Getting the Right Salespeople on the Bus
By Douglas G. Davidoff
Founder & CEO, the Imagine companies
To download a .pdf version of the complete article click here.
No organization can depend on genius; the supply is always scarce and unreliable. It is the test of an organization to make ordinary human beings perform better than they seem capable of, to bring out whatever strength there is in its members, and to use it. – Peter Drucker
As I travel and meet with various business leaders, giving talks, speeches and coaching sessions, one issue above all else has emerged as the primary barrier to profitable growth: good salespeople. In his book Good to Great, Jim Collins demonstrates how critical it is to hire good people, introducing the metaphor of “getting the right people on the bus.” The current popularity of that concept indicates the widespread challenge companies face in getting the right people necessary to deliver on the corporate strategy. Any employer who has ever suffered a mis-hire (this would include every employer I've ever come in contact with) understands the damage of a mis-hire. This is especially true when it comes to hiring salespeople.
Hiring expert Geoffrey Smart reports in his book Topgrading, that the typical mis-hire rate for businesses is 50%. Our research indicates that the typical mis-hire rate of salespeople is greater than 75%. This means that a typical company must hire four salespeople before finding success. A good rule of thumb to use when assessing the damage caused by a mis-hire is a four multiplier. This means that if you expect a salesperson to earn $100,000 in their first year, the cost of a mis-hire to you (when factoring in the search, training, lost opportunities and time) is approximately $400,000.
Is there anything you can do about avoiding mis-hires, or is this just a fact of business life today? Should you find alternatives to using salespeople, as many consultants are now recommending? The answers to these questions are the subject of this issue of The INTELLIGENT GROWTH Ezine.
ARE SALESPEOPLE MADE OR BORN?
What makes great salespeople? Believe it or not, the typical answer to this question is that they are “born to sell.” This answer, though, is the first cause of a potential mis-hire. So what does make a great salesperson? The question itself arises from an erroneous belief that some people are “born to sell,” while others are not. The reality is that what makes a great salesperson may include attributes born to them. But those attributes are insufficient to be a great salesperson. There is no single answer to the question, "what makes a great salesperson?"
A far better question – perhaps the only question—to ask is: "what makes a great salesperson for what we are trying to sell, the way we are trying to sell it, with the resources we are using and within the corporate culture we have?" And that question, while much more complicated, is the real question you have to answer if you want to avoid a mis-hire.
There is no direct correlation between the personality of the candidate and what will make a successful hire for your company. Failure to assess the needs of your organization and define the critical skills and talents of an ideal hire, drastically decreases your odds of a successful hire. Stop looking for that natural salesperson who has 'it', and start looking for the individual that can fill a unique position in your company.
THE TOP 10 REASONS FOR SALESPERSON MISHIRES
PLUS ONE BIG MISTAKE
Another major cause of a sales hire failure is when the organization counts on the new salesperson to “figure it out.” This big mistake is especially prevalent in entrepreneurial companies where the entrepreneur is hiring the first salesperson in the department, though it also happens regularly in companies with existing sales departments. This mistake manifests itself in many forms. It can occur when a salesperson is hired with the idea that the hire can also “build a sales department.” The hire may be expected not only to be a really good salesperson, but to also figure out the “strategy” that will move sales forward. These are just a few instances of this mistake.
The two major problems with expecting your new salesperson to “figure it out” are that many of the expectations of the hire are in conflict. Do you want the hire to build a sales team or build sales? Do you want to leave success to chance, or do you want a salesperson who can test results beforehand?
A HIRING PROCESS
In past issues of this e-zine, I have addressed the need for an effective sales process as part of the formula for success. It is equally, if not more important to have a defined process for successful hiring. This process should apply to all hires, not just sales, but it should certainly apply to hiring salespeople. Our research has found that an effective hiring process can reduce the mis-hire rate for hiring salespeople to below 20%. Imagine Sales Consulting has developed The Talent Advantage™ which enables companies to build high performing sales teams. If you would like more information on The Talent Advantage, click here.