely cmpowercd However, valuable activily measures can be obtained even in the totally self-managed selling

organization

1.4.4 Measuring Customer Results

Besides sales results, customer results are a good component to measure sales

force performance “‘hrough successful interaction with customers, the sales

force creates customer solutions, customer satisfaction, and sustainable

profitable relationships Customer retention rates, repeat rates, loss ratios,

penetration, message memorability, and complaints have been used to

evaluate customer relationships” | Andris A Zoltners, 2001, Page 60]

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Conventional method ta measure customer satisfaclion is survey Customers’

thinking about product, price, and sales service is expressed in the survey So,

it is important to write a questionnaire that shows the impact of sales force on customer salisfacton,

1.4.5 Measuring Company Results

In selling organizations, sales force is a significant contributor to the success

of the firms Top management base on sales and its prolils lo cvaluate sales force performance Financial achievement of a selling organization is shown

in sales and profits These measures can be expressed in four ways: (1) stated

in absolute levels, (2 conveyed as a percentage of goal attainment, (3) expressed relative to the prior year’s performance, (4): compared to the

competition

Sales force is a cormplex organization It is impossible to use single

micasurement lo assess complexity onc In order to evaluate sales force management cffectively, it is necessary to combine five dimensions of sales

force productivity framework: (1) productivity drivers, (2) people and culture,

(3) sales activitics, (4) customer results, (5) company results

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CHAPTER 2: ANALYSIS OF SALES FORCE MANAGEMENT AT TOYOTA GTAT PHONG

Being one of Toyota Vicinam’s dealers, Toyota Giai Phong (TGP) has Lace

with many tough competitive with others dealers of Toyota Vietnam (TMV)

as well as others brands in aulos markels

2.1, INTRODUCTION OF TOYOTA GLAL PHONG

2.1.1 TGP history and development

Toyota Giai Phong- a joint-venture company- is established on 22"! January,

1998 under Investment License No 14-GP-HN of Hanoi People Committee

Toyota Giai Phong became Toyota Vietnam’s dealer on 1* October, 1999

~ ‘Toyota Giai Phong’s Founders

Vielnamese partner is Saigon General Service Company (SAVICO):

- Address 66-68 Nam KY Khoi Nghia Street, 1* district,

Hochiminh city

- Business field: trading, manufacturing, exporting, importing,

transporting, real-estate

Japanese partner is Sumitomo Corporation (SUMITOMO)

- Address: 2-2 Hototsubashi, 1-chome, Chiyoda-IV, Tokyo, Japan

- Business field: General trading including automobile and parts

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s* Investment scale

- Investment capital: 3,000,000 USD

- Investment duration: 20 years SAVICO contribute 51%

SUMITOMO contnbute 49%

Business field:

‘Toyota Giai Phong Company has been operating since April,

1999 as TASS with function is maintenance, warranty, reparation

of Toyota vehicle Since Oct, 1999, Toyota Giai Phong became

official dealer of ‘loyota Vietnam with the main functions as

follows

- Selling Toyota vehicles in Vietnam

- Supplying after sales service, warranty and maintenance

automobiles

- Supplying genuine parts

- Exporting local assembled cars

- Training and developing distribution network in Vietnam

2.1.2 Toyota Giai Phong’s organization structure

According to joint-venture charter and contract regulation:

- Board of management includes 4 members: 2 members are

belong to Savico, 2 others belong to Sumitomo

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Board of directors includes 1 General Director and 1 Deputy

General Director who assign by Board of management

Under Board of Management and Board of Directors, there

are 4 main departments at TGP:

© Finance Department

© Sales Department

© Administration and Human resource Department

© Maintenance Workshop

For the positions from Chief accountant, Sales manager,

Service manager and other staff, Board of directors has

authority to recruit and sign labor contracts according to

Vietnam Labor cade

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Figure 2.1: Organization Structure of Toyota Giai Phong

BOARD OF MANAGEMENT

me

2.1.8 Toyota Giai Phong”s financial competency and facililies

2.13.1 Finance competency:

- Fixed capital: 1,295,360 USD including:

Showroom investment: 200,000 USI>

Land renting, and compensations 665,360 USID

Other fixed asscts: 70,000 USD

- Working capital 704,640 USD

- Lanking loans competency: being a joint-venture of Savico and

Sumitomo, all banking loans of Toyota Giai Phong are

guaranteed by Sumitomo & Savico without mortgage

- Workshop competency: The workshop is designed according lo

Toyota standard and it is equipped modem machines,

cquipments .to ensure that il can ropair all kind of aulomobile

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