Digitization of selling activity and sales force performance
Digitization of selling activity and sales force performance: an empirical investigation (by Devon S. Johnson and Sundar Bharadwaj, Journal of the Academy of Marketing Science, 2005)
Summarized by Patrick Stroobandt and Sander Lietaert, Vlerick Sales Centre
Digitization can be described as the creation of a technology-based capability to perform activities previously performed by human capital.
More specifically, the digitized selling capability is focussed on the development of web sites designed to provide information and product transactions with customers, replacing many routine sales force activities. The purpose is to examine the impact of digitization as a firm's selling capability on the sales force. This by pursuing two objectives:
a) Conceptualize digitization of selling activity and assess the implications
for two sales force outcomes: salesperson effectiveness and salesperson
b) Assess the effectiveness of implementation strategies to motivate
salespeople in an e-business environment.
Digitization of the selling activity
Whereas customers in certain industries would previously contact the salesperson, the advent of search engine marketing, online marketing, social media marketing and mobile marketing gives customers much more opportunities to interact with the company. As a consequence, salespeople get more time available to perform added value activities.
Two sub-processes that determine the extent to which a salesperson is likely to be disintermediated from the channel.
a) The first process involves the decomposition of activities into routines
amenable to automation.
b) The second process is a sub-process of increasing complexity of the work
environment which improves salespersons' career prospects.
The trade-off between these sub-processes accounts for employee ambivalence toward digitization.
When developing a digitized channel capability, managers need to reduce salesperson ambivalence and encourage integration of the new channel into the salesperson's job.
The moderators of the effect of digitization on sales force outcomes are:
Human capital investment: Training and education needs to be given to salespeople in order to prepare them for a new environment and reduces job insecurity but it does not enhance salesperson effectiveness.
Sales force control systems: Behaviour-based control systems may lead to more ineffective channel integration as opposed to outcome-based control systems. It is important that salespeople maintain a creative 'doing while learning' approach whilst integrating the new channel.
Customer-initiated change: The idea that salespeople are more likely to accept digitization when this change is customer-initiated is not supported in this study.
Competitive imitation: Firms that pursue competitor-oriented objectives might not be looking at their own capabilities and were likely to expect lower levels of profitability. Imitation also creates increased job insecurity but has no impact on salesperson effectiveness.
Digitization has the paradoxical effect of improving salesperson effectiveness and heightening job insecurity concerns. Also, managers can improve the technology-enabled multichannel capabilities of the firm by giving priority attention to human capital improvement, sales force control systems and communication of the digitization strategy.