Chapter 13 – Personal Selling and Sales Management

Discussion Questions

1. Define:Relationship marketing TCNExpatriate “Master of destiny” philosophyLocal nationals Separation allowance

2. Why may it be difficult to adhere to set job criteria in selecting foreign personnel? What compensating actions might be necessary?

It may be difficult to adhere to set job criteria in selecting foreign salesmen because there may be several different levels of job criteria and the company must move down these levels after having trouble hiring individuals who conform to the established criteria. Compensating actions, which may be necessary, include sales commissions, as this motivates the better personnel and eliminates the receiving of equal wages by both the better and poorer salesmen.

3. Why do the global sales force cause special compensation problems? Suggest some alternate solutions.

The global sales force causes special compensation problems because an imbalance is created, as the expatriate salesman would normally receive more than would the foreign salesman, and the foreign salesman will feel aggrieved and mistreated. Motivational devices are valuable in providing solution but perhaps a foreign sales force managed by expatriate salesmen is best.

4. Under what circumstances should expatriate salesmen be utilized?

Expatriate salesmen should be used when a more technical approach is necessary, when communication with the parent company is vital, when legal barriers dictate the use of expatriate salesmen, or when the markets will not support full-time salesmen.

5. Discuss the problems which might be encountered in having an expatriate sales manager supervising foreign salesmen.

Problems encountered would include the following: legal barriers, a lack of communication between the expatriate sales manager and the foreign sales force, and the expatriate’s inability to adapt to the foreign environment.

6. “To some extent, the exigencies of the manpower situation will dictate the approach to overseas sales organization.” Discuss.

Sales organization approach will vary for a number of reasons which are: inadequately trained foreign personnel (so expatriate personnel are required), foreign personnel must be employed for legal reasons, expatriate salesmen are unwilling or unavailable to enter the market, and foreign personnel are unwilling or unavailable to enter the market.

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7. How do legal factors affect international sales management?

Legal factors may affect international sales management because some countries require that the sales force be composed all or partly of natives. In other cases (such as in Argentina), severe regulations regarding the firing or discharging of personnel force companies to hire expatriates or be stuck with incompetent or noncooperative nationals who cannot be discharged without a legal struggle.

8. How does the sales force relate to company organization? To channels of distribution?

The sales force may be a domestic salesman working from the parent company, expatriate salesmen and/or foreign salesmen. Home office management or decentralization of the above vary with the type of sales force. If a market is small, chances are that it will not be serviced by a resident expatriate salesman or foreign salesmen but by a domestic salesman from the parent company.

9. “It is costly to maintain an international sales force.” Comment.

It is certainly more expensive to maintain an international sales force than a domestic sales force because travel, living expenses, interpreters, training and establishing a sales force, etc., all contribute to higher expenses. However, the increasing number of companies going overseas indicates it is well worth it.

10. Adaptability and maturity are traits needed by all salesmen. Why should they be singled out as especially important for international salesmen?

These two traits are singled out as especially important for international salesmen because the foreign market is extremely different from the domestic market and calls for different policies and more independent decisions and commitments. The traits are credited with being two of the prime causes for failure of international salesmen.

11. Can a person develop good cultural skills?

Yes. Good cultural skills just as good social skills can be developed. Cultural skills provide the individual with the ability to relate to a different culture, even when the individual is unfamiliar with the details of that particular culture. Anyone being sent to another culture should receive training to develop cultural skills. In addition, they should receive specific schooling on the customs, values, and the social and political institutions of the host country. There are a variety of organizations that provide intercultural training.

12. Describe the six attributes of a person with good cultural skills.

Someone with cultural skills can: (1) communicate respect and convey verbally and nonverbally a positive regard and sincere interest in people and their culture; (2) tolerate ambiguity and cope with cultural differences and the frustration that frequently develops when things are different and circumstances change; (3) display empathy by understanding other people’s needs and differences from their viewpoint rather than from the individual’s own viewpoint; (4) be nonjudgmental, avoid judging the behavior of others on their own value standards; (5) recognize and control the SRC, that is, recognize their own cultural values as an influence on their perceptions, evaluations, and judgment in a situation; and (6) laugh things off, a good sense of humor helps when frustration levels rise and things do not work out as planned.

13. Interview a local company which has a foreign sales operation. Draw an organization chart for the sales function and explain why that that company used particular structure.

Individual project.

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14. Evaluate the three major sources of multinational manpower.

Expatriates—declining in importance as foreign nationals are found to fill marketing positions. The cost of an expatriate is often much greater than a foreign national. The advantages of the expatriate are more adequate technical training, better knowledge of the firm and its product, and often better communication with the parent company. The weakness is that the expatriate often suffers from the cultural differences existing in the host company.

Cosmopolitan personnel—type of expatriate who is not a national of the parent company’s country. Reflects the growing nature of international business. Used nearly exclusively at the top level of management.

Foreign national—an increase in the mobility of foreign nationals is making them more useful to the firm. At the sales level, the foreign national is at an advantage. Salary levels are lower for them as well as their selling expenses, because they are able to transcend legal and cultural barriers. However, they sometimes are too close to the culture which impedes their effectiveness. They sometimes are too close to the culture which impedes their effectiveness. They are most effective in situations which do not require great technical training.

15. Which factors complicate the task of motivating the foreign sales force?

The biggest factor is the cultural differences that occur, which cause motivation and behavior to vary from the domestic salesmen. The cultural differences reviewed in Chapters 4 and 7 affect the motivational pattern of the foreign sales force.

16. Why do companies include an evaluation of their employees’ families among selection criteria?

An evaluation of employees’ families is becoming more important for overseas assignments since it is recognized that the family’s ability to adjust to a foreign environment may be the most important factor determining whether or not an employee will stay in a foreign assignment for the length of time the company desires.

17. Concern for career and family is the most frequently mentioned reason for managers to refuse a foreign assignment. Why?

The most important career-related reservation is that a two-or three-year absence will adversely affect opportunities for advancement. This “out of sight, out of mind” fear is closely linked to the problems of repatriation. Without evidence of forward planning to protect career development, the better qualified and ambitious personnel may decline the offer to go abroad. Concern for one’s family may also interfere with many accepting an assignment abroad. Initially, most potential candidates are concerned with the problems of uprooting a family and taking them into a strange environment. Such questions as the education of the children, isolation from relatives and friends, proper medical and health care, and, in some countries, the potential for violence reflect the misgivings the family may have about relocating in another country.

18. Discuss and give examples why returning U.S. expatriates are dissatisfied. How can these problems be overcome?

Low morale among returning U.S. expatriates and a growing amount of attrition among returnees have many reasons. Some of the complaints and problems are family related, while others are career related. The family-related problems generally deal with financial and lifestyle readjustments. For example, some expatriates find that in spite of the higher compensation program received, their net worth has not increased. Many have found, on returning home, that with inflation of intervening years they are not able to buy a home comparable to the one they sold on leaving. The hardship compensation program used to induce the executive to go abroad creates readjustment problems on the return home. Such compensation benefits permitted the family to live at a much higher level abroad than at home. Since most compensation benefits are withdrawn when the employee returns to

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the home country, the standard of living decreases and the family must readjust. Another objection to returning to the United States is the location of the new assignment; frequently, the new location is not considered as desirable as the location before the foreign tour. While family dissatisfaction may cause stress within the family on returning home, the problem is not as severe as career -related complaints.

A returning expatriate’s dissatisfaction with the perceived future is usually the reason many resign their positions after returning to the United States. The most frequently heard complaint involves the lack of a defined plan for the expatriate’s career when returning home. New home-country assignments are frequently mundane and do not reflect the experience gained or the challenges met during the foreign assignment. Some feel that their time out of the “mainstream” of corporate affairs has made them technically obsolete and thus ineffective in competing immediately on their return. Finally, there is some loss of status that requires ego adjustment when an executive returns home. The expatriate executive enjoyed a certain degree of autonomy, independence, and power with all the prerequisites of office not generally afforded in a comparable position domestically. On returning home, many find it difficult to adjust to being just another middle manager. Companies with the least amount of returnee attrition differ from those with the highest attrition in one significant way—personal career planning for the expatriate. Expatriate career planning begins with the initial decision to send the person abroad. The initial transfer abroad should be made in a context of a long-term company plan. Under these circumstances, the individual knows not only the importance of the foreign assignment but when to expect to return and at what level. The critical aspect of the returning process is to keep the executive completely informed; propose return time, a new assignment, and future prospects. If it is understood that foreign corporate experience is a necessary prerequisite for growth and promotion within the company, then many of the problems faced today with foreign assignments will be eliminated.

19. If “the language of international business is English,” why is it important to develop a skill in a foreign language? Discuss.

Proponents of language skills argue that learning a language improves cultural understanding and business relationships. Others point out that to be taken seriously in the business community, the expatriate must be at least conversational in the host language. Some recruiters want candidates who speak at least one foreign language even if the language will not be needed in a particular job. Having learned a second language is a strong signal to the recruiter that the candidate is willing to get involved in someone else’s culture.

Though most companies offer short, intensive language training courses for managers being sent abroad, many are making stronger efforts to recruit people who are bi- or multilingual. According to the director of human resources at Coca-Cola, when his department searches its data base for people to fill overseas posts, the first choice is often someone who speaks more than one language.

The author feels strongly that language skills are of great importance; if you want to be a major player in international business in the future, learn to speak other languages or you might not make it—your competition will speak more than one language.

20. The global manager of the year 2010 will have to meet many new challenges. Draw up a sample resume for someone who could be considered for a top-level executive position in a global firm.

A resume for the global manager of the year 2010 should reflect the experiences and skills in the description below. Experience in domestic operations as well as foreign experience in at least two or three foreign assignments, fluent in at least two languages and conversant in others (reflecting his/her foreign assignments), and management experience in marketing, operations and/or finance would all appear on the resume of someone destined for a top-level executive position in a global firm.

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The executive of the year 2010 will be a completely different person. His or her education will include an undergraduate degree in French literature as well as a joint MBA/engineering degree. Starting in research, this executive for the 21st century will quickly move to marketing and then on to finance. Along the way there will be international assignments that will take him or her to Brazil where turning around a failing joint venture will be the first real test of ability that leads to the top. This executive of the year 2010 will speak Portuguese and French and will be on a first-name basis with commerce ministers in half a dozen countries.

As the 40-year postwar period of growing markets and domestic-only competition fades, so too is the narrow one-company, one-industry chief executive. By the turn of the century, companies’ choices of leaders will be governed by increasing international competition, the globalization of companies, technology, demographic shifts, and the speed of overall change.

While this description of tomorrow’s business leaders is speculative, there is mounting evidence that the route to the top for tomorrow’s executives will be different from today’s. A Whirlpool Corporation executive was quoted as saying that the CEO in the 21st century “must have a multi-environment, multicountry, multifunctional, and maybe even multi-company, multi-industry experience.”

Until recently the road to the top was well marked. A 1987 survey of chief executives reported that more than three quarters of them had either finance, manufacturing or marketing backgrounds. In the future, it will be very difficult for a single-discipline individual to reach the top.

The executive recently picked to head Procter and Gamble’s U.S. operations is a good example of the effect globalization is having on businesses and the importance of experience, whether in Japan, Europe or elsewhere. The head of all P&G’s U.S. business was born in the Netherlands, received an MBA from Rotterdam’s Eramus University, then rose through P&G’s marketing ranks in Holland, the U.S., and Austria. After proving his mettle in Japan, he moved to Cincinnati to direct P&G’s push into East Asia and then to his new position. Speculation is that if he succeeds in the U.S., as he did in Japan, he will be a major contender for the top position at P&G.

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