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https://doi.org/10.1111/j.1937-8327.1998.tb00110.x
Copy DOIJournal: Performance Improvement Quarterly | Publication Date: Oct 22, 2008 |
Citations: 14 |
This return-on-investment (ROI) evaluation study determined the business impact of the sales negotiation training course to Dell Computer Corporation. The specific metrics used include profit margin and margin attainment percentage, units sold and attainment percentage, total revenue and attainment percentage. The study applied a five-step ROI measurement process used at Dell Computer. The process steps include Plan-Develop-Analyze-Communicate-Leverage. Using this process, this particular case study involved 57 participants who attended the Dell Situational Negotiation course and an equivalent control group. To collect data, the corporate sales information database was used to compare pre- and post-training metrics for both training and control groups. A cost benefit analysis was also conducted to determine ROI of the training. Among the key findings of the study are: •There was an overall improvement of 17.63% in all metrics for the training group. The greatest improvements were in profit margin volume sales and total revenue sales, with 61.56% and 41.86% respectively. •Average quarterly compensation per participant increased by 14.11% for the 3rd quarter over the 2nd quarter for Fiscal Year (FY) 1997. •The training group performed better than the control group in all metric areas which means that the Dell Situational Negotiation has positively impacted performance and goal attainment. •The cost-benefit analysis calculated an ROI of 523.25% for a three-month period. The total net profit to the company, in margin dollars, is $763,297. •Projected annual net profits generated by Dell Situational Negotiation training is about $1.5 million per year. The recommendations generated from the results of the study include the following: •These results have to be communicated to executive and management staffs for them to recommend the training to those who have not yet attended. •Coaching and reinforcement efforts for the course have to be stepped up so that these improvements can be sustained. •Due to the significant results of this study, the course should be included in development plans of sales representatives, account executives, sales managers, and regional sales managers. •It is suggested that a follow-up study be done to identify specific negotiation skills and tools that are being used on the job.
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