4.2.1 Channels 14
4.2.2 Recruiting 15
4.2.2.1 Recruiting at JVs 15
4.2.2.2 Recruiting at SOEs 16
4.2.3 Orientation 17
4.2.3.1 At JVs 17
4.2.3.2 At SOEs 18
4.2.4 A typical sales rep’s profile 18
4.3MOTIVATIONAL PERCEPTIONS 20
4.3.1 Effort – Performance Relationship 20
4.3.1.1 At JVs 20
4.3.1.2 At SOEs 21
4.3.2 Performance – Rewards relationship and Fairness 22
4.3.2.1 At JVs 22
4.3.2.2 At SOEs 22
4.3.3 Valence of rewards 22
4.3.3.1 Basic financial compensation: Salaries, Commissions, Fringe benefits 22
4.3.3.2 Work supports 24
4.3.3.3 Prizes 24
4.3.3.4 Training 25
4.3.3.5 Job achievement 26
4.3.3.6 Recognition of management 27
4.3.3.7 Advancement opportunities 27
4.3.3.8 Job responsibility 28
4.3.3.9 Job security and stability 29
4.3.3.10 Freedom and supervision 29
4.4MOTIVATIONAL PRACTICES 31
4.4.1 Setting up motivational policies, incentive packages, or/and campaigns,
programs 31
4.4.2 Communicating these program to sales reps 32
4.4.2.1 At JVs 32
4.4.2.2 At SOEs 32
4.4.3 Monitoring and facilitating implementation 32
4.4.4 Evaluating, reinforcing and improving the programs 33
4.5LIMITATIONS AND DIRECTIONS FOR FUTURE STUDIES 33
CHAPTER 5 34
RECOMMENDATIONS 34
5.TO JOINT VENTURES: CREATING A PARALLEL MULTI-LADDER SALES SYSTEM 34
REFERENCE 40
APPENDIX 1: GUIDELINE QUESTIONS FOR INTERVIEWS 42
APPENDIX 2: RANKING OF THE IMPORTANCE OF REWARDS 43
v
List of Tables
Table Title Page
TABLE 1: SAMPLE OF COMPANIES INVESTIGATED 8
TABLE 2: SAMPLE OF INTERVIEWEES 9
TABLE 3: A TYPICAL SALES REP’S PROFILE 20
TABLE 4: PERCEPTIONS ON MOTIVATIONAL FACTORS 30
vi
List of Figures
Figure Title Page
FIGURE 1: A MODEL OF SALESPERSON MOTIVATION 5
FIGURE 2: TYPICAL STRUCTURE AT JVS AND SOES 10
FIGURE 3: THE RESEARCH FRAMEWORK 12
FIGURE 4: SALES FORCE AND DISTRIBUTION ARRANGEMENTS 15
FIGURE 5: AN EXAMPLE OF A PARALLEL MULTI-LADDER SALES SYSTEM 35
FIGURE 6: VICIOUS CIRCLES AT SOES 37
vii
Chapter 1
Introduction
2.1 Rationale of the Research
2.0 Role of motivation to the sales force
According to Douglas and William (1998), by nature, salespeople handle such type of a job that is
• Hard since they have to frequently deal with new people, namely customers, who are tough
and demanding. And they only start selling when customers say “No”.
• Flexible and self-controlled because salespeople spend majority of their time out of office.
• Ambiguous in terms of roles perception since they have little supervision and under pressure
from dual masters: their customers and their companies.
Thus, managing sales force requires more motivational methods rather than controlling ones.
Quite many researches, studies have been working on the issue of how to motivate salespeople
to achieve their most productivity. However, almost all of these studies were carried out in
developed countries, far fewer studies were carried in developing countries. So the first issue this
paper aims to address is whether motivational techniques that work in developed countries can
also applied developing countries like Vietnam?
2.1 Selling as a new career in Vietnam
Vietnam has recently emerged as a new developing country. Vietnam was a closed and highly
centrally planed economy until 1986. Under this economy, there was no real selling since selling
to whom, at what price, at what quantity, etc. are determined from the government. As a result,
there are no real salespeople.
To shift to a market economy, Vietnamese government has been undertaking “doi moi” program
(meaning economic renovation program) to open the economy since 1986. The move forces
companies to do real selling tasks, and some employees become salespeople. The “doi moi”
program has also brought in several foreign firms, who are helping to build a professional sales
career in Vietnam. However, selling as a career in Vietnam is characterised with no systematic
education, very fragmented (because each company develops its sales force differently), and no
clear way to develop. In this situation, at the infant of selling as a career, the question of how to
motivate salespeople becomes more blurred to sales managers in Vietnam. Thus, this paper
would like to contribute to make clear motivational issues of the sales forces in Vietnam.
2.1 Problem statement
Thus, this research aims to address these issues of what motivates salespeople in specific
conditions of Vietnamese economy at the time being? And how can management utilize these
factors to increase their sales forces’ productivity.
1
2.1 Research objectives
Specifically, the research’s objectives are as follows:
• To find out what factors field salespeople in Vietnam perceive as motivators to them and what
factors sales managers perceive as motivators to their subordinates?
⇒ Money: salary, bonus, fringe benefits, commissions.
⇒ Management’s recognition: medals, certificates, titles.
⇒ Prizes: physical valuables like mobile phones, motorbikes, watches, etc.
⇒ Work supports: tools that facilitate doing a job.
⇒ Training
⇒ Advancement opportunities
⇒ Job achievement
⇒ Job security and stability
⇒ Freedom and supervision
• To compare Joint Ventures’ (JVs) motivational practices to salespeople and that of
Vietnamese State Owned Enterprises (SOEs) in:
⇒ Setting up a motivational policies, incentives packages or programs,
⇒ Selling (communicating) these programs to salespeople,
⇒ Monitoring and facilitating implementation of such programs, and
⇒ Evaluating, reinforcing and improving the programs.
• To try to recommend applicable models for sales management in Vietnam to motivate their
subordinates.
⇒ To joint ventures
⇒ To state owned enterprises
2.1 Information needs
To achieve the above objectives, following information is needed.
2.0 From the sales reps
• What factors do they value most in term of motivating them: salaries, fringe benefits, prises,
recognition, work supports, advancement opportunities, training, responsibility, job security
and stability, autonomy, and supervision.
• What are salespeople’s opinions about effort and performance relationship?
• What are salespeople’s opinions about performance and rewards relationship?
2
• How do salespeople value the rewards? Are rewards worth their effort?
2.1 From sales managers
• Do sales managers understand their salespeople’s motivational factors?
• How are quotas set?
• What are criteria to evaluate salespeople’s performance?
• How are rewards given? What are the most frequently used rewards?
• How do sales managers design, implement an incentive program, and evaluate its
effectiveness?
• What are compensation and promotion policies?
• What is a typical sales rep’s profile?
3
Chapter 2
Literature review
2.1 Model of salesperson motivation
In general, a person is motivated to do a task when he himself desires to put effort into the task,
continues to put forth or expend his effort over a period of time to fulfil the task (Douglas and
William, 1998, p 483). There is a lot of literature on how a person gets motivated. The most
influential theories include Maslow’s (1970) hierarchy of needs, Vroom’s (1964) expectancy
theory, Herzberg’s (1987) hygiene-motivation theory, and equity theory (Adams, 1976).
According to Maslow (1970), one has five levels of needs and the lower level must be satisfied
before the next higher level is sought. The five levels are as stated in terms of sales management
by Douglas and William (1998, p 520) as follows:
(1) Basic needs like cash wages and bonuses,
(2) Safety and Security needs such as job security and fringe benefits,
(3) Belongingness and Social needs such as President club for more than $1 million salespeople,
(4) Esteem needs like recognition, and
(5) Self-actualization like challenging tasks calling for creativity.
In his hygiene-motivation theory, Herzberg (1987) classified factors into two types: hygiene
factors are those make workers feel dissatisfied if these factors are not sufficiently available but
they do not make workers feel satisfied if there are more than enough of them. These factors
usually are company policy and administration, supervision, salary, work conditions. Only
motivation factors make workers feel satisfied with their presence. These factors usually are
achievement, recognition, work itself, responsibility, and advancement opportunities.
Vroom’s (1964) expectancy theory and Adams’s (1976) equity theory are the two main theories
that explained the process of human being motivation. These theories provide the basic ideas for
the model of motivation of the sales forced described in following paragraphs.
Walker et al. (1977, 1979), Douglas & William (1998), and Futrell (1991) combined and
developed these theories specifically into the field of sales force motivation. According to these
authors, motivation of a salesperson is a function of (1) expectancy, (2) instrumentality, (3)
valence, and (4) fairness. This is shown in Figure 1.
Expectancy refers to a salesperson’s question “if I try harder, will my performance improve?” In
essence, it is the salesperson’s perception on effort – performance linkage. The stronger the
belief that the answer is “Yes”, the more likely the person spends more effort on the task.
Instrumentality refers to the salesperson’s question “if my performance improve, will I get
rewarded for that?” In other words, it is the salesperson’s perception on performance – rewards
relationship. Again, the stronger the belief that the answer is “Yes”, the more the person wants to
improve his performance.
4
Valence refers to the person’s question “Are the rewards worth trying for?” This means how
valuable rewards are perceived to the recipient. Obviously, the more important the reward is to
the person, the harder he will try to achieve those rewards.
Fairness refers to how his rewards are compared with others’ rewards in relative terms, i.e. by
value of a ratio between each person’s rewards over that person’s contribution. If a salesperson
thinks his ratio is somehow similar to his peers’ ratios, he will feel fair. If he feels fair, he will exert
more effort.
Figure 1: A model of salesperson motivation
The above model works this way: If the salesperson believes that his additional effort will lead to
improvement of performance AND he will be rewarded for that performance improvement AND
rewards are valuable to him AND rewards are fairly given among reps, the salesperson will
probably feel satisfied, thus he will put more effort into the job. The multiple sign reflects the
relationship among the four factors: All the factors must be present if motivation is to be achieved.
Managers’ task is to assure a strong “Yes” answer to each and all of the above questions.
2.1 Previous findings on motivation of the sales force
How to assure a strong “Yes” answer to each of the above questions has long been managers’
tough challenge. Now we will see what has been done to get the desired answer in each element
of the model.
Since no research has been done on the issue in Vietnam, the present research uses some
findings in studies carried out in the US, China, Hong Kong, and South Korea as benchmarking
ideas.
2.0 Expectancy estimates
Obviously, how much effort to put on a specific task is within each salesperson’s control.
Therefore the person’s perception on this relationship depends on what it means by performance
and improvement of performance. Previous researches show that these concepts, in turn, depend
on job descriptions, systematic evaluation (Yoo and Lee, 1987), specific organizational
procedures and practices (Chung and Lee, 1989) and feedback or communication in an
organization (Alan et al. 1994). These help sales personnel have a clear picture of what is
expected from them so they could direct their effort into right areas or “working smarter” (Barton
5
Effort Performance Rewards
Motivation Expectancy Instrumentality Valence Fairness
=
X X X
Belief that
more effort will
lead to greater
performance
Belief that
greater
performance
will be
rewarded
Perceived
value of
rewards
Perceived
fairness of
giving rewards
among reps
et al. 1986). Benson and Stephen (1980) also found that clear task is the most important
determinant of salespeople’s motivation. Feedback and communication are critical in informing
salespeople about how they are performing and how much improvement they have made. This
helps them realize the linkage between effort and performance (Alan et al. 1994).
Cron et al. (1986) found that salespeople in different career stages have different expectancy
estimates since they have different experience and knowledge. The more experience a
salesperson acquires, the better the person can guess his performance. That means salespeople
in later career stages have higher expectancy estimates.
2.1 Instrumentality estimates
Clearly, this relationship depends on how rewards systems are designed. For example, if it is a
straight salary, sales reps will not see why they have to try harder and still get the same amount
with less effort. But, if it is a commission salary, “salespeople know how much they will be paid for
each sale and that their incomes will increase as a result of more sales” (Douglas and William,
1998). Thus, rewards systems should be designed in a way that effort is rewarded properly.
However, “pay-for-performance” is not an easy task since one cannot always clarify any task
(Benson & Stephen, 1980).
Feedback and communication also play an important role in making salespeople have clear
instrumentality estimates since feedback and communication confirm, enforce, and reinforce
salespeople’s belief that better performance will be rewarded (Alan et al. 1994).
Instrumentality estimates also vary with career stages due to two reasons. One, role perception
becomes clearer when a salesperson proceeds into later stages. Two, the person becomes more
committed with the organisation. Therefore, salespeople in each successive stage (with the
exception of disengagement stage) have higher instrumentality estimates (Cron et al. 1986).
2.2 Valence estimates
Finding what really motivates salespeople has long been manager’s most difficult area. This is
probably the richest documented area on motivation. Maslow’s (1970) hierarchy of needs theory
and Herzberg’s (1987) hygiene-motivation theory fall in this area. The common assumption is that
people seek things to satisfy their needs, and the things they seek are motivators to them.
In sales settings, Futrell (1991, p 373) classifies these factors into seven categories as a
motivation mix as follows:
(1) Sales climate: ceremonies and rites, stories, symbols, and language.
(2) Basic compensation: salary, commissions, and fringe benefits.
(3) Special financial incentives: bonuses, contests, and trips.
(4) Non-financial rewards: opportunities for promotion, challenging work assignments, and
recognition.
(5) Sales training: initial, ongoing, and sales meetings.
(6) Leadership: style and personal contacts, and
(7) Performance evaluation: method, performance activity and publicity.
6
Douglas and William (1998) and Cron et al. (1986) argue that a salesperson’s needs vary in
accordance with career stages. Walker et al. (1985) confirmed this by stating that young
salespeople have higher attraction to higher order rewards such as promotion, personal growth
opportunities while older salespeople place relatively more on money.
Stephen and Benson (1980) found in the US context that the most important determinants of
motivation to a salesperson are (1) a clear task, (2) need for achievement, and (3) type of
compensation plan. Some of the factors found in the US are applicable to Asian salespeople
while some are not. For example, Keun and Anil (1997) found that overall model of relationship
among organizational formalization, role stress, organizational commitment and propensity to
leave developed in the US can be applied in South Korea. While Alan et al. (1994) found that US
salespeople have higher valence for pay increase, job security, promotion, formal recognition,
personal growth and development, and worthwhile accomplishment than their Japanese and
Korean counterparts. Even though within China, salespeople in Hong Kong have different set of
motivators to their Mainland salespeople (Sandra, 1998).
2.3 Fairness
Equity theory (Adams 1976) states that a worker’s perception on fair rewarding depends on the
ratio of inputs into the job over rewards received by that person. If one’s ratio is similar to his
peers, it is perceived fair. The implication to sales management is developed by Futrell (1991, p
379) that sales managers when evaluating a salesperson’s performance and when devising a
rewards system must make them appear fair to salespeople. The problem is that fair or unfair
notion are completely are subject to each salesperson’s judgement. Thus, one way to get rid of
this is to thoroughly discuss with salespeople and get them agree on the methods. It also requires
transparency during implementation process of the program.
7
Không có nhận xét nào:
Đăng nhận xét