n Am I B I A U n I VE RS ITV OF SCIEnCE AnD TECHnOLOGY

FACUL TV OF MANAGEMENT SCIENCES

DEPARTMENT OF MARKETING AND LOGISTICS

QUALIFICATION: BACHELOR OF MARKETING

QUALIFICATION CODE: 07BMAR LEVEL: 6

COURSE CODE: SOT612S COURSE NAME: SALES AND OPERATIONS

MANAGEMENT

SESSION: JANUARY 2017 PAPER: THEORY

DURATION: 3 HOURS MARKS: 100

SUPPLEMENTARY/ SECOND OPPORTUNITY EXAMINATION QUESTION PAPER

EXAMINER($} MR. C. KAZONDOVI

MODERATOR: MS. E. SEMENTE

INSTRUCTIONS 1. Answer ALL the questions.

2. Write clearly and neatly.

3. Number the answers clearly.

PERMISSIBLE MATERIALS

1. Examination Question Paper

2. Examination Answer Booklet

3. Calculator

THIS QUESTION PAPER CONSISTS OF~ PAGES (Including this front page) ·-·

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SECTION A Question 1

Multiple choice questions

Choose the correct answer and use the table provided on [page 9] by ticking the correct option [X or v] to answer these questions, detach and insert it into your answer booklet. 2 marks will be awarded for each correct answer. [15 x 2 = 30 Marks]

1.1 Today, the most successful sales managers are seen as-------- rather than

A. directors; team leaders. B. controllers; bosses. C. team leaders; bosses. D. bosses; directors. E. team leaders; collaborators.

1.2 Excellent salespeople may not make good sales managers because: A. Some of the traits and skills needed to be a good sales rep are different from those needed to be a successful manager. B. Top salespeople, when promoted to management, always expect too much from the people working under them. C. Salespeople don't respect a boss who has had no previous managerial experience. D. As a manager, the former sales rep does not spend enough time in the field working with the sales force. E. None of these is correct.

1.3 With respect to the importance of sales force management: A. lt is unnecessary if a company has truly adopted the marketing concept. B. The cost of maintaining a sales force is much lower than advertising expenses. C. lt is important because in most firms the sales force and their bosses are critical to the success of carrying out marketing plans. D. Students typically are not involved in sales management activities until they have been out of school for many years. E. lt is more important than marketing management.

1.4. Which of the following is an accurate generalisation regarding the concept of objectives in strategic sales force planning? A. Sales force objectives should guide strategic marketing planning. B. The objectives should be specific, and be stated in written form. C. After sales-management strategies are determined, then the objectives for sales management will follow. D. Objectives are not necessary if you have good administrators. E. None of these are correct.

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1.5. If an area sales manager is assigned a volume quota/target but is not allowed any voice in the selection of his salespeople, which principle of organisation is violated? A. Provision for centralization . B. Provision for flexibility and stability. C. Proper span of control. D. Need for balance and coordination. E. Relationship of responsibility and authority.

1.6 A company is likely to use a line organization when: A. Management wants to use various marketing specialists. B. The market consists of quite different groups of customers. C. The company is small and sells a few related products. D. Management believes in a policy of decentralization. E. The sales force is large.

1.7 All except one of the following points are reasons why a good programme for selecting salespeople is important. Which is the exception? A. Good salespeople are hard to find . B. A sales manager is no better than his salespeople. C. Turnover rates will be lower. D. Training and supervision are not needed if sales representatives are well selected. E. Well-selected salespeople should be more productive.

1.8 With respect to the processing of applicants for sales jobs: A. Initial screening should be done with an application blank. B. Management should use long, guided interviews for each applicant. C. Management should develop individualized forms designed for the particular needs of the given firm. D. Each company should determine its most effective selection tool, and then use only that tool. E. None of these is correct.

1.9 With regard to the motivation of those under them, managers: A. Often don't know what is the most important to their employees. B. Mangers most frequently rank job security as being most important to employees. C. Can predict accurately what will appeal to their employees. D. Managers rank promotion as the number factor motivating their employees. E. None of these.

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1.10 Which of the following is an example of the level of earnings, in contrast to the method of compensation? A. The reps are paid a straight salary. B. The pay plan includes generous insurance profits. C. Ten percent of the reps earn more than N$50,000 a year. D. People on straight commission do not get a paid vacation . E. None of these.

1.11 Regarding the different types of sales quotas, it is correct to say that: A. Sales-volume quotas usually encourage the sales of high margin products. B. Selling expense quotas are good when a firm wants to develop new markets C. Combination quota plans typically have the advantage of being simple to compute. D. Volume quotas are better than activity quotas when a company wants to develop good relations with customers. E. None of these is correct.

1.12 The correct terminology in demand forecasting may be illustrated by saying that the ___ for training shoes in Namibia next year is 800,000 pairs, while the for Omvungu (brand) training shoes in that market is 100,000. A. Market potential -sales potential (market share). B. Sales potential -sales forecast. C. Market share - sales potential. D. Sales forecast- market potential. E. None of these is correct.

1.13 All ofthe following are reasons for establishing sales territories, except: A. lt reduces the number of salespeople needed. B. Helps to improve customer relations. C. Management can better evaluate sales force performance. D. Increases sales force effectiveness. E. Improves sales force morale.

1.14 The evaluation stage in the marketing management process is not likely to include: A. Matching the sales results against sales goals. B. Estimating territorial sales potentials. C. Analyzing marketing costs. D. Preparing a sales volume analysis. E. Appraising territorial sales performances.

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1.15 For a more effective marketing cost analysis, sales executives usually regroup ledger expenses into various: A. activity classifications. B. administrative groups. C. operating statements. D. accounting groups. E. sales volume categories.

Question 2

True or False Questions

Use the table provided on [page 9] by ticking the correct option [X or v] to answer these questions, detach and insert it into your answer booklet. 2 marks will be awarded for each correct answer.

[10 x 2 = 20 Marks] 2.1. Regarding the relationship between a marketing cost analysis and the usual accounting system in a firm, accounting maintains a historical record of a company's financial events; a marketing cost analysis is a tool designed more for use in planning and controlling a company's future operations.

2.2 Three hundred sixty degree feedback involves getting feedback primarily from all of the salesperson's customers.

2.3 Most organizations perform a complete marketing audit at least once a year.

2.4 Once a route plan has been set up by management and agreed to by a salesperson, the rep can deviate from this plan, even though the plan was set up in the first place.

2.5 A market index is a market factor expressed in a quantitative form relative to some base figure.

2.6 Sales quotas are usually established for a time period of a year.

2.7 An expense control plan that sets selling expenses as a percentage of sales will encourage the development of new territories.

2.8 The best signal that your compensation plan isn't working is that several of your best salespeople quit.

2.9 Many companies do not differentiate top performance from average performance in terms of salary.

2.10. A straight salary plan is the most widely used method for compensating a sales force.

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SECTION B (Total 50 marks)

Question 3 (20 Marks]

Figure 1- Phases of Developing and Conducting a Sales Training Programme

Sales managers must make a number of critical decisions through the four phases above in Figure 1. Discuss with specific examples how you would go about through each and every step of the Sales Training Programme. Be as specific as possible.

Read the Case Study entitled SPECTRUM HEALTH, INC.- Leadership in a Crisis Situation

"Ok, we are now officially in a crisis," Cara Baker said out loud to herself. She knew she was about to face the toughest leadership challenge of her career- but was not sure how she would handle it.

Cara has been an area sales manager for Spectrum Health for just over 6 years. She supervised 10 territory reps across her area. Spectrum Health, Inc. is a $3.2 billion medical equipment manufacturer. The company produced a wide range of medical supplies and devices for health care providers such as physicians, hospitals, and health maintenance organisations. Products range from expensive heart- lung machines to inexpensive stethoscopes, thermometers, and wound closure products.

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Cara felt that the morale of her sales force was never high, especially after the layoff of two of her sales people. This was part of the restructuring exercise by the company to decrease their sales force by 24%. The reps were unique individuals who did not seem to interact much with each other. They were each motivated by different goals . She never sensed any animosity among them and had been hopeful that somehow she could make them more a team .

Her regional sales manager who performed her recent evaluation told Cara that she needed to do a better job communicating with her sales people -especially through coaching and individual contact. She told her regional, "I've never been good with that touchy-feely stuff, but I'll try to do better. Cara have been told that her unit's overall sales levels were disappointing. Market research indicated that Spectrum held a 5.2% share of the market in her area. This was well below the company's current national average of 8.5% market share in the country.

The stand out problem in her area was the lack of success in selling the more expensive health care products, such as the heart-lung machine. To effectively sell such complex devices, team selling is required. Therefore, Spectrum reps must coordinate the efforts of engineers, cardiopulmonary experts, and other high-tech colleagues. This is a very difficult situation from Cara's perspective since she needs to try and improve the morale of the underachieving group of people who have a long history of not being committed to anything other than their own individual goals. Further, she has to do this in a tough business climate in which the company is laying off her sales people.

Commitment to the organisation is clearly at an all-time low among reps. How can she get these reps excited about working toward a common company goal when they do not trust the company. She has been trying her level best to make time for individual contact with her reps. To this end; she will address all 10 reps first thing Monday morning in a one-hour sales meeting. She then plans to spend the rest of the week, through Friday, coaching them individually. She also plans on accompanying at least some of them on sales calls.

Her first challenge is to decide what kind of leadership to provide to- and how much time to spend with- each of her 10 reps. She feels that these reps can be categorised into five distinct groups:

1. Two reps, Kristi and Kraig, are high-performing and experienced. They sell all Spectrum products the way they should be sold . In fact, they are the only two reps who consistently sell the big items such as the heart-lung machine. This success stems in part from the close bonds that the two have formed with some of the non-sales (Technical) people at Spectrum.

2. Four reps, Alien, Ashley, Andre and Art, are solid performers but lone wolves. The performance is average to above average across these four reps. Cara appreciates much of what they do, but she is disappointed in their sales of big-ticket items such as the

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heart-lung machine. These reps love their jobs, especially the autonomy. They generally have little interaction with others at Spectrum, including both sales and non-sales personnel.

3. Two reps, Daniel and De bra, are low performing rookies. Actually, these two reps have been with Spectrum for almost one year now. They are the only two reps left that Cara personally hired (the other two she hired were laid off). They are bright and energetic, but they still lack experience. Cara feels they could be much better performers if they improve their selling technique.

4. One rep, Erin, is a mediocre-performing misfit. To Cara, Erin stands out as being a loner among loners. The reps are generally not close to each other, but Erin seems to be least interactive. Her sales levels are a bit higher than the rookies, but they should be since she has been with Spectrum for almost five years. Erin never seems happy. Cara suspects this stems from the fact that she was born and raised in South Africa which is over 5 000 km away.

5. Finally, the one remaining rep, Robert, is a low-performing burned-out veteran. Now approaching 60 years old, Robert was a solid performer in years past. However, his performance has been dropping significantly. Cara get the sense that Robert is looking forward to his retirement, and, in fact, she is, too.

Cara wants to develop a strategy for effective leadership of her sales force. She understands there are different styles of leadership, and that most leader behaviours are either transactional or transformational. She also understands that her leadership style should be appropriate for the current situation. Cara wants to develop a specific plan of action for each of the five groups of salespeople, but she needs your help.

Question 4

4. 1. What is the general message that Cara should give all the reps in the Monday morning meeting? (10 marks)

4. 2. What are the specific leader behaviours that Cara should exhibit toward each of the five different categories of reps? Be specific. (20 marks)

Grand Total lOO marks

THE END

SI Page

Question 1 [Total 30 Marks]

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1.4 1.5 1.6 ~.7

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1.10 f .,

1.11 1.12 1.13

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1.14 1.1·5

Question 2 [Total 20 Marks]

True 2.1 2.2

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2.3 " 2.4

2.5 2.6 ./:--2.7 2.8 2.9 2~10

SECTION A: ANSWER SHEET

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' False '

STUDENT NAME& STUDENT NO:

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