sales force managment

Motivation

1


Discussion Questions
 What is the best way to motivate a
salesforce?
 How can you systematically design a
motivation system?

2


Three Major Determinants of
Motivation
 Environmental conditions
 The firm’s management policies
 compensation
 supervision
 task characteristics

 Personal characteristics of the
salesperson
3


Motivation Session
Objectives
 understand the components of motivation
through the expectancy-value model

 relate management tools to components
of the expectancy-value model, to use in
influencing motivational levels
 consider how management style and the
use of various “tools” influence motivation

4


Motivation Session Outline
 Locus of Control and Motivation
 Expectancy-Value Model of motivation
 what is it?
 Who cares? (implications of the model)

 Glengarry Glen Ross & the impact of
the sales manager on motivation
 The impact of role stress
5


Locus of Control and
Motivation
 Locus:
 External vs. internal attributions
 Stable vs. unstable attributions

 Examples:






External Stable:
External Unstable:
Internal Stable:
Internal Unstable:
6


The Expectancy-Value model
 Why are people motivated
 to initiate a task
 to choose a certain effort level
 to persist in a task

 Expectancy Principle: salespeople choose a level
of effort based on the expected payoffs of
alternative effort levels
 Most popular model of motivation (at least
among sales force researchers)
7


Expectancy-Value Model in
Notation
 Mj=Ej x Vj where:
 Mj=motivational drive to achieve level j of
performance (e.g. sales, number of new accounts
etc.)

 Ej =beliefs about the effort to performance linkage:
perceived chances of achieving level j of
performance given effort
 Vj = overall subjective utility (valence or value) of
achieving level j of performance

8


Examples:
Ej

Vj

Mj

Level of Performance

80% 60

48

If j=$200,000 in sales

40% 100

40

If j=$300,000 in sales

10% 80

8

If j=$400,000 in sales

9


Valence/Value: Vj
 Valence is a composite of the utility you derive
from the suboutcomes (consequences) that
accompany achieving level j of performance
 These might include:
 more pay, promotion, liking & respect, lack of leisure
time, personal growth
 security, sense of accomplishment, recognition, hurting
personal life

 Outcomes can have negative utility/valence
 Obviously the list could be longer & vary across
individuals

10


Vj=  (Iij x Vi)
Vj = expected overall utility to an individual of achieving
performance level j
Iij = beliefs about the performance to suboutcomes linkages: the

individuals subjective probability that achieving performance
level j would create suboutcome I (instrumentalities)
Example: 30% chance that selling $300K (performance level j)
would get one a promotion (suboutcome I)
Vi = the utility an individual derives from suboutcome I
(e.g., a promotion) Note: this can be negative
11


That’s nice, but who cares?
 Nobody thinks like this (it’s too
complicated)
 But model holds up well in field
testing (good “as if” model)
 Explains up to 40% of variance in
performance

12


Expectancy-Value Model
Advantages
 Model is a handy way to structure a messy
question
 Forces you to project o each individual’s
underlying beliefs (expectancies) and
needs/wants (values)
 Different people can exhibit the same level
of motivation for very different reasons
 Nice vocabulary to talk about motivation

13


Implications for How to
Motivate
 No reward is motivating if it is out of reach (low expectancy)
 Raising the goal (performance level j) often depresses
motivation
 Introduces negative outcomes
 Depresses expectancies

 Can motivate by trying to induce sales people to:






raise expectancy (I.e. through training, encouragement)
consider a negative suboutcome unlikely
consider a positive suboutcome likely
Add a new positive suboutcome
Change their ideas about whether suboutcomes are desirable or
undesirable (vi: doomed strategy for the most part)

14


Glengarry Glen Ross
 what is the impact of management style on the

components of the expectancy value model?
 What motivational “tools” are used?
 How do these tools impact motivation in the
short-term? Over the long term?
 How do these tools impact extrinsic motivations?
Intrinsic motivation?

15


Motivators
 Positive Motivators








Commission
Recognition
Acceptance
Respect
Trust
Achievement
Pride

 Negative
Motivators







Fear
Intimidation
Revenge
Obligation
Social Comparison
(one-up)

16


Sales Manager Objectives &
Tools
 Objectives:
 Increase magnitude and accuracy of expectancies
 Increase accuracy of instrumentalities
 Understand and work with valences

 Key:
 reduce role stress arising from role ambiguity & role conflict

 Tools:






training: expectancies
evaluations, reviews: expectancies, instrumentalities
communication, participation: instrumentalities
selection: hire SP whose Vi’s match company suboutcomes

17


How to Motivate
 Define each employee’s motivating factors and
provide an environment that incorporates those
factors
 Praise performance
 Address poor performance
 Set goals & clearly communicate expectations
 Share your vision and include your team in creating it

18


Measuring Components of the Model
 May be done informally for small sales forces, but
beware of biases (e.g. we believe what we want to
believe; we think everyone else is like we are)
 periodic surveys can be conducted to quantify each
component of the model
 expectancies: to what extent do you believe that if you do x,
y will happen

 instrumentalities: to what extent do you believe that if y
happens, you’ll receive z
 valences for suboutcomes: how important is ..

 Quantified information is valuable at both the
aggregate level and the individual level

19


Role Stress
 “A primary influence on how salespeople perform is their
perceptions of the demands placed upon them”
 “A role is a prescription:
 it tells you the activities and behavior that are expected of anyone
in a position

 Role partners
 communicate expectations
 pressure salespeople to meet them

 A role partner is anyone with a vested interest in how a
salesperson does the job, such as:
 the boss, the customers, other executives, other salespeople and
support people, people who are significant in the sales rep’s
personal life

20

Role Stress (continued)
 Role stress is like a disease; most reps suffer
complications of role stress
 Why?
 Sales is at the boundary of the firm; salespeople are boundary
spanners, which means lots of role partners
 Salespeople often have to be creative; find solutions; reconcile
needs
 A sales reps performance affects performance of lots of other
people
 Sales reps personify the cruel voice of the marketplace
(scapegoat- kill the messenger)
 Time and resource constraints necessitate tradeoffs between
role partners’ expectations

21


Role Stress (continued)
 Day after day, salespeople grapple with the
messages their role partners send them and the
pressures role partners put on them.
 Two things create role stress (create problems
that eventually will make the salesperson
miserable):
 Perceived Role Conflict
 Perceived Role Ambiguity

22

Perceived Role Conflict:
 you feel that the demands of your role partners
are incompatible. To make one happy, you have
to upset another (perceived).
 Upshot: misery & poor motivation

23


Perceived Role Ambiguity:
 You feel you don’t have the information to cope
with your job demands






don’t
don’t
don’t
don’t
SUM:

know how to do a task
know what role partners expect
know how your performance is being evaluated
have clear objectives
unsure how you’re doing and what to do next

24


How to reduce Role Stress
 Communicate! Give feedback!
 Even bad news is better than news
 Salespeople must have accurate expectancies &
instrumentalities
 Training and encouragement: increase expectancies
for desired levels of performance- people who believe
they can, often do
 Accept that some role stress is normal (even
desirable)
 but be especially alert for dysfunctional levels of role
stress in inexperienced people

25