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2/15/2006 12:04:00 AM

 

New product success depends on sales staff's trust in manager and how staff is judged

Because of the risks and uncertainty associated with selling new products, the trust a sales staff has in its manager goes a long way in motivating young, inexperienced salespersons. University research indicates that this trust is based on the staff members' perception that their boss supports them and judges them more on how well they perform the sales process than on how well the new product sells.

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Selling new products can be fraught with uncertainty and risks, particularly for young and inexperienced salespeople. A new study suggests that a sales force is more likely to overcome its discomfort at selling new products if they trust their boss. One way sales managers can build that trust is by taking a hands-on approach to the sales process -- rewarding their sales staff on how well they follow procedures rather than simply on the number of sales they make.

"When selling a new product, young, less-experienced, less-educated sales staff would rather be judged on how well they learned the process, regardless of how many sales they make," explained Haiyang Li, an assistant professor of management at Rice University's Jesse H. Jones Graduate School of Management.

"This approach puts less pressure on them and sends a positive signal that their supervisor is supportive and concerned for their welfare in the process of new product selling."

Employees' trust in their sales managers is also enhanced when the managers use a hands-on approach during a highly volatile market, particularly if their employees also have undergone intensive training for selling the new product.

"If the market is unstable and rapidly changing, the sales staff perceive themselves as being at a higher risk because they could be penalized for results largely beyond their control," Li said.

"Sales managers who appear to shoulder a greater proportion of that risk, as well as provide training in advance of selling the product, are more likely to increase their staff's confidence and ultimately their loyalty, motivation and trust."

Contrary to other studies which suggest that managers need to use a more hands-off approach by stressing results, Li believes this does little to enhance salespersons' trust of their managers. This supervisory style does, however, have a positive influence on trust when the sales manager puts greater emphasis on long-term sales goals and when the sales staff is more experienced.

"When a sales manager focuses more on results over the long term, the salespeople may feel less pressure to perform," said Li.

"Because they have time to learn and achieve from experience in the field, the salespersons, particularly those with less experience, are going to view their managers as supportive, and trust them more."

According to Li, there are also circumstances when the trust developed from a manager's hands-on approach is weakened. This can occur when managers have long-term orientations and encourage the sales force to be a part of sales decisions. This style of supervision may weaken the trust relationship between employees and their managers over the long term because the performance limitations of young and inexperienced salespeople may become more apparent to the managers.

"Their participation in decision making also implies that they share in the consequences and potential risks of such decisions," said Li.

"For young salespersons, this managerial approach could appear less caring and supportive, and therefore limit their respect for the sales manager."

In a forthcoming article for the Journal of Product Innovation Management entitled "The Effects of Formal Controls on Supervisee Trust in the Manager in New Product Selling," Li and co-author Kwaku Atuahene-Gima from the department of management at the City University of Hong Kong studied 150 randomly selected high-technology firms from Beijing's High-Technology Experimental Zone in China. The researchers set out to determine the best approaches sales managers could take to enhance the support and commitment of young, inexperienced salespersons involved in new product sales.

Data was collected through on-site interviews with 450 salespersons accompanied by a questionnaire. The majority of the respondents were male under 34 years old with less than a university-level education. The average length of tenure with their companies was 3.2 years, and the average amount of sales experience was 4.3 years.

While these findings not only have implications for managers in China, but in the U.S. as well, Li points to the importance of managers' sensitivity to cultural milieu.

"In this country where there is a more individualistic orientation, for example, employees may not appreciate as much hands-on control as the young, inexperienced employees they surveyed in China, who tended to depend more on their managers," said Li.

An expert on product innovation and business strategies in China's transition economy, Li has published other research on this emerging market in a number of scholarly publications, including Academy of Management Journal, Strategic Management Journal, Journal of Marketing, Management and Organization Review, Journal of International Marketing and International Business Review.

For more information on this research, contact Li at haiyang@rice.edu or Debra Thomas at the Jones School at dthomas@rice.edu.