Digitalthink Case Analysis

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Answers of the questions mentioned in the Case:

1. What should DigitalThink Salespeople “Look Like”? What experience set should they have? Do the company want to hire sales people who are already familiar with the training market? With the new media/Internet Market?

Ans. As mentioned in the case Goettner concluded that going direct was the only viable option sales person

1. Should be committed to create long term, ongoing revenues.
2. Ability to work as a partner with customer.
3. Should be able to sell product inside the account

Given the constraints in the cost mentioned young ambitious and sales oriented persons can be hired. Having said that strong training experience is also required so there should be some people with experience need to be hired who can train or mentor other inexperienced people. This can be a good trade-off and will balance out cost and experience equation.  Yes company wants to hire salespeople with familiarity with training market but they are costly.

1. What quotas should be set for salespeople for FY1999 given that the salespeople would be new to DigitalThink and the catalogue would still be acquitting critical mass? To answer this question the believed they had to make a decision regarding what a salesperson quota should be once DigitalThink had a full catalogue of 150 courses or more. DigitalThink management believed that, once the company was larger and had a bigger course catalogue, salespeople should be responsible for about 20 active accounts.

Ans. The quota can be kept with industry standard average of 1 Million $. In start of quarter it might be difficult to achieve but will be fairly possible by the end of the year. Until enough courses are developed, the target given to the sales people should be given target size of 750 per account per course annually (22500 $ per account per 30 courses on basis of present performance) and 20 number of accounts.

1. Should they hire regional managers first or should they hire one or two more salespeople first, to save money and get more data in terms of what a salesperson could sell?

Ans. DigitalThink can initially hire sales people but not reginal managers. After paying salary it can be checked how much profit is being made on basis of this analysis can be made if it is viable to hire a regional manager or not. Jay Palace can play role of manager till a new manager is hired after financials support same. Newly hired sales manager can take things further by developing sales forces and work towards increasing revenue per sales person.

1. Should the regional sales managers have quotas in the addition to their sales oversight jobs? Should Palace have a personal quota?

Ans. No, it’s not advisable to managers and Palace to have personal quotas, sales multiple work only if respective people perform their key jobs efficiently. Regional manager’s key role should be to monitor and maintain sales of each salesperson and hire new sales people. This will make the sales teams effort more effective. Personal quota might create conflict in priority of roles and may affect performance in primary role, which is to grow sales team and its performance rapidly. Similarly Palace should also concentrate on his primary role and mentor his sales force.