What type of sales organization structure is best for you?

There are many forms of sales organizations and structuring the right one can be difficult and challenging.

The more popular forms of sales structures are:

1-Product sales orientation: here sales people are well versed in the products that the enterprise has to offer.  This can be a specific product or a suite of products or a series of solutions that the sales person is the “expert” in.  One major advantage to this structure is having product experts, but a major disadvantage is potentially high costs to support.

2-Market orientation: here the sales team is orientated towards certain industries. Examples could be government, financial or transportation segments where the sales person sells solutions that are appropriate for each segment. One major advantage to this structure is having industry/solutions experts, but a major disadvantage is potentially duplication of function per areas.

Further sub divisions within market orientation are structures such as major/ named or national account management (NAM) or global (GAM) account management, where large of important accounts have assigned people.

3-Geographic structure: here sales people are assigned and are responsible for all accounts in their territory and for knowing all products. One major advantage to this structure is having low costs, but a major disadvantage is limited or few real experts in the field.

4- Sales function orientation: here sales people perform certain sales functions such as order entry, selling, or managing sales events.  One major advantage to this structure is having an efficient sales operation, but a major disadvantage is duplication of costs to support.

Complicating the different options is when a re-seller is added to the mix.  For example, a firm may have a direct sales force to sell to everyone except Federal and State Governments.  For these customers they use a specialized reseller.

Regardless of structure one selects consider the following guidelines.

-What selling efforts will be needed to meet the organizational goals?

 -What skills and how many sales people are required to meet these goals

 -What structure (from above) is best suited to handle the type of products or solutions for the types of accounts and/or industries.

-How should the selling effort be allocated/deployed to meet these goals

-How will the sales force be managed and compensated

-What will the workload be per sales person to achieve the targeted goals?

Most importantly, know your customers and make sure they will receive the best in class services!

RHL 8/10/10

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