September 23, 2021

ELECTRONIC COMMERCE AND ELECTRONIC PROCUREMENT While the role of the salesperson has changed considerably, there have also been significant changes in the way sales and procurement are carried out, particularly between large organizations and their suppliers. In these business-to-business (B2B) environments, the nature of electric commerce, or e-commerce, has certainly undergone a revolution in recent years. E-commerce and B2B trading The term ‘electronic commerce’ or e-commerce refers to any sales or trading activity that is carried out over an electronic network. Today, e-commerce is synonymous with business-to-business (B2B) trading, as opposed to its business-to-consumer (B2C) counterpart. Although the first wave of growth of e-commerce was in the B2C domain, the B2B area is between five and ten times larger. E-commerce comes in many different flavors. For many years, electronic data interchange (EDI) allowed companies to place orders and facilitated suppliers’ sending invoices electronically. However, the growth of internet use has seen an accompanying expansion of e-commerce through this medium. No one should be misled into believing that success on the internet is guaranteed. For every success story there are hundreds of expensive e-commerce failures. Poor website design, reluctance to conduct transactions through a new medium, problems with the adoption of common standards, difficulties with the integration of back-end computer systems and security fears are all barriers that hinder the faster adoption of e-commerce by consumers and businesses alike. E-commerce can take place at four levels Level 1: Publish This is the provision of information to the customer electronically. It is one-way communication that may involve annual reports, press releases, information on products and services, recruitment opportunities and advertising. Sometimes referred to as Internet and IT applications in selling and sales management brochure ware’, it is little more than the establishment of an online presence and has little to do with selling. Level 2: Interact The next level refers to interactive engagement with the user on the internet. For example, Dell’s website provides online technical support services including email links to online technical support representatives. Again, this has little to do with sales but does provide an additional layer of functionality to the ‘publish’ level. Level 3: Transact The third level of e-commerce allows goods and services to be bought and sold over the internet. Reaching this level can be costly in terms of initial investment, and although operating costs should be lower than more traditional ways of conducting business, usually costs need to be driven down in other areas of the business for cost savings overall to fall. Level 4: Integrate The highest level of e-commerce is where integration of the computer system and processes of traders is achieved to create a strong, formalized relationship. This may involve the establishment of a business-to-business extranet which is an electronic network linking companies to their trading partners. Extranets allow partners to exchange information such as that relating to ordering, delivery and invoicing in a secure environment. For example, Mobil’s extranet allows the oil company to accept orders from 300 distributors globally. CUSTOMER RELATIONSHIP MANAGEMENT Customer relationship management (CRM) is a term for methodologies, technologies and e-commerce capabilities used by firms to manage customer relationships. In particular, CRM software packages aid the interaction between customer and company, enabling the firm to co-ordinate all its communications so that the customer is presented with a unified message and image. CRM vendors offer a range of IT based services including call centers, data analysis services and website management. One basic principle behind CRM is that company personnel should have a ‘single customer view’ of each client. As customers are now using multiple channels more frequently, they may buy one product from a salesperson and another from a website. Indeed, a website may provide product information which is used to buy the product from a distributor. Interactions between customer and company may take place through a combination of some, or even all, of the following: direct sales force, call centers, websites, email and fax services or distributors. Therefore it is crucial that no matter how a customer contacts a company, front-line staff have instant access to the same data about the customer, such as their details as well as past purchases. This usually means consolidation of the many databases held by individual company departments into one centralized database that can be accessed by all relevant staff on a computer screen. Although the term CRM is relatively new, the ideas and principles behind it are not. Businesses have long practiced some form of customer relationship management. What sets present-day CRM apart is that companies now have an increased opportunity to use technology and manage one-to-one relationships with huge numbers of consumers. This is facilitated by companies such as Seibel (www.seibel.com), SNT (www.snt.com) and Sales force (www.salesforce.com), which provide specialist consultancy services. In practice, CRM projects have not always achieved their objectives. It is therefore important to take note of the following factors, which research has shown to be related to successful implementation: having a customer orientation and organizing the CRM system around customers; taking a single view of customers across departments and designing an integrated system so that all customer-facing staff can draw information from a common database; having the ability to manage cultural change issues that arise as a result of system development and implementation; involving users in the CRM design process; designing the system in such a way that it can readily be changed to meet future requirements; having a board-level champion of the CRM project, and commitment within each of the affected departments to the benefits of taking a single view of the customer and the need for common strategies – for example, prioritizing resources on profitable customers; creating ‘quick wins’ to provide positive feedback on the project programmes; ensuring face-to-face contact (rather than by paper or email) between marketing and IT staff’ piloting the new system before full launch.   The role of technology in the retail industry Some of the greatest changes in e-commerce have taken place within the field of retailing.

DESIGNING THE SALES FORCE Personal selling is a key element in promotion, one of the four Ps in the marketing mix. But not all sales representatives do exactly the same kind of selling. In business settings, McCurry has distinguished these six types of sales representatives, ranging from the least to the most creative types of selling   Deliverer: A salesperson whose major task is the delivery of a product (milk, bread, or fuel). Order taker: A salesperson who acts predominantly as an inside order taker (the salesperson standing behind the counter) or outside order taker (the soap salesperson calling on the supermarket manager). Missionary: A salesperson whose major task is to build goodwill or to educate the actual or potential user, rather than to sell (the medical “detailer” representing an ethical pharmaceutical firm). Technician: A salesperson with a high level of technical knowledge (the engineering salesperson who is primarily a consultant to client companies). Demand creator: A salesperson who relies on creative methods for selling tangible products (vacuum cleaners or siding) or intangibles (insurance or education). Solution vendor: A salesperson, whose expertise lies in solving a customer’s problem, often with a system of the firm’s goods and services (such as computer and communications systems). In general, salespeople perform one or more of the following tasks: ➤ Prospecting: Searching for prospects, or leads, ➤ Targeting: Deciding how to allocate their time among prospects and customers, ➤ Communicating: Communicating information about the company’s products and services, ➤ Selling: Approaching, presenting, answering objections, and closing sales, ➤ Servicing: Providing various services to customers—consulting on problems, rendering technical assistance, arranging financing, expediting delivery, ➤ Information gathering: Conducting market research and doing intelligence work, and ➤ Allocating: Deciding which customers will get scarce products during shortages. As this list suggests, the sales representative serves as the company’s personal link to its customers and prospects while bringing back much-needed information about customers, markets, and competitors. Therefore, smart companies look carefully at the design of the sales force, including the development of sales force objectives, strategy,structure, size, and compensation.   Sales force structures  Territorial: Each sales representative is assigned an exclusive territory. This structure results in a clear definition of responsibilities and increases the rep’s incentive to cultivate local business and personal ties. Travel expenses remain relatively low, because each rep travels within a small area. Product: The importance of sales reps’ knowing their products, together with the development of product divisions and product management, has led many companies to structure their sales forces along product lines. Product specialization is particularly useful for product lines that are technically complex, highly unrelated, or very numerous. Kodak uses one sales force for its film products that are intensively distributed, and another sales force to sell complex products that require technical support. Market: Companies often specialize their sales forces along industry or customer lines. IBM set up a sales office for finance and brokerage customers in New York, another for GM in Detroit, and still another for Ford in Dearborn. Market specialization helps the sales force become knowledgeable about specific customer needs, but the major disadvantage is that customers are scattered throughout the country, requiring extensive travel. Complex: When a company sells a diverse product line to many types of customers over a broad geographical area, it often combines several structures, with sales forces specialized by territory-product, territory-market, product-market, and so on. A sales representative might then report to one or more line and staff managers.   Sales force size Once the company clarifies its sales force strategy and structure, it is ready to consider sales force size, based on the number of customers it wants to reach. One widely-used method for determining sales force size is the five-step workload approach:  (1) Group customers into size classes by annual sales volume; (2) Establish call frequencies, the number of calls to be made per year on each account in a size class; (3) Multiply the number of accounts in each size class by the call frequency to arrive at the total yearly sales call workload; (4) Determine the average number of calls a sales rep can make per year; and (5) Divide the total annual calls (calculated in step 3) required by the average annual calls made by a rep (calculated in step 4) to see how many reps are needed.   Sales force compensation The compensation package is a critical element in attracting top-quality sales reps, starting with the level and components. The level of compensation must bear some relation to the “going market price” for the type of sales job and required abilities. If the market price for salespeople is well defined, the individual firm has little choice but to pay the going rate. However, the market price for salespeople is seldom well defined. Published data on industry sales force compensation levels are infrequent and generally lack sufficient detail. The company must next determine the four components of sales force compensation— a fixed amount, a variable amount, expense allowances, and benefits. 1). The fixed amount, a salary, is intended to satisfy the sales reps’ need for income stability. 2). The variable amount, which might be commissions, a bonus, or profit sharing, is intended to stimulate and reward greater effort. 3). Expense allowances enable sales reps to meet the expenses involved in travel, lodging, dining, and entertaining. 4). Benefits, such as paid vacations, sickness or accident benefits, pensions, and life insurance, are intended to provide security and job satisfaction. Fixed compensation receives more emphasis in jobs with a high ratio of nonselling to selling duties and in jobs in which the selling task is technically complex and involves teamwork. Variable compensation receives more emphasis in jobs in which sales are cyclical or depend on individual initiative. Fixed and variable compensation give rise to three basic types of compensation plans—straight salary, straight commission, and combination salary and commission. Only one-fourth of all firms use either a straight-salary or straight-commission method, while three-quarters use a combination of the two, though the

Core functions of central bank The bank is responsible for the issuance of Kenyan currency and ensures that the currency is free from counterfeit, clean and fit for circulation Undertake economic and financial analysis and monitors a wide range of indicators on the economy to support monetary policy decisions The central bank uses various tools to manage the supply of money in the economy and the bank also manages issuances and repayment of treasury bills and bonds The central bank licenses and monitors payment systems that facilitate funds transfers between parties Provide banking services to the governments (National and county) and commercial bank The central bank licenses, regulates and supervises financial institutions under its preview, including commercial banks, microfinance institutions, forex bureaus and representative offices of foreign banks