If you’re in charge of hiring, training and developing inside sales reps, then what you’re about to read may shock you a little bit, but it will also resonate with you and explain why many of the reps you hire ultimately fail.
In their book, “How to Hire and Develop Your Next Top Performer” by Herb Greenberg, Harold Weinstein and Patrick Sweeney, they compared results from hundreds of thousands of assessments that were conducted over several decades with actual sales performance measurements and concluded:
#1) 55 percent of the people earning their living in sales should be doing something else, and
#2) Another 20 to 25 percent (of salespeople) have what it takes to sell, but they should be selling something else.
Before you dismiss these results as far-fetched, think about your own inside sales team. If you’re like most companies, you probably have the 80/20 rule where 80% of your sales and revenue are made by your top 20% producers. What that means is that the other 80% of your reps struggle to make quota (or rarely do), and I’ll bet that over the course of a year or two, half of these reps have either quit, been fired, or you wish they would move on.
I’ve worked with hundreds of companies that have inside sales teams, and I can attest to the accuracy of the stats above. Every time I begin working with a new company, I assess the skill level, aptitude, desire and ability of each member of the team. What I find is that up to half of the reps employed shouldn’t have been hired to begin with (or shouldn’t still be working at the company), and most important thing we can do is to replace them with better qualified candidates.
If you’re with me so far, then let me make a couple of caveats before you start thinking about replacing half your sales team…
First, in order to give each member of your existing team the full chance to succeed, you have to make sure that you have invested the proper time and energy in identifying and defining your sales process (I call it a DSP – Defined Sales Process). Next you need to design a sales training program – complete with specific scripts – that teach the best practices of your sales process and then properly train your existing team on them. And finally, you need to teach your managers how to coach and train your reps to adhere to those scripts and best practices. Assuming you take the time to do this first (I usually get companies through this process in anywhere from 45 to 90 days), then you are ready to begin recruiting and hiring more qualified candidates.
So, how do you begin to look for and eventually identify the other 45 percent of people who are actually cut out for the career of sales? Here are 3 important guidelines to follow:
1) Slow hiring, fast firing. If I were to ask you what activity college football coaches spend up to 70% of their time, what would you say? Watching game film? Coaching their players? Preparing game plans? The answer is none of those. College coaches spend up to 70% of their time recruiting talent to play on their team. Does that surprise you? If you hire sales reps like most companies do, then it probably did.
Most companies hire sales reps the wrong way. They hire reps quickly, and they hold on to underperforming reps far too long. The first guideline you want to follow is to do just the opposite. The best thing you can do is always be recruiting and have a constant flow of talent to evaluate and hire. Your goal should be to hire slowly – after a structured and careful evaluation process – and then to be ready to let reps go who have not shown the improvement or performance that you’ve identified in advance is necessary (you’ll refer back to your DSP to arrive at this).
The key here is that if you have a steady flow of talent and candidates to choose from (and in this market, there are many people available), then you’ll be much less likely to make quick and ill advised hiring decisions. Plus, you’ll be less likely to hold on to underperformers who are likely to never make it in your selling environment.
2) Be more willing to consider and to hire candidates who either don’t have your particular sales experience, or don’t have any sales experience at all. If we go back to the results earlier in this article – that 55 percent of people in sales should be doing something else, and another 20 to 25 percent should be selling something else – then it means that the common practice of hiring experienced sales candidates will produce an unsatisfactory result as much as 80 percent of the time!
A much more effective way of hiring successful sales reps is to start with raw and motivated candidates and then train them properly right from the beginning. Teaching new candidates the right skills and techniques is a lot easier than first getting an experienced sales rep to unlearn all their bad habits first. Of course, you must have a solid sales training program that teaches effective sales skills and the best practices of your particular sale (these best practices will also come after you’ve defined your sales process – DSP).
You can still interview and even hire experience sales reps, but just bare this in mind: The biggest predictor of future success in sales is what the rep has done in the past. What a rep is used to producing and earning defines their comfort zone and in fact defines every aspect of their financial life. In life – and in sales especially – we all tend to live up to or down to what we are used to. If you want to know what an experienced sales rep might produce at your company, then just find out how much they earned at their previous company. Divide this number by their commission, and you’ll have a very accurate idea of what you can expect they’ll produce.
Then ask yourself if that’s enough. If it isn’t, then take a chance on someone new to the profession of sales and instill in them a new comfort zone based on success at your company.
3) Regardless of whether you hire an experience sales rep or someone new to the profession, what you absolutely must do is make sure your managers are measuring the right indicators of sales success and progress. You would be surprised by how many companies measure and rely on metrics that don’t drive sales. I’m talking about things like number of calls, time on the phone, etc. Now don’t get me wrong – these are important metrics and they definitely play a role in the success or failure of your inside sales team. But they don’t drive sales. Let me explain the difference.
While it’s obviously important that your reps are making the most amount of calls and contacts with decision makers as possible, this alone will not drive sales. You see, if your reps are not qualifying prospects properly, or if they are not handling objections or brush offs well enough to win sales, then if they simply make more calls, this won’t result in a lot more sales. In fact, it will just waste more of their time, more of your resources and result in more frustration in your sales department.
The only thing that drives more sales is effective conversations that move the sale forward with qualified prospects. Each contact with a qualified prospect must have benchmarks that are achieved and agreements must be made at every point of the sales cycle for that prospect to ultimately result in a sale. Coaching and measuring the successful navigation of these benchmarks is what drives sales. This is the crucial difference begin measuring quantity (make more calls) versus qualify (measuring what happens during those calls).
Once you understand and can apply that difference in your sales environment, and once you can teach this to your reps, then and only then will you begin building a more successful sales team and company. Until then, you are likely to keep repeating the kind of performance you’ve had over the last few years – regardless of how many new reps you hire.
To recap these successful hiring guidelines, start with the philosophy of slow hiring and fast firing. Always be on the lookout for new candidates, and turn each employee into a mini recruiting machine. Offer hiring bonuses, referral bonuses, and other incentives to get your whole company looking for qualified and talented candidates that you can add to your sales team.
Next, expand your search of talent. Don’t just run ads in the sales section of the paper or online source, but expand to college recruiting boards, acting blogs (actors often make great inside sales reps!) and other websites. Be open to bring on someone fresh to the profession of sales and teach them the right skills from the beginning.
And finally, make sure you measure (and reward) the actions that drive sales. Remember, it’s how your sales reps handle the brush offs and smokescreens and stalls that determine how successful (and empowered) they are more than how much time they spend on the phone. It’s always “who” is in the pipeline that is more important than “how many.”
Follow these guidelines and you’ll be on your way to building a highly successful inside sales team.