The Effects of Organizational Structure on Selling Behaviors

Abstract

A national random sample of industrial salespeople was surveyed to assess the effects of centralization and formalization on selling behaviors. The responses from 241 salespeople were analyzed using ordinary least squares regression. The results indicated that hierarchy of authority positively affected job codification and rule observation. Job codification and rule observation had negative effects on customer orientation and adaptive selling. Since customer orientation and adaptive selling improved salesperson performance, it appears that sales managers engaged in strict monitoring and directing of salespeople’s activities may be hurting their productivity by stifling their creativity to be customer oriented and adaptive. Apparently, salespeople preferred a decentralized and less bureaucratic organizational structure to implement the marketing concept and to tailor their sales messages to the uniqueness of each selling situation. However, for young and inexperienced salespeople, the negative effect of job codification and rule observation on adaptive selling became non-significant. Thus, the structure of selling organizations may need to be altered based on the age and experience of salespeople. Based on the findings, managerial implications and directions for future research were provided.