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Allocating Selling Effort via Dynamic Programming
Charles A. Beswick
Vol. 23, No. 7 (Mar., 1977), pp. 667-678
Published by: INFORMS
Stable URL: http://www.jstor.org/stable/2630847
Page Count: 12
You can always find the topics here!Topics: Sales territory, Control units, Sales management, Trading areas, Dynamic programming, Modeling, Algorithms, Territories, Marketing, Travel time
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This article presents a model for allocating selling effort and setting sales force size which explicitly considers interactions with territorial design, forecasting, and performance evaluation. An extremely fast, dynamic programming algorithm for the allocation of selling time to control units is presented, and a proof of the optimality of this solution under specified conditions is provided. This algorithm also generates the optimum sales force size and provides output which is a basis for designing sales territories. The allocation algorithm can accommodate a large class of multivariate response functions. The model also incorporates subjective judgment into the decision process. Interaction with sales management of a test firm has shown that the model is highly useful in pinpointing problem areas, in evaluating salesmen, and in designing territories which can, to a large degree, achieve the benefits of the optimum allocation generated by the model.
Management Science © 1977 INFORMS