Foundations of Sales, Group C

Part I: Foundations of pricing

Week 1: Setting & getting prices

• B2B vs. B2C
• Bargaining techniques (includes role-play Porcelaine, WHU)
• Profit impact of pricing
• Calculating price-quantity-cost compromises

Week 2: Channel pricing

• Channel systems
• Channel economics
• Trade terms
• Value-based pricing (includes case Soren Chemicals, HBS)
• Retail pricing

Part II: Foundations of selling

Week 3: Building value perceptions

• Presenting to top executives
• Designing professional selling documents
• Sales conversation techniques (includes video case)

Week 4: Building customer relationships

• Organizational buying process
• Pricing process and selling process (includes case Boise Automation, Ivey)
• A networking lifestyle (includes case Heidi Roizen, HBS)

Part III: Foundations of sales force management

Week 5: Managing key account sales

• Sales forces and sales jobs
• Budgeting and forecasting
• CRM systems
• Key account management
• Pipeline management (includes case PackMach, WHU)

Week 6: Old school vs. next generation sales and marketing

• Managing field sales (includes case Clef Company, HBS)
• Managing inside sales

Any business model has two sides: operations and sales. In most firms, the operations side is traditionally transparent, predictable and slightly over-managed, while the sales side is traditionally intransparent, unpredictable and heavily undermanaged. This course introduces key aspects in managing sales performance.

To manage sales means managing the peoplewho make sales, i.e. those who talk to customers, communicate innovations, negotiate prices, and obtain signatures under a contract: the sales force. The significance of salespeople is illustrated by a statement ascribed to Andrew Carnegie (1835-1919), an entrepreneur in the 19th century: “You can take away my money and take away my factories, but leave me my sales staff – and I’ll be back where I was in two years”. The sales force is not only the No. 1 revenue driver, but also a major cost driver. On average, firms spend 10% of their revenues on the sales force. In the economy, the overall amount spent on sales forces is three times the combined spending on advertising. Sales and service are often the largest functions in the firm. Most country subsidiaries of multinational enterprises are essentially sales organizations. Consequently, learning to lead a firm requires learning to lead the sales force.

Students who consider a corporate career should consider starting their career with a few years in sales. In sales, you learn to view the business through the skeptical eyes of customers and salespeople. It is not by coincidence that brand management tracks in companies such as Procter&Gamble or L’Oréal commence with a mandatory stage in sales. Unlike most students believe, sales is not a career hindrance, but a career booster on your resume. The public image of selling is negatively biased by TV mockery of B2C salespeople such as ruthless used car salesmen or slick door-to-door salesmen of books, brushes, or vacuum cleaners. However, in B2B, selling is not at all about extrovert show-stars who talk a customer into buying. Firms are looking for a new generation of key account managers with the analytical skills of a strategy consultant who can meet the customer’s top managers eye-to-eye. In other words, they are looking for WHU students as key account managers.

Students who like consulting should consider a career as a consultative seller. Consulting skills are important to sellers and selling skills are important to consultants. The competence requirements are more similar than most students expect: In a strategy consulting firm, you don’t become a partner as the best advisor, but as the best project seller and the best client relationship manager. In sales, you don’t win projects only by being a nice guy, but by adding value to the client’s strategic agenda as an advisor. By the way, the pay level in sales is more than comparable to consulting: The best-paid people in any firm are the top salespeople. But the best kept secret is: Whereas a consulting life is often spent in stifling meeting rooms in the German province, a B2B sales life offers more international travel, includes more wining & dining in exciting places, and leaves more personal freedom.

Students who consider the entrepreneurial path will soon realize that entrepreneurship is all about selling. You collect capital by selling your business idea to investors (In fact, some investors will only invest if the founders themselves are the first salespeople). You grow your business by selling products and services to customers. You hire talent by selling your company culture to candidates. You get suppliers by selling your reliability as a business partner. You exit by selling your customer base and technology to other firms. Entrepreneurship requires the two traditional competence areas of commerce: 1) accounting/finance and 2) sales/marketing. As a future entrepreneur, you cannot go wrong by specializing in these two areas during your BSc and MSc studies.

Selling is a set of skills that can be learnt. Only few people are born as a selling ace. WHU is the only German university with a mandatory Bachelor course in sales. Most university curricula either neglect sales or treat sales as a part of marketing. However, in the business world, far more people work in sales than in marketing. In B2B, Sales typically is the dominant function and Marketing is often a part of Sales. In B2C, Sales and Marketing are equally powerful.

The course intends to enhance five categories of competences:

• factual knowledge, for example, applying salespeople jargon to discussing the status of a sale (such as the “buying center”, “red flags”, “mentor”, “RFQ”, “gatekeepers”), applying negotiation jargon to discussing the status of a negotiation (such as BATNA, ZOPA, walk-away price, non-offer offer), apply sales management jargon (such as quota, forecast, pipeline, DSM, and other idioms), and understanding the specific terminology of sales management in a different sales contexts, such as selling to distributors, selling to large enterprises, B2B2C, and industrial selling,
• conceptual knowledge, for example, explaining the evolution of retailing, analyzing the composition of a buying center, analyzing sales pipelines and generate sales forecasts, calculating price-trade-offs against other profit drivers, analyzing economic value to customer, and mapping the structure of personal networks,
• sales-specific procedural knowledge, for example, applying a structured negotiation blueprint, evaluating the win probability of a sales opportunity, evaluating the needs of a customer through questions, and creating professional selling documents,
• general business-relevant procedural knowledge, for example, preparing for business meetings, making the best out of a limited preparation time budget, making concise contributions to meetings, and constructively building on contributions by other participants in the meeting, and
• metacognitive knowledge, for example, evaluating one’s own selling behavior, and observing the power of deep reflection and mindfulness that is not distracted by smartphones.

The learning method mix includes role-play sessions between students with joint debriefings, case-based discussions with concluding mini-lectures, interactive concept lectures, and managerial guest presentations. This video shows the style of case-based sessions: https://www.youtube.com/watch?v=IbNNsq1fC0A. The problem-based way of learning requires a great amount of energy, both from the student and from the teacher.

• 33.33% (30 points): six case preparation notes (pdf, bullet points are enough, ca. 500-750 words)
• 66.67% (60 points): 60-minute final exam (closed book). The final exam is a laptop-based Moodle quiz, regardless of whether you write on-campus or off-campus. It is composed of quantitative calculation questions and qualitative multiple-choice questions. All questions will be given in English. All response options for multiple-choice questions will be in English as well.

If you are a student from a previous BSc cohort who failed the examination Module Foundations of Marketing & Sales previously and who has to re-take the module (“Modulwiederholer”) now: Your course score starts from zero. If you want to obtain a module grade in April, you must submit all assignments during this semester. Please note that this course has an early enrollment/un-enrollment deadline because the first assignment is already due in the second week of the course.

If you are a student from a previous BSc cohort who has not completed the first take of the module yet (“Erstversuch”) because you were ill on the day of the final exam and who has to write a make-up exam (“Nachschreibeklausur”) now: Your score for the cases still counts and will enter your final score together with the make-up exam.

The final exam is based on the content of this semester. If you are from an earlier BSc cohort, please note that some course contents have changed compared to the version of the course that you originally participated in. You are advised to attend as many of the current sessions as possible.