Eureka Forbes Case Study

1. For Case titled “Eureka Forbes”, comment on the suitability of the new sales performance evaluation plan. Should this be rolled out? If yes would you recommend some changes to the plan & why?

The new sales performance evaluation plan has its own share of benefits, since it moves to rewarding on adhering to a well-defined sales process. However, the following adaptations can be made to the evaluation programme in order to make it more robust

• Elimination of  non quantifiable parameters in evaluation process:

There are certain parameters in the new sales performance evaluation sheet (Exhibit 14 Continued) such as “GAS- Gift a smile”, “Active door knocks” which are either not easily quantifiable, or not a reliable piece of information to reward performance. Since the inputs for these parameters are being received from the Euro Champs themselves, there is a huge possibility of socially desirable responses coming in, which would defeat the purpose of a fair evaluation process.

• Defining a minimum ratio for  parameters:

To avoid inflated number being reported for, say, number of appointments, the organization can further refine the rewards system by only giving points if a minimum appointments to demo ratio is maintained. For e.g. the case talks about a ratio of 1:10 for demos converted from appointments.

• Training of group leaders in Spreadsheet:

The group leaders can be made more efficient in data entry and analysis by using the spreadsheet features. Since each group leader manager manages the reporting for 4 customer sales specialists, and each specialist has to report 44 data points about his performance each day, assuming he takes 3 seconds to enter the data in the spreadsheet (after being trained in excel), he can complete the entire days reporting in less than 10 minutes. Also, since the task is integrally embedded in his key responsibilities, even the group leader can increase his efficiency in completing his own tasks.

• On the job training in concurrence with centralized training:

The idea of a CRTC is integral for optimization of trainings, however, since there is huge dependence of the organization on the customer sales specialist, enough importance should be given to shadowing and on the job training for the new specialists. The centralized training shouldn’t be considered as a replacement of on the job training, but only as a complementary technique.

1. Explain the reasons for the failure of the current sales process that were observed by Goklaney in the field.

The Company mainly used the “Direct Product Sales” channel which included both face-to-face and phone sales and nearly 70% of the sales revenue came from it (Exhibit 2). The process has few disadvantages which affects the overall effectiveness.

• Lack of formal customer contact database:

This lead to poaching of territories by experienced and seasoned reps demotivating newer reps.
This also lead to knocking on doors of customer twice in a day leaving the customer irritated.

• The reps required intense training:

Goklaney observed that on sales calls EuroChamps just focused on completing their demo and they repeatedly missed prospects signals of interest to buy the product.

• Ignorance by reps:

The demo equipment were not cleaned or damaged while visits to customer which lead to a bad impression and reduced the possibility of sale.

• Inability of EuroChamps to handle customer objections:

The reps were unable to convey the value which the customer was getting from the product and followed the sale process mechanically.

• The process is expensive:

Referring Exhibit 1, we can infer that despite increase in sale of products the operating profit has come down which means the cost of sales and expenses has increased.

• The cold calls can be time consuming:

The sales rep can take hours to explain the consumer about the product in order to fix a demo appointment. Also, on call he might be not be able to judge the consumer behavior at specific point of time and hence unable to overcome customer objections.

• Limited coverage:

The Company’s current penetration was only 14% and there was huge pressure on EuroChamps to cover as much area as possible and a given target of door knocks and sales.