Guide Rethinking Sales Management: A Strategic Guide for Practitioners

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You are here Features Demand generation. September 7, Login to rate this article 0. No votes yet. Login Login with your username and password. Or create your username and password First things first. This study explores a specific aspect of the connection between sales and marketing integration and better performance; specifically whether the integration of the sales and marketing functions in business-to-business B2B organisations facilitates the development and implementation of successful new strategies in response to market change.

Based on a pilot survey, a model is proposed, placing sales and marketing integration, characterised by both interaction and collaboration between the two functions, as an antecedent for excellence in gathering market intelligence, and then using it to react strategically to changing market conditions and customer demands. Organisations are under pressure to adapt to changing external circumstances so that they can survive and thrive in the long term.

Those responding effectively to market turbulence are more likely to build competitive advantage over rivals who do not. While organisations are under pressure to change, their salespeople are in turn under pressure to implement the necessary strategies in the marketplace to ensure these changes happen. Whilst these might only be relatively small changes to the marketing mix, they could also be more significant, such as entering a new market, launching a new product or adopting a new distribution channel.

Such action might be required in response to external change, but may also be internally driven in order simply to improve effectiveness. The sales function is a critical link between these two forces.

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The marketing function will not be able to perform adequately unless it is sufficiently connected with what is happening in the marketplace. Homburg, Jensen and Krohmer 5 noted that marketing departments sometimes have a low level of knowledge of the market and products, and that there is insufficient sharing of information between sales and marketing. So, if sales and marketing do not integrate adequately, they and therefore the organisation as a whole cannot observe and react to changes in the market.

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A high level of integration between marketing and sales could make the organisation very responsive to market dynamics. The focus of this research lies where the rubber appears to meet the road: at the interface between sales and marketing. This exploratory research investigates whether increased sales and marketing integration results in organisations being better at gathering market intelligence and reacting to this by developing and implementing appropriate new strategies.

In their review of the literature on sales management and organisational change, Jones et al 1 note that firms who respond effectively to market turbulence are more likely to build competitive advantage over rivals who do not. They identified a need to understand the salesforce's role in guiding organisational change efforts, and in turn how sales departments themselves are adapting to environmental changes. Market-driven influences have been considered in other departments besides sales, 6 but attention to the sales function and the important role that it plays both in informing and implementing marketing strategy is limited.

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Authors have identified the sales function as a valuable source of market intelligence, 3 , 7 but Le Bon and Merunka 8 noted that few organisations fully leverage this potential. The salesforce is an important component of the change process as it informs the organisation of external opportunities and threats. What appears not to have been fully considered is the efficacy of how this information is disseminated to the organisation: difficulties in mobilising the salesforce to engage in marketing intelligence, 9 and adequately communicating gathered information to the organisation 10 have long since been reported.

The blame for this has largely been attributed to the salesforce. The question of how well market intelligence is received or indeed solicited by the organisation, as opposed only to how well it is transmitted by the salesforce, seems pertinent, yet overlooked. Poor communication can lead to negative perceptions of the change process, as discussed by Kotter and Schlesinger 11 , 12 and Hultman. Genuine integration of sales and marketing can be distinguished from simple coexistence and communication.

The integration of sales with marketing has recently been the subject of academic interest and calls for further research. The dangers of failure to integrate include marketing being out of touch with the market. This raises the question of where sales and marketing integration fits in with market-led organisational change. There appears not to be any explicit link previously made between integration of these two functions and improved strategic manoeuvrability in the face of market turbulence.

Jones et al 1 discussed the role of the salesforce in guiding organisational change efforts and adapting to environmental changes, and warned that conflict between sales and marketing could be a sign to managers that the implementation of new strategies might fail. This research aims to pull together these previously unconnected elements of the literature by focusing on the concept of organisational propensity to change.

It is designed to explore whether improved integration of the sales and marketing functions enables organisations to be not only more sensitive to changes in the market, but also better at implementing appropriate strategic responses. The main aim of this pilot study was to investigate whether sales and marketing integration affects corporate performance in the context of managing market-driven organisational change. Two constructs were formulated to measure this: the quality of actionable market intelligence gathered by the organisation following Guenzi and Troilo 22 , and the capacity to implement appropriate strategic responses.

The sales and marketing integration construct needs to comprise interaction as well as collaboration Kahn and Mentzer 16 in order for organisations to achieve a good score on both constructs: interaction will result in successful sharing of information between the two functions, and therefore successful gathering of market intelligence.

But without adequate collaboration, this could not result in successful implementation of a strategic response to this intelligence. The quality of actionable market intelligence gathered by the organisation will be higher if sales and marketing are more closely integrated. Increased integration between sales and marketing results in organisations being more adaptable to market-driven change i. A cross-sectional, correlational study was chosen to gather the necessary data to measure each of these variables and test their effect on one another, with the aim of quantifying the strength and direction of the relationship between them.

Depending on the normality of the data collected, either parametric or non-parametric statistical analyses could then be carried out to quantify the direction, strength and confidence limits of these two relationships.

Rethinking Sales Management: A Strategic Guide for Practitioners

This worked by leveraging the experience of a number of respondents from an executive background by asking them to provide their perspectives in the context of a change event that had occurred in their organisation. They were asked to relate this event to the market intelligence that may have driven it, and in turn were asked about the integration of their sales and marketing departments. This involved asking eight questions to measure market intelligence gathering and eight questions which measured strategic reactivity.

An additional question measured both, making a total of nine indicators for each construct. The questions captured data on factors such as perceptions of quantity and usability of market intelligence provided by Sales, strategy-formulating ability, suitability of chosen responses, and finally satisfaction with strategy implementation speed, effectiveness and sustainability. The questionnaire was then pilot tested on a group of industry peers as part of the development process, before being administered. By collecting multiple datasets, this method could describe and explain the relationship between sales and marketing integration with market intelligence gathering and strategic reactivity.

A standard set of questions was posed to multiple respondents for gathering data on their own opinions and the attributes and behaviour of their organisations. The initial sampling frame was based on a purchased B2B database, as this would enable a large number of respondents to be contacted in a time-efficient way. The identification and selection of respondents through the chosen sampling frame aimed to ensure they would fit the desired profile: senior personnel with a suitable background to ensure that they would be able to answer the questions with both accuracy and objectivity.

Respondents therefore included Managing Directors, Chief Executives and managers or directors in charge of both Sales and Marketing. To further ensure the selection of respondents with the appropriate background in sales or marketing, and the appropriate senior level, filtering questions were used to qualify the knowledge of the respondents, 25 these particularly focused identifying the job role of the individuals.

In addition, descriptive data were collected for each sample by asking the number of staff in the whole organisation, and specifically how many in sales, and how many in marketing. The response rate was very low, which is common in research involving sales management topics, 26 and online surveys. A personalised covering letter, containing the link to the survey, was emailed to each contact, which has been found to increase response rates.

At least 30 responses were needed to give an adequate degree of confidence in the strength of the relationship, 30 and 41 were gathered. No pre-existing scales to measure market intelligence gathering and strategic reactivity were found, so they were developed using the nine indicators discussed above. Another scale measured the sales and marketing integration construct and was adapted from a questionnaire devised by Kotler et al.

The reliability of these scales was tested before analysing the results to ensure that they were internally consistent and that each question on the scale was in fact measuring the same construct. The survey was read by people and a total of 41 responses was obtained, equating to a completion rate of The survey had been successful in sampling respondents of the desired professional background: of the 90 per cent of respondents who gave their job title, over 43 per cent were either top-level executives or else in charge of both sales and marketing.

The remainder were in charge of either sales or marketing. The data were tested for normality and considered fit for parametric analysis of the variables. This correlated the variables of sales and marketing integration and market intelligence gathering, and sales and marketing integration and strategic reactivity, quantifying the strength and direction of the two relationships. Both scatter plots visually indicated a positive correlation, with a stronger relationship seen between sales and marketing integration and market intelligence gathering.

This was confirmed when calculating Pearson's correlation r and the coefficient of determination r 2 for both relationships. The Pearson's Correlation Coefficients were verified by Spearman's Rho test, a non-parametric technique for correlating datasets that do not have a normal distribution. Organisations that have highly integrated Sales and Marketing departments are able to gather better quality market intelligence than those who do not.

Organisations with highly integrated Sales and Marketing departments will be better at reacting to market dynamics by formulating and implementing effective strategic responses compared with those that do not. Diagram illustrating the relationship between the interaction and collaboration components of Sales and Marketing Integration, and the Market Intelligence Gathering and Strategic Reactivity components of organisational Propensity to Change.

An organisation's propensity to change effectively in response to market dynamics is affected by the combination of its ability to gather market intelligence and react to this by formulating and implementing appropriate strategies. Optimal market intelligence gathering is dependent on interaction between sales and marketing, whilst optimal strategic reactivity requires both interaction and collaboration. These two components form the construct of sales and marketing integration, hence the finding that sales and marketing integration contributes towards successful implementation of strategic changes in response to market dynamics.

It is interesting to note that smaller organisations exhibit a higher degree of sales and marketing integration, market intelligence gathering and strategic reactivity than large ones see Figure 4 , supporting the view of Kotler et al 17 that integration between sales and marketing becomes an issue as companies grow. It has long been known that larger organisations have a higher degree of inertia than smaller ones when it comes to change implementation.

Having fewer people involved in the decision-making and implementation processes would also increase reactivity in terms of strategy implementation, as inertia is reduced.

Rethinking Customer Engagement: Put Your Relationship First

Nevertheless, since this research was exploratory, we can only conclude that the hypothesis that larger organisations have a lower propensity to change in response to market dynamics than smaller ones deserves further investigation. Since propensity to change in response to market dynamics is an aspect of superior company performance, these exploratory findings are consistent with Le Meunier-FitzHugh and Piercy 24 and add some weight to Jones et al 's 1 call for further research in the role of sales in company's strategic responsiveness.

We infer that better integration between sales and marketing will make the process of change implementation easier.

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It is often said that the pace of change in markets is accelerating, and that it is only the companies that keep close to their markets in order to anticipate and respond to change who will survive in the long-run. Many companies invest in market research as a key input their customer relationship management systems. In business-to-business sectors, categorised by more complex organisational customers and often by complex solutions, the relationship between salespeople at the customer interface and marketing colleagues creating a brand positioning for a company should intuitively be close.

The management effort to facilitate integration between sales and marketing should not be under-estimated. There are historical precedents for sales and marketing departments in conflict, and it is the responsibility of senior management to create the right climate and organisational framework for close working relationships between sales and marketing that will improve the company's overall ability to react strategically and in good time to the demands of its markets. The low rates response and completion may be attributable to a number of issues, including poor timing in the economic cycle, questionnaire fatigue, and the generally low response rates for sales management studies as discussed.

Furthermore, some of the companies sampled even had a policy on non-participation in research. It is also feasible that lack of interest in this survey may reflect that fact that few practitioners may understand the relevance or importance of this integration, which would be a cause for concern. Whilst there are limitations to this research, it is difficult to imagine a substantively interesting organisational analysis that is not potentially compromised.

Longitudinal research could also be used to test whether sales and marketing integration affects the sustainability of change implementation. Buchanan et al 's 35 managerial, cultural and political factors have been linked with interdepartmental relationships: the strength of these has been proved to have a positive effect on organisational propensity to change, but it must also be understood to what extent this affects the sustainability of change post-implementation.

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