Recruit And Retain Superstars In Sales

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1. Recruit and RetainSuperstars in SalesIlona Jerabek, PhDPsychTests AIM Inc. 1 2. Reasons for recruiting salespeople Growth in primary business 84% Expanding into…
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  • 1. Recruit and RetainSuperstars in SalesIlona Jerabek, PhDPsychTests AIM Inc. 1
  • 2. Reasons for recruiting salespeople Growth in primary business 84% Expanding into new markets 28% Expanding into new lines of business 12% Replacing agents leaving firm 37% Other 4%Source: National Association of REALTORS® 2
  • 3. In-house sales team or alternatives? In-house sales team Outsourcing Resellers Distribution channels Independent reps 3
  • 4. Reality checkIn a survey of 23,000 employees at more than fifty-five companies, they found that: Only 36% of those surveyed clearly understood the corporate or organizational goals, what the organization was trying to achieve and why Only 20% of those surveyed understood clearly the link between their jobs and the organization’s goals Only 15% felt fully enabled to achieve their goals Only 20% fully trusted the organization they work for 4
  • 5. In other words …If these same statistics had to do with a football team then: Only 4 of the 11 players would know which goal was theirs Only 2 of 11 would care Only 2 of 11 would know what position they played and the expectations of their positions All BUT 2 players would consider competing against their own teamIf this were your team, how long would you keep the coach? 5
  • 6. Common challenges Hiring the right people  Personality suited for sales  Personality suited for the particular position  80% of your company’s sales volume comes from the top 20% of your sales people => Why pay 80% of sales force to bring in only 20% of the revenue? Turnover  Greener pastures (flocking to employers of choice)  Gen X and Y – the job-hopper cohorts  Leaving bad managers  Turnover is very, VERY costly Marketing vs. sales divide 6
  • 7. Common challenges Behavior issues  Big egos and Prima Donnas  Backstabbing – taking competitiveness to the extreme  Dishonesty  Absenteeism Motivation  Unclear vision  Disengagement issues  Commission structure  Personal vs. organization’s goals divide Loyalty 7
  • 8. Turnover – Howmuch does it cost? 8
  • 9. Pop quiz According to McDonalds, the turnover cost of losing an entry-level employee earning $12,500 per year is ____. 1. Less than $2,500 2. $2,500 3. $5,000 4. $7,500 5. $10,000 9
  • 10. Pop quiz According to McDonalds, the turnover cost of losing an entry-level employee earning $12,500 per year is ____. 1. Less than $2,500 2. $2,500 3. $5,000 4. $7,500 5. $10,000 10
  • 11. Pop quiz The turnover cost of losing a sales representative earning $75,000 per year is ____. 1. $48,000 2. $67,550 3. $93,750 4. $110,500 5. $125,000 11
  • 12. Pop quiz The turnover cost of losing a sales representative earning $75,000 per year is ____. 1. $48,000 2. $67,550 3. $93,750 4. $110,500 5. $125,000 12
  • 13. Turnover cost summary TURNOVER COST as a % of JOB TYPE/ CATEGORY annual salary Entry Level – Hourly , Non Skilled (e.g. Fast Food Worker) 30 – 50% Service/ Production Workers – Hourly (e.g. Courier) 40 – 70% Skilled Hourly (e.g. Machinist) 75 – 100% Clerical/ Administrative (e.g. Scheduler) 50 - 80% Professional ( e.g. Sales Representative, Nurse, Accountant) 75 – 125% Technical (e.g. Computer Technician) 100 – 150% Engineers (e.g. Chemical Engineer) 200 – 300% Specialists (e.g. Computer Software Designer) 200 – 400% Supervisors / Team Leaders (e.g. Section Supervisor) 100 – 150% Middle Managers (e.g. Department Managers) 125 – 200% 13
  • 14. NOTE: Percents are rounded to reflect the general range of costs from studies Costs are fully loaded to include all of the costs of replacing an employee and bringing him/her to the level of productivity and efficiency of the former employee. The turnover included in studies is usually unexpected and unwanted. The following costs categories are usually included:  Exit cost of previous employee  Recruiting cost  Employee cost  Orientation cost  Training cost  Wages and salaries while training Turnover costs are usually calculated when excessive turnover is an issue and turnover costs are high. The actual costs of turnover for a specific job in an organization may vary considerably. The above ranges are intended to reflect what has been generally reported in the literature when turnover costs are analyzed.Sources of Data: Industry and trade magazines have reported the cost of turnover for a specific job within an industry. The Saratoga Institute Independent studies have been conducted by various organizations and compiled by the Jack Phillips Center for Research. The Jack Phillips Center for Research is a Division of Franklin Covey. 14
  • 15. Who are the right people? 15
  • 16. Climbing the performance pyramid GAP 16
  • 17. Marker traits of star salespeople Intrapreneurial characteristics Business sense and instincts  Sales knowledge  Prospecting  Qualifying leads  Gathering info  Presenting  Resolving objections  Closing  Getting referrals  Strategizing and positioning  Resourcefulness  Mental speed  Negotiation skills  Research skills  Problem-solving skills  Relationship building skills  Memory for names, faces, personal information 17
  • 18. Marker traits of star salespeople Drive and ambition  Goal-orientation  Competitiveness  Initiative  Energy Social skills  Listening skills  Questioning skills  Communication skills  Sociability  Networking skills  Empathy and recognition of other people’s emotions  Persuasiveness  Helpfulness 18
  • 19. Marker traits of star salespeople Self-assuredness  Self-confidence  Assertiveness  Comfort with rejection  Comfort with decision-making  Comfort with public speaking Organizational skills  Neatness  Record keeping  Time management  Meticulousness Coping skills  Tolerance for failure – thick skin  Comfort with rejection and criticism  Emotional control  Adaptability Honesty 19
  • 20. Intrapreneurship An intrapreneur is someone who  Comes up with new ideas  Develops them conceptually  Ensures buy-in from stakeholders  Mobilizes the necessary forces  Implements  Personally assumes risks 20
  • 21. Characteristics in an intrapreneur business insight understanding of the market environmental awareness strength of character persistence, stamina and determination innovative and creative problem-solving ability to manage change capacity for analysis, organization and control of activities ability to inspire people at all levels, to engage their interest and ensure they are effective and successful loyalty 21
  • 22. Different jobs, different profiles Similar traits, different mix  High-tech sales vs. car sales vs. retail  Sales style:  Pioneers  Hunters  Farmers  Sales approach:  Improvisers  Chameleons  Planners  Hawkers  Persuaders ⇒ Hire people with the right profile for the job Hire people whom you can keep satisfied  Take into account organization’s policies  Keep it real – don’t hire people who are motivated by things your company cannot offer  Be aware of trade-offs 22
  • 23. Sales personality test factors Comfort with public speaking  Goal orientation Comfort with risk-taking  Initiative Comfort with decision-making  Energy Comfort with rejection/criticism  Neatness Sales knowledge  Time management Self-confidence  Meticulousness Recognition of other’s  Listening Skills emotions  Integrity Adaptability Assertiveness  Helpfulness Persuasiveness  Emotional control Communication skills  Mental speed Networking skills  Research skills Competitiveness  Problem-solving skills 23
  • 24. How to find the right people? 24
  • 25. How to recognize talent “Hire for attitudes, train for skills” Screening process Interview Assessment Decision tools Assessing impact of trade-offs 25
  • 26. If you can’t measure it, you can’t control it … Bottom Line: People who perform well have:  Increased self-awareness  Improved morale  Increased retention  Increased engagement  Enhanced productivity  Better job satisfaction . . . profits surge! 26
  • 27. “Assess and conquer” Define the job Assess the incumbent Assess the candidate Perform gap analysis Assess and manage performance Assess and manage promotions Retain your best people 27
  • 28. Assess the job Task analysis  Taskdescription  Shadowing Job analysis Job description Personality profile of the ideal candidate Key characteristics and attitudes Behavioral benchmarks for the position Reach consensus among the stakeholders 28
  • 29. Assess the incumbent Strengths  What traits and attitudes contribute to good performance?  What are the downsides? Challenges  What are the traits and attitudes that hinder performance?  What do you wish you could change in the incumbent? 29
  • 30. Assess the candidate Select and hire effective employees Find people with the right profile for the position Recognize team players Accurately predict successful performance 30
  • 31. Assess the candidate Prescreening Interview Personality assessment Assessment of work environment preferences Skill assessment Attitudes and values 31
  • 32. Prescreening Screen for deal-breakers  From company’s perspective  From candidate’s perspective Evaluate key attributes Knock-out questions Assess essential skills 32
  • 33. Interview pitfalls – The candidate Candidates well-trained in interviewing skills  Rehearsed responses  Spinning  Outright cheating ⇒ Read between the lines ⇒ Ask unusual questions ⇒ Ask situational questions Good candidates inexperienced in interviewing process  Disadvantaged – have to think about answers on the spot  Can miss diamonds in the rough 33
  • 34. Interview pitfalls – Interviewer bias First impression  It takes seven seconds to make a first impression  50% of it is based on the person’s appearance  First opinions are formed in the first 12 minutes of an interview Halo effect  strength (or weakness) in one area is generalized to other areas Primacy and recency effects:  The interviews we remember most are the first and the last of the group  We tend to remember the beginning and the end of individual interviews Rationalization of negative aspects if we like the candidate Looking for someone similar to self Self-fulfilling prophecy:  First impression of someone (from a first meeting or from their resume) will subconsciously influence questions resulting in confirmation of said first impression 34
  • 35. Interview – Probing for revealing info Situational/behavioral questions  Gut responses  Attitudes  Reasoning Strengths and weaknesses Ambitions Motivators 35
  • 36. Interview – Down the memory lane Past behaviors are the best predictors of future behaviors  Did you experience conflicts or major differences in opinion with co-workers or management?  How did you resolve them?  What did your past employers value most about you?  What did they suggest you improve/work on?  What’s the most common misconception about you? 36
  • 37. Interview – Show me what you’ve got Initiative and resourcefulness  What do you know about our company?  Why do you want to work here?  What can you contribute to our company?  What do you think our company can bring you?  In 3 sentences, why should we hire you rather than somebody else? (elevator pitch) 37
  • 38. Interview evaluation Decision tools  Objective criteria  Weighting system  Decision grid Quantify qualitative information Multi-rater evaluation 38
  • 39. Perform gap analysis Measure the difference between the candidate and the requirements of the position Identify significant gaps – changes in behavior and playing a role of the “job persona” are required to close the gap Determine the actions that support these required changes/behaviors Predict the energy requirements to make these changes and the resulting frustrations 39
  • 40. Keeping the bestand getting the best out of them 40
  • 41. Retain the good ones Training and professional development Personal development Empowerment Engagement Alignment of goals Growth potential (career and earnings) Organizational culture Management climate Working hours and flexibility 41
  • 42. Retention drivers … times are changing DISCONNECTING DRIVERS OF RETENTION EMPLOYERS’ VIEW EMPLOYEES’ VIEW1. Management Climate 1. Benefits2. Supervisor Relationship 2. Compensation3. Culture & Work Environment 3. Growth & Earnings Potential4. Benefits 4. Management Climate5. Growth & Earnings Potential 5. Time & Flexibility6. Training & Development 6. Culture & Work Environment7. Compensation 7. Supervisor Relationship8. Time & Flexibility 8. Training & Development 42
  • 43. Manage what matters Management by objectives Management style  Transform the management style according to what works for the person  Micromanagement – avoid or use it sparsely and for specific purposes  If possible, adjust the job to the person Manage expectations  What’s expected of employees  What the employees can expect  Resist pipe dreams Keep employees in the loop  Decisions  Results Align personal goals with company’s goals 43
  • 44. Motivating your sales force Set clear goals and expectations  When they know what they’re aiming for, they will make more efforts to get there Hold team meetings  Discuss strategies and ideas  Every member of the team can contribute to the discussion Team building  Organize periodic team building activities  Make a point of celebrating birthdays and anniversaries  Celebrate new hires  Celebrate successes 44
  • 45. Training and development Offer training possibilities  About what they sell  How they sell it  Career development  Personal growth  Mentoring and coaching 45
  • 46. Pop quizWhat is greater? ROI generated from Training & Development ROI generated from the acquisition of capital improvements 46
  • 47. Pop quizWhat is greater? ROI generated from Training & Development ROI generated from the acquisition of capital improvements 47
  • 48. ROI from trainingACTUAL BUSINESS RESULTS FROM TRAINING & DEVELOPMENTSETTING TARGET GROUP DESCRIPTION METHOD RESULTSCoca Cola First level supervisors 8 ½ day workshops Action planning 1447% ROI covering supervisor roles, Follow-up session Benefit/cost goal setting and team building Performance monitoring Ratio 15:1HMO All Managers and employees Organizational Development Performance Monitoring 20,700 New members (team building Management 1270% ROI building, group meetings Estimation BCR 13.7:1 Customer service trainingDirect Sales All employees in the 20 hr. program spread over Action planning Payback of program Financial Services Division 60 days focusing on investment in 1 yr total quality mgmtYellow Managers Redesigned interviews Follow-up interviews 1115% ROIFreight Performance appraisal BCR 12:1Systems appraisal with training Performance monitoring interpersonal skillsFederal Government New Supervisors 5-day intro to Follow-up questionnaire 150% ROI supv. course BCR 12:1 covering eight key competenciesBakery Multi-Marques, Inc Supv./ Admin 15 hrs of supervisory Action Planning 215% ROI skills training (Work process Including the analysis), role of training Performance Monitoring 48
  • 49. Sales contests A little friendly competition goes a long way:  Hold sales contests with non-cash awards (winning a fun night out enriches the winner’s life and creates enjoyment, a cash award has to be substantially larger to make a difference)  Keep the contests about short-term goals (long-term goals foster procrastination)  Use largest percentage increase as a goal rather than highest number of sales to give everyone a chance of winning  Make the contest periods and types unpredictable: When you become predictable, it is easy to hold off big sales for a little while to have them count in the upcoming contest. 49
  • 50. Building trust and engagement Align goals  Explain what the company goals are and how the individual sales representative affects those goals  Make their contribution personal Provide comparison tools  Share financial information  Show them how they compare to their colleagues Provide coaching and mentoring  Coach them periodically  We tend to forget key concepts when we get rolling  We all need to be reminded what we do well and what we need to improve from time to time Keep the atmosphere positive  Encourage rather than threaten  Reward improved performance rather than demoting and decreasing bonuses 50
  • 51. “Show me the money!” … and alittle pat on the back will help too Monetary compensation is important  Decent base  Commissions  Bonuses Be creative with incentives  Offer original non-monetary rewards  Tailor rewards to the recipient Create social reinforcement opportunities  Public praise is much more powerful than doing the same in private Pay particular attention to reward improvement in the bottom-tier sales staff’s performance  Rewarding the top performer is expected, but the sales representatives that don’t do so well need to be rewarded even more 51
  • 52. Big egos and Prima DonnasTo get the most out of them: Make them feel important Make them feel appreciated Figure out their needs and play into them Instill upon them the vision and mission of the company Communicate how theyre an integral part of the team Praise them for a job well done Give them perks 52
  • 53. Big egos and Prima DonnasTo mitigate the down side: Don’t give in to unreasonable demands Try to keep them grounded Cultivate humbleness Boost the team spirit Talk good traits into existence Throw them a challenge Reward team players Be diplomatic but candid with negative feedback 53
  • 54. Other factors Age  Positivelyrelated to commitment  Negatively related to turnover Personal needs  Work/family balance  Personal situation (attitude to travel, furthering one’s education, commuting, hobbies)  Flex time  Virtual office 54
  • 55. Retention – what to watch out for Compensation  Gross revenue vs. Gross margin  Commission caps  Expense accounts  Other perks Control of factors affecting performance  Budget control after closing (if commission based on gross margin)  Availability of supporting materials  Turnaround of feedback from others Quotas  Focus on the top line  Take into account the sales cycle 55
  • 56. Retain your best people Motivate, develop and retain your employees Improve coaching and development sessions Add objectivity to the promotion and review process Predict how a transfer or promotion will impact performance 56
  • 57. Are you the “Employer of Choice”?Do you… Align benefits & workplace attributes to create a dynamic work environment? => EMPLOYEE ENGAGEMENT Use tools to measure performance of exceptional workers? => BEHAVIORAL & LEADERSHIP 360 ASSESSMENTS Build career growth and development from the inside out? => BEHAVIORAL & LEADERSHIP 360 ASSESSMENTS Reward employees for driving organizational flexibility (adaptation to change)? => EMPLOYEE ENGAGEMENT 57
  • 58. Ilona Jerabek, PhD9001 blvd. de l’Acadie, Suite 802 Montreal, Qc H4N 3H5 ilona@psychtests.comDirect line: 514-745-3189, ext 112 Fax: 514-745-6242 58
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