Enhancing the Sales Force Performance was a 4-day training program at IIM-A. IN my last blog I had written about registration and the pre-training work.
The first day was a case study on Ingersoll Rand. Each group comprising of six participants had to prepare a presentation of not more than six slides. The company a global leader in Compressors had three approaches of reaching the market.
The first was the Direct Sales Force (DSF) where the sales engineers interacted with the OEMs ( Original Equipment Manufacturers ) end users to solicit business. The second channel was the distributors and the last one was the Air centres which were the authorized showrooms of the company. As a policy most of the low-end products were sold through the distributor and the air centre channel. The high-end compressors above 50-HP were sold through the DSF model as it involved a higher amount of technical complexity and client engagement vis-à-vis the smaller compressors. However over the last decade the performance of the DSF team was declining whereas that of the other two channels was on the rise.
The company was to launch centac-200 a 200-HP centrifugal compressor and the management was in dilemma whether to hand over the product to DSF or otherwise. There were a number of issues like market share, the competition etc. which were discussed in great detail over a 20-page case-study.
Prof P.K. Sinha asked one out of the six groups to make a presentation who came out with its solution to the problem. Some of the unique earnings for me were as follows.
Positive aspects of the methodology:
- Minimum Use of Power Point: Prof Sinha hardly used any power point slides to make his presentation. On the contrary, a number of trainers feel that the training effectiveness is directly correlated with the number of power point slides. I have seen trainers using 50+ slides in a ½ -day session. They feel by overloading the students with jargon, the training becomes effective. Students get bored with such information overload. Secondly there are too many transitions, colour combinations, bells & whistles etc. No wonder every year Microsoft comes with new features in Power Point and the hapless or inexperienced trainers get carried away by it.
- Deeper Questioning: Termed as Socratic Method of Q & A Prof. Sinha made the participants think from the various dimensions which could not have been anticipated. For example he asked what advantage does the market mover or the innovator has? Most of the students responded in positive saying that company who launches the product becomes the market leader and that the market mover captures the market. The logic which looked obvious; he had a counterpoint. He said that group of Tatas has always decided to be a market follower and still capture the market share ( except steel)
- Providing New Insights: Like the above example, he also said that even today there is so much hype about innovation ( which has become a buzz word) most of the innovations have been made by small companies and the big companies having seen the learning curve were able to reap the harvest by either modifying the product or with brute marketing power were able to capture the market.
– In case of Compressors he compared three products A, B & C whose prices were $ 60K, $50K & $40K respectively. Participants opted for the C being cost –effective. However he showed the difference between Price and the cost of ownership ( over a period of 10 years) where the most expensive product had the least cost of ownership.
– The cost of ownership for the three productsA,B & C turned out be :
$ 920K, 1080K & 1120K. Now the interesting part Cost of the product A was hardly around 7% ( 60/920) whereas the energy cost was almost 80%.
– Considering the above he showed even giving a product free is a viable proposition. But then Salespersons need to have a much deeper understanding of the customer’s business; his energy bills and how he can become a part of the customer’s growth process. This requires a much better approach than selling a mere compressor by discussing the features and its superiority over competitor.
– He said it is now wonder that ABB , Siemens and Schneider Electric ( and even IBM) are harping more on energy, making a better planet rather than just foucssing on product selling.
In short, the training methodology was highly interactive with minimum power point and a deeper and precise questioning which made the participants look at the situation from a much different perspective hitherto not thought of.
It was also complemented by providing the new trends ( which sometimes are counterintuitive, remember CK Prahlad- Fortune at the Bottom of Pyramid ) like a new paradigm of selling, requirement of new skills sets etc.
Due to the self-imposed restriction the limitation of the above shall be discussed in the next blog.