Threat of substitutes

This assignment content discusses the challenges faced by a business organization in the UK market, including international companies emerging alongside domestic ones. It also highlights the threats of substitutes and industry rivalry that can impact the company's sales performance. To overcome these challenges, the sales manager should conduct effective sales planning and trend analysis to inform resourcing decisions. The assignment also emphasizes the importance of assessing gaps in sales personnel performance and developing a strategic sales force structure to meet future requirements.

ISM Model Assignment- Unit
U604-Sales force organisation
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Table of Contents
Task 1: Understanding how to organise the sales force..................................................................3
1.1................................................................................................................................................3
1.2................................................................................................................................................3
1.3................................................................................................................................................4
1.4................................................................................................................................................4
1.5................................................................................................................................................4
1.6................................................................................................................................................5
Task 2: Understanding internal and external factors.......................................................................5
2.1................................................................................................................................................5
2.2................................................................................................................................................6
2.3................................................................................................................................................6
Task 3: Using sales planning and trends to inform resourcing........................................................7
3.1................................................................................................................................................7
3.2................................................................................................................................................8
Task 4: Reviewing sales force structure..........................................................................................8
4.1................................................................................................................................................8
4.2................................................................................................................................................8
References........................................................................................................................................9
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Task 1: Understanding how to organise the sales force
1.1
A sales manager has to abide by the workplace norms such as being concerned and aware of the
health and safety issues, equality and diversity observation when designing sales-force structure.
Employment law should be abided by the manager in recruiting and designing the sales-force
structure. Business code of conduct contains all the relevant legislation including observation of
equality and diversity in the workplace and abstaining from any kind of discrimination within the
workplace (ACAS.org.uk, 2019). Apart from these, the workplace health and safety concerns are
also to be effectively taken care of by the management and the sales manager should have the
requisite knowledge and experience to ensure that such regulations are being ethically observed
within the sales team and the sales department as a whole. In the case of the chosen organisation
the sales manager has the responsibility of ensuring that there is no discrimination based on
ethnicity, nationality, religion, gender or social group. The organisation also takes care of the
working hours of the employees so that there is no exploitation at the workplace by making the
employees work overtime (Gov. UK, 2019).
1.2
The deployment of several resources such as human, financial and capital resources is a major
challenge for the organisation. This is because the recruitment of sales personnel involves a lot of
expenses apart from just compensation and incentives. Sales personnel should be recruited with
prudence and diligence such that there is no excess of expenditure behind hiring salespeople that
ultimately turns out to be futile for the business. One of the most effective ways of selecting a
sales-force size is the workload technique that was proposed by Talley (Darmon, 2007). The
formula for selecting the number of salespersons is as follows:
Number of salespeople = Number of customers x Call frequency
Average weekly call rate x Number of working weeks per year
The organization should follow a strategy where there is no wastage of sales personnel behind
cold calling. Cold calling should be done by the telemarketers only and only the required number
of salespeople should be recruited by the business for conducting the sales activities. The
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compensation strategy for the salespeople can be designed in several ways such as designing
fixed compensation, commission only or salary, and commission approach.
1.3
The sales manager has to take up the major responsibility of selecting the right candidates for
holding different positions within the sales department of the organisation. Developing a team is
of prime importance within an organisation. The task of sales and marketing requires effective
coordination and teamwork to achieve various business goals. Hence, the sales manager should
play a prudent role in selecting candidates that have the right attitude and drive for sales and also
the mentality to work in teams when the situation demands. The sales manager within the
organisation can implement the development model proposed by Bruce Tuckman in 1965 which
consists of the stages: forming; storming; norming and performing (The Team Building
Company, 2019).
1.4
For achieving an effective sales process, an organisation should ensure a sound sales structure.
Structures cab be split regionally along with some of the technical specialists. There can be key
account managers also depending upon the nature of the products or services offered by the
business. There can be centralised base for conducting the sales meetings and formulating sales
strategies. There can also be remote location working where the sales personnel are dispersed at
several locations. The sales manager has to ensure that there is effective coordination between
the sales personnel and the manager for ensuring that the customers are being served effectively
and the sales personnel are also motivated in the right direction.
1.5
Quality control and quality assurance is one of the prime strategies of a sales organisation that is
dealing with a product or even a service. The modern generation of customers are extremely
quality conscious and if they are not able to receive the expected quality of products or services
from the company then they will move to a rival brand. This can lead to substantial loss of
profitability for the organisation. This is the reason behind the organisation strictly adhering to
quality management practices like Total Quality Management principles that are observed within
the organisation. For ensuring proper quality management and assurance, Deming Wheel or
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Deming’s Cycle is effectively used in the business which consists of the following steps: Plan,
Do; Check; Act (iSixSigma, 2019).
1.6
Mobile computing systems have been gaining increasing popularity in the world as also in the
UK as many of the sales organisations are adopting these technologies to accomplish sales tasks
faster and with immaculate accuracy. Salesforce automation has been one of the significant
technological developments that have been achieved. Today, the scope of manual labour has
decreased manifold and many of the tasks that had to be physically performed by the sales
managers and the sales executives are nowadays conducted with the help of several software
applications such as online retailing systems; market information systems and customer
relationship management (CRM) systems. Therefore, it is essential for a sales manager to train
successfully in these technological advancements and develop accordingly to meet the future
demands of the sales organisation (Farrer, 2019).
Task 2: Understanding internal and external factors
2.1
Analysis of internal and external factors affecting a sales organisation is of prime significance for
a sales manager to ensure that the strategies can be designed effectively and the business
objectives are achieved in time. The objective of a sales organisation is to conduct an effective
market analysis and determine some of the major micro-environmental or internal and macro-
environmental or external factors that impact the organisation regularly. There are several
strategies that the sales manager can implement to determine the internal factors such as through
SWOT Analysis. The external factors can be assessed using tools such as Porter's Generic
Strategies like Cost Leadership, Differentiation, Cost Focus, and Differentiation Focus. The
management can choose any of the strategies or their combinations depending upon the market
situation and all the strategies will impact the sales force of the business. Change management
should be carefully adopted when required and there should be effective strategies to support the
sales force in such a situation (ITM Platform, 2018).
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2.2
The activities of a sales organisation in the UK are controlled by different legislation those need
to be followed diligently and ethically by the business. Some of these laws are the Sale of Goods
Act 1979 which discusses the various terms and conditions of selling goods to different parties.
There are some other policies also such as the Fair Trading Act, 1973 which deals with the right
practices to be adopted in trading. Consumer Protection Act, 1987 should also be followed
diligently by an organisation to ensure that the interests of the consumers are not tampered with
and there is ethical service delivery to the consumers as agreed in the sale contract
(Legislation.gov.uk, 2019).
2.3
To ensure that the future trends in the sector are effectively accounted for by the business there
needs to be an implementation of some of the tools such as the PESTEL Analysis and the
Porter's Five Forces Analysis. The PESTEL Analysis of the organisation in the UK depicts the
following:
PESTEL Analysis
 Political- The political condition in the UK is stable and it is encouraging for the sector
in which the organisation operates.
 Economic- The economic prosperity and growth of the UK are instrumental in offering a
sound platform to all the business organisations in diversified sectors.
 Social- The consumers in the UK are extremely quality-conscious and hence, a business
has to ensure that it can sell high quality of authentic products and services to the
consumers.
 Technological- Technological development in the UK has been unprecedented such as in
the domain of Information and Communication Technology (ICT).
 Environmental- The environmental guidelines need to be observed diligently by any
business organisation including a sales organisation which offers services to the
consumers.
 Legal- The legal norms such as trade laws, workplace ethics, occupational safety, and
health and several other legislation need to be followed by the organisation (Bush, 2016).
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Porter’s Five Forces Analysis reveals the following outcomes:
Porter’s Five Forces
 Bargaining power of the customers- The customers have substantial bargaining power
as they have many alternatives to choose from due to the high level of competition in the
industry.
 Bargaining power of the suppliers- The suppliers also have moderately high bargaining
power because several business establishments are offering similar types of products and
services in the UK.
 Threat of new entrants- There is a moderate threat from emerging business as due to
globalisation free trade agreements are in place and many international companies might
emerge along with domestic companies.
 Threat of substitutes- There can be some substitute products or services that might
impact the sale of a product or service in the UK. So, the threat is moderately high.
 Industry rivalry- This is a major threat for the business organisation because the degree
of competitive rivalry in the industry is growing fast (Childress, 2019).
Task 3: Using sales planning and trends to inform
resourcing
3.1
A sales manager should be able to conduct effective sales planning and analysing sales trends to
achieve effective sales force resourcing. The analysis of the Product Life Cycle is extremely
important in this aspect because the sales manager has to determine in which situation the
product or the service is in among the following stages: Introduction; Growth; Maturity; Decline.
Another important tool that can be used to assess the need for current products and services and
the probable future strategies is the Ansoff Growth Matrix. It is composed of several strategies
like Product Development; Market Development; Penetration Market Growth; Diversification.
The strategies should be chosen prudently by the sales manager to achieve effective sales
planning and resourcing.
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3.2
It is essential for a sales manager to be able to determine the gaps in the sales performance of
each of the sales personnel and the overall department also, including his performance. A skill
gap analysis has been proposed by Jobber and Lancaster (2009) that details a matrix that can be
used effectively by the modern sales managers for successfully identifying the performance of
each of the sales personnel. The tool helps in analysing the qualitative as well as the quantitative
results of the sales force performance for the organisation. Based on this analysis, the sales
manager can decide the plans to motivate the salespeople by undertaking necessary steps such as
training and development, rewards and recognition and others (Jobber & Lancaster, 2009).
Task 4: Reviewing sales force structure
4.1
It is essential for the sales manager to effectively assess the effective sales force structure against
the requirements in the future. Due to the highly dynamic business environment, it is essential to
alter the sales force structure to suit the future demands of the industry. So, a strategic drift
should be effectively accounted for the structure of the sales force should be altered effectively.
The sales structure is also affected by a business orientation which often has to be modified
depending on the changing demands of the consumers or several other factors impacting the
industry. The better the sales manager can assess these factors the more will be the chances of
the business to succeed in the long run.
4.2
The salesforce should be developed to meet the future requirements and this is a task that should
be effectively achieved by the sales manager. Piercy and Lane (2015) have developed a concept
of Market IQ which considers the several internal and external factors within which the business
operates. The analysis should be quantifiable to develop the future sales strategy of the
organisation. If the Market IQ is low then it is the time for the business to develop future
strategies more effectively such that the risks associated with the business can be effectively
mitigated and the sales force can conduct their functions effectively and the business is also
profitable and sustainable (Piercy & Lane, 2015).
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References
ACAS.org.uk. (2019). Rights and responsibilities at work. Retrieved from
https://www.acas.org.uk/index.aspx?articleid=4663
Bush, T. (2016). An Example PEST Analysis of The UK. Retrieved from
https://pestleanalysis.com/pest-analysis-of-the-uk/
Childress, B. (2019). PORTER'S 5-FORCES MODEL. Retrieved from
https://www.referenceforbusiness.com/management/Or-Pr/Porter-s-5-Forces-Model.html
Darmon, R. Y. (2007). Leading the Sales Force: A Dynamic Management Process. In Business
& Economics.
Farrer, L. (2019). Remote Working: Is It More Than A Trend? Retrieved from
https://www.forbes.com/sites/laurelfarrer/2019/02/01/remote-working-is-it-more-than-a-
trend/#75a6d4bc7fdf
Gov. UK. (2019). Maximum weekly working hours. Retrieved from
https://www.gov.uk/maximum-weekly-working-hours
iSixSigma. (2019). DEMING CYCLE, PDCA. Retrieved from
https://www.isixsigma.com/dictionary/deming-cycle-pdca/
ITM Platform. (2018). Principles of change management in organizations. Retrieved from
http://www.itmplatform.com/en/blog/principles-of-change-management-in-organizations/
Jobber, D., & Lancaster, G. (2009). Selling and Sales Management (8th ed.).
Legislation.gov.uk. (2019). Consumer Protection Act 1987. Retrieved from
https://www.legislation.gov.uk/ukpga/1987/43
Piercy, N., & Lane, N. (2015). Marketing Strategy. Wiley Encyclopedia of Management; Volume
9. Marketing; https://doi.org/10.1002/9781118785317.weom090310.
The Team Building Company. (2019). Forming - Storming - Norming - Performing. Retrieved
from https://www.teambuilding.co.uk/theory/Forming-Storming-Norming-
Performing.html
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