The effect of managerial cost prioritization on sales force turnover

Driven by organizational focus on bottom-line profitability, business-to-business (B2B) sales managers face pressure to justify and control sales expenses. As cost information becomes more accessible, higher value may be placed on this information relative to revenue information to help alleviate this pressure. Therefore, this study conceptualizes cost prioritization and argues that while bottom-line management gains may ensue, cost prioritization may also have unintended consequences for sales force engagement. Therefore, this research examines the effect of managerial cost prioritization on sales force turnover. Output control, behavior control, and micromanagement are identified as key factors impacting the relationship between cost prioritization and sales force turnover. Empirical testing is based on a survey of B2B sales managers from various industries across the United States. Results indicate cost prioritization increases sales force turnover. Output control attenuates, while micromanagement exacerbates, this relationship. In addition, functional and dysfunctional turnover are differentially impacted by cost prioritization.