Harvard Case - QualityKiosk: Sales Force Design for Anabot
"QualityKiosk: Sales Force Design for Anabot" Harvard business case study is written by Sreeram Sivaramakrishnan, Anuroop Krishna. It deals with the challenges in the field of General Management. The case study is 11 page(s) long and it was first published on : Aug 11, 2022
At Fern Fort University, we recommend that Anabot adopt a hybrid sales force model, combining a dedicated team of in-house sales representatives with a network of independent distributors. This approach will leverage the strengths of both models, ensuring Anabot can effectively reach its target market, manage costs, and achieve sustainable growth in the emerging markets.
2. Background
QualityKiosk, a subsidiary of Anabot, is a leading provider of automated kiosks for various industries. Anabot faces the challenge of expanding its reach into emerging markets, where the traditional sales force model is often inefficient and costly. The case study focuses on the decision-making process for designing an effective sales force structure for QualityKiosk, considering factors such as market dynamics, cost-effectiveness, and long-term sustainability.The main protagonists are:
- Anabot: The parent company seeking to expand into emerging markets with its subsidiary, QualityKiosk.
- QualityKiosk: The subsidiary responsible for developing and selling automated kiosks.
- Management Team: The team responsible for making the decision on the sales force design.
3. Analysis of the Case Study
To analyze the situation, we can utilize a combination of frameworks:
1. Porter's Five Forces:
- Threat of New Entrants: High, as the kiosk market is relatively easy to enter with the availability of technology and manufacturing capabilities.
- Bargaining Power of Buyers: Moderate, as customers have options from different kiosk providers but may require customization.
- Bargaining Power of Suppliers: Moderate, as component suppliers are numerous but some may be specialized.
- Threat of Substitute Products: Moderate, as alternative solutions like mobile apps or traditional service points exist.
- Rivalry Among Existing Competitors: High, as the kiosk market is fragmented with several established players.
2. SWOT Analysis:
Strengths:
- Strong brand reputation in the kiosk industry.
- Innovative product portfolio with advanced features.
- Established manufacturing and distribution capabilities.
Weaknesses:
- Limited experience in emerging markets.
- Potential challenges in adapting to diverse cultural and business environments.
- Lack of a dedicated sales force in emerging markets.
Opportunities:
- High growth potential in emerging markets with increasing demand for automation.
- Partnerships with local distributors to expand reach and leverage local expertise.
- Potential for customized solutions to meet specific market needs.
Threats:
- Competition from local and international players.
- Economic instability and political risks in some emerging markets.
- Potential for regulatory challenges in certain regions.
3. Strategic Planning & Organizational Structure:
Anabot needs to develop a clear strategic plan for its expansion into emerging markets, outlining the target markets, growth objectives, and resource allocation. This plan should be aligned with the overall corporate strategy and consider the long-term sustainability of the business.
The organizational structure should support the strategic plan and facilitate effective coordination and communication between different departments. This may involve creating a dedicated team for emerging markets, establishing clear roles and responsibilities, and implementing performance evaluation systems to track progress.
4. Recommendations
1. Hybrid Sales Force Model:
- In-house Sales Team: Anabot should establish a core team of experienced sales professionals dedicated to emerging markets. This team will be responsible for developing relationships with key customers, providing technical expertise, and managing large-scale projects.
- Independent Distributors: Anabot should partner with a network of independent distributors in each target market. These distributors will have local knowledge, existing customer relationships, and a strong understanding of the market dynamics. They will be responsible for generating leads, closing smaller deals, and providing after-sales support.
2. Sales Force Training and Development:
- Cultural Sensitivity: Anabot should provide comprehensive training to both in-house and distributor teams on cultural sensitivity, local business practices, and effective communication strategies in different markets.
- Product Knowledge: Training programs should focus on product features, benefits, and applications specific to the needs of emerging markets.
- Sales Skills: Sales training should cover effective sales techniques, negotiation skills, and customer relationship management.
3. Technology and Analytics:
- CRM System: Anabot should implement a robust CRM system to track customer interactions, manage leads, and analyze sales performance data.
- Data Analytics: The CRM system should be integrated with data analytics tools to identify market trends, customer preferences, and areas for improvement.
- Digital Marketing: Anabot should leverage digital marketing channels to reach potential customers in emerging markets. This includes website optimization, social media marketing, and online advertising.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core Competencies: Anabot's core competencies lie in product innovation and manufacturing, which are essential for success in emerging markets. The hybrid model allows Anabot to leverage these strengths while also benefiting from local expertise.
- External Customers: The hybrid model caters to the diverse needs of customers in emerging markets, ranging from large-scale projects requiring specialized expertise to smaller deals requiring local support.
- Competitors: The hybrid model provides a competitive advantage by allowing Anabot to respond quickly to market changes and adapt to local conditions.
- Attractiveness: The hybrid model is cost-effective, as it reduces the need for a large in-house sales force in emerging markets. It also leverages the existing network of distributors, minimizing upfront investment.
6. Conclusion
By adopting a hybrid sales force model, Anabot can effectively expand its reach into emerging markets, achieve sustainable growth, and maintain its competitive edge. This approach combines the strengths of both in-house sales and independent distributors, ensuring that Anabot can effectively address the diverse needs of its customers while managing costs and mitigating risks.
7. Discussion
Alternatives:
- Exclusive Distribution: Anabot could solely rely on independent distributors, but this approach may limit control over sales processes and customer relationships.
- Direct Sales Force: Anabot could establish a fully in-house sales force in emerging markets, but this would be expensive and require significant investment in recruitment, training, and infrastructure.
Risks and Key Assumptions:
- Distributor Performance: Anabot needs to carefully select and manage distributors, ensuring they have the necessary skills, resources, and commitment to represent the brand effectively.
- Market Volatility: Emerging markets can be unpredictable, and Anabot needs to be prepared to adapt to changes in economic conditions, political stability, and consumer behavior.
- Cultural Differences: Anabot needs to be sensitive to cultural differences and adapt its marketing and sales strategies accordingly.
8. Next Steps
- Market Research: Conduct thorough market research to identify target markets, assess competitive landscape, and understand customer needs and preferences.
- Distributor Selection: Develop a rigorous selection process for identifying and partnering with qualified distributors.
- Training and Development: Implement comprehensive training programs for both in-house and distributor teams.
- CRM System Implementation: Select and implement a suitable CRM system to manage customer relationships and track sales performance.
- Performance Evaluation: Establish clear performance metrics and evaluation systems to monitor the effectiveness of the hybrid model.
By taking these steps, Anabot can successfully implement the hybrid sales force model and achieve its growth objectives in emerging markets. This approach will enable Anabot to leverage its core competencies, adapt to local conditions, and build a sustainable business in these dynamic markets.
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Case Description
In December of 2020, the head of product development at QualityKiosk Technologies Private Limited (QualityKiosk) was grappling with a significant issue. QualityKiosk provided application quality assurance, business automation, digital experience management, and data analytics services to financial services companies across India. Krishna had to recommend the way forward for the company's latest product-Anabot, a new information technology (IT) journey analytics platform. The Anabot platform could provide its clients with quick insight about any IT incidents in the client's technology services. It also provided around-the-clock intelligence to the client's team handling those incidents. In its first year of sales, the customer journey analytics platform had been adopted by five major clients, generating over ₹20 million in revenues for QualityKiosk. However, between May and August 2020, none of over fifty potential clients who had expressed an interest in the Anabot product had proceeded to make a purchase. For the entire Anabot product team, anxiety was increasing about the future of their product. In an upcoming product review meeting with the company's chief executive officer, the head of product development would be required to present his recommendations for the future of the Anabot platform.
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