territory mgt tab 1 a 0403

Module 1A

Territory Mgmt/

Territory ManagementTerritory Management

Module 1A

Territory Mgmt/

Scenario with Business LeaderScenario with Business Leader

In preparation for an operating plan review with your Business Leader next week, you need to address the following questions:

“How are you assigning customer accounts to your salespeople ?”

“Why do you assign them in that way ?”

“How do you link account potential to your overall territory strategy ?”

What’s really on your Business Leader’s mind is……“How do you know your Territory Plan will yield your Operating Plan ?”

“What do you need in order to make your Operating Plan ?”

Module 1A

Territory Mgmt/

In preparation for your Business Leader’s visit….In preparation for your Business Leader’s visit….

Think about your answers to the three questions (5 min)

Share your answers with your Table Team (5 min)

De-brief each other:

Did You Meet Your Leader’s Expectations ? (5 min)

Scenario with Business LeaderScenario with Business Leader

Module 1A

Territory Mgmt/

Learning ObjectivesLearning Objectives

Design an effective Territory Plan

Ensure your Territory Plan helps you maximize your OP

Assign accounts & deploy resources to maximize your OP

By the end of this module, you will be able to…By the end of this module, you will be able to…

Module 1A

Territory Mgmt/

Territory Budget

Account (Customer) Assignments

Resource Deployment Plan

Overall Territory Potential

Competitor Position

Marketplace Dynamics

Effective Territory PlansEffective Territory Plans

Key Elements …Key Elements …

Module 1A

Territory Mgmt/

Does the structure of each salesperson’s territory reflect the maximum number of accounts they can penetrate effectively?

Have individual accounts been prioritized by potential volume available?

Have current penetration and share been evaluated for each account?

Have sales volume, share, and margin targets been established for each account?

Effective Territory PlansEffective Territory Plans

Ask yourself …Ask yourself …

Joint development with your salespeopleJoint development with your salespeoplewill yield a sustainable plan!will yield a sustainable plan!

Module 1A

Territory Mgmt/

Should I assign individual sales budgets by a “Top Down” approach?” OR

“Should I use a “Bottom Up” approach: having my individual salespeople first establish their sales budgets?”

“Do I have enough ‘cushion’ in my Territory Budget?”

“Do I understand the Total Potential of my territory?”

Territory Sales BudgetsTerritory Sales Budgets

Class Discussion

Module 1A

Territory Mgmt/

Does my budget equal the “roll-up” of individual salesperson budgets?

Have I built sufficient stretch into individual budgets to ensure the total in case of unforeseen events?

How would I reward my people if they achieve their stretch budgets?

Have I taken into account other activities required of my people… – Six Sigma projects?– ACFC?– Professional Development / Training?– Mentoring?– Area Sales Council; Boundaryless Sales Team meetings?

Effective Territory BudgetingEffective Territory Budgeting


Module 1A

Territory Mgmt/

Table Team Discussion

What information do you need to gather to determine …

…how to assign accounts to my salespeople? …how to deploy other resources available to me?

Resource DeploymentResource Deployment

Module 1A

Territory Mgmt/

Customer information– Strategic goals, financial strength, expected growth rate– Current available business, long-term potential – Buying practices, decision making processes– Positions and behavioral styles of influencers and decision makers

Current suppliers– Current GE share– How entrenched are our competitors?

Resources required– What does it take to support this customer?– What impact can we have on their CTQs?– What type of skill set should our salesperson have, to grow and

effectively serve this account?

Assigning Accounts to SalespeopleAssigning Accounts to Salespeople

Tips …Tips …

Module 1A

Territory Mgmt/

Number of PeopleNumber of People Outside Sales Inside Sales Sales Support €/$Sales / Salesperson

GE__________ _________ _________ _________ €/$_________

Competitors

__________ _________ _________ _________ €/$_________

__________ _________ _________ _________ €/$_________

__________ _________ _________ _________ €/$_________

__________ _________ _________ _________ €/$_________

Resource Deployment vs. CompetitionResource Deployment vs. Competition

Module 1A

Territory Mgmt/

How to ensureHow to ensuremy ‘Territory Plan’my ‘Territory Plan’

will workwill work

Module 1A

Territory Mgmt/

[confidential] All Salespeople Top Performer Lowest PerformerActivity: (My Estimate) (Their Estimate) (Their Estimate)

Customer Facetime _______% _______% _______%(“Touch Time”)

Administration _______% _______% _______%

Travel _______% _______% _______%

Other _______% _______% _______%

Total 100 % 100 % 100 %

Productivity Analysis ToolProductivity Analysis Tool

Customer Touch Time – INCLUDES meetings, conversations (phone or in-person), presentations, Interactive video conferences, participation in customer events,

Customer Touch Time – DOES NOT Include e-mail, voicemail, customers visiting a GE web-site or driving to a customer.

Module 1A

Territory Mgmt/

Routine Typically follows a consistent pattern, based on optimal routing and

clustering visits based on proximity Visits accounts with unvarying frequency

Reactive Fosters flexibility and allows for quick reaction to opportunities Tends to be crisis-prone, and may sacrifice consistent coverage and long

term account management

Proactive Driven by long-term results. Allocates calls and time based on a plan that optimizes account potential

Individual Territory PlansIndividual Territory Plans

How Salespeople Manage How Salespeople Manage TheirTheir Territories … Territories …

Most salespeople use a combination of stylesMost salespeople use a combination of styles

Module 1A

Territory Mgmt/

Do your salespeople’s plans describe how they will capture new accounts? (Develop)

Capture more of each customer’s available business? (Penetrate)

Defend our existing business share in the face of aggressive competitive challenges? (Retain)

Individual Territory PlansIndividual Territory Plans


Module 1A

Territory Mgmt/

Know each Salesperson’s skill level– Territory Management Style– Training or Coaching or Mentoring Required ?

Know the concentration of accounts (Customers) required for you to meet your Operating Plan

– Geographical Distribution– Market Type

Devise and implement a logical (and consistent) plan for assigning accounts

– Are your accounts distributed equitably ?

Keys to Effective Territory ManagementKeys to Effective Territory Management

Involve your salespeople inyour territory plan development!

Module 1A

Territory Mgmt/

AppendixAppendix

Module 1A

Territory Mgmt/

Account Plan Critical ElementsAccount Plan Critical Elements

1. Customer demographics & financials2. Key customer personnel, position, behavioral style3. Current GE business status with customer4. Customer buying practices5. Current suppliers & share6. Key goals & objectives7. Action Plans & Strategies to achieve goals8. Resources required9. GE Business-specific criteria

Module 1A

Territory Mgmt/

Account PlanningAccount Planning

Determining Customer Available Business - “The Great Unknown”Determining Customer Available Business - “The Great Unknown”

Some Answers

Ask Customer - check as many different people as possible…Purchasing, Marketing, Finance, Accounts Payable, Executives

Annual Reports including CEO Letter, On-line Customer web-site etc

Contact Other GE Businesses - BST

Ask Other Suppliers - Their estimated share, Their competitor’s share

D & B Reports

Tour Customer Plant - storage cribs, receiving area, equipment installations

Industry Data Bases

Module 1A

Territory Mgmt/

Account Return On Investment - ExampleAccount Return On Investment - Example

I. Potential1. Past Sales _________2. Additional Potential Sales _________3. Total Potential (1+2) _________4. Probability of Realizing Potential _________5. Expected Value (3 x 4) _________

II. Time Required to Realize Expected Value6. Number Calls Required _________7. Approx. Call Duration - Hours _________8. Call Hours Required (6 x 7) _________9. Travel Time per Call _________10. Total Travel Time (6 x 9) _________11. Total Time Required (8+10) _________

III. Return on Time Invested - ROTI12. Gross Margin on Expected Value _________13. Cost of Time Invested (11 x Cost/Hr.) _________14. ROTI (12 / 13) _________

Module 1A

Territory Mgmt/

Account Return On Investment - ExampleAccount Return On Investment - Example

I. Potential1. Past Sales $500,000_2. Additional Potential Sales 1,000,000_3. Total Potential (1+2) 1,500,000_4. Probability of Realizing Potential __65%___5. Expected Value (3 x 4) 975,000__

II. Time Required to Realize Expected Value6. Number Calls Required __100____7. Approx. Call Duration - Hours ___1.5___8. Call Hours Required (6 x 7) __150____9. Travel Time per Call ___1_____10. Total Travel Time (6 x 9) __100____11. Total Time Required (8+10) __250____

III. Return on Time Invested - ROTI12. Gross Margin on Expected Value @30% 292,500___13. Cost of Time Invested (11 x Cost/Hr.) __6,000___ (@$50K/Yr)14. ROTI (12 / 13) __48:1_