sales turnover

Are You Having Productive One on Ones With Your Sales Team Members?

Photo by Daniil Silantey on Unsplash

Photo by Daniil Silantey on Unsplash

Are You Having Productive One on Ones With Your Sales Team Members?

A Brief Guide to Conducting Meaningful Sales Rep One on Ones

 

I have always had the practice of meeting salespeople one-on-one every week, even if it was over the phone. My experience is that even the most experienced and seasoned salespeople need and want one-on-one interaction, whether it be for encouragement, help with problem-solving, support with strategic thinking, assistance with call planning or reviews, or internal help, like guidance on collaborating to receive support from other departments.

Even if they know what they need to do, having someone to bounce ideas off is extremely helpful. The essential thing is that the manager needs to be able to add value to the sales representative—they need to be able to help in some way. If the manager doesn’t add or offer any value, the one-on-ones won’t be of any value and won’t be welcomed. In fact, the reps will do whatever they can to avoid the manager, as they will be viewed as a waste of reps’ time.

In my one-on-ones I would always have a specific agenda but also always left time open for free dialogue. The agenda typically included:

 

actions review from previous meeting

results (or the lack thereof)

funnel review and discussion

what needed to be done to move business forward

strategic account planning

help/resources needed

current or immediate known challenges or issues

potential challenges or risks

any coaching opportunities that may have arisen and not yet been covered

personal/career development discussion, if needed or requested

any actions requiring follow-up

open discussion that may surface items

 

You want to ensure that these meetings aren’t viewed as simply the manager’s way to get caught up and keep an eye on things so that they are seen as being on top of things for their boss. While it is certainly important to catch up, the focus should be on the actual coaching and value-add of the manager–sales representative discussion. It’s not about you the manager, its about the rep and how you can help him or her be the best they can possibly be.

During the writing of my book The Street Savvy Sales Leader, I went through the process of becoming a professionally certified business coach by the Worldwide Association of Business Coaches (Conducted by Shift Coaching, shiftcoaching.ca). It was an extensive process that included several interactive training clinics, a substantial reading list, role-playing, observing practice-coaching sessions and putting in actual real-time, practical coaching hours. In all, the certification entailed well in excess of 70 hours[LC1]  of effort.

I wish I had gone through a coaching process like this earlier in my sales management career, as I would have been a more effective leader and coach if I had. I would recommend becoming a certified coach (from a reputable organization) to any dedicated Sales manager. It will make you a more seasoned, thoughtful and respected Sales leader.

Again, actual coaching means that you need to develop consistent and regular conversations that serve to help the sales process and sales rep development. These conversations need to be planned and must link to what you are trying to achieve as an organization and the culture you are creating.

Any additional thoughts and ideas on one on ones?, Would love to hear them, it is so important and needs to be a priority in all Sales Managers schedule.

For more information and insights into sales organization imperatives see my website,  www.streetsavvysalesleadership.com , 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@streetsavvysalesleadership.com

 

Mark Welch

Founder

Street Savvy Sales Leadership

www.streetsavvysalesleadership.com

 

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,  www.streetsavvysalesleadership.com , 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@streetsavvysalesleadership.com

 

Mark Welch

Founder

Street Savvy Sales Leadership

www.streetsavvysalesleadership.com

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 mark@streetsavvysalesleadership.com

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

Mark Welch

Founder

Street Savvy Sales Leadership

www.streetsavvysalesleadership.com

For individual sales or sales leadership coaching, workshops, contract work, or advising feel free to contact me by email mark@streetsavvysalesleadership.com

Sales Metrics-Yes you need it but how much is too much?

dominik-martin-100803-unsplash.jpg

Metrics don’t replace the Art of selling,, they augment it.

I’ve interviewed many sales leaders, accountability around sales metrics was mentioned as a top priority. So, there is no doubt that leaders recognize how important metrics and analytics are in the maximizing of their sales team’s performance.

Sales analytics basically provide information for sales management to assess the sales and marketing efforts. The analytics can help with accurate sales forecasting, more sophisticated funnel management and trends, enhanced buyer knowledge, and performance by rep. They can also facilitate more meaningful coaching conversations by giving managers the data they need to help the reps be more efficient and effective. The balancing act here is to be able to surface the optimal type of information without over burdening the sales teams.

Part of the story is to ensure that sales teams have the support they need, and that they know the “why” behind the data. Any data that can be derived and entered without the need for a field salesperson should be done by sales support when possible. Keep salespeople in the field as much as you can. For data they need to manipulate, make sure it’s easy for them to manage and that they’re able to do it remotely using mobility tools.

 

“What gets measured, gets done.”

–Mason Haire, organization theorist

 

There is no question that sales management needs metrics in order make sure the funnel is as full as it can be and that the sales group is meeting the revenue expectations of the company; however, the amount and type of information required needs to be specific to the unique demands of different businesses.

It’s safe to say that metrics are equally important to the reps themselves, as they own the outcome. The best salespeople know where they stand at all times and what they have to do to be successful. For those who don’t know, it’s up to management to assist and coach in this very important area. It may seem quite intuitive how important this is, but not all sales management or salespeople fully appreciate it.

As Jeb Blount points out in his book, Fanatical Prospecting: “It is no different in sales. Elite salespeople, like elite athletes, track everything. You will never reach peak performance until you know your numbers and use those numbers to make directional corrections.”1

The important thing to keep in mind here is to pick the right metrics that will get you to where you need to go, and ensure you are only using metrics that are necessary. Overdoing metrics will overburden the sales force with activity—that will do nothing more than take them away from filling their funnel and closing more business. 

In determining what to measure its important to measure activity as well as the outcome of the activity. Some sales people will argue, how can you measure what you seemingly can’t control, such as a customer’s decision-making process? or when a deal closes?

The major priority behind sales is to influence the decision making process and to close new opportunities. Yes there can be pieces of the decision process that are difficult to measure and change, and we can’t always predict exactly when a deal is going to close. But it is our role as much as possible in sales to influence, change, and help with buyers decisions, and to close business. So we need to measure both, the activity we need to engage in, and the outcomes we are being asked to perform.

I agree wholeheartedly with Mike Weinberg, who stated, “You cannot build a sustainable productive, healthy sales culture without a laser focus on goals and results. And that’s especially true if you want to maintain a high level of sales talent within the organization. A-players want to be pushed, expect to [be] held accountable for exceeding goals, and won’t tolerate being micro managed.”2

While the metrics are important, it’s equally important how you measure and manage them. As mentioned, top salespeople don’t like to be micromanaged—and they shouldn’t be. But knowing what activity typically drives what result is mission critical. Where the management of these metrics becomes especially important is to manage to the individual needs of each sales person. Each person is different, and therefore, how you coach and manage each person needs to be different. The same goes for metrics: they need to be used, but they need to be used in different ways for different situations.

The importance in using data is not about micromanagement; it’s about helping the reps understand what they need to do in order to meet their objectives. If used in the right way, with the right kind of coaching, the use of relevant data will be welcomed by the sales force, as they’ll  know it will help them be more successful.

Some sales organizations opt to be granular about the reps’ activity. How many sales calls are the reps making per week on average? The old adage, “You can’t sell anything unless you’re actually talking to a customer” is very true. Whether it’s an inside sales role or outside only, the dynamic is the same; and, typically, it’s a numbers game. The more customers a sales rep sees and presents solutions to, the more sales that rep is likely going to make. The issue is how many sales calls are required to be successful, and this is where art versus science comes into the picture. Until you measure the activity and get some history, you’re guessing. You need data.  And of course, where the art comes into play, some sales people will require less activity to reach the same result as they are more effective than their peers.

In enterprise-level large companies with complex sales, it’s less about the number of meetings and other specific measures and more about strategic planning and action plans around specific opportunities.

Remember, one size does not fit all. Align what you are measuring to the role and against the outcome you are after.

I would love to hear from your viewpoint on this topic, please comment below.

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

Mark Welch

Founder

Street Savvy Sales Leadership

www.streetsavvysalesleadership.com

For individual sales or sales leadership coaching, workshops, contract work, or advising feel free to contact me by email mark@streetsavvysalesleadership.com

 

1)      Fanatical Prospecting, The Ultimate Guide to Opening Sales Conversations and Filling the Pipeline by Leveraging Social Selling, Telephone, Email, And Cold Calling—Jeb Blount, John Wiley and Sons Inc, New Jersey, 2015, page 37

2)      Sales Management Simplified-The Straight Truth About Getting Exceptional Results From your Sales Team, Mike Weinberg, Amacom, 2016, page 13

 

 

What is Sales Productivity and How Do You Measure It?

Photo by Toa Hefliba

Photo by Toa Hefliba

What is Sales Productivity and how do you measure it?

What gets measured gets done!

Sales productivity is one of the most talked about sales leadership subjects, so much so that I wrote a whole book on the subject. (The Street Savvy Sales Leader-due out summer 2018) www.streetsavvysalesleadership.com

How to do you get more out of your sales resources?

At its most basic level, it is about building the best sales teams you can possibly build;

have them work together collaboratively;

support them and coach them to the highest level possible;

help point them in the right direction and plan for success;

have a mindset of continuous improvement and learning;

don’t bog them down with excess administration and other extraneous reporting or management demands;

build a strong sales process with well defined analytics;

have a customer-driven mindset;

and build a culture where they can flourish in a trusting, and caring environment.

The answer to the question on what is sales productivity and how do you measure it depends in large part on what is being sold, the market segment and size, and fundamentally what is most important for the organization to measure.  But at the end of the day, to me it's quite straight forward, the more each individual sales rep sells on average (Whatever the measure), the higher the sales productivity.

This could be the more widgets or units the sales rep sells, or the more revenue the sales rep sells, or the more margin a sales rep sells, more net new customers, or increased wallet share. The measurement really depends on what the company is trying to achieve, what is most important to the growth of the company, and what is the company’s strategy. In a declining market for example it could even represent retention numbers. The answer lies at least in part in what your company objectives are.

The more challenging question is How do you measure it? What is the benchmark? and What do you want or need it to be?

The best example of a sales productivity measurement is to simply calculate what was sold by the sales force in one period and compare it to what was sold in a latter period. So, from a starting point, “what gets measured gets done”. You must start tracking all the sales numbers so you know where you’re at.  I know it’s a given, but I also know of many organizations, and quite large and somewhat sophisticated companies that really don’t have a good handle on their detailed sales numbers.

How can you set a benchmark and track progress? How do you know if any investments you make contributes to the sales force selling more stuff if you don’t have the measurements in the first place? How do you even know what your problems are if you can’t measure the actual sales statistics?

The best example of sales reporting I ever experienced was in a mid sized company of just under 200 employees with over 30 sales reps at the time. We knew how much each rep sold each month for the previous 5 years. We knew what was sold by each rep by tenure, how much they sold on average if they were a 3 month, 6 month, 9 month, or 12 month and longer tenured rep. We knew how much was sold on average by geographic region and by product, we also knew how much was sold on average by each sales manager. We tracked this by average by month and by rolling average by quarter.

On top of that, we knew these statistics and could tie them in with turnover ratios as well. These measurements helped us understand our sales results and our comparative sales results over time, by region, by manager, and by sales rep tenure. We could pinpoint sales problems in all those areas so that we could dig in and work on determining why the numbers were off, and take steps to improve them.

You can’t figure out where you’re going without knowing where you are. I can’t stress this enough; sales reporting is critical to sales productivity improvements.

Another measure that we could derive very simply from this reporting was the Sales Participation ratio’s which is also a crucial measurement to understand further your sales productivity status. It is the classic Top Producer syndrome, are you getting far too much of your results from too few people? What percentage of your sales force is creating the bulk of your revenue growth? In many organizations, it’s the classic 80/20 rule, getting 80% of your results from 20% of your sales force. This needs to be challenged and worked on to improve at every turn. It is fundamental to the improvement of your sales growth.

You are probably asking yourself, how much does it cost to get these numbers, how much resources do I need to get this kind of reporting? I argue the latter; how much is it going to cost if you don’t? Tens of thousands of dollars, Hundreds of thousands of dollars, even Millions of dollars in some cases. One of the smallest organizations I worked for with the fewest resources had the best sales reporting out of any company I ever worked for.

From these sale’s reports, you can then see what the current results are, or the benchmark results are if you will. From here you set the targets you need to achieve, and then it’s a matter of setting a plan to get there.

Sales productivity improvements can be effected and affected by many high-level levers, basically though, it’s how talented your sales people are, and then it’s a matter of how efficient and effective you can help them become.

Efficiency is all about how sales is using their time, are they talking to the right people with the right message at the right time. I often ask my sales people; What is one of the most important asset that you have personally that contributes to your success?  The answer is Your Time!  How they can use their time more efficiently and effectively is largely how they will improve their results.

There was one time study conducted in 2013 that found that reps were spending 19% of their time in internal meetings, 41% of their time selling, and 40% of their time searching or creating and revising sales/marketing material. Not great news, less than half a sales rep’s time is spent selling. This number was much worse in some of the companies that I have witnessed.

As Neil Rackman, author of SPIN Selling stated “An effective sales force is a more sustainable competitive advantage than a great product stream” (1)

That pretty much sums up how important the sales function is and therefore how important it is that we make it the best we possibly can.

For more information on sales productivity or other leadership imperatives, please refer to my website www.steetsavvysalesleadership.com, or my upcoming book, The Street Savvy Sales Leader, or email me at mark@streetsavvysalesleadership.com.

 

Mark Welch

Founder

Street Savvy Sales Leadership

www.streetsavvysalesleadership.com

For individual sales or sales leadership coaching, workshops, contract work, advising, or speaking engagements

 

(1)   Spin Selling-Situation, Problem, Implication, Need-Payoff-Neil Rackman, McGraw-Hill, Inc., 1988, Page xvi