January 24, 2017

Type of sales organization – Line Sales Organization

The line sales organization is the oldest and simplest sales organizational structure. It is widely used in smaller firms and in firms with small numbers of selling personnel. For instance, in companies that cover a limited geographic area or sell a narrow product line. The chain of command runs from the top sales executives down through subordinates. All executives exercise line authority, and each subordinate is responsible only to one person on the next higher level. Responsibility is definitely fixed, and those charged with it also make decisions and take action. Lines of authority run vertically through the structure. And all persons on any one organizational level area independent of that level.

Line sales organization

The line sales organization sees its greatest use in companies where all sales personnel report directly to the chief sales executive. In these companies this executive often is preoccupied with active supervision and seldom has much time to devote to planning or to work with other top executives. Occasionally, however, the line sales organization is used where more than two levels of authority are present. Theoretically, there is no cross communication between persons on the same level. Contacts between persons on the same level are indirect and are affected through the next higher level. For example, the assistant sales manger of division 1 arranges to confer with the assistant sales manager of division 2 through the sales manger. Similarly, contacts by sales personnel with the office staff flow up through the organization to sales manager and back down through the assistant sales manager in charge of the office to the office staff.

The basic simplicity of line organization is the main reason for its use. Because each department member reports to only one superior, problems of discipline and control are small. Lines of authority and responsibility are clear and logical, and it is difficult for individuals to shift or evade responsibilities. Definite placement of authority and responsibility saves time in making policy changes, in deciding new plans, and in converting plans into action. The simplicity makes it easy for executives to develop close relations with salespersons. With this working atmosphere, it is not surprising that executives who come up through a line organization are frequently strong leaders. As the typical line sales department has few organizational levels, administrative express are low.

The greatest weakness of the line sales organization is that so much depends upon the department head. The head needs outstanding ability and rare qualifications, and should be well versed in all phases of sales management, for there are no subordinates with specialized skills and knowledge. Even if the head is an all around expert, there is insufficient time for policy making and planning, since rigidity of the line structure requires that a great deal of attention be given to direction of sales operations. The liked often must make decisions and take action without benefit of planning. Under such conditions, results are often disappointing.

For rapidly growing concerns and for those with large sales staffs, the line organizational structure is inappropriate. As the department grows, new layers of executives must be added to retain control. Orders and directions must be passed down through a growing series of administrative levels. Managerial effectiveness becomes impaired and result are less predictable, as directions become more and more distorted and garbled at each succeeding organizational level.; moreover , as salespeople are sacrificed, and maintaining morale becomes a grater challenge. Not many executives have the talents needed to manage a large scale line sales department effectively, and line organization offers little opportunity for subordinates to acquire these skills.

Ordinarily, the stakes are too high, except perhaps in the smallest companies, for managements to gamble on the availability of a replacement at the time needed. Sound organizational practice dictates that trained under studies be ready to step into the shoes of their superiors. But more often than not, chief sale executive in line sales organizations fail to groom their own replacements.

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