Many companies in Business-to-Business (B2B) environment consider value-based selling (VBS) to be a selling approach that can move the conversation with their customers from price to value. Thus, firms today invest in training their sales force to improve how the value of their product or service is quantifiable and communicated to customers effectively.
While the implementation of Value-Selling Training Programs (VSTP) is regarded as an important step in educating sales people, little is known about the effectiveness of the programs in regard to measurable financial results for the company and the effects generated for the various parts of the organization.
However, the effectiveness of VBS has not yet been measured (e.g. financial outcomes) extensively and the effectiveness of such programs must be questioned if there is no Return on Investment (ROI) for the organization.
Based on semi-structured one-on-one interviews with key decision makers of these companies, financial outcomes were identified, e.g. increase in margins or ROI (%) of such programs and portrayed the various effects of these VSTP i.e. behavioural, awareness and marketing-related benefits, which were caused by the training. The most outstanding finding was that company managers, who focused on measuring the outcome of the training initiative received positive results whereas the majority of interviewed company decision makers did not track the success (effectiveness) in detail or were only able to describe non-tangible results – some provided a “gut-feeling” of their outcomes.
To further advance knowledge about the effectiveness of VSTP, future research avenues were identified to ensure ROI of such initiatives and areas of improvement such as suitable evaluation tools and practical methods to measure the outcome and increase financial returns of the investment.
Table of Contents
1 Introduction
2 Management Problem and Context
2.1 Aim and Purpose of the Research
2.2 Research Questions
2.3 Business Context
2.4 Academic Context
3 Literature Review
3.1 Achieving Competitive Advantage
3.2 Concept of Customer Value
3.3 Value of Goods and Relationships
3.4 Value-based Selling
3.4.1 VBS Behaviours and Skills
3.4.2 Customer Value Management and Value Calculation
3.4.3 Value-based Selling Training Concept
3.4.4 Consultative and Relationship Selling
3.5 Measuring Training Program Effectiveness
3.6 Measuring the Financial Impact of Sales Training
3.7 Summary of Literature Review
4 Research Design and Methodology
4.1 Methodology for Primary Research
4.2 Coding
4.3 Semi-structured One-on-one Interviews
5 Findings and Analysis
5.1 Analysis of Primary Data
5.1.1 Question 1
5.1.2 Question 2
5.1.3 Question 3
5.1.4 Question 4
5.1.5 Question 4a
5.1.6 Question 5
5.1.7 Question 5a
5.1.8 Question 5b
5.1.9 Question 6
5.1.10 Question 7
5.1.11 Question 8
5.1.12 Question 9
5.1.13 Question 10
5.1.14 Question 11
5.1.15 Question 12
5.1.16 Question 13
5.1.17 Question 14
5.1.18 Question 15
5.2 Evaluation and Limitations of Study and Methodology
5.3 Results
5.4 Generalization of Research Findings
6 Conclusion and Recommendations
6.1 Research Objectives
6.2 Managerial Implications
6.3 Academic Contributions and Suggestions for Further Research
Research Objectives and Themes
This thesis examines the effectiveness of Value-Selling Training Programs (VSTP) within B2B organizations, specifically investigating whether such training leads to measurable financial performance improvements and beneficial behavioral changes in sales teams.
- Measurement of training effectiveness and Return on Investment (ROI)
- Implementation of value-based selling strategies in B2B markets
- Impact of training on sales performance, margins, and customer relationships
- Evaluation methods for organizational sales training initiatives
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3.4 Value-based Selling
Value-based selling (VBS) or value-selling can be described as a sales approach to identify opportunities for growth and profitability within the customer base (Kaario et al., 2003). It requires different skills on the salesperson level and the current literature has shown a link between performance of a sales organization and this approach to generate value to the buyer. Kaario states that unit prices are going down in almost all industries provoking margin erosion and driving companies to find new revenue streams and sources of profit by selling business impacts that result in increased profits for the customer and finally for the selling company instead of selling products, services or solutions.
He suggests two dimensions, i.e. bringing value to the customer during and after the process and secondly, selling needs to bring value to the provider by generating strong and steady cash flows to compensate for the costs of the resources needed to develop these seller-buyer relationships (Kaario et al., 2003). Kaario et. al. attribute that this investment needs to be allocated to customers with greatest future potential.
In consequence, VBS is a long-term approach and a segmented logic to identify the right potential customers who are willing to pay an extra price because of the tangible and intangible value (e.g. process innovation, time- or cost savings) it brings to their business and how it contributes to achieving personal goals of the key decision maker or the buying unit.
Terho et al. provides a definition of value-based selling (VBS): Value-based selling is the degree to which the salesperson works with the customer to craft a market offering in such a way that benefits are translated into monetary terms, based on an in-depth understanding of the customer's business model, thereby convincingly demonstrating their contribution to customers’ profitability (Terho et al., 2012).
Summary of Chapters
1 Introduction: Provides an overview of the research scope, the importance of Value-Based Selling (VBS) in maintaining competitive advantage, and the research objectives.
2 Management Problem and Context: Addresses the challenge of measuring the effectiveness of sales training and defines the specific research questions regarding financial outcomes and organizational impact.
3 Literature Review: Synthesizes academic theories regarding competitive advantage, customer value, VBS strategies, and established training evaluation models like Kirkpatrick’s.
4 Research Design and Methodology: Details the qualitative research approach, specifically the use of semi-structured one-on-one interviews with sales executives for data collection.
5 Findings and Analysis: Presents the gathered primary data, categorizes outcomes, and evaluates the financial and behavioral impacts reported by the interviewed companies.
6 Conclusion and Recommendations: Summarizes the key research findings, provides managerial implications for VBS implementation, and suggests avenues for future research.
Keywords
Value-based selling, VBS, Sales training, VSTP, ROI, B2B, Financial performance, Sales performance, Customer value, Training effectiveness, Kirkpatrick model, Competitive advantage, Relationship selling, Consultative selling, Sales strategy
Frequently Asked Questions
What is the core focus of this master thesis?
The thesis investigates the effectiveness of Value-Selling Training Programs (VSTP) in B2B environments, specifically aiming to determine if these programs yield measurable financial results for companies.
What are the primary themes discussed in the work?
The work focuses on value-based selling (VBS), training effectiveness evaluation, the connection between sales strategy and financial performance, and the behavioral changes in sales personnel.
What is the primary objective of the research?
The primary goal is to understand how VSTP influences an organization's financials and to study perceived changes in sales representative behavior following the training.
Which research methodology does the author employ?
The author uses a qualitative research approach, conducting semi-structured one-on-one interviews with senior sales executives from various European companies to gather empirical data.
What content is covered in the main body of the research?
The main body covers a comprehensive literature review on customer value and selling models, the design of the research, the analysis of interview data regarding tangible and non-tangible results, and managerial recommendations.
Which key terms characterize the study?
Important terms include VBS, ROI, Customer Value, Kirkpatrick model, Competitive Advantage, and Sales Performance metrics.
How does the author define Value-based Selling?
The author utilizes the definition provided by Terho et al. (2012), describing VBS as the extent to which a salesperson collaborates with a customer to translate benefits into monetary terms based on a deep understanding of the customer's business model.
Why is the Kirkpatrick model relevant to this research?
The Kirkpatrick model is used to evaluate the success of the training, specifically analyzing participants' reactions, learning gains, behavioral changes, and the ultimate organizational results.
What findings were reported regarding the financial impact of training?
The research identified that companies using VSTP reported measurable benefits such as increased profit margins, revenue growth, and improved win rates, although measuring these strictly on a results level remains a complex challenge for many firms.
What recommendations does the author give for successful implementation?
The author recommends regular refresher training, consistent coaching by sales managers, adapting compensation schemes to drive desired behaviors, and investing in tools to quantify customer value.
- Arbeit zitieren
- Thomas Menthe (Autor:in), 2016, Effectiveness of Value-Selling Training Programs, München, GRIN Verlag, https://www.grin.com/document/323945
