A study on sales force management the case of toyota giai phong from 2002 to 2006

vietnam national university, HANOI hanoi school of businessLuu Thi Diep Anh A STUDY ON SALES FORCE MANAGEMENT THE CASE OF TOYOTA GIAI PHONG FROM 2002 TO 2006 Master of business administr

vietnam national university, HANOI hanoi school of business

Luu Thi Diep Anh

A STUDY ON SALES FORCE MANAGEMENT THE CASE OF TOYOTA GIAI

PHONG FROM 2002 TO 2006

Master of business administration thesis

vietnam national university, HANOI hanoi school of business

Luu Thi Diep Anh

A STUDY ON SALES FORCE MANAGEMENT THE CASE OF TOYOTA GIAI

TABLE OF CONTENT

ACKNOWLEDGEMENTS i

TABLE OF CONTENT ii

LIST OF FIGURES v

LIST OF TABLES vi

LIST OF CHATS vii

INTRODUCTION 1

CHAPTER 1: SALES FORCE MANAGEMENT 5

1.1 DEFINITION AND THE ROLE OF SALES FORCE MANAGEMENT 5

1.2 FORMULATION OF A STRATEGIC PROGRAM 6

1.2.1 Sets goals and objectives 6

1.2.2 Demand estimation 6

1.2.3 Determines sales force size and structure 8

1.2.4 Sales territories 11

1.2.5 Quotas setting 13

1.3 IMPLEMENTATION OF THE SALES PROGRAM 14

1.3.1 Sales force recruitment and selection 14

1.3.2 Sales training 15

1.3.3 Sales Motivating 18

1.3.4 Designing compensation and incentive programs 19

1.4 MEASURING SALES FORCE 22

1.4.1 Measuring Sales Force Productivity Drivers 23

1.4.2 Measuring People and Culture 24

1.4.3 Measuring Activity 25

1.4.4 Measuring Customer Results 26

1.4.5 Measuring Company Results 27

CHAPTER 2: ANALYSIS OF SALES FORCE MANAGEMENT AT TOYOTA GIAI PHONG 28

2.1 INTRODUCTION OF TOYOTA GIAI PHONG 28

2.1.1 TGP history and development 28

2.1.2 Toyota Giai Phong’s organization structure 29

2.1.3 Toyota Giai Phong’s financial competency and facilities 32

2.1.4 TGP’s business performance from 2002 to 2006 34

2.2 THE SALES FORCE MANAGEMENT AT TGP 35

2.2.1 TGP’s sales model 35

2.2.2 Implementation of sales force management at TGP 37

2.3 MEASURING SALES FORCE PRODUCTIVTIES 43

2.3.1 Sales results 44

2.3.4 Company results 52

CHAPTER 3: SOLUTIONS FOR IMPROVEMENT OF SALES FORCE MANAGEMENT AT TOYOTA GIAI PHONG 55

3.1 THE VIETNAM AUTOMOTIVE TREND 55

3.1.1 The Vietnam’s automotive market trend 55

3.1.2 The Vietnam automotive consumer’s trend 56

3.2 RECOMMENDED A NEW MODEL FOR TGP 56

3.2.1 Demand estimation 56

3.2.2 Sales force structure 57

3.3 IMPROVING QUALITY OF RECRUITMENT AND TRAINING 57

3.4 DEVELOPING CUSTOMER SATISFACTION PROGRAM 57

3.5 APPLY CRM 59

3.5.1 The core of CRM: 59

3.5.2 Benefits of CRM 60

CONCLUSION 62

REFERENCES 63

APPENDICES 64

LIST OF FIGURES

Figure 1.1 Functional Sales Organization……….…….9Figure 1.2 Geographical Sales Organization……… …….10Figure 1.3 Sales Organization with Product-Specialized Sales Force…… 10Figure 1.4 Sales Organization Specialized by Type of Customers….… 11Figure 2.1 Organization Structure of Toyota Giai Phong……… ….31Figure 2.2 Sales force structure at Toyota Giai Phong ……….36Figure 3.1 TGP’s sales organization specialize by type of customers … 57

LIST OF TABLES

Table 2.1 Human Resource of TGP……… ………… 33

Table 2.2 TGP’s performance for 5 years……….………34

Table 2.3 TGP’s commission table……….………41

Table 2.4 TGP’s Sales record in 2006………42

Table 2.5 Average sales volumes per salesperson………44

Table 2.6 TGP Customer satisfaction results from 2002 to 2006…… …46

Table 2.7 TGP’s types of customers………… ……….…48

Table 2.8 TGP’s sources of customers……… ………51

Table 2.9 TGP’s revenues vs profit from 2002 to 2006……… ….52

LIST OF CHATS

Chat 2.1 TGP’s business performance from 2002 to 2005……….…….34

Chat 2.2 TGP’s sales volumes in 2006……….……42

Chat 2 3 Sales volumes per salesperson………45

Chat 2.4 TGP’s Customers Satisfaction results from 2002 to 2006……46

Chat 2.5 TGP’s type of customers………48

Chat 2.6 TGP’s source of customers ………51

Chat 2.7 TGP’s revenues vs profit from 2002 to 2006……….…52

Chat 2.8 TGP’s market share……… ………….54

1 THE PROBLEMS:

Sales force is a powerful asset of selling organizations It is a crucial factorcontributes to the success and stable development of the firm A good salesforce management can help the company to increase productivities as well asits competitive advantages In Vietnam auto market, the tough competitionbetween 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: TruongHai, Xuan Kien auto and Chinese low-cost imported cars make the autodealers face many difficulties Toyota Giai Phong, 1 of 5 dealers in the Northand 1 of 15 dealers of Toyota in Viet Nam, has three main functions: Toyotacar sales – introduction, warranty, maintenance, repair service supply andgenuine part supply It is tougher for Toyota Giai Phong because it competenot only with other brands dealers, but also with 14 other Toyota dealers inViet Nam

After 8 years operation, Toyota Giai Phong has significant achievements but

it usually in the 3rd rank of Toyota Vietnam’s dealers Customer satisfaction isnot 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 forother dealers of Toyota Vietnam

2 OBJECTIVES AND AIMS:

Literature review about the sales force management like: designing sales forcestrategy and structure, recruiting and selecting, training, evaluating,compensating, and measuring sales force productivity

Base on Toyota Giai Phong’s sales force performance analysis, the thesispropose solutions for improvement of sales force management at Toyota GiaiPhong

3 RESEARCH QUESTION:

The thesis uses some questions as follows 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

5 DATA SOURCES:

The thesis bases on textbook of sales force management; human resource

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

be applied for other Toyota dealers in Vietnam

10 OUTLINE:

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

Chapter 1: Theory on sales forces management.

Chapter 2: Analysis of sales forces management at 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 responsiblefor the sales of either a single product or the entire range of an organization'sproducts” (http://www.marketingpower.com/dictionary) A sales forcenormally reports to a sales manager A strong and efficient sales force is avital asset to an organization It helps in the smooth realization of sales targetsand ensures perennial sales productivity

Sales force management managing the sales force itself involves a number ofkey areas including, performance measurement, selection and training ofsalespeople, and motivational methods Sales-force management involvesthree different tasks Firstly, it is the methods for selling and managing a salesterritory There are no prescriptive methods for doing this and, if anything, anadaptive approach to selling is probably best Secondly, it is the supervision

by management which should include valid performance measurement andsuitable motivational methods The third task in concerned with the setting up

of a sales force in terms of its organization Key changes in the future arelikely to be concerned with technological advancements and informationhandling The organization and structure of the sales force depends on severalfactors Different business scenarios require different types of sales forceorganization It may be possible to increase sales productivity by attemptingnew methods of sales allocation The new models of sales allocation are:Segment-based sales force, Functional sales force, Consultative sales force,Enterprise sales force, Transactional sales force Hybrid/Queuing sales force

The activity of sales in an organization is carried out by the sales force Ahighly motivated sales force is instrumental in increasing the salesproductivity of the organization This increases the significance of sales forcemanagement With sales force management, a sales team will produce betterROI analyses for its customers, and improved sales proposals that arecustomer-focused.

1.2.1 Sets goals and objectives

To establish sales force goals and objectives, a company must determine thecurrent status of the selling organization Goal setting methods are rooted inapproaches for identifying market potential and other key drivers that impactperformance Goals are based upon three key factors: marketing’s view ofcustomer potential, the sales organization’s view of what is possible, andmanagement’s insights and expectations SFM create a top-down, bottom-upanalytical approach and develop goals that link to the company’s expectations

as well as gain the buy-in of all key stakeholders A typical goal setting willconsist of an in-depth analysis of customer base, followed by a rigorousanalytical 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 inaccuratedemand estimation can be costly The firms not only need to identify marketopportunities but they also need to produce accurate estimates of demand forproducts the result from this activity

Market opportunity analysis involves:

 Estimation of market potential or the expected sales of acommodity by the entire industry serving the market during a stated period

 Estimation of sales potential or the share likely to 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 theirexpected consumption or purchases of the products

 Sales force composite: this method requires every salespeople toestimates their expected sales These estimations are discussed, revised, and thenpooled to other levels of the sales organization hierarchy

 Jury of executive opinion: this method is also called expertopinion method It pools the top executives of the company to assess the salespossibilities for next period The forecast may be done by average the individualjudgment or by group discussion Besides, Delphi technique is also used, in thisprocedures each one in the group submits a forecast to the group coordinator Theestimation summary is prepared by coordinators and distributed to the ones whosubmit forecasts Then their estimates are revised

by them if necessary The process continues until a reasonable consensus is reached.

 The market test: it is a controlled experiment where product isplaced in several representatives cities to see how it perform and then the result areprojected to the area in which the firm operates

 Time series analysis: the analysis of historical data is used to develop sales forecast

 Statistical demand analysis: relationship between sales and theimportant factors affecting sales is determined to forecast the future

Depend on the business field of the firm, Sales manager will choose the mostsuitable 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 ensuressales productivity for long time A sales force should be built in specializedgroups and make the sales increasing stably and continuously There are manyfactors influence to the sales force’s organization and structure Differentbusiness scenarios require different types of sales force organization

1.2.3.2 How to design a sales force organization

 Principles for designing sales force organization

 Organizational structure should reflect a marketing orientation

 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

Chief Marketing Executive

Figure 1.2: Geographical Sales Organization

Chief Marketing Executive

4 District Sales Managers

Salespeople each with own

Eastern Regional Sales Manager

4 District Sales Managers

Salespeople each with own

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

Figure 1.3: Sales Organization with Product-Specialized Sales Force

Chief Marketing Executive

Sales Manager Sales Manager Sales Manager

Salespeople Salespeople Salespeople

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Figure 1.4: Sales Organization Specialized by Type of Customer

Chief Marketing Executive

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

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relatively It is necessary to decide sales force size before design territories for

salespeople There are three popular methods for determining the size of sales

force:

 Breakdown method: this method relies on estimation of sales

volume per one salesperson and sales forecast to determine sales force size

Number of Salespeople



Sales forecast

 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 method 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 general process might be expected to follows:

 Select the basic control unit,

 Estimate market potential in each control unit

 Combine control units into tentative territory

 Perform a workload analysis for each territory

 Adjust tentative territories to allow for sales potential and

coverage difficulty differences

 Assign salespeople to territories

1.2.5 Quotas setting

1.2.5.1 Purpose of quotas

A sales quota is the sales goal assigned to a marketing unit in a specifiedperiod Sales quotas may be high or low depend on customer, product andmarket situation The quota plan is a full set of quota assignments

Sales quotas are used to motivate salespeople, evaluate their performance, andcontrol their efforts For a quota plan to produce its potential benefits, thequotas must be attainable with normal effort, easy to understand, andcomplete

1.2.5.2 Quotas-setting process

 Select types of quotas: This choice entails determining whether

the firm will use quotas that 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 seek

some mechanism for combining the individual quotas in to a single summarymeasure that serves as the standard for each representative’s performance Often alinear combination or weighted average is used in which the weight reflect theimportance of each component to management

 Determine the level of each type of quota: in this step the sales

manager need to determine the level at which each type of quota is to be set Inestablishing level, sales manager must balance a number of factors, including thepotential available in the territory, the impact of the quota level on thesalesperson’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 Nomatter how good you are at training, motivating, evaluating, and planning, allthat applied to mediocre salespeople produces mediocre results Cast the playwell and it becomes easier to direct

1.3.1.1 Establish policy concerning responsibility for recruitment

and selection

The first decision is who in the company will have the responsibility forhiring the salespeople Two factors influence this issue is: (1) the size of thesales 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.

1.3.1.2 Analyze the job and determine selection criteria

There are three steps in recruitment and selection procedures: (1) a jobanalysis 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 thejob to determine what activities, tasks, responsibilities and environmentalinfluences are involved Sales manager or job analysis specialist canconducted this analysis It is important for who prepare a job description thatdetail in the findings of the job analysis Job description is used to develop astatement of job qualifications, which list and describes the personal traits andabilities a person should have to perform the tasks and responsibilitiesinvolved

1.3.1.3 Find and attract a pool of applicants

There are some sources of recruitment both internal and external

 Educational institutions

 Employment agencies.

Each source has its own advantages and disadvantages The matter is thatsales manager needs determine which source or combination of sources islikely to produce the largest pool of good, qualified recruit

1.3.1.4 Develop and apply selection procedures to evaluate

applicants

The final of recruitment is to evaluate each applicant through personal historyinformation, interviews, reference checks, and formal test The purpose is tofind the best applicant who meets the qualifications and requirements of thefirms

1.3.2 Sales training

A formal or informal program designed to educate the sales force and conveymanagement expectations of job responsibilities Sales training providesmanagers with the opportunity to communicate high performanceexpectations through training and to equip the sales force with the skillsneeded to reach high performance levels A well-designed training programmoves beyond passive learning techniques and shows the sales force how tosell

1.3.2.1 Determine objectives

Salespeople are not born, but are made Every organization should have asound sales training and development program to train salespeople Trainingsales force well not only increases their productivity and capacity but alsoimproves sales force confidence and enthusiasm, reduce turnover, improvecustomer relations, and product better management of time and territory

1.3.2.2 Develop and implement program

 Training program is designed to train both new and experiencedsalespeople The topics should contain in training program are: productknowledge, competitive knowledge and advantage, customer knowledge andprofile, selling skill

 Training courses on theory are normally held at theoffice/meeting room but some courses needed application, hand-on and experiencetraining, so salespeople need to work at or tour their factory/otherdepts./customer’s location to understand more about what they have learnt

 Media use in sales training: Classroom with Instructor (77%),Workbook/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 each training session, the salespeople will be asked by interview

or survey if they are satisfied with the course (perception of training, courseevaluation and instructor evaluation) Base on these evaluations, thecorrective action will be taken for future improvement Every six months, allsalespeople will be tested on product, competitor, customer knowledge, andselling skill The score will be compared with previous test and benchmarkedagainst peers This presents a reality check for both the salesperson and salesmanager 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’sefforts to their job activities related closely to job motivation The impacts onmotivation are: salesperson’s personal characteristics, environmentalconditions and organizational variables

1.3.3.1 The impact of a salesperson’s personal characteristics on

motivation

Each salesperson with personal characteristic has different perceptions of thelinks between effort and performance (expectancies), and betweenperformance and rewards (instrumentalities) They are also likely to havedifferent valences for the rewards they might obtain through improved jobperformance The personal characteristics the affect motivation include (1)individual’s satisfaction with current rewards, (2) demographic variables, (3)job experience, and (4) psychological variables-particularly the salesperson’spersonality traits and attributions about why performance has been good orbad

1.3.3.2 The impact of environmental conditions on motivation

Environmental factors such as variations in territory potential and strength ofcompetition can constrain a salesperson’s ability to achieve high levels ofperformance Such environmental constraints can cause substantial variations

in performance across salespeople

1.3.3.3 The impact of organizational variables on motivation

The company policies like incentive and compensation and characteristics candirectly facilitate or hinder a salesperson’s effectiveness Organizational

variable like leadership, span of control and supervisory variables alsoinfluence salespeople’s performance indirectly by affecting their valences forcompany rewards and the size and accuracy of their expectancy andinstrumentality estimates.

1.3.4 Designing compensation and incentive programs

Compensating sales force presents a particular challenge because packagesmust be extremely competitive and should provide adequate incentives tomotivate employees to do their best and allow company to achieve maximumprofitability The framework to use when designing compensation andincentive as follows:

1.3.4.1 Assessing the firm’s situation and sales objectives

Purpose of sales compensation program is to influence the sales force to reachthe target manager set The requirements they made are largely dictated by thefirm’s marketing and sales objectives and account management policies

1.3.4.2 Determining which aspects of job performance to reward

It is necessary to design a sales compensation and incentive package todetermine salespeople’s current valences for various rewards When thefirm’s objectives and time allocation of salespeople is not matched, thecompensation and incentive program can be redesigned to reward desiredactivities or performance outcomes more strongly, the motivating the salesreps to redirect their effort Because people’s need for a particular rewardvary, depending on their personalities, demographic, characteristics, sodiversification compensation program is needed

1.3.4.3 Deciding on the most appropriate mix of compensation

The decision about how much total compensation (basic salary pluscommissions or bonuses) a salesperson may earn is crucial in designingaffective motivation program Overpaying and underpaying are not good forcompensation program Overpaying can cause resentment and low moraleamong the firm’s other employees and executive when the salespeople canearn more money than even top management Underpaying is likely to makethe firm have high turnover, with higher cost for recruiting and trainingreplacement and lost sales

1.3.4.4 Financial incentives: choosing the most effective form of

finance

In order to determine the most effective form of financial compensation, thefirm need to decide whether it should use (1) straight salary, (2) straightcommission, or (3) a combination of base salary and incentive pay such ascommissions, bonuses, or both Nowadays, most organizations use thecombination (basic salary + incentive+ commission) The base salary providesthe salesperson with a stable income while allowing the company to rewardits salespeople for performing tasks not directly related to short-term sales.The incentive portion of combination plans provides direct rewards tomotivate salespeople to extend effort to improve their sales volume orprofitability To be effective, the incentive pay portion of the combinationplan has to be large enough to generate the necessary interest amongsalespeople

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 salespeople to get sales target To besuccessful, a sales contest needs to have (1) clearly defined, specificobjectives, (2) an exciting theme, (3) reasonable probability of rewards for allsalespeople, (4) attractive rewards, and (5) the necessary promotion andfollow through

1.3.4.6 Nonfinancial rewards

Nonfinancial incentive plays an important role in a firm’s compensationsystem Advancement and promotion opportunity are one of effectivemotivations Because all salespeople cannot possibly move into salesmanagement positions, some companies have dual career paths to maintainthe motivating potential of promotion and advancement One leads topositions in the sales management hierarchy, and other leads to greaterresponsibility in selling itself, such as a better territory or key account sales

To recognize if programs are effective, the salesperson’s peers and superiorsneed to realize outstanding performance of the representatives This can bedone through a formal recognition program at a sales meeting, publicity in thelocal press, announcement in the company’s internal newsletter, or in otherdesirable ways

1.3.4.7 Reimbursement of selling expenses

Since different reimbursement plans have an impact on the effective financialcompensation received by, and the motivation level of, firm salespeople,however, some of the relative advantages and limitations of alternative plansand policies as follows

 Direct reimbursement plans: the most popular type of expense

reimbursement is direct and unlimited reimbursement of all

“allowable and reasonable” expenses In order to getreimbursement, salespeople have to submit all receipts or retailrecords justify expense claims and the company agrees to pay75% of all the salesperson’s entertainment, travel andtelephone… expenses Salespeople and company share theexpenses -> it make salespeople have more responsible and saveexpenses

 Limited reimbursement plans: Some firms limit the total amount

of expense reimbursement, either by setting the maximum limits for each expenseitem (e.g., $40 for lodging and $50 for food) Both arrangements must vary dollaramounts to accommodate different expenses in different territories The flatmonthly 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 most commonlyassociated with “straight commission” compensation plan involving highpercentage commission The rationale is that salespeople will be motivated tospend both the effort and money necessary to increase sales volume as long as theresulting financial rewards are big enough to be worthwhile

1.4 MEASURING SALES FORCE

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

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

activities, (4) customer results, (5) company results Each component of aselling organization is used to measure some scopes Sales force investment,sales force activity, customer results, and company results are easy tomeasure Cost, sales, and profit data are kept in the accounting system.Activity data can be collected from customer surveys, or sales managers, orthrough self-reporting Many firms search for customer feedback to supervisetheir 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

 To measure sales force productivity drivers, sales managementdecisions 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 at that decision or process Moreover, each decision or process is also appraised

in terms of its impact on the selling organization’s ability to succeed

 Competency and impact can be evaluated by quantitative andqualitative measures Territory-level analysis is very useful measure among manyquantitative ones to evaluate sales force productivity drivers Salespeople’s targetneeds to be improved if they do not allocate their time effectively Thecompensation plan needs to be revisited if high performers are underpaid and lowperformers are overpaid The sales territories need to be

rebalanced if some sales territories have significant workload andothers do not have enough work to do.

 Qualitative Measures of the Sales Force Productivity Drivers

 Qualitative data can be used to evaluate both the impact ofproductivity drivers and the organization’s current competency

Qualitative data can be collected by interviewing withsalespeople and managers in the field with salespeople or in theworkshop sessions with experienced sales and marketingmanagers Managers hear the results of field interviews and arepresented with quantitative data Then they are asked to assessthe organization’s competency and the impact of their sales forceproductivity drivers

 Another Qualitative Benchmark: Result of a research on theimpact on the ability of the sales force to succeed which run by the authors at theKellogg Graduate School of Management shows that recruitment, training, and thefirst-line sales manager are crucial factors influence sales force succeed These arethe

“people” drivers from Sales Force Productivity Framework [Andris A Zoltners, 2001, Page 47]

1.4.2 Measuring People and Culture

 Selling organization contains different people, and it causes thedifferences between sales forces Some have good performance but some have not.The best way to evaluate salespeople is testing From the test, knowledge and skilllevels of the sales

force are known Turnover is a good measure of motivation and compensation policy.

 Sales managers also need to be evaluated Normally, companiesbase on sales results to assess sales management It is valuable to determine howmanagers contribute to salesperson growth, culture formation, and customersatisfaction A good measurement tool to evaluate sales managers is peer andsubordinate reviews

 The culture is the core of the organization It is the unwrittenrules that guide the behavior of salespeople and sales managers in the firm whenthey face familiar or new situations Culture is norms, values, and the way peopletreat to each other within the company to make their works more effectively Eachselling organization has distinct culture Some are empowering; others arecontrolling Some are focused on short-term results; others are focused on long-term results In spite of these cultural differences, many selling organizations havebeen successful in this industry However, some cultures are more successful thanothers because of factors influence to its culture like marketplace and competitiveenvironment

1.4.3 Measuring Activity

 In order to reach the sales target, salespeople need to do the rightthings It is up to their business field, there are various ways to influence customersand prospects They can make a phone call or arrange an appointment to seecustomers or prospects They

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make quotations, prepare contract, bid on business, writeproposals and letters, take orders and service customers,demonstrate their products or leave selling aids; they may evenwork with customers to integrate their products into thecustomers’ products and processes They target accounts and call

on the appropriate individuals in a customer’s organization Salesforce activity can be monitored to know if the sales force is doingthe right things and right directions

 There are some ways to measure sales activity Some salesmanagers want to control all activities of salespeople They need to report in detailwhat they do to their sales manager such as customer information, how to contact,stage of the process This method makes sales manager know exactly salesactivities so they can adjust in time In contrast, some sales managers just focus onthe sales results They think that the sales force should be completely empowered.However, valuable activity 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 salesforce performance “Through successful interaction with customers, the salesforce creates customer solutions, customer satisfaction, and sustainableprofitable relationships Customer retention rates, repeat rates, loss ratios,penetration, message memorability, and complaints have been used toevaluate customer relationships” [Andris A Zoltners, 2001, Page 60]

Conventional method to measure customer satisfaction 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 oncustomer satisfaction

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 profits to evaluate salesforce 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 thecompetition

Sales force is a complex organization It is impossible to use singlemeasurement to assess complexity one In order to evaluate sales forcemanagement effectively, it is necessary to combine five dimensions of salesforce productivity framework: (1) productivity drivers, (2) people and culture,(3) sales activities, (4) customer results, (5) company results

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

Being one of Toyota Vietnam’s dealers, Toyota Giai Phong (TGP) has facewith many tough competitive with others dealers of Toyota Vietnam (TMV)

as well as others brands in autos markets

2.1 INTRODUCTION OF TOYOTA GIAI PHONG

2.1.1 TGP history and development

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

1998 under Investment License No 14-GP-HN of Hanoi People Committee.Toyota Giai Phong became Toyota Vietnam’s dealer on 1st October, 1999

 Toyota Giai Phong’s Founders:

Vietnamese partner is Saigon General Service Company (SAVICO):

- Address 66-68 Nam KY Khoi Nghia Street, 1st 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-JV, Tokyo, Japan

- Business field: General trading including automobile and parts

 Investment scale:

- Investment duration: 20 years SAVICO contribute 51% SUMITOMO contribute 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 becameofficial dealer of Toyota Vietnam with the main functions asfollows:

- Selling Toyota vehicles in Vietnam

- Supplying after sales service, warranty and maintenance automobiles

- 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

- 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: