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Sales Territory Design: Thirty Years of Modeling and Implementation

Andris A. Zoltners and Prabhakant Sinha
Marketing Science
Vol. 24, No. 3 (Summer, 2005), pp. 313-331
Published by: INFORMS
Stable URL: http://www.jstor.org/stable/40056963
Page Count: 19
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Sales Territory Design: Thirty Years of Modeling and Implementation
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Abstract

Sales territory alignment is the assignment of accounts and their associated selling activities to salespeople and teams. Models, systems, processes, and wisdom have evolved over 1,500 project implementations for 500 companies with 500,000 sales territories. Optimization models have evolved over time to explicitly consider travel time along road networks and customer disruption. Personal computers with continually increasing speeds and storage capabilities, the Internet, and mapping databases have enabled the development of systems that communicate alignments visually to sales managers. Because of their combinatorial complexity, multiple conflicting objectives, and personnel aspects that touch everyone in the salesforce, the alignment models were unable to completely solve the sales territory alignment issues faced by companies. Consequently, processes that add local managerial knowledge were used to communicate and enhance model-derived solutions, while achieving very high implementation rates. The territory alignment team gains knowledge with every sales territory alignment. Alignment insights get codified. Alignment experts improve every model-derived solution. This wisdom becomes part of subsequent alignments and triggers further innovation. Over time, the role of processes and wisdom becomes larger than the role of the models and systems.

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