Inside sales structures and firm performance

Abstract

Organizations face a considerable challenge in determining the appropriate balance between inside and outside salespeople, largely due to the uncertain effects that a high dependence on inside salespeople has on firm performance. To address this challenge, we employ a multimethod research design, combining a qualitative theories-in-use approach with a quantitative analysis using panel data from 194 firms to examine the relationship between dependence on inside salespeople and firm performance. The results reveal that while higher dependence on inside salespeople increases the volume of interactions between salespeople and customers, thereby increasing firm performance, these interactions tend to be of lower quality, thereby decreasing firm performance. Notably, the net effect on firm performance is more likely to be positive when customer exchanges are less demanding and when managers can exert more control over inside salespeople. This study provides actionable macro-level theory on inside sales, addressing a critical gap in academic knowledge and managerial practice.