How important is hiring for B2B sales? According to the just-released CSO Insights 2015 Sales Performance Optimization Report—a survey of some 4,000 sales organizations—sales hiring is a critical, even mandatory activity. But of equal interest the report shows that, for a majority of organizations, it is also a total crapshoot.
The Slippery Slope
Let’s look at the raw statistics. According to the CSO report, 96.8% of firms are growing or maintaining their sales organizations in 2015. But how well are organizations hanging on to the talent that they’re so busy hiring? The average turnover rate for salespeople is 22.4%–comprised of 10.3% reps leaving the firm, and 12.1% the firm inviting them to leave. Additionally, statistics from various other sources show that the average tenure of a salesperson runs anywhere from 2.5 years (top end) to less than 12 months (low end).
The takeaway: The ability to retain top talent is slipping, and you are ‘in the hole’ at the start of each year (since over ⅕ of your sales force will turn over).
The importance of correcting this course, for any company, is extremely obvious. Sales is the lifeblood of any organization—no sales, no revenue. No revenue, no company.
The Pressure Cooker
How does this filter down to the individual salesperson? According to the report, 63.6% of average annual sales quotas are greater than $500,000 per rep. While these quotas are being put in place, the majority of organizations also take 7+ months for a new salesperson to be productive.
So the median sales rep is literally a Million-Dollar Man, who takes 3/4 of a year to locate and get up to speed (let’s face it—that rep isn’t “found” until they’re proven themselves). In this robust 2015 economy, everyone is looking for that Million-Dollar Man.
What does that mean for you? Pressure, baby, pressure! And as we learn in physics, pressure causes heat. How well can you stand that heat?
We’re No Different!
We’re certainly not excluding ourselves. Last year at Pipeliner CRM we actually shed more than 20% of our sales force, despite doubling the overall team. We expanded our Direct Sales, Partnership and Current Accounts Teams while at the same time winnowing. This issue is universal.
6 Steps to Relief
So how can we relieve some of this awful pressure? By taking a good, hard look at these statistics and thinking with the desired outcome in mind. For new hires, it’s going to take you the better part of a year to find out if you have a proven sales rep on board or not. And the clock is ticking on your current team, regardless.
With that knowledge, here are 5 steps you can take to make sure the reps that you do bring aboard succeed. Additionally, by nailing these steps, current reps will stay with your company longer– their eyes won’t wander to “greener pastures” if they’re happy– and you can even make it possible for some that may not have made it, to reconsider leaving.
Nail down that sales process. One vital aspect to relieving the pressure—for everyone involved—is ensuring that your sales force has a successful, established sales process to follow. In virtually ever case studied, a stable sales process led to improved performance results. If your company is lagging a bit behind in this area, you’re not alone: most studies also find that a majority of companies do not have a sales process they consider truly efficient. You can take a leap ahead of the competition—and provide the same for your reps–by stabilizing your sales process. And a consistent process will help new hires transition sufficiently.
Create an ideal sales rep profile. It runs along the same lines as building a buyer profile for your sales process—only in this instance you’re putting together a salesperson profile for future hires.
By this we don’t mean a simple job description (we’ve been doing that for decades and we’re still in the same place). Your industry has a particular culture. So does your company. Take some time and work out the attributes of a salesperson for your company, based in a good part on your own sales champions.
You also want a salesperson that is as good a fit as possible for your particular buyer profile. Ideally you’d want a salesperson that had worked successfully in your industry, and even more ideally had sold to some of your same clients. But if that isn’t possible, a similar industry with a similar buyer profile will certainly work.
3. Break the old rules—less than expected, more than it appears. Salespeople are generally overburdened with non-sales activities, such as administration and excess reporting. Offload these tasks to sales support personnel and other non-selling staff. Free up your sales reps’ time to actually sell. You’d be amazed how productive a sales team can get when unburdened by SDRs or shared Assistants.
4. Create a career path. At the same time, create a career path for sales professionals to advance. By this we don’t mean the traditional career path of climbing the corporate ladder through management—sales reps generally shun such a path, anyway. Through more successful meeting of quotas, make job security and perhaps an ever-increasing compensation system the path to follow. Of course make traveling this path easier through great mentoring and coaching.
5. Create new rules—tools are friends, so invest wisely. Make it so that your CRM is the only place where sales plans, data and processes end up. A CRM system should be the single location for all sales data—yet because traditional CRM applications can be difficult to use, salespeople often utilize their own spreadsheets, notes, playbooks, collateral, strategies, contact lists and even pipeline applications. Get them using CRM, period, no exceptions. (Note: this may require replacement of a burdensome outdated CRM system with one that actually does the job).
With this CRM-centric approach, sales managers can then spend their time working with and overseeing the sales process. Preparation and planning lead to coaching and mentoring — as opposed to updating and rehashing leading to second-guessing and vulturing in to clean up carcasses.
6. Different is better than “better.” When offering sales positions, don’t promise “better.” Instead promote “different.” How?
- Turn the job description into a compensation equation that designs itself — for both your company and the candidate.
- Explain quota system and path to attainment.
- Make commission split ranges transparent and up for discussion.
- Offer base salary range, normalized to current level of candidate, +/- from current sales role.
Think as if you are recruiting free agents who want to sign with a winning team. Clearly communicate all advantages above compensation. Ask candidate to “sell” their own package. You’ll clearly see when a sales prospect can’t (or won’t) provide a win/win. Thus, you can see the “true colors” and weed accordingly.
What About You?
How does this data impact you and your company? Have you seen it to be true? What are your sales hiring plans for 2015?