THE MARKET-DRIVEN SALES ORGANIZATION Cuarrer OuTLINE FACTORS INFLUENCING ORGANIZATIONAL DESIGN AND STRUCTURE MARKETING AND MARKETS SAEs JoBS ARE VARIED AND CAN BE CLassiFiED ‘THE SALESPERSON’S JOB ACTIVITIFS AS A TERRITORIAL MANAGER Sues ORGANIZATIONAL DESIGN SALES ORGANIZATIONAL STRUCTURE New Forms oF ORGANIZATIONS COORDINATION AND TECHNOLOGY LEARNING OpyECTIVES ‘A-sales force is a complex selling unit of the firm. Its organizational design and structure are built around its customers and markets.After studying this chapter, you should be able to explain: The type of markets in which salespeople work. I The major job activities of salespeople. The various types of sales jobs. I Why sales jobs are designed for an individual onganization’s markets and customers. The various types of sales force organizational structures. Newer forms of organizations. I How coordination and technology improve customer service.a SE Tn January, leads were dropping, competitors were refocusing their efforts, and the number of new members had decreased significantly. This was the cue for Dave Mezzanotte, director of sales for SecureHorizons, a health plan for seniors, that some changes had to be made in the roles of his salespeople. He also realized that even the ‘mention of words that start with re—like realigning and reorganization—could put ‘many employees in a panic.So what did Mezzanotte do? He eased them into changes, preparing them every step of the way:"T wanted to get the organization into the mode ‘of accepting quick change? he says. Mezzanotte began by traveling extensively in the fel listening in on inside sales calls and speaking to top performers about difficulties they were having, He then met. with his management team, and they came up with a vision of where the industry ‘was headed and what SecureHorizons would have to do in onder to adjust. By Febru- auy.he had presented the company with*a graphic depiction of where we needed to 0, what the problems were, what we needed to fix He included anecdotes from his interviews about how employees were working harder for fewer results ‘When the major realignment was announced in April, everyone was ready. On the day of the announcement, managers held individual meetings with their employees to address conceens. Management announced that people taking on new roles would undergo training in May" had to let them know when T presented this vision that 1 ‘would never just let them hang out there Mezzanotte says. He also made sure that information about compensation was available that day. One year after his plan was implemented, Mezzanotte declares that SecureHiori- zons has maintained its market Leading position with the enrollment of 45 percent of all seniors who signed up for new health plans. However, some employees did strug- ale with their roles in the first few months, and Mezzanotte thinks that the company ‘may require another eestructuring in the near future. His expectations are that his emi- ployees will be ready:! il78s carr 4 7 Factors INFLUENCING ORGANIZATIONAL DESIGN AND STRUCTURE Tar Manxer-Daiven Satts Oneanization ‘Companies such as SecureHorizons are trying to find ways to make the entire orga nization customer oriented. his approach allows more flexibility and responsiveness in today’s competitive global environment. Every company wrestles with the problem of organization. Reorganization often is necessary to reflect new strategies, changing market conditions, or innovative pro- duction technologies.” ‘These organizations are using the fundamental concepts of organizing, Organiz- ing is the deployment of resources to achieve strategic objectives. Deployment is the division of labor into specific departments and jobs, formal lines of authority, and _mechanisms for coordinating diverse organizational tasks. ‘Organizing is important because it develops from strategy. Strategy defines what ‘to do;organizing defines how to do it. Organizational structure isa tool managers use to hamess resources for getting things done. The design of a sales force requites s- tablishing effective working relationships among the sales force, marketing, and other ‘groups in the organization. The right organizational structure does not guarantee re- sults, but the wrong structure can dampen results.As you will sce in this chapter, the relationships among a company's markets, types of sales jobs, and salespeople’s ac- tivities influence the design of various sales jobs and even the structure of the sales organization, The operation of a sales force requires the coordination of numerous interacting ot interdependent groups and activites. In deciding on the organizational design and, structure of a sales force, managers: Examine customers in each market, Determine the types of sales jobs needed to serve a market. Note the job activities salespeople must do. Design sales jobs around customers. Set up the sales force organizational structure, which includes the vari- ‘ous sales jobs and geographic territories. ‘These relationships are shown in Figure 4.1.As you will see later, properly de- signed sales jobs lead to higher performance and a better quality of work life for sales personnel. This chapter discusses cach element of Figure 4.1. It starts with customers and markets, Figure 4.1. Tae RetaTionstirs AMONG MARKETS, Jos, AND ACTIVITES INFLJENCE SALES Jo DESIGN AND ORGANIZATIONAL STRUCTURE Establish Sales Organizational Structure