Sales managers: marketing's best example of the Peter Principle?

It's time to update the venerable job of managing the sales force.

Corporate bottom lines depend heavily on the effectiveness of sales managers. Czinkota, Kotabe, and Mercer (1997) contend that the sales manager's responsibility for handling the entire interface with customers is possibly the most important factor in creating and perpetuating corporate success. Herbert Greenberg, founder and CEO of Caliper, Inc., a human resource consulting firm in Princeton, New Jersey, says bluntly that "the quality of the people in the sales force comes down to the quality of its leadership" (Brewer 1997).

It seems apparent that sales performance is determined to a large extent by how well the sales manager can motivate, lead, and control sales force operations. But whether viewed from the perspective of salespeople, customers, sales managers themselves, or top management, there is concern that sales organizations are not performing as desired. In fact, there is support for the contention that sales managers may well be marketing's best example of the Peter Principle: They have arrived at their level of organizational incompetence.

Perspectives of Salespeople

"'Mad-as-hell' salespeople are everywhere," exclaimed a recent cover story in Sales & Marketing Management (Royal 1995). For more than six months, researchers traveled the country asking top salespeople, "What keeps you from selling?" Most surprising was the long list of complaints - and the fury. Angry claims that sales management wouldn't listen to them and that company support staff were not customer-oriented were common. But many believed they were being compelled to run on high-tech treadmills that were moving way too fast; they felt they were sinking in a sea of unorganized, non-prioritized information dumped into their computers, with e-mail fast becoming an impersonal way for sales managers to deliver bad news. An earlier nationwide survey (Carew 1989) identified a number of additional criticisms voiced by salespeople about their sales managers: they were disorganized; they made capricious decisions on such critical matters as hiring or promoting people; they neglected motivation; they communicated poorly; they chased sales volume instead of profits; they overlooked comprehensive planning; and generally they failed to provide leadership.

Perspectives of Customers

A national survey of purchasing managers by Bricker (1992) found that only 20 percent were satisfied with the sales reps calling on them, and 43 percent believed the reps offered less-than-average customer support. Nearly three-fourths of the purchasing managers said that salespeople's familiarity with their customers' businesses and products was either average, low, or very low. Too many reps seemed focused on quick sales, displaying neither the desire nor the patience to learn their customers' needs and priorities. For instance, many assumed that purchasing managers are concerned only with price, yet just 18 percent of the purchasing managers ranked price as important in selecting suppliers. In a study by Lendrum (1990), 1,000 buyers who dealt directly with salespeople in the food industry rated them low on providing customers with assistance, keeping them informed, following up on orders, knowing about promotional techniques, and motivating in-store personnel. With respect to ethics, a recent Gallup poll of consumers found that of all the business occupations, selling and advertising were ranked at the bottom in terms of honesty and ethical standards (Lamb, Hair, and McDaniels 1996). Moreover, based on a recent report of the American Customer Satisfaction Index, the level of customer satisfaction continues to decline (Stewart 1995).

These findings indicate that the managerial buzzwords of this and the past decade - consultative selling, total quality management, reengineering, partnering, relationship marketing - apparently have had little positive impact on salespeople in dealing with their customers. Although the problems tend to be manifested at the individual level, it is the sales managers - organizationally charged with responsibility for the performance of their people - who must be ultimately accountable. After all, many of the problems result from ineffective recruitment, selection, training, motivation, evaluation, and control of sales personnel - functions that are the primary responsibilities of sales managers.

Perspectives of Sales Managers

Seemingly oblivious to or unconcerned about large-scale dissatisfaction among their salespeople and customers, sales managers remain confident and almost complacent about their own abilities and performance. According to Berger (1996), C&C Marketing Research's second annual technology survey of more than 250 sales managers found that 42 percent of them never log onto the Internet as part of their jobs, even though 73 percent of responding firms have Web sites. Keenan (1995) reports that nearly 95 percent of surveyed sales managers think they are effective listeners, though few have ever been trained to listen past merely hearing to truly understand what is being said. Self-satisfaction in the face of mounting problems does not serve sales managers or their companies well.

Short-Run Tactics. Despite their apparent complacency, today's sales managers are facing more pressures and market challenges than ever. Some are tolerating or even encouraging short-run sales tactics that …