sales compensation

The Top Three Challenges Facing Sales Organizations Today And What To Do About It !

Photo by Shane Rounce

Photo by Shane Rounce

This is definitely my most important post so far.

While companies all face different challenges, there are three universal ones plaguing the sales industry today:

1. The buyer’s journey has changed dramatically. There are now more decision makers in every sales situation; the buyer is busier, more knowledgeable and more risk-averse; the buyer’s expectations of the sales profession are much higher; and the decision process is more complex. Thus, it is harder than ever to move a buyer to make a change.

2. It is tougher than ever before to differentiate your offering. Companies and salespeople are struggling to stand out and truly offer something of sincere value in every step of the sales process to their customers in a very crowded market. Even if you have a product or service that can be differentiated it’s still tough to get buyer mindshare.

3. Sales reps are facing increasingly complex and time-challenging demands. Companies want more data (typically through CRM platforms), reps need to be more knowledgeable about their product and more prepared for every sales interaction than they ever have and there is greater pressure on reps to provide consistently higher sales. The reps may not receive sufficient support, so they need to work harder to balance increased internal demands against winning more sales.


So, here we have the perfect storm: a more complex and challenging customer environment, where more time is essential to properly prepare for each customer interaction; a proliferation of products and competitors that makes differentiation more challenging; and increased expectations for both sales achievements and non-selling activities.


My strident message to senior sales leaders and B to B executives and owners;

You absolutely cannot have your cake and eat it, too. Sales needs the time to focus on selling and, at the same time, the sales organization needs to close the gap between buyers’ expectations and the sales community’s skills and expertise.

So if you want to be a world class sales organization, give your team the tools and support they need and let your sales people sell. Do not overburden them with non selling stuff !!!


Creating a Best-in-Class Sales Team

I have witnessed firsthand these increased challenges in the marketplace and in the customer mindset, yet I believe sales remains an exciting and rewarding career. Despite what others may suggest, sales is not dead, it is evolving. And we in the field must adapt.

In order to meet business growth objectives, you need to overcome today’s challenges. The only way to do that is to build a best-in-class sales team. By best-in-class, I mean a sales organization built on a solid foundation that’s composed of a winning, supportive and collaborative sales culture; caring leadership; an effective hiring process; a strong sales process with robust analytics; proven execution; a customer-driven philosophy; and a mindset of continuous improvement and learning.


Below are the 10 imperatives that I believe are critical for developing a sales organization that will help you win in the marketplace and meet your revenue goals.


1. A well-thought-out, customized hiring process to find the candidates with the most potential to succeed.

2. A defined onboarding program and talent management system that will get your new hires firing on all cylinders as quickly as possible and keep them that way.

3. A finely tuned sales process and funnel management.

4. Appropriate key performance indicators, metrics and analytics to measure success.

5. Sales planning to ensure you are calling on the right targets and that your salespeople are focused.

6. Sales methodology to ensure consistency and effectiveness in the sales process.

7. Effective real-time coaching to help your salespeople be their best.

8. Compensation and reward and recognition programs that are aligned with what you need to achieve.

9. Change management, because change is here to stay.

10. A caring, high-performance culture where sales employees feel they are a part of something of value and where they can express themselves and collaborate freely in a team environment.


These imperatives will enable your sales leadership to create a best-in-class sales team, which will provide your organization with the best possible opportunity to win in the marketplace.


It is these 10 imperatives that my book, The Street Savvy Sales Leader is all about.


For more information and insights into sales organization imperatives see my website, , or to pre order my upcoming book, The Street Savvy Sales Leader, A Guide to Building Teams that Consistently Win New Business.

Street Savvy Sales Leadership offers individual sales or sales leadership coaching, workshops, contract work, advising, and speaking engagements.

If you have any questions or comments, please email me at


Mark Welch


Street Savvy Sales Leadership

What Is Your Sales Turnover Costing Your Business?

Photo by Matthew Kane

Photo by Matthew Kane

A study titled Hiring Top Sales Management, conducted by the Sales Management Association in late 2015, found that a mere 33 percent of the 152 firms involved in the study conducted a well-defined hiring process when hunting for new sales talent. If you extrapolate from these study results, it means that two-thirds of sales organizations hire one of the most important roles in the company using an informal process (in other words: they hire without putting a lot of thought into the key ingredients of a successful hire for their organization). Obviously, there is a lot of room for improvement and ways to save companies from lost opportunity by making the wrong call.

What gets measured, gets done, and stats can really help in determining where problems lie. Ideally, you want to know the turnover statistics of your sales force separate from the rest of the company. Also, statistics should be broken down by wanted and unwanted, or voluntary versus involuntary. This is HR language for when someone exits the organization on their own (voluntary or unwanted) or whether they were asked to leave (wanted or involuntary).

A voluntary exit and an involuntary exit are two different challenges and need to be dealt with in different ways. Exit interviews should be conducted for all voluntary exits in order to fix problems that might otherwise continue to arise or to spot underlying trends that you may need to pay attention to.

Let’s look at some numbers to illustrate what I mean. Let’s say you have a sales staff of 46, and three employees leave on average per month. At first glance, that doesn’t seem like a lot, does it? But it equates to an annual sales employee turnover of 78 percent. Almost 80 percent of your sales resources has turned over in this simple example:

Formula: Divide the number of employees who left over the period by the average number of total employees over the period.

3 exits x 12 months = 36 exits

36 exits over 46 total sales force is 78% per annum

For a monthly turnover rate in this example, you would divide 3 exits by 46 staff, which would be 6.5% per month. Obviously, that’s not a good statistic.

The three exits per month should be broken down by voluntary and involuntary so you can know how many were let go versus those who left on their own. If, on average, two leave per month on their own, that’s a voluntary turnover of 52 percent and an involuntary rate of 26 percent. Both statistics would need improvement, but it is critical to examine the voluntary exits to figure out the root cause of each of the exits. Without knowing the root causes, the company could be spending a lot of money unnecessarily on trying to fix the wrong things.

There are hugely differing views on the cost of replacing sales hires, varying from a low of one-third of the individual’s salary to over 100 percent of the individual’s salary. I’ve seen numbers as high as $600,000 and more. A 2012 article in Selling Power indicates that salesperson mis-hires can cost as much as $616,000. It is difficult to pinpoint an overall number, however, as the circumstances are so totally different from one company to another. Some might use recruiters to find new hires, and doing so can carry a high cost. Some companies use internal recruiters who, in turn, recruit through job boards on the internet and may also use recruiters. Some organizations might, on average, have mostly long-tenured salespeople while other companies may have mostly less-tenured salespeople. Obviously, the cost will be higher in losing long-tenured, good performers. They are tough to replace.

To go back to the example given above, if you use the most conservative mis-hire cost of 100 percent of the salary of any given sales employee, and that salary is $60,000, the cost would be $60,000 per exit. The turnover in the example would be costing the company a conservative $2 million-plus per year. Again, I view this as conservative if you think about recruitment costs, retraining and onboarding the new salespeople and getting them up to the same productivity levels as the employee who left. This could take three months, and in most cases, six to 12 months or even longer. During this time, no or minimal sales will be achieved and the demands of the manager during onboarding will be significant. Potential customer issues could arise, and there’s the risk of prospects being dropped or lost in the cracks between transitions. The list goes on.

A thorough hiring practice review could help prevent a good portion of these costs. I lived this firsthand in one company where I was the sales leader. We had well over a 60-percent turnover rate when I joined the company. By building well thought out hiring practices in partnership with HR, we brought down the turnover to under 30 percent. This was a massive cost savings for the company and resulted in a significant uplift in sales productivity.

It’s worthy to note, that to attract and retain new hires you need to have a pay structure and a compensation plan that is market competitive and a solid sales culture, or you won’t attract the right people and/or keep them. I have heard it said on several occasions that people don’t work for money. I beg to differ when it comes to sales. Sure, there are other factors, but good salespeople—your top talent—want to get paid well. Pretty much in every single interview I have conducted (which would be in the hundreds), rarely was money not an issue at some point in the hiring process.

For every voluntary exit, the organization should always conduct an exit interview, as mentioned earlier, to understand why people are leaving, especially if they are top performers. This can often be a challenge to get to the root cause, as exiting employees are not always candid or forthcoming about the real reason they want to leave the company. But it is worth the effort to come as close as possible to the answers, so that you can make improvements where necessary. You can also spot problem areas when, for example, the turnover is higher on one sales team on average than it is on another sales team. This gives you an opportunity to probe and find out what might be going on within that team to cause the disruptions/turnover.

Of course there are many factors in sales turnover, but fixing or improving hiring practises is a great start to improving turnover rates.

Key Questions to Ask

For the sales leader, here are some points to consider :

Have you investigated and detailed the drivers of performance for the top performers in your company?

Have you created a model of “what good looks like” that helps make clear those drivers and behaviors of top performers?

Have you developed a program to test for those drivers for new recruits?

Have you created detailed and well-thought-out job descriptions or profiles for all your sales roles?

Have you created specific interview questions and assessment competency tests?

Do you have a standard hiring process to ensure consistent results?

Have you established a hiring criteria grid to organize and rank your hiring short list?

Do you manage and track turnover by tenure and experience, so you can manage the sales rep’s lifecycle and raise the performance based on tenure?

Have you developed an effective reference-checking process?

Do you conduct exit interviews with unwanted turnover employees?

Do you have a compelling story to recruit the best salespeople possible?

I would love to hear your viewpoint on this topic, please comment below. Or email me at

To read about other sales leadership topics or to increase your sales productivity check out my website

Mark Welch


Street Savvy Sales Leadership

For individual sales or sales leadership coaching, workshops, contract work, or advising feel free to contact me by email