Exam 8: Evaluating the Effectiveness of the Organization

The hierarchical sales analysis begins with total sales for the sales organization and proceeds through each lower level in the sales organization.

Potential benefits resulting from an audit include, among others, increases in productivity, sales and profits due to improvements and efficiencies in production operations.

Intraorganizational factors such as company organization are considered in this area of the sales organization audit framework:

It is possible for sales volume to seem unchanged even though units sold increased.

When using a top-down perspective in sales analysis, the emphasis is on identifying potential problem areas at each level and then

Results of salesperson performance evaluations are typically tactical.

Productivity improvements can be obtained by

The income-statement approach to profitability does not incorporate any evaluation of the investment in assets required to generate the net profit or profit contribution.

Productivity improvements may be obtained by using more input to maintain the same level of output.

When actual selling costs far exceed budgeted costs

One type of sales analysis involves comparisons with previous period.

The basic form of this method for determining expenditure levels for selling expense categories could be called zero-based budgeting:

Which of the following is not one of the four types of analyses outlined in the text as a method for analyzing sales organization effectiveness?

Recruitment, selection, and sales training are examples of factors considered in this area of the sales organization audit framework:

Which method of determining expenditure levels for selling expense categories depends upon accurate sales forecasts?

The costs of a sales organization audit, in time and money, typically outweigh the benefits.

Improvements in sales productivity should be achieved by an increase in output with the same level of input.

Probably the most often used method to establish selling budgets is

When using income statement analysis, the different levels in a sales organization are treated as separate businesses.

Translating budgeted and actual selling costs into percentages of sales achieved would provide a means for assessing whether the cost/sales relationship had been maintained.