hiringsmart sales manager briefing 2010
DESCRIPTION
An executive briefing for Sales Managers walking through a case study of an organization that significantly increased their sales once they understood who their stars, so-so and passangers were.TRANSCRIPT
High Impact Sales
Management
15 years in organizationsConsulting 10 years‘Fit’ was hit-and-missSales people hiring sales people
A bit of Background
The ‘80/20 Rule’
- Fact or Fiction?
These take upthe slack for the
Bottom Performers– but are highly mobile
These pull sales out of the
organization and put pressure on everyone
Bottom Performersproduce 32% less than the
‘Average’ producers
Top Performersproduce 32% more than the
‘Average’ producers
Source: “The validity and utility of selection methods in personnel psychology: Practical and theoretical implications of 85 years of research findings” Psychological Bulletin, Sept 1998, Vol. 124, No. 2, pp 262-274.
‘Normal Distribution’
45 salespeople averaged 109% of target
Top 10 averaged 125% of target (111% to 139%)
Bottom 7 averaged 92% (82% to 99%)
More on this case study later…
Real Life: Novartis
Just 14 Account Executives
Dramatic performance gaps
Average sales of 3 Top Performers: $1.25M
Average sales of 3 Bottom Performers: $850K
More on this case study later…
Real Life: Data Service Organization
The Real World: Analysing Your Sales team
Meet Your Team
Tom $1,000,000
Mike $1,000,000
Tony $700,000
Dave $700,000
Sue $600,000
Amy $500,000
sherry $500,000
John $400,000
Charles $300,000
Brian $300,000
Two you call probably ‘Stars’, right?
Five you’d likely rate as ‘So-So’
Three who’d generally qualify as ‘Passengers’
But what if you analyse their performance a little more closely?
Tom $1,000,000
Mike $1,000,000
Tony $700,000
Dave $700,000
Sue $600,000
Amy $500,000
sherry $500,000
John $400,000
Charles $300,000
Brian $300,000
$6,000,000
Total Sales
Assign Salespeople to Tiers
“Stars”Tom $1,000,000Mike $1,000,000
$2,000,000
“So So”Tony $700,000Dave $700,000Sue $600,000
$2,000,000
“Passengers”Amy $500,000
Sherry $500,000
John $400,000
Charles $300,000
Brian $300,000
$2,000,000
32% less than average
sales
Average sales
32% morethan average
sales
These all looked the same when hired…
What do you miss?
…but traditional approaches do not work consistently well!
If traditional approaches worked you wouldn’t have an issue…
“It’s not experience – or college degrees or other accepted factors…
…(it) hinges on fit with the job.”
Source: Herbert M. Greenberg and Jeanne Greenberg, “Job Matching for Better Sales Performance, ” Harvard Business Review, Vol. 58, No. 5.
360,000 salespeople followed through sales careers over 20 years
Profiles Sales Assessment
Can she cope with the mental demands of your
sales environment?
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Thinking Style
Occupational Interests
Behavioral Traits
Learning Index
Verbal Skill
Verbal Reasoning
Numerical Ability
Numeric Reasoning
Enterprising
Financial/Admin
People Service
Technical
Mechanical
Creative
Energy Level
Assertiveness
Sociability
Manageability
Attitude
Decisiveness
Accommodating
Independence
Objective Judgment
Can she cope with the mental demands of your
sales environment?
Will she be comfortable in your sales environment?
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Thinking Style
Occupational Interests
Behavioral Traits
Learning Index
Verbal Skill
Verbal Reasoning
Numerical Ability
Numeric Reasoning
Enterprising
Financial/Admin
People Service
Technical
Mechanical
Creative
Energy Level
Assertiveness
Sociability
Manageability
Attitude
Decisiveness
Accommodating
Independence
Objective Judgment
Can she cope with the mental demands of your
sales environment?
Will she be comfortable in your sales environment?
Will she be motivated to sell your products &
services?
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Thinking Style
Occupational Interests
Behavioral Traits
Learning Index
Verbal Skill
Verbal Reasoning
Numerical Ability
Numeric Reasoning
Enterprising
Financial/Admin
People Service
Technical
Mechanical
Creative
Energy Level
Assertiveness
Sociability
Manageability
Attitude
Decisiveness
Accommodating
Independence
Objective Judgment
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Thinking Style
Occupational Interests
Behavioral Traits
Learning Index
Verbal Skill
Verbal Reasoning
Numerical Ability
Numeric Reasoning
Enterprising
Financial/Admin
People Service
Technical
Mechanical
Creative
Energy Level
Assertiveness
Sociability
Manageability
Attitude
Decisiveness
Accommodating
Independence
Objective Judgment
The JobMatch™
Pattern
Shaded areas indicate the JobMatch pattern
The JobMatch patterns show requirements for the sales positions in
your company
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Thinking Style
Occupational Interests
Behavioral Traits
Learning Index
Verbal Skill
Verbal Reasoning
Numerical Ability
Numeric Reasoning
Enterprising
Financial/Admin
People Service
Technical
Mechanical
Creative
Energy Level
Assertiveness
Sociability
Manageability
Attitude
Decisiveness
Accommodating
Independence
Objective Judgment
GoodMatch
Grey areas indicate the JobMatch pattern
Red boxes show the candidate’s scores
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Thinking Style
Occupational Interests
Behavioral Traits
Learning Index
Verbal Skill
Verbal Reasoning
Numerical Ability
Numeric Reasoning
Enterprising
Financial/Admin
People Service
Technical
Mechanical
Creative
Energy Level
Assertiveness
Sociability
Manageability
Attitude
Decisiveness
Accommodating
Independence
Objective Judgment
QuestionableMatch
Grey areas indicate the JobMatch pattern
Red boxes show the candidate’s scores
Critical Sales Behaviours
Critical Sales Behaviours
Job Matched
Shield Your Targets!
Non-Job Matched
24%28%
5%8%
Low Turnover Industry
High Turnover Industry % left / fired after 6 months 46% % left / fired after 14 months 57%
% left / fired after 6 months 25% % left / fired after 14 months 34%
1. Make sure I lose no So-So or Star Performers?
2. Raise Passengers to So-So level?
3. Raise So-So Performers to Star level?
4. Hire Stars first time?
5. Move out Passengers who are not most likely to improve?
So what difference would it make to my $ results if I could:
Tier Averages
StarsTom & Mike = $2,000,000 / 2 = $1,000,000
So-SoTony, Dave & Sue = $2,000,000 / 3 = $667K
PassengerAmy, Sherry, John, Charles & Brian = $2,000,000 / 5 = $400K
So-So Average: $667KPassenger Average: $400K
Difference $267K…every time you hire a Passenger instead of a So-So it costs $267K
…if you’d been hoping for a Star you missed by $600K (they average $1M)
…but let’s keep it conservative and focus on moving Passenger to So-So performers
So what’s your loss fromhaving Passengers vs. So So?
Remember, you had five:
Amy
Sherry
John
Charles
Brian
So Passengers represent a loss of $1.3M ($266k x 5) in sales…
…but what’s the premium for getting it right?
The ‘Getting it Right’ Premium
What’s the premium if:
Raise one Passenger to So-So level?$267K – total sales go from $6M to $6.27M (+4.4%)
Raise two Passengers to So-So level?$534K – total sales go from $6M to $6.53M (+8.8%)
Raise all Passengers to So-So level?$1.33M – total sales go from $6M to $7.33M (+22%)
…and these are sustainable ANNUAL increases – not one-off premiums
The ‘Getting it Right’ Premium
If we weren’t keeping it conservative you might ask:
“what’s the premium if all are Stars”?
Total sales increase by $4M from $6M to $10M (+67%)
Annually!
The Dark Side
This knife cuts both ways:
Lose just one Star performer and replace with……a So-So – costs you $333K (per annum!)
…a Passenger – costs you $600K (per annum!)
Lose just one So-So performer and replace with……a Passenger– costs you $267K (per annum!)
However you slice it – you cannot afford attrition
Benchmark pattern created of the top three performers
All 14 reviewed against pattern
Big difference between matched / non-matched people:Matched: Average sales: $1.31M
Non-Matched – Average sales: $840K
Average difference between selected and non-selected: $470K
…Which would you prefer to hire?
• Just 14 Account Executives
• Dramatic performance gaps– Average sales of 3 Top Performers: $1.25M– Average sales of 3 Bottom Performers: $850K
Real Life: Data Service Organization
Initial SetupSet up private online ‘Virtual Assessment Centre’
Profile all of your existing sales team
Feedback to all salespeople
Produce a Profile pattern for YOUR Stars
Run the whole team against that Profile
Create Sales Management reports for managers of each team member – input on how to manage them up a tier
Run a workshop for managers on managing salespeople up the tiers
Provide the facility to produce Sales Hiring Reports to hire the best person next time
Base cost of $895 plus $235 per salesperson
Typical Costs?
The initial consultation will provide you with the potential gains in your team and is provided at no charge
Our 10 person example would have cost $3245
Remember for that team moving:One Passenger to So-So level: +$267K (+ 4.4%)
One So-So to Star level: +$333K (+ 5.5%)
One Passenger to Star level: + $600K (+ 10%)
All Passengers to Star level: +$1.3M (+22%)
All Passengers to Star level: +$4M (+67%)
….All sustainable direct-to-bottom-line increases
Potential Minimum Return?
Set a consultation appointment with us before leaving
Initial consultation is not chargeable – in that meeting we’ll :
Go through the process with you of analysing your sales
Create your Performance Tiers
Work out your ‘premiums for getting it right’
Quote you for implementation of Profile Sales Assessments for your sales team
What Next?
Thank You!
For further information, or to
receive a copy of this presentation, please
contact us
HiringSmart(800) 513-7277