- In the ideally organized sales department, wasted motion and duplication of effort would be eliminated, friction would be minimized, and cooperation maximized. Dynamic characteristics inherent in marketing preclude the achievement of such perfection. But when sufficient attention is given to sales organization, the ideal is approached, if not attained, and personal selling efforts increase in productivity.
- How an organization works is more important than how it is supposed to function. Sales management should direct its main organizational efforts toward the “informal” organization. Through intelligent leadership and related “human relations” talents, the skilled manager moves both individuals and informal groups along lines that facilitate achievement of the purposes of formal organization.
To Permit the Development of Specialists
As a business expands, marketing and selling activities multiply and become increasingly complex. It is difficult to fix responsibility for performance of all necessary activities, particularly when executives are reluctant to delegate authority.
One purpose of reorganizing the sales department is to facilitate assignment of responsibility and delegation of authority. In fact, specialization, or division of labor as economists call it, is the chief means through which the processes of organization and reorganization are affected. As tasks grow in number and complexity, they are broken down into manageable units and are assigned to specialized personnel. The assignments made are called “delegations of authority.” This is conducive to the development of specialists.
To Assure that All Necessary Activities are Performed
As a sales organization grows and specialization increases, it is increasingly important to perform all necessary activities. What are “necessary” changes over time? When jobs are highly specialized, danger exists that the organizational plan will not provide for supervision of all activities. Essential tasks may not be performed, simply because they are not assigned to specific individuals.
When a company is small, for instance, its executives are in close contact with users of the product. As a company grows, as marketing channels lengthen, and as the marketing area expands geographically, top executives become farther and farther removed from the customers. As soon as executives begin to lose their informal contacts with customers, an individual should be assigned responsibility for maintaining such relationships. If these contacts are highly important, responsibility for maintaining them should be assigned to an executive specializing in customer relations.
To Achieve Coordination or Balance
Good organization achieves coordination or balance. Individuals vary in competence, potential, and effectiveness. Their personalities may be such that through assumption of authority, failure to delegate it, or both, their positions are magnified out of all proportion to their importance. Worse yet, total accomplishments of the organization are less than they could have been if, so to speak, greater advantage had been taken. By getting people to pull together as a team rather than as an assortment of individuals, the organization accomplishes more collectively than its members could independently.
Motivating individuals to work together toward common objectives is, then, important in achieving coordination. Individual goals are subordinated to, or reconciled with, organizational goals. Some of the means for accomplishing this are indoctrination and training programs, group meetings, supervision and guidance, and two way communications.
Modern organizational theory suggests that sales departments should be divided into small, freely communicating, face to face groups to decrease the possibility of uncoordinated proliferation.
To Define Authority
Sales executives should know whether their authority is line, staff, or functional. Line authority carries the power to require execution of orders by those lower in the organizational hierarchy. Staff authority is the power to suggest to that holding line authority the method for implementation of an order. Functional authority enables specialists in particular areas, such as in technical product service, to enforce their directives within a specific and limited field. Line executives make decisions on the need, place, and time of action over a wide range of matters. Staff executives advise line executives about methods but have no formal power to require or enforce the execution of their recommendations. Functional executives are specialists’ experts in some aspect of the business who assist executives holding general line authority. For example, such specialists advise on new product introduction.
A sales organization receives directions from several sources No person should have more than one boss. The supporting argument is that, if individuals receive instructions from multiple sources, they may get conflicting and confusing directions. The argument is a good one, but the “one boss” rule does not necessarily follow. Modern organizational theory points out that the real problem is; one not of avoiding the multiple boss situation but harmonizing orders and directives from different sources. A smoothly operating sales organization has built in ways of achieving harmony. Two important ways are continuing coordination of the work of different executives and free flowing communications systems.
To Economize on Executive Time
As a sales department’s operations and activities increase in complexity and number, additional subordinates are added.
This permits higher ranking sales executives to delegate more authority. It also allows for the more effective use of specialization, while higher executives devote less time to operations and more to planning. One purpose, then, of organization and one often overlooked is achieving economies in the use of executive time Top sales executives need not concern themselves personally with all the sales department’s problems and activities, particularly routine or technical ones, when they have capable and well trained subordinates.
In building the sales organization, then, the need for effective coordination limits the number of subordinates who report directly to certain executives. This limit is the “span of control.” But the greater the abilities of the coordinator and of those reporting to him or her, the larger the number that can be effectively coordinated. Lower level sales executives, however, those with salespeople reporting directly to them, have a wider span of control than higher executives devoting much time to planning and policy formulation and little to administrative and operating details.
