Problem:
Edward Smeets is the new sales manager for Grunwald Instrumentation. He has just come aboard to head up a sales force of seventy sales professionals, all of whom possess at least a B.S. in a scientific field. Many have Master's Degrees.
Smeet's sales reps sell highly complex instrumentation systems that are used to analyze a variety of different materials in a variety of laboratory environments. The instruments, sixteen in total, are used to analyze gases, liquids, and blood. Each product is very technical and customers expect their Grunwald sales rep to be very knowledgeable about the technical applications of their product to their analysis requirements of their laboratories.
Each sales professional covers an assigned territory which usually comprises about one-half of a state. In some cases, the sales rep may cover two states, but 80% of the sales reps are within a two-hour drive of their home. The sales team has been divided into twelve teams around the country, with each team having its own sales manager and five to nine sales reps, all of whom call on a variety of customers. Sales teams operate out of the same office, located in a major metropolitan area (e.g., Boston, Dallas, San Francisco, Atlanta, etc).
Sales rep turnover has been 15% annually the past few years and Smeets sees it as imperative that he do something about this. Annual sales have been averaging a 3-5% increase each year over the past five years... but the corporate president wants more, complaining that your competition has been averaging 6-8% sales growth increases in revenue each year.
Analyze the sales force structure. What is the current sales force structure that is being used and what might be the limitation of the sales force structure that is currently employed? What changes, if any, would you suggest that Smeets consider to the sales force structure to effect increased sales?