COURSE: SALES FORCE MANAGEMENT (MKT623)

NAME: NUR RAIHANAH BINTI MOHD RALI

NO. STUDENT: 2019468486

PART A (20 QUESTIONS)

1. TRUE
2. TRUE
3. FALSE
4. TRUE
5. FALSE
6. FALSE
7. TRUE
8. TRUE
9. FALSE
10. FALSE
11. TRUE
12. FALSE
13. TRUE
14. TRUE
15. TRUE
16. FALSE
17. TRUE
18. TRUE
19. TRUE
20. TRUE

PART B (10 QUESTIONS)

1. A
2. D
3. A
4. B
5. A
6. D
 7. C
8. C
9. D
10. C

PART C (4 QUESTIONS)

QUESTION 1

Straight salary is a way of rewarding a salesperson in which the salesperson is paid solely
on a salary basis without commissions on sales. The fundamental advantage of a straight
salary is that management can persuade salespeople to engage in tasks that do not
immediately result in sales. Straight salary pay plans are especially useful when
management struggles to quantify an individual salesperson's true impact on sales volume
or other performance metrics. For example, corporations typically compensate their sales
team when they engage in missionary marketing. Secondly, a straight salary is simple to
calculate and administer for management. Also, they provide managers with increased
freedom. Reassigning salespeople to new areas or product lines is simply because they are
not concerned with the impact on their sales volumes.

However, straight compensation also has downsides that may deter top-performing sales
agents who desire to maximize their earnings through hard work and dedication. It tends to
attract only less experienced employees seeking a "secure" compensation structure. As a
result, retention may decrease, and turnover may increase. If the salespeople are unable to
increase their earnings, they may seek employment with another business that offers
commission. Straight salary compensation is not directly related to any specific component
of job performance. However, the magnitude of those increases and the manner in which
success is judged are up to the manager's whims.

Furthermore, a straight commission is a compensation structure that compensates

individuals for achieving a specified level of performance. Typically, the company determines
the straight commission by examining the employee's sales volume. The first benefit of
straight pay is that it provides the same immediate motivation as a commission
compensation plan. Direct motivation occurs when there is a clear and direct link between
the salesperson's performance and the financial reward he or she obtains. Salespeople are
highly driven to enhance their sales productivity in order to increase their compensation, at
least until they reach a point when additional incremental gains become unappealing.
Following that, straight commission strategies have an element of fairness. Automatic
rewards are given to high performers, while low performers are discouraged from
maintaining their low production. From a sales management perspective, commission plans
have a lot of benefits. Compensation expenditures are directly proportional to sales volume.
This is advantageous for enterprises with limited working capital, as it eliminates the need to
pay a high wage to the sales force until the sales team creates a big volume of sales.

As a result, the disadvantages of the straight commission are that the sales manager has no
control over the sales team, and earnings are uncertain. When all financial incentives are
directly related to sales volume, it's frequently difficult to inspire salespeople to engage in
relationship-building activities that do not directly result in short-term sales. For instance,
they may overstock their consumers and overlook post-sale support. They then have little
incentive to devote time to market research and other responsibilities that divert attention
away from actual selling efforts. Moreover, commission-based compensation can make a
salesperson's profits inconsistent and unpredictable. When business conditions are difficult,
turnover in the sales force is likely to be significant, as salespeople struggle to make ends
meet on the meagre revenues generated by weak sales. In a draw, money is advanced to a
salesperson during months when commissions are low in order to assure that he or she will
always earn a certain minimum wage. This provides salespeople with guaranteed pay and
offers management increased control over their operations.

QUESTION 2

Compensation packages are the comprehensive plan for compensating employees for their
work. It is significant because it provides a thorough method of planning employee
remuneration. There are five basic steps that can be taken to tailor compensation packages
to the unique demands of each firm. The first step is to create job descriptions. A detailed job
description should be written to cover all of the sales representative's work obligations.
Some sales representatives are actively involved in selling, such as the onsite sales
manager in an industrial transaction, while others serve in a support position, such as the
presales function. Following the creation of job descriptions, they should be analyzed for
complexity level, and compensation should be determined accordingly.

The second step is to create sales and other objectives, emphasizing the critical nature of
measuring both sales and other objectives in deciding the remuneration package. This step
makes it quite evident that compensation packages should not be determined solely on the
basis of sales volume. Indeed, additional objectives such as the number of new customers
increased the difficulty level of the sale, and efficiency parameters such as conversion rates,
etc., must be considered. This stage emphasizes the need of considering not only the
volume of leads generated but also the work expended in generating them when determining
the pay package.

Moreover, the third stage is to establish acceptable general salary categories. Compensation
packages must be classified according to numerous characteristics such as education,
experience, required skill set, and nature of employment. This procedure will assist in
ensuring that individuals with comparable competencies or skill sets receive comparable
compensation packages, hence reducing some bias.

Additionally, the fourth step is to establish and pretest the compensation plan. This stage
highlights the essential nature of establishing the compensation package's structure and
pretesting it prior to its implementation in the organization. Compensation packages should
include a base package that covers the sales representatives' living expenses and a variable
component that is neither excessively high nor excessively low in percentage of total
compensation. Compensation plans must account for commissions as well.

Finally, the final step, "implement and evaluate the compensation package," is concerned
with the actual implementation of the compensation package for the sales representative as
well as the monitoring of the compensation package's effectiveness in retaining a level of
motivation and attracting the organization's talented stream.

QUESTION 3

Bias in performance evaluations, in general, can impede highly competent people from
achieving their goals while hindering businesses from fully exploiting their skills. As a
consequence, every human resource department should make a commitment to identifying
and eliminating prejudice in employee performance reviews. Employee performance in
management across the organization could be improved by teaching managers to recognize
and prevent biases.

There are a variety of strategies for avoiding performance evaluation errors. Managers could
use a Behaviourally Anchored Rating Scale (BARS) approach to evaluate their employees'
performance. This strategy makes an attempt to focus on the individual's controllable actions
and other performance criteria. It necessitates that sales managers analyze a broad range of
factors affecting a salesperson's job performance in depth. It includes well-defined anchors
for those performance criteria in precise behavioural terms, allowing managers to examine
what constitutes performance thoughtfully. However, some of these elements are more
crucial than others to job success, and the key to evaluating people is to concentrate on
these critical success factors (CSFs).
Secondly, Managers could use 360-degree feedback to evaluate employees' performance.
Oftentimes, the most accurate way to assess an employee's performance is to solicit input
from multiple sources and then utilize the results to determine overall performance. 360°
multi-rater evaluations are an excellent technique to reduce bias because they 'average out'
the ratings and reviews from multiple sources. It brings into a new era of salesperson
development and improvement through performance appraisal as an effective technique.
Incorporating these and other relevant performance data sources into the formal evaluation
process may help promote a more productive dialogue between the sales manager and
salesperson during performance reviews.

After that, managers should establish a straightforward evaluation structure. The absence of
evaluation guidelines almost always results in bias. This suggests that an evaluation is prone
to bias as a result of the "wide box" review procedure, which comprises open-ended
questions that managers respond to throughout each review. To address this issue, a
standardized evaluation structure could be developed for all managers to follow, and they
could be trained on how to apply it, rather than leaving the review to their own discretion.
This straightforward framework will aid in increasing the accuracy of evaluations.

Other than that, agree on specific goals. Managers can avoid experiencing bias by inquiring
about employees' goals well in advance of the performance review, which enables
managers to track employees' progress over time. Managers must revisit their previously
agreed-upon goals for the employee prior to conducting an evaluation to ensure they are still
fresh in their minds. In this manner, they'll be evaluating each of their direct reports fairly.
Likewise, managers should maintain track of employee progress to minimize distance bias
and to ensure they never forget the value of what employees accomplish throughout the
year.

Finally, when conducting an evaluation, performance managers should ask only pertinent
questions. Also, re-evaluate the evaluation questions. A compelling question would ask
managers to identify three of an employee's skills in a certain area. This way, they will avoid
writing extensive lists of objectives for the staff they favour while overlooking the strengths of
others. Such questions compel them to dig deep for answers rather than relying on their
preconceptions. As a result, managers will provide clearer recommendations on how to
improve, and employees will feel valued because their employer recognizes their year-round
contributions.

QUESTION 4

Ethics is concerned with the establishment of moral standards that may be used to evaluate
actions and situations. It focuses on behaviours that have the potential to cause actual or
potential harm to an individual, group, or organization. As a response, ethics take a more
aggressive role than the law. While ethical norms seek to anticipate and avert social issues,
the majority of laws and regulations are enacted after the adverse repercussions of activity
become obvious.

To begin with, sales managers face two distinct ethical dilemmas. The first group is
ingrained in the manager's interactions with salesmen. Ethical considerations in sales
manager-sales force relationships include fairness and equal treatment of all social groups in
hiring and promotion, respect for the individual in supervisory practises and training
programmes, and fairness and integrity in the design of sales territories and determination of
compensation and incentive rewards. Nearly every aspect of sales force management
involves ethical considerations.

In today's sales management, the influence of social values cannot be overstated more than
in the way social values set ethical standards. Ethical behaviour is more than simply
adhering to the law. Thus, certain activities may be lawful but unethical at the very same
time. To put it another way, if a salesperson claims that their product "runs rings around
Brand X," they may be participating in legal exaggerations, but many salespeople and their
consumers consider such tiny white falsehoods as unethical.

Moreover, customers and salespeople are the subjects of the second set of ethical
concerns. Only indirectly do these concerns affect the sales manager because the manager
can't always see or oversee the conduct of every employee in his or her team. It is the duty
of managers, however, to set high ethical standards for their employees' conduct, express
these expectations clearly, and enforce them strictly. For a company to impose ethical
standards on its employees, there is a strong and practical business purpose. A supplier's
sales and earnings may suffer over time if customers become wary of doing business with it
because of unethical sales techniques.

Besides that, the ethical standards of all customers and suppliers are not the same.
Therefore, salespeople are sometimes under pressure to take activities that are at odds with
their personal principles or the formal business standards they consider to be right. To seal a
deal or keep up with the competition, sales agents or their management may believe a
questionable activity is necessary. Many ethical difficulties in sales are not tackled by
management directives, and many sales staff are looking for more specific rules to help
them overcome these issues.

Finally, it's critical that the sales team has access to an effective policy, not simply one that's
on paper. In order to further decrease ambiguity, policies should be made plain to all parties
involved, including salespeople and clients. Managers, on the other hand, should lead by
example in order to influence their salespeople's ethical behaviour. As long as top
management pretends to adhere to one set of norms while actually practising another,
formal policies have little impact. If sales manager expects ethical behaviour from their staff,
they should hold themselves to the same ethical standards. It is the integrity of the
company's culture and value system that ultimately determines the level of ethics in the
sales force.