Sales, logistics, maintenance… key components for best possible sectorization

 Apr 10, 2019

Photo credits: Lonely Planet - Unsplash

Sectorization divides up a defined geographic space into territories for action. Apart from delivering the desired result of a breakdown of an area into a series of separate entities, it serves to distribute, balance and structure these zones depending on constraints inherent to the business activity concerned on the one hand, and results sought on the other.

Your aim may be to define delivery, accessibility or attraction zones, or demarcate sales sectors to be assigned to agents or sales teams: sectorization can be described as a multi-criterion optimization exercise designed to serve strategic mission objectives.

There are three key areas of interest here:

Financial considerations

A sectorization may be considered to be approaching perfection when the whole of the territory under consideration is covered, and the human resources engaged on the ground have the practical means at their disposal to generate the expected revenue from their efforts. This will most likely be the case when an agent spends more time with their customers than on the road between these customers, or when delivery zones allow a certain number of deliveries to be achieved while clocking up the lowest possible mileage. Whether reasoning in terms of creating value (revenue banked, higher margins, customer loyalty affirmed because customers are happy…) or savings achieved (less fuel, lower mileage, fewer staff) a good sectorization gives you a clear competitive advantage since it translates directly into efficiency and productivity gains that will, in turn, show in terms of real numbers in the company’s financial result.

Logistical considerations

Administering activities with a view to covering the whole of a geographic market as efficiently as possible is not something that can be delegated easily to individuals, valuable as their understanding and intuition of the working practicalities of the job may be, and nor is it something that should be simply superimposed over a grid of administrative boundaries (districts, counties or post code areas…) the logic of which rarely corresponds to business realities. For example, if, a priori, the idea of assigning two adjacent departments to each sales person in a sales force seems like an equitable distribution, in reality it makes no sense because neither the number of customers nor the potential revenue they represent is identical in every department. Similarly, for the logistics of delivering to, or re-stocking points of sale, it is the location of the said POS in relation to the different logistical bases or depots that will determine the most logical zones, and not the fact that the points of sale are situated in the same administrative entity as the warehouse or depot. Mapping is the ideal tool to reveal this type of relationship and establish a sectorization based on objective statistical and topological criteria (distances, travel times, number of visits…) rather than on seemingly logical, but inapt, criteria.

The human dimension

While all companies will readily agree on the need to focus on customer loyalty, increasing numbers of businesses now recognise the strategic importance of retaining the loyalty of their staff. In the mobile sector – that has a reputation for being a demanding field of work, so recruiting is always a challenge – a well-thought-out sectorization can really help when it comes to nurturing staff motivation/loyalty. This is especially true for sales staff, who will be all the more motivated to achieve their objectives if their allotted sector has both the necessary sales potential and lowest possible travelling times. True, also, for technical and maintenance staff who will be able to carry out higher numbers of interventions in one day if they are familiar with their customers’ equipment or machinery and can keep control of the lengths of time needed for a visit. Delivery staff, too, will be more inclined to stay with the company if their routes are planned and viewable in advance, and realistic both in terms of pace and assignment of a reasonable day length. In these three areas of activity, offering suitably dimensioned and balanced sectors can boost satisfaction of individual staff members as regards their working conditions, keep levels of morale high, and, because the sectorization is seen to be equitable, foster cohesion within teams.

You don’t have to be a specialist in this area to understand that these issues are all interdependent, and that the whole challenge of a ‘good’ sectorization is to achieve the right balance between your operation’s priority areas and the geographic realities on the ground for the territories in which your teams are operating.

There is no such thing as an ideal sectorization

While sectorization is the essential prerequisite to putting an efficient operation in place for your sales teams, it’s important to let go of the idea that an ideal sectorization is achievable. There is no such thing in practice. Any more than there is any one automation tool that could magically produce such a thing…

So, it’s a question of looking for an optimum solution depending on objectives and contingencies, rather than trying to create an abstract model that will inevitably fall over as soon as it is created, due to the realities of ground truth and human behaviours. The other reason there can be no such thing as an ideal sectorization, even for a given activity, is the time factor and a host of changes that come along and end up making today’s optimum solution a thing of the past: tomorrow’s solution will be different! This has two main implications:

  1. the importance of choosing and weighting criteria you put into the equation to arrive at the optimum sectorization at a given moment, that assumes having the data corresponding to these criteria to hand, along with a suitable tool to align them on the geography;
  2. the requirement to periodically readjust an existing sectorization, or even to reconstruct it entirely, to take changes into account (new customers that affect the balance of existing sectors, the arrival or departure of staff so reassignments have to be made to maintain coverage, the launch of a new activity, or creation of a tele-prospection cell that alters the intervention perimeter for existing staff.
A multi-criterion sectorization tool will not perform all aspects of the ‘thinking things through’ for you. But what it will do, is keep the geographic dimension of your particular operation in view, and bring new variables into your model each time you need to create a simulation to find the new optimum with regard to the priorities of the moment – and all this without having to rebuild from scratch every time … Take care, nevertheless, as modifying an existing sectorization will always give rise to concerns within teams. Encouraging bonding between your teams at the outset will help limit the risk of resistance to change, or even rejection pure and simple. As for any restructuring project, information and change management are critical to uptake and success. It’s worth bearing this in mind! sales-and-logistical-sectoring

 

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