CHAPTER 3 - SALES FORCE AUTOMATION [SFA]

Introduction -

SFA i.e. Sales Force Automation is designed to help salespeople, acquire and
retain customers, reduce administrative time and basically make sales people’s activities
something that earns them and their company profit. SFA has the following purposes.

1. Increased Revenue - Quite obviously, gross income in the profit (i.e. improvement
in the bottom line) is the main goal of implementing SFA. But it is not just the
sufficient answer to SFA’s success. Just as important is the increase in revenue
per salesperson and in the gross profit per year. If you have an increase o 100% in
sales revenues but your cost of sales has increase or it strictly came as a result of
your increased sales force, your SFA implementation fails.

2. Reduction in the cost of sales - This doesn’t stand for reduction in force (meaning
fewer employees which obviously mean to you). But in this case, we are talking
about a reduction inn the amount of time that is used by the sales people in co-
ordination of their efforts, continuous data entry and often unsuccessful attempts
to extract and interpret data without the tools to do so. Studies show that sales
time to fulfill administrative functions is almost half of a salesperson’s activities.
By reducing the time engaged in these administrative or other non-sales related
efforts, the cost of the sales is reduced. This is one of the most successful results
of SFA.

3. Customer retention due to company - If your customers are happy, they will stay
with you even if they are paying a bit more. It is not about the money but about
the relationship with the company and often the relationship with particular
salespeople within the company. SFA’s benefit is to provide you with a view of
the customer that allows an intelligent salesperson or a company to understand the
value of the individual customer through customer history and communication
with the company. Though it can never be a substitute for personal interactions, it
can provide the intelligence and the view to better plan how to actually do good
things for your clients.

4. Sales force increasing mobility - The sales force is out of the office most often.
They have to do many duties like meeting customers, moving through airports etc.
This is making mobility a competitive issue requiring effective mobile tools such
as internet and hand sets.

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5. Easily available customer information with single view - Multiple apartments may
have interests in viewing the status of the customer account or opportunity. E.g.
the sales department wants to see the status of the opportunity. The accounting
department wants to see the status of invoicing and billing for the same account.
The marketing department wants to see reports on varying degrees of
success/failures of their campaign with individual account within each department
are individuals with different roles who have their own agendas. The vice
president of sales wants to see all the activities of all salespeople in his
department. He also wants to get a sales pipeline report to refine his sales forecast
for the coming quarter. The accounts manager does not need that much
information. He wants a national view of all sales activities around the accounts
he owns. The sales manager wants to see the opportunity progress but not all the
contact lists of each salesperson. Each salesperson wants to manage his customer
accounts. Each of them has an individual view that allows them to see all the data
they need to see; but at the same time there is a universal view of all the data
available to all departments at all time.

Sales Force Automation functionality -

At its roots, SFA has the same fundamental features regardless of the vendor. The
treatment of the core features tends to oscillate only in the depth provided, the look and
the feel of the interface and the transparency to the user. The list that follows is a
representative feature set for SFA.

1. Contact Management (CM) - It is a basic tool that has entire applications devoted
to it. Contact management modules take on an added degree of complexity when
it is integrated to SFA package mainly because it is to be linked to all other
modules incorporate. Otherwise contact management covers the basic things like
name, address, phone number, company, title, personal and business information,
activities related to individual, attachments related with the individual and level of
that decision makers. Some applications such as Siebel sales are able to take this
contact information and create organizational charts for sales people so that they
can see who they have to deal with, at what level of customer hierarchy.

2. Account Management (AM) - This standard feature allows the salesperson to

handle individual corporate account. Each account has multiple links t the other
information beyond the corporate name and address, including the contacts by
corporation and the proposed opportunities by corporation. Fundamentally, it is
another view of the customer and the potential data that is designed to work with
sales departments that have accounts manager or that what corporate information.
It can include either general or highly detailed views of an enterprise.

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3. Opportunity Management (OM) - This is often seen as the most essential of SFA
modules. The aspects that OM covers include the specific opportunity, the
company it belongs to, the salesperson or the team that is working on it, the
assignment of revenue credits if there is a sales team, the potential for closing of
this particular opportunity, the final results of this opportunity, the stage of the
sales process this opportunity is in, and the potential closing date for the
opportunity. Additionally competitive information is included here. E.g. who is
specifically competing for the opportunity against your company and how much
threat they represent? Even more interesting, in some better SFA packages, a
competitive products metrics can be brought up to see how well your product
stack up against the competition’s product equivalent. This can give salesperson a
valuable selling point.

4. Lead Management (LM) - Lead management functionality can be seen as a subset

of opportunity management. With SFA packages that have strong lead
management features, the sales person can import leads multiple sources and
using criteria established through the sales process weigh the potential of these
leads to become opportunities.

5. Pipeline Management (PM) - the sales pipeline is a particular term for the
execution of established sales process. Each company has its criteria for what
constitutes its sales process. E.g. one company could set up salesperson’s
objectives that are weighed by the steps of the sales process. The sales process
may have the following sequence -

• Prospecting
• Potential lead
• Opportunity
• Building vision
• Short list
• Negotiation
• Closed- won/lost

Thus, the variations in the sales process may not be infinite but they are extensive,
if you can successfully embed your sales process into the SFA application, then
you can use the application as it was meant to be used.

6. Sales Forecasting (SF) - Part of PM is getting forecasts from sales and then
managing sales activities to those forecasts; e.g. if the salesperson is expected to
do $2.5 million business and eh does 40% of it, then the company have serious
problems. If that is due to poor forecasting tools, SFA also has problem.
However, most SFA programs have adequate sales forecasting tools. But most
sales forecasts are still nothing more that good guesses regardless of how many
algorithms people stuff in program.

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7. Proposal Management - When implemented, it is a way of coordinating and
tracking external proposals. It normally has an overflow which is determined by
who is responsible for what part of proposal. Additionally, it can control the
effective completion of the proposal by guiding the stages of evaluation of cards
of proposal.

8. Quota Generation- A simple tool that generates quotes for customers. Normally, it
uses information on pricing in the product catalogue that is available with SFA
application and has been customized for individual company offerings.

9. Order Tracking- This feature tracks the status of invoice and product delivery.
This is normally tied into the back office financial functions.

10. Sales Quota Management- This is normally for sales managers. It allows them to
see how the individual sales person is doing relative to their quota within some
defined time segment.

11. Commission Management- This is a tool that calculates commission for sales
people. Though it looks very simple, it is not easy thing to implement. Sales
persons can often share the opportunities, which complicate the calculation of
commissions. Additionally, depending upon the company, the sales team might
have some private arrangements going. These arrangements are known to the
managers and have to be programmed into the application so as to cut accurate
commission cheques.

12. Territory Management- This is another important feature that solves a complex
problem. It is not particularly complicated until there is a change in the territory.
That can mean a new person takes over an existing territory or a territory can be
restricted and re-divided among existing sales people geographically. Re-dividing
a territory becomes a very political issue that has to be managed carefully.

Sales force automation technology-

What makes SFA powerful is not just functionality but also the combination of
functionality and flexibility of technology. It allows each of them [i.e. the managers and
the sales people] to analyze the data, stay on the top of the opportunities, embed best
practices for the future sales people and last of all, do all this by just clicking the mouse.

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Data Synchronization -

One of the most important technologies is data synchronization. It is the process

of updating information among unconnected computers. Each synchronization system
gets data that confirms with the data on any other system far away.

Sales people in the field can maintain subset of master database and update their
local data while others are working with same data simultaneously. Synchronization also
allows corporate managers and sales teams to share information created by field sales
people such as meeting notes, schedules and forecasts.

Important recent sales trends related to the mobility and wireless data make
synchronization even more important. There are several points which are to be
considered.

• Sales people operate spending more time out of the office with customers. Many
sales people are telecommunicating [i.e. working out of their homes rather than in
corporate branch offices].
• Sales people operate as members of sales teams and as products become more
complex and technical, the need to share information grows.
• Entire sales and marketing organizations are using computer based customer,
sales and project based information more effectively. Field people can use this
information to close sales faster and managers can access this information input in
the filed. This means that for SFA, data synchronization becomes most essential
piece of technology.

The Data Synchronization Process -

Data synchronization takes up a fair amount of network infrastructure bandwidth.

It actively involves a lot of what comprises the corporate information system, to take
example of Sales Logix data synchronization system which is one of the most
sophisticated CRM data synchronization systems in the market.

Working of SalesLogix data synchronization system is as follows-

Dia.

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Field sales people with laptop computers need to download relevant subset of data
manipulate and update data and need to synchronize changes with new information from
host computer database. The typical process of synchronizing data between remote and
host system requires several basic steps as shown in the figure.

Remote databases are created for mobile salespeople and branch offices. Each
database is a subset of corporate database. It will contain information needed by only that
particular salesperson; e.g. information on filed salesperson’s laptop is only pertaining to
his particular account. The synchronization system tracks the information pertinent to
particular salesperson to both remote database and host database. Remote salespersons
can connect to home office using low bandwidth modem or WAN connection.
Salespeople or managers who are at desk can connect via their local area network. Log
files are exchanged that contain information to be updated in respective database. After
connection is completed, new data is supplied to each database and should have up-to-
date information. It is estimated that using localized version of data synchronizer [where
only updates are done], 50% of the communication cost can be saved.

Flexibility and Performance -

Synchronization system should be capable of supporting large scale field implementation

with potentially 100s of reasons. Besides using most efficient means to distribute and
post data, flexible support to modern client-server database is critical to meet demands of
data synchronization. High performance synchronization requires powerful database
capabilities and performance.

Other SFA applications -

• Incentive compensation system - This is a functional feature and there are

standalones devoted to it. This particular feature allows vice president of sales to
design compensation plans and to track them.

• Competitive information system - This is often tied to multiple sources so that as

a salesperson, one could do the research online and internally fined what he
should do. There are some external programs that are not tied to CRM. But there
are some serious advantages to be able to integrate internet searching with server
and desktop searches.

• Telesales campaign management - This feature helps inside sales managers to

design telemarketing campaigns. Thus they have an organized and sophisticated
way to track activities of telemarketers.

• Sales assistant - This feature is there for sales people without experience.

• Expense reporting - This feature ties expensive reporting to both account and
CRM system.

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 • Learning management system/content delivery tool - This feature allows means
for new employees to understand sales process and experienced employees to
request and proceeds appropriate sales information and tools ranging from
brochures to competitive information.

• Marketing encyclopedia - this is a centralized depository for all marketing

materials so all sales people have access to appropriate materials for their
customers.

• Partner management capability - This really doesn’t belong to SFA applications

but some limited functionality is there so that indirect sales opportunities are
there.

• Custom sales process and methodologies - This is a built in base practices and
known methodology. The value is that, companies have benefits of using well
established and consistently popular sales methodology.

• Consistent sales methodology framework - This is a framework for preceding

features.

Other SFA features -

• SFA centric flow - This is a sales specific workflow that assigns permissions and
roles to either specific people or titles; e.g. sales manager might need to approve
an opportunity entered into a system by a sales person because of resource cost of
opportunity. A flag as opportunity would then notify the sales manager of the
need to approve it before it can be officially registered into sales pipeline.

• Customer need assessment - Using templates and comprehensive set of questions

and interviews, the sales person is able to work with customer to determine what
they are specifically looking for. This means that functionality has to include
ability of sales person to understand customer business process.

• Custom product competition - This allows sales person to provide customer with
specific set of products that meets their actual needs.

• Sales order creation from quotes - This generates actual order for customer based
on quotes those were developed from price and product configuration designed
via the needs assessment.

• Automated customer billing - This is an integration point. It means that the back
office can generate customer invoice automatically form information that the
salesperson has entered into customer records. This feature is consequence of
preceding features.

End Of Chapter 3

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