The value of rule based sales territory management

The definition of a sales territory is – according to Charles M. Futrell in the Fundamentals of Selling – the customer group or geographic district for which an individual salesperson or sales team holds responsibility.

Why?

In my opinion, the sales territory is much more than only a geographic split. However, in most companies at this moment sales territories are setup by either a geographical split or by no clear split because accounts are divided due to historical assignments for example. This can happen when a company and the sales force is growing, and the sales reps got accounts – semi randomly – assigned to them. These accounts can be all sizes and types of accounts and shattered all over geographical regions. This leads to major travel and training costs and fuzziness about why an account is assigned to a certain sales rep. When this is the case in your company, it is a good time to choose for rule based sales territory management.

What?

With rule based sales territory management in Oracle Sales Cloud and Oracle Engagement Cloud it is possible to define territory boundaries based on 10 different so called dimensions. The following dimensions are out of the box available in Sales Cloud: (1) Products, (2) Industry, (3) Organization Type, (4) Customer Size, (5) Sales Channel, (6) Account type, (7) Business division. Next to that there are three auxiliary dimensions available, which can be setup to cater for company specific rules. For example, the industry can be used to classify accounts within different industries, the sales channel can define direct and indirect sales accounts and the geography dimension can be used to define territories by specified countries, cities, and postal codes.

Using these dimensions rules, it can be defined which account should go to what territory and therefore to what sales rep. For example, all small and medium accounts in the Netherlands and the Dutch speaking part of Belgium go to one sales rep, all large accounts in that same geographic region go to another sales rep. Or all accounts in a certain country of a certain industry go to one sales rep, all accounts of another industry go to another sales rep and the rest of the accounts go to a third person. Next to that, it is possible to let one territory copy its rules from another which is useful when you have success managers or consultants following certain sales reps in their assignments.

The image below shows an example for the Telescope industry. As you can see, this industry is divided in geographic split in the US, and in products Supplies and the full product. For each of these territories it is possible to have a specific sales rep.

For the win!

The big win in this way of assigning accounts is that there is a clear cut visible in which accounts go to who, and why. The results of this is that the accounts are most commonly less geographical spread and new accounts in the system are directly assigned to the right person. This will make the assignments fair, save time in the back office and saves time and money in the travel and education of the sales reps! A big advantage for any business that is striving for efficiency and first time right!

To make sure all the assignments are done correctly, high quality account dimensions are needed. If you do a split based on size and or industry type, it is important that all accounts that should fall into that rule have a size and or industry type. This will be elaborated more in a later article.

If you want more information about what territory management in Oracle Sales Cloud and Engagement Cloud can do for you, please contact Carolien Graafsma.

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