To download these slides and access recording: http://www.tigi.net/thank-you-for-attending-rosi-webinar/ Where's the value in sales effort? In today's environment, it's more important than ever to define that effort and act upon it, in order to show your return on sales investment. TIGI's Gunter Wessels and Sam O'Rear presented this information-packed webinar. You can expect to learn: -The true definition of ROSI -The Value of Sales Effort -How to Use ROSI to Improve Performance -Strategic and tactical implications of ROSI -Actionable Recommendations At the conclusion of the webinar, Gunter and Sam answered audience questions.

1. GET YOUR ROSI UP:
How to Improve Your Return on Sales Investment
April 18, 2012
Gunter Wessels, Ph.D., MBA Sam O’Rear, M.A. BA
Partner, Practice Principal, TIGI Senior Partner, Founder, TIGI
gunter@mytigi.net sam@mytigi.net
@gunterwessels @TIGI_Inc
www.tigi.net
© TIGI 2012 All rights reserved

2. What We’ll Cover
1 ROSI Defined
2 The Value of Sales Effort
3 Using ROSI to Improve Performance
4 Strategic and Tactical Implications
5 Recommendations
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3. 1 ROSI Defined
ROSI = Return On Sales Investment
ROSI is a measure of Sales Productivity
ROSI = Revenues
Sales Costs
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4. How to Find Your ROSI Costs!
Cost of the Sales Team is part of SG&A:
• Salesperson, Manager, and Support Staff Salaries
• Incentive Compensation Cost
• Travel Expenses
• Technology -- CRM Software, Cell-phones, iPads, etc.
• Customer Entertainment Expense
• Training and Skill Development Investment
• Business Intelligence Databases, Reports, etc.
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5. 2 Where’s the Value in Sales Effort?
We asked a group of 15,000 reps where they add value
Responses: Evaluation:
• Customer Education • Marcom / Product Function
• Transaction Support • Contracting, Logistics
• Capacity & Stocking • ERP and EDI
• Pricing • Product Marketing Function
• Relationship Management • Brand, Customer Service
• Customer Attention • Inbound Marketing
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6. The Value of Sales Effort
Personal selling adds value and is needed when...
• Customers face significant transaction and decision risk.
• Companies face transaction, customer, and COGS risk.
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7. ROSI Benchmarks
Improving the ROSI
Benchmark: ROSI - 8.0
How to Improve ROSI? SALES
• By Growing Sales
• With Sales Cost Flat, to Down
COSTS
Analysis by Albers, Mantrala & Sridar (2010 JMR)
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8. Value of Sales Activity: Benchmarks
Improving the ROSI with activity
Selling Expense Sales Revenue
Sales • 31% Current Period Elasticity
Management
• Meaning: a 10% increase in
sales activity leads to a 3.1%
change in sales volume.
Sales Effort
Yields +3.1%
Sales Activity
in Sales $
+10%
Analysis by Albers, Mantrala & Sridar (2010 JMR)
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9. ROSI Example
Your Company has $60 Million in Sales in 2012
Your sales target for 2013 will grow by 6%, i.e. $3.6M
The sales cost was $8M for 2012, and you have been
requested to keep sales cost level for next year.
• How do you attain the growth with zero sales rep adds?
• What is the 2012 ROSI?
• What will ROSI be for 2013?
• How will the Current Period Elasticity work for you?
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10. ROSI Example
Your Company has $60 Million in Sales in 2012...
Your sales target for 2013 will grow by 6%, i.e. $3.6M
The sales cost was $8M for 2012 and you have been
requested to keep sales cost level for next year.
• How do you attain the growth with zero sales rep adds?
• 2012 ROSI = 7.5 ROSI Target for 2013 = 7.9
• 20% increase in sales activity would yield sales $3.6M
Management Decision: How can we adjust incentives
and activities to increase "face-time" by 20%?
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11. ROSI Drivers
Driver Example
• Focused Sales Effort • Unsought Goods
• Product/Service Launches • Innovative Solutions
• Sales Effectiveness • Competitive Advantage
• Risk Management • Forecast Accuracy
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12. ROSI Killers
Killer Example
• Lack of Metrics • Outcome Measures
• Undisciplined Pricing • Evolving Pricing Policy
• Hybrid Channels • Double Coverage
• Commoditization • Built-in Demand
• Cumbersome Contract • Legalistic Approval and
Processes and Policies T&C Negotiation
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13. 3 Using ROSI to Improve Performance
ROSI measures the outcomes of sales behaviors: ROSI IS:
Therefore, to "Up Your ROSI"... Quality vs.
Quantity
• Sales Leadership Requires a Focus On--
Sales Activity: Wins, Velocity, Engagements, and Losses
• Performance Compensation Should Be Based On--
ROSI IS:
Sales Behaviors: Pay for targeted behaviors Activities vs.
• Sales Management Requires Focus On-- Outcomes
Coaching Behaviors: Coaching the right sales behaviors
in contact with the customer
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14. 4 Strategic & Tactical Implications
Strategic Sales Activities:
In a Commodity Market:
• Relationship Management
• Issue Resolution
In an Innovation Driven Market:
• Three Dimensions of Value Communication
• Influencer Engagement
• Leverage the Credibility Factor (Branding)
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15. 4 Strategic & Tactical Implications
Tactical Sales Activities:
When selling...
• Are we talking to the right people?
• What are we talking about when engaging these people?
• How is the organization supporting the engagement?
• Is there enough of the right activity?
Quality in Quantity
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16. 5 Recommendations
What to do today:
• Calculate your ROSI
• for your sales team
• for each territory
• Evaluate your performance metrics
• Re-focus on high value activities
• What/where/how do salespeople they spend their time?
• What/where/how do managers spend their time?
• Evaluate your management infrastructure
• What activities are the managers creating and motivating?
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17. 5 Recommendations
What to do next:
1. Upgrade skills: Business Acumen, Evidence-Based Selling,
Salesmanship, RFP Strategy
2. Update the playbook: Corporate Accounts, Contracting &
Coverage Models -- Aimed at the Best Activity Model
3. Revise metrics: Behavior Metrics--Customer Engagement,
Wins and losses, Attrition, Margin Compression
4. Assess, develop and package talent: Managers,
Specialists, Generalists, New-business, and Support
5. Recognize that behaviors lead to sales: Sales performance
is a trailing indicator; sales behaviors are a leading indicator.
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18. Questions?
www.tigi.net
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19. As a participant today:
Use Code: “2012ROSI”
• $1500 credit on a TIGI consultation
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20. Upcoming Webinars
May 16: 5 Medical Distribution Strategies Doomed to Fail in 2012
June 13: How Healthcare Reform Impacts Your Business Today
© TIGI 2012 All rights reserved

21. Thank You
Gunter Wessels, Ph.D., MBA Sam O’Rear, M.A. BA
Partner, Practice Principal, TIGI Senior Partner, Founder, TIGI
gunter@mytigi.net sam@mytigi.net
@gunterwessels @TIGI_Inc
www.tigi.net
© TIGI 2012 All rights reserved