Sales Force Management Practices in Organizations With A Supportive Climate Towards Creativity
Sales Force Management Practices in Organizations With A Supportive Climate Towards Creativity
Sales Force Management Practices in Organizations With A Supportive Climate Towards Creativity
In this research paper, the author draws on the theoretical insights of the organizational
creativity and marketing literatures, and empirically examines the link between
creative working environments and human resource management practices in the sales
force. A questionnaire survey from a random sample of 168 sales managers from
different industries was used. Exploratory structural equation modeling and
independent t-tests were used for the analyses. Results provide evidence that
companies with working environments that support creativity place greater importance
in the implementation of general sales force management practices, namely
(1) selection and placement, (2) training, (3) performance appraisal, and (4) pay and
bonus systems compared to firms with less supporting environments toward creativity.
Keywords: sales force management; organizational creativity; exploratory SEM
1. Introduction
With the increasing rate of competition, being creative is considered as an important
competitive advantage for firms’ success and survival (Basadur, Taggar, & Pringle, 1999;
Gilson, 2008). Creativity is defined as the production of new and useful ideas concerning
products, services, processes, and procedures (Amabile, 1996), and it is the first step
toward innovation (e.g. the implementation of the ideas) (Amabile, Conti, Coon, Lazenby,
& Herron, 1996; Shalley & Gilson, 2004). Increasingly, creativity has become valued
across a variety of tasks, occupations, and industries, and can serve to set any organization
apart from its peers through the creation of novel products, streamlined workflows, or
innovative ideas (Im & Workman, 2004).
Firms, however, rely on their sales efforts to sustain themselves. Increasing evidence
suggests that sales, in the twenty-first century, are changing; they become more strategic
than operational with the salespersons increasingly acting as relationship managers rather
than as traditional order-takers (Storbacka, Ryals, Davies, & Nenonen, 2009). The sales
force is becoming the most critical and expensive marketing resource for companies in
many industries (Zoltners, Sinha, & Lorimer, 2008). Nevertheless, despite the importance
of the sales management element of the marketing mix, the role of creativity is a relatively
unexplored area in the sales force management practices that firms employ.
We attempt to contribute to this endeavor by drawing on the conceptual framework
related to ‘culture and marketing’ originally developed by Deshpande and Webster (1989).
According to this framework, a firm’s organizational culture is an important element on
the management of the marketing function. In the present paper, we investigate the link
*Email: lzabetak@dpem.tuc.gr
2. Theoretical background
2.1 Amabile’s model for assessing the organizational climate for creativity
There are two main theoretical models that have guided the area of organizational
creativity: those of Amabile (1988, 1996) and Woodman, Sawyer, and Griffin (1993).
Both models acknowledge the importance given to social and contextual influences for
Journal of Strategic Marketing 61
salesperson. Pay and bonus systems refer to remuneration schemes and plans for
rewarding the sales force.
A great deal of prior research has discussed the importance of thinking strategically
about human resources (Beugelsdijk, 2008; Huselid, Jackson, & Schuler, 1997; Wang &
Zang, 2005) and this may be particularly important when investigating the relationship
between organizational climate and sales force management practices. The sales function
is affected by the rapidly changing and highly complex business environments with
organizations having to adapt at fast rates (Geiger & Guenzi, 2009).
The practices used to select, train, appraise, and reward salesperson all need to be
systematically linked together so that salesperson know what is expected of them and
when and how. Stated differently, organizational climate should be considered as
inextricably bound to sales force management practices. Therefore, it is reasonable to
assume that firms with different climate should place different importance in sales
personnel selection, training, appraisal, and reward decisions.
3. Hypotheses development
Till date, no relationships between climate for creativity and sales force management
practices have been established; however, a few meaningful relationships can be explored.
An important component of the sales force management is the selection of the
appropriate individuals to assume sales positions (Dubinsky, Anderson, & Mehta, 1999;
Ganesan et al., 1996). Of equal importance is the placing of an individual in a position
where his or her personal characteristics, work skills and abilities match the job’s requisite
qualifications (Dubinsky et al., 1999). In firms with a high creative climate, it is plausible
that selection devices can be used to try and select salespersons who are more likely to be
creative or who have higher innate creative ability. Furthermore, firms may develop job
descriptions where creativity is required for the job. When salesperson are given a reason
to be creative through job requirements, it is likely that they will try novel approaches to
their work. These practices are more often applied if the selection and placement of
salesperson is considered important. Therefore, we offer the following hypothesis:
Hypothesis 1: Organizations high in creative climate will tend to place greater
importance on the selection and placement practices of their sales force
compared to organizations with a less creative climate.
Training of the sales force is considered as a fundamental requirement for sales success
(Dubinsky et al., 1999) and it should be viewed as an investment rather than as an expense.
Offering training opportunities that can increase individuals’ knowledge base or their
creativity and relevant skills should help salespersons to try to be more creative in their
work (Sujan et al., 1988). We expect firms with a climate supportive to creativity to place
greater importance on the training of their sales force by using several procedures such as
specific orientation training programs, regular evaluation of training programs, and
evaluations on training results and outcomes. More formally, we propose that:
Hypothesis 2: Organizations high in creative climate will tend to place greater
importance on the training of their sales force compared to organizations
with a less creative climate.
While selection, placement, and training of the sales force are all important, organiza-
tions also may want to put systems in place to track their salesperson’s performance so as to
be able to appraise and ultimately reward them appropriately (Babakus, Cravens, Grant,
Journal of Strategic Marketing 63
Ingram, & LaForge, 1996; Dubinsky et al., 1999). For firms the evaluation of the
performance of the sales personnel is critical with multiple indicators of performance being
applied; however, previous research evidence suggests that the evaluation process in most
firms is a relatively unsophisticated and unsystematic process (Morris, Davis, Allen, Avila,
& Chapman, 1991), implying that top management provides only general guidelines for
performance evaluation. We expect firms with a climate supportive to creativity to place
greater importance on the performance evaluation of their sales force not only in terms of
outcome performance (i.e. increase in sales volume and market share) but also in terms of
behavioral performance (i.e. salesperson efforts to collect information and acquire product
knowledge), and maintain formal procedures and evaluation forms, tailored-made criteria
for performance appraisal, and regular performance appraisal activities. More formally,
we propose that:
Hypothesis 3: Organizations high in creative climate will tend to place greater
importance on the performance evaluation of their sales force compared
to organizations with a less creative climate.
Finally, the sales management literature suggests that compensation systems span a
spectrum from straight salary or ‘fixed’ to straight commission or ‘incentive-based’ (e.g.
George & Weitz, 1989). The majority of the firms use hybrid systems that provide both a
base salary and some form of commission or bonus as an incentive (Slater & Olson, 2000).
In any case, rewards and incentives indicate to salespersons what kind of performance is
desired by the management and are thus valuable means of communicating corporate
values and goals to individual employees. Firms that value creativity will clearly show to
their sale force that creative behavior is acceptable. This implies the design of very careful
and flexible pay and bonus systems, that is great emphasis in the pay and bonus systems
compared to organizations with less support to creativity. More formally, we propose that:
Hypothesis 4: Organizations high in creative climate will tend to place greater
importance on pay and bonus systems of their sales force compared to
organizations with a less creative climate.
4. Methodology
4.1 Sample and procedures
Our basic research approach is a cross-sectional survey of respondents from a sample on
the databases of membership lists of the Hellenic Management Association. Members of
this society are managing directors, marketing, sales, human resource managers,
accountant managers, etc. In order to address the potential for common method bias in the
measures used, we adopted the following procedure to collect the data.
First, 840 personalized requests to participate in the study were emailed to a random
sample from the national list consisting of managing directors, with full contact details.
There was no monetary incentive to complete the study. However, a summary of the
findings was offered as an incentive to participate. Email messages explained the purpose of
the survey, as a study on sales forces management practices. The email was accompanied
by a short questionnaire requesting the assessment of the firm’s total performance.
Furthermore, we asked the managing director to provide information about the managers
who were responsible for the sales functions of the firm. We obtained complete and usable
data from 175 managing directors (response rate: 20.6%). Data collection took place during
September – November 2009.
64 L.A. Zampetakis
In the second stage, a questionnaire was emailed to the sales manager at each firm.
A cover letter accompanied the questionnaire. It explained the purpose of the study, the
importance of respondent participation, and time frame within which to return the
questionnaire. Further, respondents were assured that their responses would be held
confidential. The questionnaire included items for the assessment of the firm’s climate for
creativity and the importance placed in sales force management practices. The initial
emailing was followed by a second emailing two weeks later. The survey was completed
about 11 weeks after the initial mailing, yielding 168 completed questionnaires. The
response rate in the present study is within acceptable range (168/850 ¼ 19.76%)
(Cycyota & Harrison, 2006).
The sample consisted of 75% males with mean age 42 years (SD ¼ 7.3). Almost 75%
of the respondents had a bachelor’s or master’s degree. Average tenure in years was 8.8
(SD ¼ 7.3). The respondents in the study were involved in industrial products (17%),
industrial services (23%), consumer products (55%), and consumer services (5%). Firms
employed 230 employees on average, while the mean (standard deviation) of the
percentage of salesperson to total number of employees was 16.0% (18.0%).
are open to new ideas, constructively challenge each other’s work, trust and help each
other, and feel committed to the work they are doing. Sample item: ‘There is free and open
communication within my group’. Cronbach’s reliability coefficient for ‘workgroup
supports’ was 0.83.
We used six items to assess the ‘sufficient resources’ subscale, that is the extend to
which appropriate resources, including funds, materials, facilities, and information, are
provided to employees. Sample item: ‘Generally, I can get the resources I need for my
work’. Cronbach’s reliability coefficient for ‘sufficient resources’ was 0.83.
Finally, we used six items to assess the ‘challenging work’ subscale, that is a sense of
having to work hard on challenging tasks and important projects. Sample item: ‘I feel
challenged by the work I am currently doing’. Cronbach’s reliability coefficient for
‘challenging work’ was 0.83.
To overcome problems associated with the fit of the confirmatory factor analyses
(CFAs) of the KEYS scale reported in previous research (Amabile et al., 1996), in the
present study we used the exploratory structural equation modeling (ESEM) approach
(Asparouhov & Muthén, 2009; Marsh et al., 2009). Specifically, Amabile et al. reported
that the analysis of fit measures for the KEYS scale revealed a ‘moderate fit to the data’
(Amabile et al., 1996, p. 1167). In their results, Amabile et al. (1996) reported that
component fit measures showed that all items loaded onto their corresponding scales, but
many items were found to load on more than one scale.
Recently, it has been argued that model specifications based on a simple structure CFA
(i.e. not including cross-factor loadings) is unnecessarily restrictive and that cross-factor
loadings are sometimes a necessary element of model testing (Asparouhov & Muthén,
2009; Marsh et al., 2009). In the ESEM approach, in addition to or instead of a CFA
measurement model, an exploratory factor analysis (EFA) measurement model with
rotations can be used in a structural equation model.
We assessed total organizational creativity by taking the sum of the subscales when
z-scored.
scale ranging from ‘very low’ (1) to ‘very high’ (5). The average of these four items was
used as the firms’ total performance (Cronbach’s reliability coefficient was 0.84).
5. Results
5.1 Common method bias
We tested for the potential occurrence of common method variance by employing a
Harman’s one-factor test. Specifically, we conducted an exploratory factor analysis
containing all 51 items. The results reveal that there are 11 factors that account for 72% of
the total variance. Common method effects are not a likely contaminant of the results
observed in this investigation, since the first factor did not account for the majority of the
variance (only 19.5%).
Results of our ESEM analyses indicated that the theoretical constructs used
from the KEYS scale had an acceptable fit: x 2 (76, N ¼ 168) ¼ 130.75, p ¼ 0.001,
RMSEA ¼ 0.065, CFI ¼ 0.956, TLI ¼ 0.977.
Table 2. Independent t-tests and effects sizes (Cohen’s d) for the differences between high and low creativity groups.
4. Training of the salespersons 2.82 1.04 4.29 1.11 t (104) ¼ 25.96*** 1.17
5. Organizational productivity 20.47 0.70 0.57 0.60 t (104) ¼ 28.14*** 1.6
6. Total organizational performance 3.29 0.78 3.65 0.72 t (104) ¼ 22.42** 0.47
and bonus systems of the salespersons [t (104) ¼ 4.79 p , 0.001)]; and training of the
salespersons [t (104) ¼ 5.96, p , 0.001)]. Furthermore, we found statistically significant
differences in the two groups in terms of organizational productivity and organizational
performance with the high organizational creativity group having higher scores.
We used the GPower (version 3.01) statistical program (Erdfelder, Faul, Lang, &
Buchner, 2007) to estimate the effect sizes (Cohen’s d) of the aforementioned independent
t-test. Results are presented in Table 2.
According to Cohen’s widely accepted suggestions (Cohen, 1988), all effect sizes are
moderate to large. We performed sensitivity analysis with GPower in order to estimate the
effect size that the study was able to detect with a power (1 2 b) 80% and a ¼ 0.05.
Results indicate that the minimum effect size to which independent t-tests were
sufficiently sensitive is 0.55, which is still a moderate to large effect.
Finally, we examined differences in the two groups in terms of the total organizational
performance items. We found statistically significant differences in market share
[t (104) ¼ 1.38, p , 0.05)] and cash flow increase [t (104) ¼ 2.05, p , 0.05)] but not in
the sales growth rate [t (104) ¼ 1.377, p ¼ 0.235)].
regarding the relationship between sales force management practices and organizational
creativity provide some support for this proposition.
We have found that firms with a working environment that supports creativity consider
important the selection and placement, training, performance appraisal, and payment of
the salespersons. These firms seem to have realized that creativity may be an inherent
requirement of the sales job and use appropriate sales force management practices that
provide signals to the salespersons that creative activity is required, recognized, and
rewarded. These firms perform better in terms of organizational productivity, total
organizational performance, market share, and cash flow increase compared to firms with
less supportive environments toward creativity.
Finally, we found no statistically significant differences between high and low
organizational creativity groups in terms of sales growth rate increase. It is plausible that
firms with high levels of organizational creativity use sales force management practices in
ways that provide more flexibility and quick responses to changing environmental
conditions or customer demands and allocate their scarce sales resources (i.e. people and
selling effort) toward more customized solutions of customer problems, thus increasing
their market share and cash flow.
The present exploratory study is, to our knowledge, the first study to directly consider
the relationship between sales force management and organizational creativity. Although
creativity in the workplace is still an emerging research field, we believe that this study
presents a potential new avenue for research and contribution to the sales management
literature.
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