Designing the Sales Force 301
reps lasts for 6 to 8 weeks, and only when new hires have mastered the skills, knowl-
edge, and products are they allowed to deal with customers.^4
To implement the firm’s sales objectives, a common strategy is for sales repre-
sentatives to act as “account managers,” arranging fruitful contact among various peo-
ple in the buying and selling organizations. Selling increasingly calls for teamwork
requiring the support of other personnel, such as top management, especially when
national accounts or major sales are at stake; technical people, who supply technical
information and service to the customer before, during, or after product purchase;
customer service representatives, who provide installation, maintenance, and other
services; and an office staff, consisting of sales analysts, order expediters, and adminis-
trative personnel. An example of a successful sales team orientation is provided by
DuPont. Finding that corn growers needed a herbicide that could be applied less
often, DuPont appointed a team of chemists, sales and marketing executives, and reg-
ulatory specialists to tackle the problem. Working together, they created a product that
captured $57 million in sales during its first year.^5
Once the company decides on objectives and strategy, it can use either a direct
or a contractual sales force. A direct (company) sales forceconsists of full- or part-time
paid employees who work exclusively for the company. This sales force includes inside
sales personnel,who conduct business from the office using the telephone, fax, and e-
mail, and receive visits from prospective buyers, and field sales personnel,who travel and
visit customers. A contractual sales forceconsists of manufacturers’ reps, sales agents, and
brokers, who are paid a commission based on sales.
Sales Force Structure
The sales force strategy has implications for the sales force structure. If the company
sells one product line to one end-using industry with customers in many locations, it
would use a territorial sales force structure. If the company sells many products to
many types of customers, it might need a product or market sales force structure.
Table 5.13 summarizes the most common sales force structures.
Major accounts (also called key accounts, national accounts, global accounts, or
house accounts) are typically singled out for special attention. The largest accounts
may have a strategic account management teamconsisting of cross-functional personnel
who are permanently assigned to one customer and may even maintain offices at the
customer’s facility. For example, Procter & Gamble assigned a strategic account team
to work with Wal-Mart at its Bentonville, Arkansas, headquarters. This arrangement
has saved P&G and Wal-Mart $30 billion jointly through supply chain improvements,
while boosting profit margins by about 11 percent.^6
Established companies need to revise their sales force structure as market and
economic conditions change. IBM, for instance, lost market share in the computing
industry because its marketing and sales organization had lost touch with customers.
The company’s worldwide marketing and sales were organized geographically, with
sales reps covering customers in a wide range of industries. Although IBM was known
for educating customers about technology—focusing solely on IBM’s products—its
“one-size-fits-all” presentations became a turn-off to increasingly computer-savvy cus-
tomers. Ultimately, lost market share and the huge cost of maintaining its sales force
made IBM slim down and reorganize its sales force vertically along 14 industry-specific
lines, such as finance, petroleum, retail, and e-businesses.^7 This step created a mix of
industry and product specialists. In another change, IBM sales reps have taken on an
active role as consultant and now seek to create customer solutions, even if doing so
sometimes means recommending a competitor’s technology.