Increasing Efficiency In Business by Walter Dill Scott (top 10 most read books in the world TXT) 📖

interviewed

believed that competition when wisely handled

is very effective in stimulating the men.

 

Of course, most firms try in some way to

<p 60>

encourage their men to excel their record of

previous years. The inquiry developed, however,

that a few are unwilling to employ competition

even in this mild form as a means to

increased efficiency. Most of the firms made

conscious use of this principle and were convinced

of its potency.

 

Competition between men in the same

department was approved by a majority of the

firms, and its adaptability to the selling

department was especially emphasized. But

some of the best houses will permit no such

competition. The diversity in opinion was

very pronounced in answering this question.

 

As to encouraging competition between departments

in the same firm, no general answer

is satisfactory. Organizations differ widely.

In many houses such competition is not practicable;

in others it certainly is not to be encouraged.

In many organizations which would

admit of such competition the experiment had

not been tried. In others it has become a

regular practice and is looked upon with favor.

 

In competition between members of the

<p 61>

same department or between departments the

danger of jealousy and enmity seems to be so

real that the greatest caution has to be

observed in managing the contests. When

such caution is exercised, the results are

ordinarily reported upon favorably.

 

As to encouraging competition with departments

of rival establishments, the diversity

of business makes general statements un-illuminating. Even where such a course is

possible, some managers reject the practice

as unwise. They believe that it is not best

to recognize other houses or to consider them

in this particular. A few firms report that

they are able to stimulate their men successfully

in this way, even though the conditions for

such a contest are difficult to handle. Of those

who utilize competition a few houses employ

no handicaps to put their men on the same

level and make success equally possible to all.

 

_The principle of handicaps is so manifestly

fair that organizers of contests can hardly afford

to neglect this essential to the widest interest and

participation in the competition_.

<p 62>

 

If the little man in a country territory

doesn’t feel that he has a fighting chance to

equal or surpass the man in the big agency,

he makes no attempt to qualify. And the

purpose of every contest, of course, is to get

every man into the game.

 

Touching monetary rewards for the winners,

there is practical unanimity of opinion.

The winner should receive a prize in cash or

its equivalent. Usually the effort is to distribute

the prizes so that all who excel their

average records receive compensation and

recognition for the additional work. In many

instances unusual increases in sales or output

are rewarded by a higher rate of compensation.

 

_That success in contests should influence

promotion was generally agreed. The knowledge

and energy shown are indications of capacity to

occupy a better position_.

 

The contest merely reveals such capacity;

the promotion might well follow as part of the

prize for the winner or winners.

 

Public commendation of winners in com-

<p 63>

petitions is held by many firms to be bad

policy. There is fear that such commendation

might render the participant conceited

and unfit for further usefulness. A majority

of firms, however, give the widest possible

publicity to such commendation. This, indeed,

is the reward most generally used and

apparently most keenly desired by employees.

Reproduction of photographs of the winners

in the house organ with an account of their

achievements is the commonest acknowledgment

of their success, though posting the

names of the winners in various parts of the

establishment is the method employed by

smaller houses.

 

_Many important houses use competition as

part of their regular equipment for handling

and energizing men_.

 

Particularly is this true of manufacturers

and distributors of specialties, patented machines,

trademarked goods and lines, and

wholesalers whose travelers are selling in

territories where conditions are generally the

same. Several firms of this sort make con-

<p 64>

scious and elaborate use of the instinct of

competition in their ordinary scheme of management.

 

A concrete and typical illustration of its

application to selling is afforded by the

experience and the undoubted success of one

of the largest specialty houses which distributes

its products direct to the consumer.

The sales force numbers about 500 men, and

executives of wide experience declare that the

organization is, of its size, the most efficient

in the United States. Analysis of this company’s

methods is most illuminating and suggestive

because every phase of the instinct

of competition has been exploited to the

advantage of both the house and its employees.

 

The medium of competition is a series of

contests—monthly, quarterly, even yearly which

bring into play all the motives urging

individuals to maximum effort and industry desire

to beat bogy, ambition to win in individual

contest with immediate neighbors and

against the whole organization, team spirit in

<p 63>

the matching of one group of agencies against

another group, and finally organization spirit

in the battle of the whole force to equal or

surpass the mark which has been set for it.

 

_The first and basic contest here is that of the

individual salesman against his bogy or “sales

quota_.”

 

This quota, the monthly amount of business

which each agency should produce, has

been worked out with great care and has a

scientific foundation. Since the great bulk

of sales are made to retail merchants, the

possibilities of each territory are determined

by reckoning the total population of all towns

containing three retailers rated by commercial

agencies. For normal months there is a standard

quota, a little above the monthly average

of all agencies the previous year, reckoned

against their total urban populations. In

“rush” months, this quota is advanced from

fifteen to forty per cent, as the judgment of the

sales manager dictates. If general and trade

conditions lead him to believe, for instance,

that the month of May should produce

<p 66>

$1,000,000 in orders, while the sum of the

usual quotas is $800,000, he calls for an overplus of twenty per cent. The territory containing

one per cent of the total urban population

of the country, as reckoned, would then be

expected to make sales equal to $10,000. This

would be the agency quota for the month,

and the first and most important task of the

agent would be to secure it.

 

_Because all quotas, both normal and special,

are figured on the productive population of the

territories and standings may be calculated by

percentages, it follows that all agents are on terms

of equality_.

 

This is essential in a contest for individual

leadership as well as in team or organization

matches. For at least eight months of the

year, there is such a competition for the best

selling record in the entire force. Variety

is given to these contests and the interest of

the men sustained by changing the terms of

the competition. One month the chief prize

will be given to the salesman who secures his

quota at the earliest date; next month the

<p 67>

award will be for the individual who first obtains

a fixed sum in orders, usually $2500;

leadership the third month will go to the man

who gets the highest per cent of his quota

during the entire period; again, the honor will

fall to the agent whose net sales total the

greatest for the month.

 

_Further changes are rung and the inspirational

effect of the contest immensely increased by enlarging

the conditions so that every third or

fourth agent is able to qualify for the month’s

honors and a prize_.

 

Here, for instance, besides the prize for

the first agent selling $2500, there will be

prizes—like hats, umbrellas, and so on—for

every man who closes $2500 in orders before

the twentieth of the month, with the attendant

publicity of having his portrait and his record

printed in the house organ which goes to

every agent in the field and every department

and executive at the factory. Before leaving

the individual contests, mention should be

made of the “star” club of agents who sell

$30,000 or more during the year; the presi-

<p 68>

dency going to the agent who first secures

that total, the other official positions falling

to his nearest rivals in the order in which

they finish.

 

The team and organization contests are

usually carried on simultaneously with the

individual competitions. These range from

matches between the forces of the big city

offices, like New York, Chicago, and St. Louis,

upward to district contests in which each team

represents from thirty to fifty salesmen and

finally to international “wars” where the

American organization is pitted against all

the agents abroad. Challenges from one

district to another usually precipitate the

district competitions; once a year there is a

three months’ general contest in which all the

districts take part for the championship of the

whole selling force.

 

_To announce contests is a simple matter;

to organize and execute them so that they are of

benefit is much more difficult_.

 

Unless the interest of the men is focused on

the contests, they are not worth while. To

<p 69>

make them successful the firm under consideration

utilized the following devices:—

 

During the contest the house organ appeared

often and was devoted almost exclusively

to the contest. In it the record of

each salesman was printed, his quota, his

sales to date, and other pertinent information.

The sheet was edited by a “sporting editor,”

and great tact and skill were displayed in giving

the contest the atmosphere of an actual

race or game. In addition the sales manager,

the district managers, and the house executives

wrote letters and telegrams of encouragement,

and even made trips to the agencies that got

under way too slowly.

 

The unique feature of the contest was the

manner in which the “sporting editor” gave

actuality to the contests by pictorial

representations. One competition took the form

of a shooting match. The house organ contained

an enormous target with two rings

and a bull’s eye. When a salesman qualified

with orders for $625, he was credited with a

shot inside the outer ring and his name was

<p 70>

printed there. With $1250 in sales, he moved

into the inner ring, and when his orders

amounted to $2500, he was credited with a

bull’s eye and his name blazoned in the center

space.

 

Another contest was represented as a balloon

race between the different districts.

Each district was given a balloon, and as sales

increased, the airship mounted higher. On

the balloon the name of the district leader in

sales was printed, while cartoons enlivened

the race by showing the expedients, in terms

of orders, by which the district managers and

their crews sought to drive their airships

higher. Each issue of the house organ showed

the current standing of the districts by the

heights of their balloons. This conception of

the selling contest was very successful.

“Going up—going up—how far are you up

now?” was used as a call, and it seemed to

strike the men and inspire them. It became

the greeting of the salesmen when they met, and

irresistibly produced a feeling of competition and

a desire to have the district balloon go higher.

<p 71>

 

Other ingenious fancies by which the contests

were given the appeal and interest of

popular sports was their conception as a baseball

game, a football game, an automobile

race, a Marathon run, and so on.

 

In providing prizes, the firm was rather

generous, though the expense was never great.

While the contest was in progress, all those

who were really “in the running” had the

satisfaction of honorable