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Simple Solutions for Sales Force Profitability

4 Oct, 2013 By: Patrick Fitzpatrick, Human Capital Sales

Sometimes the simplest solutions are the best and most obvious ones. For instance, when you cut through the billion dollar diet industry offerings the key to losing weight and keeping it off is to “eat less and exercise more.”  No matter how you look at it, that’s what it always comes back to. The answer to sales force profitability in our industry is just as simple: “decrease turnover and increase productivity.”

As we all know this is easier said than done. When you start accepting 35% to 40% turnover annually as acceptable we are already on the wrong track. The cost of losing three entry level reps at salaries of $30,000 is staggering on its own.

Decreasing turnover begins with selecting the right people. I love the Harvard story that most of you are familiar with. When the university was asked why their graduates did so well, after weighing all the criteria, the conclusion the university came to was the quality of the people they admitted. Choosing the best people to begin with will go a long way in ensuring their success, longevity and profitability.

This begins with where are you sourcing the people from, are they folks that are out of a job because of performance issues, looking for a place to land or are they currently employed people that have hit a “glass ceiling” where they are a need a broader environment in which to grow.

Is your interviewing process rigorous enough to bring out the best and reveal the weak areas in an applicant’s resume? One of the things that worked well for me was a three person interview process. The hiring manager and then the Director and then someone outside of the hiring process, with a tie to the New Hires performance like the trainer or the HR rep but more objective in their viewpoint. Not a panel interview but three separate interviews. Sometimes they would happen on the same day in the same location but oftentimes not, but we would try to complete within five working days.

We would each have three different behavioral questions and one “How did you accomplish that…” question and we would confer after the applicant had completed the three interviews. Since the trainer was responsible for getting the New Hires certified in the first 6 months and the HR rep was tied to turnover statistics, they often became the voice of reason over the manager and director who were tasked with not having any openings on their team.

There is a science to the Behavioral Questions and the accomplishment questions that time does not allow here. Suffice it to say if you put nine behavioral questions and three accomplishment questions to every candidate you would have a better idea of what you are getting for your money.

Often the issue is not who to hire, it’s that there are not applicants to interview! If you don’t have in-house recruiting I would suggest developing a strong relationship with a trusted recruiter who understands your company’s culture and what you expect in applicants. You may have to work with several and pare it down as you find the better ones. Since the manager has a vested interest in building an exceptional team I would require a short list from them for every one of their reps under 70% of plan over the past 12 months. One interview a week should be expected from the managers as well as a strong social media presence for advertising openings as they occur. Ideally they will end up with three to five “ready” candidates they would be comfortable offering a job to if one opened on their team tomorrow.

In our industry’s rapidly changing landscape it’s no secret that the future of our business’ profitability is in services. Whether it is in Managed Print, Managed Services or Professional Services. You need the annuity that services provide and the healthy margins.

You know to go out and secure this business requires a rep who can communicate on at least a Director or department head level. They need the ability to deliver a compelling case for the services and a compelling reason for the prospect to do business with your company. We also know what that talent looks like because we have it represented on our existing sales staff. They are the 20% or 30% delivering the 70% to 80% of our business. The talent is out there. They are working for somebody else unless you are competitive in what you are willing to offer to get them.

For instance if the average salary paid to a generic Sales Rep in a given area is $50,000 and your entry level Sales rep salary is $35,000, where do you think the better folks are? Looking at it another way, would it be better to pay a competent rep $50,000 or two incompetent reps $35,000 each?

Once we have decided and secured the best talent we need to be comfortable that our on-boarding process supports the New Hire and makes it crystal clear what is expected of them. Sales Trainers, managers, directors are all responsible to get the New Hire as productive as possible as quickly as possible. This is not news, it’s the execution of the plan where we fall down. The quicker these New Hires start tasting success the quicker we lock them into our culture.

Selecting the best candidates, holding them accountable for the activities that will make them successful, getting them a taste of success early will go a long way to ensuring their longevity. These people will have a capacity for future development that will translate into higher profit margins and they will become the future leaders of your company.

Patrick Fitzpatrick has over 30 years’ experience in our industry. 20 years at Director of Sales Level with Ricoh USA (formerly IKON Office Solutions). Patrick has a proven track record as an expert at evaluating, staffing, developing and driving sales talent. Currently a Managing Partner at Human Capital Sales, a sales recruiting firm, he brings his wealth of knowledge to the changing paradigm of our industry and his methodology for lowering turnover and increasing productivity by selecting the best talent.  http://www.humancapitalsales.com

About the Author: Patrick Fitzpatrick

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