Winning the Sales Talent War in the Big Data Era
Had a hard time hiring sales talent lately? You aren't alone. And guess what? It's only going to get worse!
There are a lot of headwinds confronting sales recruiters these days, according to data from recruitment company Princeton One. The strongest may be these:
- The number of sales jobs is projected to grow 18.8 percent between 2010 and 2020, according to the Bureau of Labor Statistics -- so you're facing stiffer competition for talent.
- During the recession, close to 1.6 million salespeople left the field, but the number of sales candidates between the ages of 25 to 40 entering the work force will grow at less than 1 percent. The shortage only threatens to increase as baby boomers leave mid- and senior-level sales positions. Thus, you're looking for talent from a shrinking pool of candidates.
- Perhaps most critically, the role of a salesperson has changed in response to customer demands. More technical and industry-specific knowledge is now vital to making sales meetings useful to potential customers, requiring salespeople to explain products and services in detail and in the context of the prospects. Thus, salespeople are required to do more, while being compensated less.
Can't Live Without Them
It's not as though you can get by without salespeople. The oft-repeated saw "today, everyone is a salesperson" is utter bunkum. Everyone in the company impacts the buying experience, but salespeople fulfill a critical role in getting deals on the books and revenue in the bank.
Having an empty slot on your sales team's roster imposes an opportunity cost on your organization: You're missing out on sales as you battle to staff your sales teams appropriately.
Filling those slots is not cheap, even discounting the compensation payments you may have to make (and in a tight hiring market, those payments can become fairly high).
The acquisition cost of a new sales employee was US$29,159, and the training costs were $36,290, a DePaul University study found. That's a total of $65,449 to replace each lost sales rep.
That means in a sales organization with 100 reps with an average churn rate and average hiring/training expenses, losing 21 sales reps would result in an annual cost of $1,374,429 -- not including opportunity costs. Ouch.
So, if you have A-players on your sales team, your success depends on keeping that team together. Top talent is most likely to bolt at the point when it's selling most effectively. Those salespeople are delivering numbers, have proven themselves to be effective, and thus are in high demand. If you're a sales VP, a sales manager, or in sales ops, your job may depend on how well you keep those people on your team.
You can always overpay them -- compensation has a stickiness all its own. However, few of us have that luxury. Instead, you can take advantage of data to manage your sales talent strategically, and to do so in a way that won't break the bank.
If you have an automated compensation management system in place, you're already collecting data that can enable you to identify talent that may be ready to leave your company, spot opportunities to invest in training and enablement tools that keep salespeople engaged, and adjust compensation to influence top talent to remain with your company -- and at the same time, become better at their profession.
While the exact processes will vary from company to company, here are some examples that could jog your imagination.
Watching for Likely Defectors
Is there an overachiever in your organization whose bonus or accelerator structure is constantly being revised upward? If you can spot this pattern, you may be able to identify someone who's becoming a hot commodity -- and who may feel as though his or her efforts are never enough for the company.
Another set of likely departure candidates: salespeople whose use of training and education tools is in decline after remaining constant for a while. Which leads to...
Understanding Sales Training
Ideally, your sales training is ongoing. If it ends when on-boarding ends, your sales team's skills are in a constant state of increasing obsolescence.
If your company doesn't make efforts to educate sales personnel continuously, you're setting yourself up for defections. When salespeople feel their companies are not investing in their success, they become prime candidates for relocation to a company that will make that investment.
Monitoring training is vital to make sure that training is effective and is contributing to sales' ability to close deals. If training is being consumed and results are trending up, that's good -- keep doing what you're doing, and invest more.
If training isn't being consumed and results are flat, coach sales to engage with training more. This can be done on a sales rep by sales rep basis if your training solution is sufficiently robust. Better results lead to happier salespeople, and happy salespeople are much less likely to leave.
Is Sales Content Leading to Sales?
Put yourself in the position of a top seller. Imagine that you're using the content suggested to you and it's falling flat. Do you want to stay with this organization, especially when there are lots of options available to you?
Correlating results to content downloaded and presented to the customer can give you an organization-wide view of the effectiveness of your sales content. Getting more granular, you can spot who's using the most content; if someone is consuming a lot of content but isn't closing many deals, it's likely that rep is frustrated and may be keeping an eye out for an organization that better supports him or her.
Step in to remedy this, and get that rep's input on how to improve the content. Engaging to make improvements is a key method for helping salespeople feel they're part of the team.
Use All the Incentives at Your Disposal
Salespeople like commission checks -- a lot. The temptation may be to start slicing commissions into many, many small percentages to influence selling behaviors. This can lead to some unintended consequences: complex comp plans that confuse and frustrate salespeople; incentives that are so small that salespeople ignore them; and a general feeling by salespeople that they're being micromanaged. None of this is good.
Instead, use alternatives to monetary incentives when you can. Gamification gives managers a new set of levers to influence desirable behaviors, and leaderboard or scoreboard presentations have nothing but upside.
Engaging in winning behaviors earns salespeople kudos; not engaging in them doesn't cost them money. The leaderboards are great for exposing who's engaged and who is not, and when a top performer starts to ignore desired behaviors, it's a sign of dissatisfaction; you have an opportunity to intervene to change things and to keep that A-player engaged and on board.
In each of these cases, retaining talent depends on three things: analytics to uncover insights, actions based on those insights, and an environment that collects enough data to capture those insights. Trying to battle for talent without technology tools is essentially surrendering. It forces you to rely on hunches and assumptions, and it won't enable you to spot all your retention opportunities.
You can win the sales talent war. Compensation is important, but data is the secret weapon for understanding how to spend it and how to keep your team together in a cost-effective way that leads to better sales results.