Salesmanship and Sales Management, A Historical Framework
Geplaatst op 13 december 2015 door Ronald Swensson

The development of modern salesmanship is a uniquely American story. The intense effort to ‘upgrade’ salesmanship distinguished the growth of capitalism in America from that in other countries. All European nations had peddling networks, some of which had existed for hundreds of years, but none created organized sales forces to the same degree as it did in the United States. There are several reasons for this. First, the emergence of salesmanship depended on a stable and widely used currency - in Europe in those days there were dozens of currencies - and the availability of credit - all aspects of the American economic system. Through this economic system and the enormous area, the scale of American firms was greater than in Europe. The massive manufacturing concerns of the early twentieth century, which produced tremendous numbers of business machines, appliances, and cars, hired salesmen in the hundreds (and even thousands); and these goods, all pushed by aggressive salesmanship, distinguished the American economy by their early appearance and widespread purchase. Organized selling in America flourished also for cultural reasons. Salesmanship, especially beginning in the late nineteenth century, seemed to offer a pathway to personal success.

In 1904 businessman P. W. Searles summarized in System Magazine the changes he had seen in selling over the past several years. Earlier, as he put it, a salesman traveled as his own boss. Now his routes were planned, his customers evaluated before his departure, and a trail of sales slips and reports established a record of his every move. Sales managers at large corporations assigned salesmen specific territories and gave them monthly or weekly quotas to meet. They aimed to make salesmanship uniform, predictable, and capable of being taught to new recruits. They even instructed salesmen on how to stand while talking with a customer, or how to hand over a pen at closing. Most turn-of-the-century salespeople were straight commission agents, very independent of the companies that employed them.

Frederick W. Taylor's scientific management concepts came late to the management of personal selling. This occurred because most companies believed that selling was an art, or a natural ability. Good salespeople were born, not made, and could not benefit from management. Many also believed that supervision was not necessary for commission salespeople. It was reasoned that, under the straight commission method of payment, good salespeople would be automa-tically rewarded and stay with the firm. Poor ones would be unable to support themselves and would resign. therefore, the commission compensation plan made supervision unnecessary.

Companies often allowed numerous salespeople to work in one territory so that poor performing salespeople would not limit the company from attaining the full sales potential of the territory. The problems associated with such a system are obvious. NCR, just before the turn of the century, was the first company to offer exclusive territories and unlimited earning potential to its salespeople.

The laissez faire attitude toward salespeople had clearly begun to change by the turn of the century. The influence of NCR's examples and of Taylor's scientific management concepts were powerful. New psychological theories that suggested the possibility of understanding behavior in order to improve salesperson selection and performance were being propounded. Business-people were increasingly convinced of the need to focus their efforts on management of sales forces. Another, perhaps more important influence was the changing economy. By the 1900s the old sellers' market was disappearing. Supply had caught up with demand. As a result, competition began increasingly intense. Management was forced to be more concerned with customer relations and performance in general. Therefore, sales management techniques and methods were developed to improve the competitive abilities of the firms operating in this new environment.

At the turn of the century the typical salesperson was paid a straight commission and thought of as an entity apart from the firm's organization. Therefore, firms provided very little training and development for salespeople. The ‘sink-or-swim method’ was common during the early decades of this century. As the ‘sink-or-swim method’ lost favor, true sales training became much more important. The more it came to be understood that mere ‘personality’ was inadequate for success, the more important sales training became. Business historians consider National Cash Register (NCR) the first company to provide training to its sales representatives and to be a pioneer in sales management. NCR, and some other firms, had perceived the benefits of training before the turn of the century. Corporate sales training programs consisted of learning the background and policies of the firm, product knowledge, types of customers, the market, the presentation and selling skills. The revolution in selling had consequences beyond the firm. The growth of systematic methods of salesmanship gave rise to a number of products and services. Trade journals, sales (management) magazines and -books were published. The Dartnell Corporation (John Cameron Aspley) began collecting empirical data on selling and produced reports for sales managers - a great deal of the earlier work of John Cameron Aspley is summarized in The Sales Promotion Handbook (1957). Also A.W. Shaw Company (Arch Wilkinson Shaw) started publishing books for sales managers - see the book Sales management (1914).

An important book, considered by many to be the first American sales management text, was Scientific Sales Management by Charles Wilson Hoyt (1913). Hoyt was director of the sales- and advertising department at George B. Woolson and Company (a publishing company). Hoyt positioned the sales manager as the link between salespeople and the firm. The sales manager's major responsibilities were to cooperate with salespeople and increase their efficiency. Business authors of this period noted that many experienced salespeople were hostile to sales management help -  see the book Marketing Methods and Salesmanship by Butler, DeBower and Jones (1914). Hoyt suggested that sales managers should deal with this problem by working with a new type of salesperson: . . . the one who accepted help from the house . . . and ignore the old type of salesperson . . . not the one who worked alone and was hostile to sales management assistance. Hoyt's pioneering text assigned the sales manager the following tasks to increase efficiency: (1) standardize the salesperson's presentations; (2) select candidates by obtaining their records through application blanks; (3) talk common sense to the sales force as opposed to offering them inspirational meetings; (4) and, eliminate the idea that advertising is a substitute for salespeople. Hoyt advocated the rating of salespeople through the use of contests. Despite the clear-cut danger of customer loss associated with hard selling techniques, this idea is encountered frequently throughout the early history of sales management thoughts. Its merit went unquestioned until Harry R. Tosdal's - Professor of Marketing at Harvard Business School - criticism in his book Problems in Sales Management (1921).

John G. Jones, one of the first instructors of salesmanship, offered a sales management course at New York University in 1915. It included the following topics: selecting and training salespeople; planning sales equipment; methods of compensation; territory problems; sales contests; conventions and quotas. Jones was assisted in developing this course by the Alexander Hamilton Institute, where much of the earlier sales management materials were developed. He published in 1918 his book  Salesmanship and Sales Management. Harry R. Tosdal introduced a course in sales management in 1920 which included such topics as structure of the sales organization, sales research and investigation, formulation of sales policies, and preparation and execution of selling plans. Given the independence with which salespeople had operated prior to the general implementation of sales management, it is logical that the developing role of sales management (1900-1920) would be a narrow one.

Primary concern was with selection, supervision and control of salespeople. During the 1920s, a few writers were to offer a broadened definition of sales management which included marketing tasks. In 1920 J. George Frederick proclaimed in his book Modern Salesmanagement a new era for the field of sales management, an era of development, respectability and new-found professionalism. Frederick saw the sales manager as a major player within the total marketing function, which, in turn, encompassed the entire enterprise. He portrayed the sales manager as a top level executive, contributing to policy, and responsible for its implementation through the sales force. Frederick's sales manager was concerned with product quality and new product development as determined by the needs of the market. It was the sales manager's job, he wrote, to synchronize the standardization needs of production with the market's demand for a varied product line. Sales management had begun to evolve from the narrow supervisory role of the pre-1920 era to a broader one, embracing that marketing concept. Frederick was president of a company called ‘Business Bourse’ that specialized in publishing business-related research and data, he was married with Christine Frederick, an American home economist and early 20th century exponent of Taylorism).

The issue of the efficacy of psychological testing for salesperson selection was first addressed in the early 1900s. For example, reference is made by Butler, DeBower, and Jones (1914) to ‘ingenious oral and written examinations designed to test one's accuracy, mental alertness and ability to reason’. The authors predicted a not very bright future for such devices. They believed an able experienced salesperson would hesitate to work for a house using new ideas based entirely on theory. Walter Dill Scott, a psychology professor at Northwestern University, became the director of The Bureau of Salesmanship at Carnegie Tech in 1916, and was given grants by numerous large organizations to develop improved methods of salesperson selection. On the first World’s Salesmanship Congress (1916) Scott performed 'mental alertness tests' on young salesmen to predict which ones would most likely succeed. Among others he published the book Influencing Men in Business (1911) (see section How-to-Sell Books). Discussion of salesperson selection during the twenties and thirties reveals a rejection of the earlier view of the salesperson as an entity apart from the firm. Poor performance was seen as negative to both salesperson and firm. It became clear that customers were assets and selling skills were recognized as valuable. Tosdal criticized the overemphasis of employers on technical and industry knowledge, believing intelligence and the ability to relate products to the needs of buyers to be far more important. He advocated the creation of accurate job descriptions based on the nature of the selling job.

Tosdal's discussion of compensation programs – in his second book on sales management (1925) - is as thorough as any since. No truly new programs have been developed since then. Tosdal wrote: create a compensation plan that is motivating and fitted to the needs of the business. Four factors were considered in developing a compensation plan: (1) the income necessary to maintain a reasonable standard of living; (2) the market for salespeople; (3) the philosophy of the firm regarding payment at, above, or below market; (4) the nature of the product. He mentioned that employee turnover is an excellent indicator of the efficacy of a plan. Tosdal criticized straight salary plans for their failure to motivate. However, he agreed that commission plans increase effort but also heighten rivalry and turnover, emphasize short term sales, reduce new account development, and foster salesperson independence.

Formal sales management appears to have evolved from an era when oversimplified concepts were widely accepted (pre-1900), through the narrow supervisory role of the pre-1920 era, to a broader role during the years between the two World Wars. Most of the issues one finds in sales management books today, were discussed within the field of sales management during the productive period of 1915-1930, when simple Nineteenth Century viewpoints were being abandoned and the practical tools and conceptual framework of the discipline of sales management were established. It is remarkable that not until 1958, the first Dutch sales management book was published: Verkoopleiding en Verkooporganisatie by (economist) Jan L. Wage (as part of the series 'De Moderne Onderneming').

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This text is an excerpt of the ebook '100 Classic Sales Books, A Historical Framework' by Ronald Swensson. Original text adopted from the book Birth of a Salesman by Walter A. Friedman (2004), the (Dutch) research paper Geschiedenis van de verkooptechniek by Jan L. Wage and Ronald Swensson (2013) and the research paper American Sales Management Practice and Thought by James T. Strong and Michael F. d'Amico (1999).

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