Chapter 10 Motivating the Sales Force

1. Chapter 10Motivating the Sales Force Sales Management: A Global Perspective Earl D. Honeycutt John B. Ford Antonis Simintiras

2. Chapter 10 Motivating the Sales Force Learning Objectives Define motivation; Understand the complexity of motivation; Explain the main theories of motivation; Understand the impact of cultural differences on motivation; Explain various tools available for motivating the global sales force; and Discuss the relationship between motivation and job satisfaction.

3. Chapter 10: Motivating the Sales Force What is motivation? Motivation is the inner force that guides behavior and is concerned with the causation of specific actions. Motivation is a three-dimensional construct consisting of the following: Intensity or the magnitude of mental activity and physical effort expended towards a certain action; Persistence or the extension of the mental activity and physical effort over time; and Direction or the choice of specific actions in specific circumstances.

4. Chapter 10: Motivating the Sales Force Understanding motivation Motivation should be understood at two levels: What motivates salespeopleHow salespeople choose their action (the reasons behind the intensity (the direction or decision to engage in and persistence of mental and specific actions in specific physical effort expended) circumstances)

5. Chapter 10: Motivating the Sales Force Motivational theories addressing the issue: “what” motivates salespeople Need Hierarchy Theory Self-actualisation needs Esteem needs Belongingness needs Security needs Physiological needs Physiological needs (e.g., basic salary); security needs (e.g., pension plan); belongingness needs (e.g., friends in work group); esteem needs (e.g., job title); self actualisation needs (e.g., challenging job). Source: Maslow, 1943)

6. Chapter 10: Motivating the Sales Force Motivational theories addressing the issue: “what motivates salespeople” Two Factor Theory Motivation factors(e.g., achievement, recognition, responsibility) Hygiene factors (e.g., supervision, pay, job security, working conditions) The theory argues that: The motivation factors or motivators are the primary causes of motivation and address the question “why work harder”; The hygiene factors are necessary conditions to achieve a state of neutrality and address the question “why work here”.

7. Chapter 10: Motivating the Sales Force Motivational theories addressing the issue: “what motivates salespeople” • ERG Theory • Existence (E) Relatedness (R) and Growth (G) needs are structured in a hierarchical order. The theory postulates that: • The lower the level of satisfaction in a need the more it will be desired; • The higher the satisfaction in a lower level need, the greater the desire to satisfy a higher level need; and • The lower the satisfaction in a higher level need the greater the desire for satisfying lower level needs.

8. Chapter 10: Motivating the Sales Force Motivational theories addressing the issue: “what motivates salespeople” Discussion Question What are the limitations (if any) of the content theories of motivation when applied to different cultural settings? Provide examples to justify your answer.

9. Chapter 10: Motivating the Sales Force Motivational theories addressing the issue: “how do salespeople choose their actions?” Equity Theory Equity (inequity) is defined as the belief that one is treated fairly (unfairly) in relation to others. A salesperson’s choice of effort to be expended is a result of a comparison between his output-input ratio and the output-input ratios of others. Output of A (e.g., pay, recognition) Output of B (e.g., pay, recognition) Input of A (e.g., effort, loyalty) Input of A (e.g., effort, loyalty) A salesperson who perceives to be inequitably treated can change his input, output, alter the perceptions of self and/or others, change comparisons or leave the situation.

10. Chapter 10: Motivating the Sales Force Motivational theories addressing the issue: “how do salespeople choose their actions?” Expectancy Theory Motivation is a function of a salesperson’s anticipation that a particular behaviour will lead to outcomes that s/he values. Motivation = function of (Expectancy x Instrumentality x Valence) Expectancy is the salesperson’s perception that a certain amount of effort will lead to successful performance (e.g., Can I do it?) Instrumentality refers to salesperson’s perception of the probability that performance will lead to certain outcomes or rewards (e.g., What do I get for doing it?) Valence is the perceived attractiveness or unattractiveness of an outcome or reward (e.g., How much do I value the reward?)

11. Chapter 10: Motivating the Sales Force Motivational theories addressing the issue: “how do salespeople choose their actions?” Attribution Theory Attribution theory is concerned with the “why” question. Since different behaviors can be attributed to different factors salespeople try to attribute success or failure as the outcome of their behavior to some causes by posing the question “why did this happen?” Taxonomy of causes: Locus of control dimension (causes that are within [internal] or outside [external] the individual); Stability dimension (causes that are stable or unstable) Control dimension (causes that are controllable or uncontrollable)

12. Chapter 10: Motivating the Sales Force Motivational theories addressing the issue: “how do salespeople choose their actions?” Goal Setting Theory Motivated behavior is the result of conscious goals and intentions. The theory starts from the point that a salesperson has determined to engage in an activity and argues that a person’s inclination to act in a particular way is influenced by the: Anticipated result (goal); Intention (will), which implies: Effort (will-act); and Strategy to reach the goal (object oriented content). Goal difficulty and goal specificity are two important aspects that shape performance.

13. Chapter 10: Motivating the Sales Force Motivational theories addressing the issue: “how do salespeople choose their actions?” Discussion Question What are the limitations (if any) of the process theories of motivation when applied to different cultural settings? Provide examples to justify your answer.

14. Chapter 10: Motivating the Sales Force Motivational theories offering alternative explanations Reinforcement Theory The theory suggests that behavior is a function of its consequences and explains how the consequences of past action influence future action in a cyclical manner. For example, if a particular behavior leads to a rewarding consequence the same behavior is likely to be repeated. Stimulus Response Consequence The stimulus triggers a response (behavior) and the consequences of that response (behavior) determine whether the same response (behavior) will or will not be repeated.

15. Chapter 10: Motivating the Sales Force Motivating the Global Sales Force Cultural differences and motivation Cultures differ on at least six bipolar dimensions: Universalism(e.g., rules, laws) Particularism(e.g., exceptions, unique relations) Individualism(e.g., competitiveness)Communitarianism(e.g., cooperation) Specificity(e.g., atomistic)Diffusion(e.g., holistic) Achieved status(e.g., what you have done) Ascribed status(e.g., who you are) Inner direction(e.g., conscience is located inside) Outer directed(e.g., examples are located outside) Sequential time(e.g., time is a race)Synchronous time(e.g., time is a dance) (Hampden-Turner and Trompenaars, 2000) Using examples, explain how differences in values as above might complicate the task of motivating a global sales force.

16. Chapter 10: Motivating the Sales Force Motivating the Global Sales Force Salespeople are motivated by different needs. Need for status (e.g., need for recognition and promotion) Need for control (e.g., need to be in control and influence others) Need for respect (e.g., need to be seen as experts who can give advice) Need for routine (e.g., need to follow a routine that must not be interrupted) Need for accomplishment (e.g., need more money and challenges) Need for stimulation (e.g., need to seek outside stimulation and challenges) Need for honesty (e.g.,need to believe in the rightness of their practices) (Smyth and Murphy, 1969)

17. Chapter 10: Motivating the Sales Force Motivating the Global Sales Force • Motivational tools • Motivational tools should satisfy at least two criteria. • Should generate extra effort that will help the company to achieve • its objectives , and • b) Must increase job satisfaction among salespeople. • Motivational tools include, but are not limited to: • Sales meetings; • Incentive programs (e.g., sales contests and competitions) • Recognition programs (e.g., praise, promotion, extra responsibilities)

18. Chapter 10: Motivating the Sales Force Motivating the Global Sales Force Motivation, job satisfaction, and performance Job satisfaction refers to all characteristics of the job itself and the work environment which salespeople find rewarding, fulfilling, and satisfying. Job satisfaction can be felt by anticipating a desired outcome, or by accomplishing a certain level of performance and/or receiving a reward. Job satisfaction, motivation and performance are closely related. It is important to remember that global salespeople may be satisfied by different outcomes and rewards.

19. Chapter 10: Motivating the Sales Force Summary Motivation is an inner force that drives and directs behavior. Motivation theories answer questions pertaining to what motivates salespeople and how salespeople choose their actions. The three groupings of motivational theories discussed in this chapter are: Content, Process and Reinforcement. Culture influences motivation through its influence on salespeople’s values, attitudes and norms. Sales managers have a range of motivational tools at their disposal. Cultural differences among salespeople should be taken into consideration when designing a motivational program. Motivation, job satisfaction and performance are inextricably related.