How to Predict and Prevent Sales Turnover

Recently, a company asked us to provide our assessments and help them hire 5,000 salespeople.  To me, that immediately raises red flags, like, why 5,000?  When it’s all said and done, will there be 5,000 salespeople on the street?

You know the answer to that question.

Of the 5,000 new salespeople that enter their training, 1,500 drop out before completing it.  Of the 3,500 salespeople that hit the street, another 1,750 drop out during the first 30 days. Of the remaining 1,750 salespeople, just 875 make it through 6 months.  And of the 875, just 500 are successful enough to celebrate their one-year anniversary with the company.

Certainly, this company can predict the turnover but can’t predict who will turnover – a crucial distinction.  So it would be impossible for them to prevent the turnover without doing something or a lot of things differently.  Instead of hiring 5,000 salespeople, how many would they have to hire if they could improve their ability to identify the final 500?  In other words, if they developed an improved recruiting process, strengthened their selection criteria and significantly improved their ability to identify candidates who met the new criteria, it would allow them to accurately identify the final 500 up-front.  Would they still need to hire 5,000 or could they simply hire 500?  What would happen to their costs of recruiting, selection, on-boarding and management if they could accurately predict retention?

Salespeople fail for the following reasons:

• They were bad hires (see above) – the reasons include, but aren’t limited to:
  • Lack of Necessary Skills and Competencies
  • Lack of a Sales Process
  • Too Many Sales Related Weaknesses
  • Bad Fit
  • Lack of Experience
  • Lack of Incentive
  • Not Trainable or Coachable
  • Wrong Kind of Experience
• They were not effectively on-boarded
  • Lack of Product Training
  • Lack of Sales Training
  • Lack of Market Training
  • Lack of organizational training
  • Lack of Competitive Training
  • Don’t Understand the Value Proposition
  • Don’t Understand the Company’s Position in the Marketplace
  • Not Prepared for the Resistance They’ll Encounter
  • Don’t Know Where to go for Help
  • Not Familiar with the Company’s Typical Sales Process
    • Number of Calls
    • Milestones for each Call
    • Timeline for the Process
• There were a lack of clear expectations
  • First Week
  • First Month
  • First Quarter
  • First Year
  • If They Meet Expectations?
  • If They Don’t Meet Expectations
  • How They Will be Measured
• There Wasn’t Enough Accountability
  • Not Often Enough
  • Lack of Consequences
  • Lack of Follow Through
• There Wasn’t Enough Coaching
  • Not Often Enough
  • Not Deep and Wide Enough
  • Pre-Call Strategizing
  • Post-Call Debriefing

So let’s pretend that you are doing all of this correctly.  You have an effective (world-class versus your opinion) recruiting process, you’re using an accurate, predictive, sales specific assessment customized for your business to help with selection, and you are effectively on boarding, setting clear expectations, providing coaching and holding salespeople accountable.  Is that enough?

There is more!  Your new salespeople must find the company and sales manager to their liking, enough so that it creates a supportive environment for success.  There must be:

• Sales Culture
• Trust
• Respect
• Credibility
• Relationship
• Encouragement
• Tools

Without these conditions, all of those other things you did so well won’t matter.

See Also

Facebook- Worth the Investment?

But there is still more!

There are five additional factors that can be used to predict and prevent turnover.  Our data shows that:

1. Salespeople with at least 5 years of experience are far more likely to stick than those with fewer than 5 years.
2. Sales Managers who closely manage (not micro manage, but not hands-off either!) their salespeople retain their salespeople.
3. Salespeople who are compensated by Commission, who are challenged daily, are easier to retain than those who are compensated mostly by salary.
4. Slow starters are much more likely to be retained than those who ramp up most quickly.
5. Above average salespeople (B Players) are easier to retain than C’s and A’s!

So there you have it.  In summary, do everything right and you’ll hire better salespeople who will stick around longer and make your job easier.  Doing some of it right is no more effective than if you do none of it right because you’ll be hiring mediocre salespeople who will either turnover or worse, stick around and cause frustration!