Sales training impact ratio: A model for evaluating and managing sales training

Amanda Mize, Purdue University

Abstract

In today's world, salespeople must create value for their customers, providing knowledge, advice, and problem solving skills so that the salesperson is just as valuable to the customer as the product or service they are purchasing (Rackham, 2009). In an effort to meet this demand, companies invest approximately $4 billion every year training their sales professionals to increase their knowledge, skills, and capabilities (Dolezalek, 2006). This they hope, will keep the company competitive and increase those individuals' sales and organizational impact (Murray & Efendioglu, 2007). Surprisingly, however, these training investments are often not adequately measured, if measured at all, and not well understood. In addition, it is often the case that nobody is held accountable for the results (Pangarkar & Kirkwood, 2005). In failing to evaluate impact, companies cannot be sure that they are making the right training decisions for their salespeople and getting a return on their investment. The objective of this research is to develop a simple, easy to use model managers can use to evaluate a company's returns from investing in training salespeople based on the return on assets (ROA) calculation of the DuPont Model. This would allow for individual performance assessments, salesperson comparisons, as well as aid in directing future training choices. Another objective of this research is to develop a case study with an accompanying teaching note using the model. This would allow for testing and adjustment of the model as well as provide a means for teaching and demonstrating the use of the model.

Degree

M.S.

Advisors

Boehlje, Purdue University.

Subject Area

Management|Finance

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