The changing environment of selling and sales management.

Although effective selling and sales management are often critical to marketing success, the stature of this research domain--and progress of knowledge within it--have fallen behind other areas. Difficulties in data access and the perception of some that sales is not integral to marketing may

have contributed to this situation. Although there is a rich tradition of research in selling and sales management and vigorous ongoing research efforts, as evidenced by the discourse published in and fostered by the Journal of Personal Selling & Sales Management, much of our knowledge rests on models and assumptions that were advanced in past decades and that may need revision in light of rapidly evolving demands of the marketplace. According to Rackham and DeVincentis:

   Sales forces are caught in the middle. On one side, their customers
   have changed dramatically in terms of how they purchase
   and what they expect. On the other side, their own
   corporations have shifted, going through downsizing, restructuring,
   and cost cutting. Traditional boundaries such as those
   between sales and marketing have crumbled. Salespeople have
   to cope with more products, introduced faster with shorter
   life cycles, and less competitive differentiation. (1999, p. ix)

These authors touch on the myriad changes occurring in the sales force. Adopting a historical perspective, however, leads to the realization that, in some respects, the more things change, the more they stay the same. For example, it is interesting to compare Rackham and DeVincentis's observations with those of Kahn and Schuchman as they surveyed the environment of selling over 40 years ago:

   The 1960s promise to be a period of more intense competition
   that current managements have yet experienced. The signals
   are now clearly discernable:

   * A rising tide of new products and imports.

   * A growing saturation of markets for older products.

   * An increasing invasion of markets by firms formerly regarded
     as noncompetitive.

   * The spread of automation with its enormous output
     potential. (Kahn and Schuchman 1961, p. 90)

The comparison of these perspectives, so similar across four decades, suggests that dynamism in the selling environment occurs, at least to some (perhaps significant) extent, along dimensions that remain consistent over time. It also seems likely that the same types of change that managers confront today will present challenges for sales managers 20 and more years from now. Even so, change presents challenge, and it is critically important for research in selling and sales management to address the realities of the evolving marketplace.

It was this need that motivated us to convene a conference at the University of Houston in May 2004 to discuss the implications of the changing environment for ongoing research in selling and sales management. The papers in this Twenty-Fifth Anniversary Special Issue of JPSSM are the ultimate products of these discussions. Their purpose is to suggest worthwhile research directions for six broad subareas of sales and sales management according to the collective judgment of leading scholars in the field. We are hopeful that research along the lines suggested will help bring the academic stature of research in selling and sales management more closely in line with its substantive importance and result in important contributions to marketing thought and practice.

The purpose of this keynote paper is to summarize what we see as critical changes in the environment that affect the practice of selling and sales management. These developments and trends create demands and opportunities that require adaptation and new approaches, on the part of both organizations and academic researchers who would extend basic knowledge and bridge the gap between theory and practice. We begin by discussing aspects of the environment external to the organization that affect selling and sales management. We then also briefly consider organizational adaptations to these external environmental influences, and how dynamism in the external environment and within the organization is bringing about changes in the sales force.

DIMENSIONS OF CHANGE

We discuss external environmental changes affecting the sales force in terms of four categories of influences, including customers, competitors, technology, and the ethical and regulatory environment. The organization's efforts to adapt itself to, and, in some respects, control, changes in the external environment result in changing internal structures and processes (Dyer and Singh 1998; Eisenhardt 2002; Harrigan 2001) that have important implications for sales force management. These influences are depicted in Figure 1. Collectively, these changes in the external and internal organizational environments challenge salespeople's and executives' capacity to adapt and perform to meet rising standards. They also suggest needs and opportunities for research.

[FIGURE 1 OMITTED]

Customers

Customer expectations of salespeople and their organizations continue to ratchet upward. Evidence of this can be seen in declining customer satisfaction ratings for many organizations, even as they invest heavily in process improvements and customer relationship management (CRM) technology. In particular, customer expectations are increasing in relation to salesperson knowledge, speed of response, breadth and depth of communication, and customization of information and product/service offerings. Indeed, customer expectations change, often faster than organizations can effectively respond (e.g., Colletti and Chonko 1997). Failure to adapt and respond is likely to lead to obsolescence of the sales force, and, indeed, some have questioned whether the sales force is in the process of becoming obsolete (cf. Jones, Chonko, and Roberts 2004).

Further evidence of escalating customer expectations can be found in marketing strategy research, which has evolved to include market turbulence, including customers' changing preferences. Organizations that respond most effectively to market turbulence are likely to build a competitive advantage over those who respond less effectively. From its position on the front line, the sales force has the best perspective from which to observe and respond to market turbulence and to inform the organization regarding what is occurring in the marketplace. As such, an important consideration in organizational adaptation to the environment may be the extent to which the firm utilizes salespeople as "listening posts" to monitor and anticipate market developments (Heskett, Sasser, and Schlesinger 1997). Too few organizations leverage their sales forces' full potential to provide actionable market intelligence (LeBon and Merunka 2004). In ongoing research, it will be important to understand the role of the sales force in guiding organizational efforts to adapt, as well as to study ways in which sales forces are adapting to environmental changes.

Salesperson Knowledge

In addition to the increasing burdens on salespeople for technological expertise and product knowledge, customers also expect the salespeople calling on them to become familiar with information available in the public domain and over the Internet prior to calling on the account. One executive commented that the first sales call on an account used to serve the purpose of informing the salesperson about the firm, its buying center personnel and procedures, and its buying requirements. In contrast, in today's environment, salespeople who attempt to use the first call to obtain background information--because they had not accessed available information prior to the first sales call--will make a poor first impression and likely fail to penetrate the account. Thus, precall preparation has taken on new meaning (cf. Jones, Stevens, and Chonko 2005).

The various dimensions of change in the selling environment discussed here all tend to create heavier cognitive demands on salespeople. Increasing product complexity, customer demands, technological innovation, regulatory oversight, and competition all require salespeople to process, internalize, and manage increasing information loads. Sales research has built usefully upon established theory regarding scripts and knowledge structures to describe salesperson--customer interactions (e.g., Abelson 1976; Leigh and McGraw 1989; Szymanski 1988). Given the increasing complexity of sales environments, with an accompanying increase of cognitive demands, it will be useful to strive toward greater understanding of how salespeople cope with information overload (Jacoby 1984). Given these increasing demands, greater understanding of salespeople's capacity to manage and extract practical benefits from overwhelming amounts of information would be useful. Such understanding can help organizations provide product and market information in more actionable formats. It can also inform efforts to select salespeople and plan and implement automation tools more effectively. Specific questions might include, for example, what knowledge-based characteristics should managers assess during the sales force selection process? And, because salespeople are becoming less lone wolves and more team players, what knowledge does one need to improve team dynamics (cf. Dixon, Gassenheimer, and Barr 2003)? What types of learning mechanisms can sales organizations use to foster learning within sales teams (e.g., Rangarajan et al. 2004)?

Speed of Response

Technological facilitation of communication through e-mail and the Internet have enabled salespeople to communicate more effectively with customers, as well as with their own firms. At the same time, however, the same communication advances have had the ancillary effect of increasing customer expectations regarding response time to their requests and inquiries. Given the capacity to communicate quickly and effectively, customers expect that salespeople will use it to serve their needs more quickly and completely. Collectively, customer demands for quick response are overwhelming to salespeople, who must simultaneously balance a multiplicity of other responsibilities. This has led to some early research on the effect of role overload on salespeople (e.g., Brown, Jones, and Leigh 2005). However, more needs to be done in this area to fully address the multitude of demands placed on the sales force in an environment that is becoming increasingly complex. Although increasing the size of the sales force may have some positive effect on alleviating workload demands on salespeople (Zoltners, Sinha, and Zoltners 2001), information intensity, technology demands, and increasing customer expectations still create overload conditions that are likely to affect salesperson productivity. How do salespeople cope under these conditions? What can sales organizations do to retain top performers who may be burning out (e.g., Singh, Goolsby and Rhoads 1994)?

Breadth of Communication

To effectively serve customers' needs with increasingly sophisticated products, services, and applications, salespeople must become capable orchestrators of organizational resources. They must be able to appeal to and coordinate the efforts of technical experts and executives in their organizations to assist in efforts to sell and provide service to customers over long periods of time. The role of "orchestrator" has been noted in the literature (see Jones, Stevens, and Chonko 2005; Weitz and Bradford 1999), as has internal selling (see Weitz, Castleberry, and Tanner 2004). These issues are clearly important in key account management. Yet little empirical research exists on communication issues underlying salespeople's efforts in orchestrating the relationships between selling and buying organizations.

Depth of Communication

To establish and maintain strong customer relationships, salespeople must also deal with a greater number and variety of individuals within client organizations. Understanding influence dynamics and decision-making processes has become significantly more challenging, as they become more diffuse in teams and networks embedded within the buying organization. Buying (and selling) centers (Moon and Armstrong 1994) have existed for a number of years, and the notion of salespeople identifying key influencers when selling to industrial accounts is not new. However, given the blurring of boundaries on both the selling and buying sides, more work needs to be done to advance knowledge in this area. For example, as the business environment becomes more complex, more strategic alliances are being formed between companies. Executives typically mention that, through alliances, their companies are better positioned to package "total solutions" for their customers. At the same time, depending on the circumstances, alliance partners are often competitors as well. Research to date has not addressed issues related to this type of boundary blurring. Salespeople need to become, in a sense, social scientists capable of analyzing lines of power and influence across blurring boundaries in order to sell in today's business environment.

Customization

Closely related to the issues of increased need for knowledge, communication, and coordination, noted above, is the need to provide individualized solutions for each customer. In most organizations, both buyers and sellers are dissatisfied with commoditized "one-size-fits-all" products and services. For buyers, such products will generally require adaptation to provide a viable solution, and for sellers, they represent low-margin, easily duplicated products with little differentiation from competitive offerings. Therefore, selling organizations generally seek ways to move these commodity products up the value chain with some form of differentiation (e.g., bundling services, adapting for specific types of applications, etc.). The need for customized solutions places additional burdens on salespeople in terms of information gathering and dissemination (e.g., to others in the organization assisting with sales and service, as well as to customers), and communication and coordination within both buyer and seller organizations (cf. Zoltners, Sinha, and Zoltners 2001).

Customers as Coproducers

Relationship selling and customization of products and services to suit customer needs increasingly involves customers as coproducers of services rendered. As such, the value realized by customers often depends on their own efforts as much as it does on the salesperson and the selling organization. Yet customer dissatisfaction is likely to be attributed to the seller, even when service failure occurred as a result of the customer's own error or omission. Thus, beyond orchestrating the delivery of customer value from the selling organization, the salesperson must also make sure customers perform their roles effectively in a manner that assures that they receive maximum benefit from their purchases. This involves ensuring that customers know exactly what is expected of them and that they are motivated to do it. In this regard, salespeople's responsibility for educating customers extends well beyond informing them of features and benefits, and their role as motivator extends beyond orchestrating the efforts of selling-team members. Research on these aspects of the sales role (and of the customer's role as well) remains sparse.

Competitors

Typical markets today can be described as hypercompetitive (D'Aveni 1994; Schultz 1997). At the same time, the squeeze between revenue and profit targets and the cost to serve customers places great pressure on salespeople to produce under intense competition. As product life cycles decline in duration, with firms leapfrogging one another in attempts to gain product advantage, salespeople must continually update their market knowledge (i.e., of products and competitors), exacerbating the seemingly ever-increasing cognitive load they must carry. The number of contingencies to which they must be able to adapt (e.g., different variations of competitive selling situations) continues to expand at a rapid rate.

Recently, scholars outside the sales and sales management discipline have advanced the notion that companies must embrace customer lifetime value (CLV) precepts, upon which more efficient and effective market strategies can be implemented. By better allocating resources to customer segments, companies can improve their profitability (e.g., Reinartz and Kumar 2000). These key developments in the marketing literature have straightforward relevance to the relatively under-researched sales issues of call selection (i.e., allocation of available effort over customers and prospects). The "received wisdom" in this regard is that "targeting the switchable customer" (i.e., customers or prospects who can be influenced on the margin by incremental sales effort; Gensch 1984) results in greater sales productivity. Use of CRM technology to avail salespeople of knowledge of metrics such as actual or projected CLV or responsiveness to sales and marketing efforts would provide the basis for more informed allocation of selling effort. This line of inquiry is ripe for interesting research with the objective of improving prospecting and account management.

Technology

In order for salespeople to meet the rapidly changing customer expectations, they must know more--faster. Technology enables salespeople to store, retrieve, and analyze customer data and make specific recommendations that are customized for long-term business solutions. Technology also helps salespeople manage important information during sales cycles. The need for salespeople to communicate in real time with their companies and teammates is ever increasing. Technology advances the practice of selling and the maintenance of interorganizational relationships in many ways but also creates substantial additional burdens on salespeople. As previously mentioned, although it facilitates more rapid and frequent communication, it increases the demand on salespeople to provide information and services needed by customers in real time. Moreover, organizational adoption of CRM and sales force automation (SFA) systems requires salespeople to incorporate new technology and procedures into their already busy work routines without pausing from their primary selling responsibilities.

Thus, technology adoption by the sales force is lagging, and firms lament the financial losses occurring as a result of huge technology investments that produce lackluster returns on investment (Jones, Sundaram, and Chin 2002; Keillor, Bashaw, and Pettijohn 1997; Parthasarathy and Sohi 1997; Rivers and Dart 1999; Venkatesh and Davis 2000; Widmier, Jackson, and McCabe 2002). Moreover, existing research on technology use in the sales force indicates unintended negative consequences, such as unfavorable job attitudes and turnover intentions as a result of adopting technology (cf. Speier and Venkatesh 2002).

Ethical and Legal Environment

The ethical and legal environment can constrain the sales organization's ability to effectively pursue certain marketing activities. As corporate scandals fill the pages of the business press and class-action lawsuits become commonplace, the public demands greater transparency in corporate operations and more ethical, as well as more effective, leadership. Sales managers have a responsibility to ensure that salespeople become more cognizant and vigilant with regard to the representations they make to customers. As a result, sales organizations are placing standards and limitations on claims that can be made and standards that must be upheld in selling. Thus, in highly competitive selling situations, salespeople must be particularly careful about the arguments they use and inducements they offer in attempting to win sales.

Moreover, salespeople need to be more judicious with managing expense accounts, giving gifts, managing unethical demands from buyers, making promises about product performance and delivery, and selling products that can be perceived as "unnecessary." Also, globalization has resulted in different interpretations of cultural expectations and has led to the need for more thoughtful consideration of various cultural idiosyncrasies when selling globally. What is ethical in one country may be unethical in another.

The current ethical and legal environment puts an additional burden on sales companies to select the "right" individuals. And with turnover costs continuing to skyrocket, sales companies can hardly afford to hire salespeople who make ethical and legal errors and then terminate them. Selecting and developing sales personnel has always been an important topic; today's environment increases the importance of doing this right.

SALES FORCE ADAPTATION TO INTERNAL CHANGE PRESSURES

Whereas external forces such as customer evolution, environmental shifts, technological advances, and competitive intensity challenge selling organizations, internal forces also affect the selling organization. The best sales forces not only adapt quickly and effectively to external events, they also implement new customer strategies, launch new products, innovate in the sales process, and seek constant performance improvement. These internal change forces fall into two linked categories: shifts in company strategy and the hunt for greater productivity through the management of performance challenges. Figure 2 illustrates some common internal change pressures.

Responding to Shifts in Company Strategy

Public companies face constant pressure from shareholders pushing for sustained growth and challenging sales leadership to find and implement innovative and effective strategies. Initiatives rooted in strategic shifts include building a sales force for a new product line, integrating sales forces from merging companies, and managing the changing role of the sales force now that customers can place orders using a company's Web site (e.g., partner relationship management and e-business technology).

In response to these challenges, sales managers must be sensitive to indications of impending decline. If ignored, these can escalate into long-term downward spirals. Typical indicators include the following:

* sales force turnover among the best salespeople,

* conflict between the sales and marketing functions,

* waning customer focus because salespeople are spending too much time on nonselling activities,

* declining customer satisfaction ratings, and

* missed performance goals on a consistent basis by the sales force.

Sales forces continually need to adapt to internal strategy shifts and performance challenges. Thus, theory-based methods that would address internal sales force change dynamics are urgently needed.

Managing change ultimately implies changes in behavior and culture over time (Beer 1987). Several adaptations to these changing trends are sufficiently pervasive that they are consistently noted in the papers that follow in this issue, including (1) the increasing importance of key account and ad hoc selling teams relative to "lone-wolf" salespeople, and (2) the focus on building and maintaining profitable long-term customer relationships relative to short-term revenue goals. As the following papers suggest, these developments have far-reaching implications for ongoing sales management research.

Clearly, sales force research and practice have arrived at a critical juncture. Against this backdrop, the papers that follow in this issue discuss research implications of these major trends with respect to the sales and marketing interface; selecting and developing sales personnel; leadership; motivation, compensation, and control; technology and CRM; and key accounts and team selling. We hope that they spark new ideas for research to advance the theory and practice of selling and sales management.

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--, Carl Stevens, and Lawrence B. Chonko (2005), Selling ASAP: Art, Science, Agility, Performance, Cincinnati: Thomson Learning.

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Figure 2
Internal Forces That Drive Sale Force Change

      Company Strategy                  Performance Challenges

* New product launch           * High cost-to-sales ratio
* Merger                       * Not enough new customer acquisition
* Selling process redesign     * Complacency
* Become more consultative,    * Lack of accountability
  less transactional
* New channel strategy         * High turnover
* Entry into new markets       * Not able to handle customer diversity
* Value-added services         * Not able to handle product diversity

Eli Jones (Ph.D., Texas A&M University), Associate Professor of Marketing and Executive Director of the Sales Excellence Institute, C.T. Bauer College of Business, University of Houston, eli.jones@ uh.edu.

Steven P. Brown (Ph.D., University of Texas), Bauer Professor of Marketing, C.T. Bauer College of Business, University of Houston, steve.brown@mail.uh.edu.

Andris A. Zoltners (Ph.D., Carnegie Mellon University), Founder and Co-Chairman, ZS Associates, Professor of Marketing, Kellogg School of Management, Northwestern University, andy.Zoltners@ zsassociates.com.

Barton A. Weitz (Ph.D., Stanford University), Professor of Marketing and J.C. Penney Eminent Scholar, and Executive Director of the David F. Miller Center for Retailing Education and Research, Warrington College of Business, University of Florida, bart.weitz@ cba.ufl.edu.