Hiring The Right Salespeople: Try This

I’ve written a lot about hiring sales people and sales managers on this blog.   ESR knows that the epidemic of ineffective hiring is one of the reasons that sales performance has been so dismal over the years, even before the current economic situation.

The best sales methodology, training, tools, technology, coaching, and reinforcement doesn’t have much impact if the people in the sales jobs don’t have the foundation for selling effectively.  It drains the enthusiasm and motivation of the team, wastes money, and forces sales management to spend time selling for the misfits rather than supporting and leading the rest of the team.

I’m in Ireland for two weeks facilitating a series of workshops with Irish CEOs and sales executives.  Hiring is a big issue here.  The record among Irish companies in this area hasn’t been good.

Here’s a refresher.  ESR recommends:

• Build or buy (then customize) a profile-based, structured hiring process;
• Use psychometric and predictive tests as well as income verification and background checks;
• Train hiring teams on the skills required for effective employment of the process, including interviewing and reference checking;
• Don’t by-pass the process under any circumstances;
• Understand that a key to successful hiring is objectivity.  Hiring salespeople on gut feel, the old-fashioned way, doesn’t work.

Consider adding a subjective measure or two where appropriate:

• Walk the sales candidate to their car and do a quick appraisal.  Clean inside and outside, or junk strewn about?  Untreated rust spots?  What about those bumper stickers?  How would your customers react?
• Invite the candidate and their significant other to a social evening along with you and yours.  Dinner in a nice restaurant gets the job done, especially if part of their job is entertaining prospects and customers.  Observe how they and their partner communicate for a hint of how they build and maintain relationships.

The definition of A, B and C players differs from sales vp to sales vp.  My take is you can’t make C players into B’s, because, by my definition, C’s don’t have the requisite traits.  And you can’t train someone to improve what’s in their DNA.

If you follow that logic, you’ll want to never hire a C player again.

Photo credit: © Dmitri MIkitenko – Fotolia.com

Should You Spend Your Money On Sales 2.0 Or Sales Training?

Sales training is more than 100 years old.  With few exceptions, it’s not very sexy.  Many salespeople believe (PDF) they’ve been through enough of it to last a lifetime.  For many reasons, most of their managers don’t see any value, so they take a tactical, event-based approach just to check the “trained my people this year” box.

On the other hand, Sales 2.0* is sexy.  It’s new.  There are terrific, proven, Sales 2.0 solutions that can support the sales and marketing function in being more efficient and effective.  There are also enough white papers, advertisements, websites, articles, blog posts, conferences, books, tweets, strategies, tips, definitions, claims, approaches, experts, studies and hype to confuse any sales leader who is wondering how to come out the other side of this terrible economic situation.   The promise of success from this Sales 2.0 wave is  overwhelming.

What should you do?

First let me state that ESR doesn’t sell sales training or Sales 2.0 applications.  We sell independent research and informed advice.

As an objective observer, let me suggest a simple way to assess your situation:  Neither sales training nor Sales 2.0 will deliver any real, long-term value (measured in any number of ways: more sales, more profitable sales, bigger sales, shorter sales cycles, etc.) unless you have the right people and processes in place first.  (Hopefully this isn’t the first time you’re hearing this.)

Tens of thousands of companies invested in CRM, skipping one or both of those two critical success factors.  That’s why something like only one in six companies claim their CRM systems are contributing to their selling efforts.  And how about this: less than two in ten companies get sustainable, predictable performance improvement out of sales training!

If we invest in Sales 2.0 solutions without the proper foundations in place we aren’t just going down that same road?  You bet.

Do you have the right people selling for you? If not, start fixing that right away.  Is there isn’t broad compliance across your team with the use of a flexible, pragmatic sales methodology?  If not, get that in place.  (The foundation of the methodology should be based on the current and expected attributes of the markets you are selling into and the buying preferences and tendencies of your customers, e.g. if your buyers use Twitter to communicate with their suppliers, that capability should be built into your methodology…)

Spend your money on people and process first.  Then tools. Sales 2.0 isn’t a shortcut or a replacement for those or other critical, foundation components of a sales infrastructure.  Neither is tactical, single event-based training.

One more time, listed in the right order: (This is only a partial list for purposes of illustration.)

1. Get the right people on board;
2. Build or rebuild a flexible, pragmatic buyer-centric sales methodology;
3. Train your team on the methodology;
4. Then, provide them with the right Sales 2.0 tools to make them more effective and efficient in use of the methodology.

Tell me where I’m wrong or off base about this.

* Sales 2.0 is a registered trademark of Sales 2.0 LLC

Photo credit: © Vivid Pixels – Fotolia.com

Sales Hiring From a Recruiter’s Perspective

As ESR continues to assess our clients’ sales challenges, we maintain that having the wrong people in the sales jobs is, in many cases, the biggest inhibitor to the success of a training intervention.  My interview with Todd Harris of PI Worldwide highlighted one of the tools available for sales leaders to get an objective assessment of candidates as well as existing sales personnel.

I’m far from done with this subject.  I wanted to get another perspective, so here are some questions I posed to Kathleen Steffey, CEO of sales recruitment firm Naviga Business Services, based in Tampa.  Kathleen also writes the SalesJournal blog.

Dave Stein: As CEO of a national sales and marketing recruitment firm, share with me what changes you’ve seen in your business in the past three months.

Kathleen Steffey: In the last three months I’ve seen growth and expansion with my existing customer base and a decline in “new” customer contracts. Because of this trend, my business has made a shift to heavily focus on existing customer penetration and customer management. We’ve created new programs to capitalize on our existing customer base-viral marketing campaigns, referral programs, aggressive business development penetration (all inside our existing customer base). I am also focusing heavily on recruiting performance to make sure we are executing on every single piece of business we receive to maximize revenue. Customers are behaving in a very smart way and show a thorough decision making process when it comes to candidates. They are taking every aspect of the hiring process much more serious as every penny counts these days. Because my business is steadily growing, we are currently looking for additional recruiters. Our recruiter candidate pipeline is the best I’ve seen in years, in terms of quality. I am taking advantage of the down market to select only the best and brightest to join my team in the next month.

DS: I’m curious about high-performing sales reps. Do you see them looking for new opportunities or are they sticking with the companies for which they are currently working?

KS: The volume of candidate flow has increased dramatically.  Many, many “A” player sales reps have been laid off and/or are looking for a new opportunities due to the instability of their current employer. I personally know many sales executives who have contacted me to express that they are looking for a new opportunity.  They are coming out of the woodwork right now.

DS: What about sales managers? Any new trends there? Are your clients hiring?

KS: I have seen a trend of customers that have a strong focus on evaluating overall team sales performance and linking it back to poor sales leadership. A handful of my customers are deciding to really clean shop and terminate low performing sales reps and terminate non-influential sales leaders. We have many confidential searches going on that support this scenario.

DS: What advice might you give to a sales rep or manager who is currently employed?  Stick where they are or look around for a better opportunity?

KS: If someone is employed with an organization that is reacting well to this current economy-shifting, changing, creating, enhancing, looking at different verticals to penetrate, etc, then you have a proactive organization that is adjusting to the current state and shows promise. I say stick it out and keep at it… Penetrate your prospects harder than ever and make sure you’re creating value, providing solid industry insight and serving them well.. better than you ever have.

I can’t comment on whether or not someone should stay with their organization.. it completely depends on the state of the business, industry, product, etc. I do know that two of the hottest industries that are doing well right now are healthcare and energy, in the event people need focus on where to look.

DS: I know your firm does about 20% retained and 80% contingency work. What advice can you give a hiring authority as to which way to go?

KS: While both options offer our customers the same level of attention and quality, I would have to suggest that going retained always wins. A retained relationship brings focus, commitment and efficiency to the customer/vendor partnership and displays strong value in filling the position with Naviga. At the very least, a retained relationship removes other variables that the hiring manager would normally have to deal with if working contingency-job advertisements, other recruiters, internal responses to postings, etc. A retained relationship allows Naviga to streamline the recruiting process and save valuable time for our customers.

DS: How is your firm helping companies hire the right candidates?  As you know, ESR’s research identifies this as a big, big problem.

KS: First and foremost we get to know our customers. I view this as a critical piece in quality recruiting and making an appropriate match. We understand the make-up of the organization—revenues, employees, top leadership style, product/service focus, market differentiation, strengths/weaknesses, etc. Next we get to the critical part of the engagement and this is where we reveal the sales culture/environment. We understand the sales team, territories, product price, sales cycle, ramp up, top performer profiles, sales leadership and how the team is led, CRM/reporting requirements, candidate profile, etc.  We’ve found that there is a significant correlation with how the team is led and the performance of the overall team. We take this discovery serious to determine if our candidates will be in an environment where they can be successful.

I am a strong advocate of this statement, “The best predictor of future performance is past performance”.. I train and coach my team to measure the quality of the candidates by their past performance and to relate the sales environment associated with those successes to the current position we are looking to fill. I am also a strong advocate of looking at W2’s, understanding the past compensation programs, looking at industry, product/services, average sales cycle and deal price and evaluate whether or not there is a sales environment/culture match.

Because Naviga specializes in sales recruitment, our evaluation process is very specialized and “sales centric.” We have a standardized evaluation process that every recruiter uses and it’s based on the position we are recruiting; for an example-it can vary based on hunter, farmer, or leadership positions. We use a standard list of eight (8) key sales dimensions when we interview candidates. We ask questions around selling skills, sales knowledge, intellectual ability, personal, interpersonal, motivation, tenure and compensation. Our internal evaluation process is a hybrid of Greg Alexander’s Top Grading for Sales approach, which is adjusted for our business model/customer needs.

Photo credit:  © Lisa F. Young – Fotolia.com

New Year Resolutions For Sales Leaders

Pick one or more of the resolutions below.  Commit, execute, enjoy the results.

1. I’ll never hire another sales rep who can’t get the sales job done. First, completely understand the position and the skills and traits required to be successful.  Evaluating whether a candidate meets those requirements requires a series of two to three structured interviews.  There are no perfect candidates, but if you understand gaps between what capabilities the candidate possesses and what is required for the job, you can train, coach or support that new rep to success.
   

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2. I won’t spend another dime on technology for my sales team without knowing specifically how it will help my reps win business. In general, what companies receive in return for their investment in CRM technology is significantly short of expectations.  Before you make any investments in CRM, Sales 2.0 or other emerging technologies make sure the primary recipient of value is the salesperson. There has to be a direct, proven connection between the software application and the salesperson winning more business.
   

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3. I will teach and then continue to encourage my reps to look at selling strategically. Many salespeople don’t think past the next meeting or phone call.  You will be doing them (and yourself) a big favor if you can coach them into seeing the big picture—the next five steps in the sales cycle or what the customer’s situation might be in six months when they expect to make a buying decision.
   

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4. I will look at sales performance improvement strategically. You should know by now that tactical, event-based sales training doesn’t really provide any long-term value.  So why are you still wasting time and money on it?
   

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5. I will implement a formal coaching function to support my sales reps’ growth. Coaching is not a sales manager closing a deal for a rep or telling them what to do in a tough competitive situation.   Coaching is a mission-critical, formal, ongoing activity that is required for significant sales performance improvement.  If you don’t know where to start, send me an email.  I’ll point you in the right direction.
   

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6. I will run my sales organization like the business that it should be. In order to be successful, businesses require business plans, process, discipline, documented responsibilities and accountabilities, quality assurance and measurement of output.  I’m not suggesting bureaucracy here.  Just the appropriate measure of formality and seriousness.  If seat-of-the-pants ever worked in B2B selling in the past, it certainly doesn’t any longer.
   

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7. I will provide my sales team with the leadership they need and deserve. A few questions for you around one area of leadership:  Is marketing not getting the job done?  Does the CEO set unrealistic revenue targets?  Are customers angry due to product problems?  Do your products or services not meet the needs of your market?   These and other challenges can stop the best sales team in its tracks.  It’s your job to get issues like these addressed and resolved.  If you don’t have the required leadership skills, get them.
   

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8. I will advance my team considerably further than foundation Sales 101 skills so they can really be competitive. Winning these days requires more than just basic selling skills.  Make sure your sales process includes advanced components, such as political mapping, selling to senior executives, and competitive strategies and tactics.  Find the best approaches in those areas that fit your business requirements.  Train your people.  Sustain improvement with coaching and other post-training reinforcement.
   

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9. I will elevate the importance of my team’s knowledge about our customers’ businesses. Many customers of yours are buying only what will help them survive this economic crisis.  If your salespeople can’t position your products and services in terms of contributing to your customers’ success—from your customer’s perspective—they aren’t going to sell very much.
   

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10. I will commit to understanding my weaknesses and improving those capabilities as a sales leader. There is no shortage of intelligence, research, best-practices, coaches, consultants and just plain good advice.  Avail yourself of the best of them.

Photo credit: © Stefan Rajewski – Fotolia.com

11 Timeless Tips for Interviewing a Sales Candidate

When I was a VP of sales, I had no training in hiring.  I was lucky enough to hire some winners who contributed to my company’s (and my) success.  But I also hired too many of those reps who were good enough to sell me during the interview but couldn’t sell enough of our software to make their numbers.

Here are 11 timeless tips I wish I’d had twenty years ago.  These will enable you to improve your interviewing effectiveness, resulting in fewer mis-hires:

1. Make sure you know what you are looking for.  Create a profile.  First, you’ll need to evaluate the requirements for that position. What are the market, customer, and competitive pressures? What skills (e.g. communication, business, industry knowledge, prospecting, competitive) and personal traits (e.g. intelligence, integrity, tenacity, optimism) are required for success in that specific job? Put time into this.  Getting the profile right is the most important step.
   

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2. Prepare your questions in advance. If you’ve followed tip #1, you’ll know what skills and personal traits are required for success in this job at this time. The questions you design should result in the candidate recounting their actual behavior and thoughts during selling situations rather than surreptitiously relating concepts, theories, or what they wished they would have said and done. You must include questions for every critical skill and trait.
   

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3. Remain objective during the interview.  This is hard for most of us. To interview effectively you’ll need to stay dispassionate the way a doctor might when reading your EKG or taking your medical history. One mistake many interviewers make is getting emotionally involved with the candidate, overlooking even the most blatant weaknesses.
   

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4. Trust but verify. By the time the candidate is in front of you they should have been screened by a recruiter, an admin or HR person, and had their resume vetted. Perhaps they’ve even been interviewed on the phone. Major incompatibilities and issues will have been identified. So there has to be a basic level of trust by this point, or you’d be wasting your time.  With that being said, you’ll need to verify that what the candidate is telling you is the truth.  
   

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5. Don’t lead the candidate.  Another mistake interviewers make is to telegraph or lead the candidate in the direction they expect the answers to go. For example, I can ask a candidate what sales process they prefer. I can also ask them how they go about pursuing an opportunity. The questions will likely result in two different answers. If I want to know if a candidate uses a sales process, the first question is useless. They’ll say yes. If I ask the second question and they respond, “…and I use a formal planning process…” it’s likely they do. See the difference?
   

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6. Push back. Don’t just nod and agree. Choose something the candidate says and respond with, “I don’t know if I agree with that,” and see what happens. Do they back down? Get aggressive? Or professionally ask specifically what did you disagree with. This is a very telling technique.
   

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7. Take notes. The dullest of pencils is far better than the sharpest of memories. Don’t worry about what the candidate thinks when you say, “Hold on a second, I just want to jot down a few notes.” Capture things like demeanor, communication skills, physical tendencies (like nervousness), eye contact, and sincerity. A few minutes of silence here and there isn’t wasted time if you are recording your thoughts, observations, and even specifically what the candidate said.
   

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8. Solicit peoples’ names. When a candidate describes how they sold seven million dollars worth of widgets to the Acme Company, ask who the real buyer was. There are a number of reasons I do this, but the most important is so later, when it’s time to check references, you can ask for permission to call those people.  If it turns out that you know someone the candidate mentions, keep it to yourself. Later you can decide if you want to call that person as a “blind” reference.
   

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9. Deliver powerful messages. You’re not only “buying” when interviewing, but you need to do some selling as well, especially with those great sales reps you’d love to hire.  Make certain you have spent time in advance on how to effectively positioning your company, the opportunity, the candidate’s responsibilities, the upside and the challenges. Also make sure you have prepared compelling responses to potential objections.  And by the way, the positioning and messages from everyone on your team should be the same.
   

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10. Practice. You should always be interviewing prospective candidates, even if you don’t have an open headcount. You’ll meet people at meetings, trade shows, conferences, social situations, bidders conferences, job fairs, in customers’ reception areas, and in the hotel fitness room.  Work on your interviewing skills so that when you manage to get a real winner into your office to fill a critical sales position, you’ll be at your best.
    

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11. Give the candidate feedback. If the candidate asks for feedback, don’t hesitate to tell them how they did. (If they don’t ask, that’s a bad sign.)  If they did well, but there are more steps to your process, share that with them.   If you intend to interview a candidate again, don’t share with them what you considered to be weak areas.  They’ll spend time creating the illusion that they aren’t weak in those areas for the next interview and you won’t be able to get an accurate assessment of their capabilities in those areas.

Interviewing is a skill.  Take the time to learn to be a great interviewer.  If you are anything less, your company, your position, your reputation, and your net worth are at risk.

Hiring, Compensation and Qualification

The Gap of Dunloe (Photo: Dave Stein)

I’ll be headed back to Ireland next month to facilitate two one-day workshops as part of the CEO Series for the Dublin Institute of Technology and Enterprise Ireland’s International Selling Programme.  I’ll be working with 60 CEOs and managing directors over the two days.

The topics require a bit of explanation.  Each is a critical capability for a CEO of a small to mid-size company.

In 2002 I was hired to deliver a speech to 300 technology executives in Dublin.  The subject was qualification.  The person who hired me was an executive at Enterprise Ireland—the Irish government agency responsible for the development and promotion of the indigenous business sector. He told me that one of the biggest challenges for CEOs of Irish companies was to NOT get on a plane to America every time their phone rang with an inquiry from a large U.S. corporation. (This executive shared with me that I was hired for this speech because I was the only one of several well-known sales experts that actually qualified him before agreeing to meet with him face-to-face.)  He told me that the lack of qualification was an epidemic.  Fortunately that situation has improved considerably over the last six years.  With that being said, even CEOs need to be able to prioritize their companies’ portfolios of business opportunities, especially in mid- to smaller-size companies.

Hiring of sales executives is critical as well.  Too many Irish companies, in their quest to expand to the U.S. and other countries, hired what seemed to be a strong salesperson/manager.  Many of them didn’t work out.  This has been a significant problem.  Typical: A Dublin-based telecomms company hires a person to commence operations the U.S.  Six months later, after the person has been fired, the company is at least €100k poorer, has lost a year in the international business development component of their business plan, and has probably damaged their reputation for years to come.  Again, I can report real improvement on this front as well.  CEOs in general, have become more discerning, patient, and unwilling to repeat the mistakes of the past.

Back in 2003 I asked a room full of Irish CEOs if they would feel comfortable writing a check to a salesperson for €1 million.  (It’s a standard, unscientific test I give to get a sense of how CEOs measure the importance of the sales function within their organizations.)  I was almost ejected from the room.  The Irish business community then looked at selling very differently than we do here in the U.S.  I asked the same question to last year’s group.  Only one out of 25 CEOs had a problem with it.  More progress.

I’m delighted to be on the faculty of the Dublin Institute of Technology and thoroughly enjoy my professional and personal relationships with my relatively new and growing network of Irish business associates.  I was thrilled when the former New York Consul General for Ireland, with that appealing Irish sense of humor, introduced me to the Irish Minister of Education as “Dave O’Steen.”

What’s really fun is to see these CEOs and the sales executives that work for them, hungry for knowledge, exceedingly coachable, and genuinely passionate about growing their businesses internationally.

If you have an opportunity to buy from, or do business with, an Irish company, please share your experience with me.  I’m really interested, and they’d really like the feedback.

Sales: Is it Art or Is it Science?

That’s a question I’m often asked about business-to-business selling.

I define science (in this application of the word) as the ability and willingness of a person to follow a set of processes in order to carry on the business of day-to-day selling. Examples would be formal planning, the use of checklists, dependence upon research, vigilant qualification, etc. Traditionally, people who demonstrated such behavior have been labeled left-brained.

With that in mind, then art (again, as applied to selling) is the ability to excel at such things as interpreting nuances in a customer’s behavior, effectively responding to a question with relevant examples (and diagrams), making decisions based upon gut feel, counting on instinct and acting upon hunches as a critical success factor. That’s typical right-brained behavior.

In my experience, and in the opinion of many sales experts I trust, successful business to business sales people depend on 80 to 90% science and only 10 to 20% art.

Hiring Salespeople: Reference Checking

Eliot Burdett posted a comment on my post about lying on resumes.  His own blog has a terrific list of challenges for those hiring sales people.  Here is his seventh point:  “Performing reference checks on someone who is employed is challenging due to confidentiality. (There are always managerial contacts that can be approached, although you may have to be creative in your approach.)”

The way I see it, there are three different categories of references relating to a sales candidate:

1. Offered.  These are cousins, spouses, and best friends the candidate provides when asked, or listed on their resumes. These are generally of little value. 
2. Blind.  Someone who can provide information about the candidate without the candidate knowing about it.  I worked with a CEO not long ago who was recruiting a VP of sales.  Between his network and mine, we managed to speak with 5 senior executives that knew the candidate very well and provided us with real insight.  (The candidate was not hired.)

Lying on Resumes

I’m still in Ireland. Back in Dublin after a few days of R&R in West Cork and County Kerry. Beautiful country and great people. We even had four days of terrific weather, which is a bit unusual here.

One of the topics of we discussed in today’s session of the DIT International Selling Programme, where I am a visiting professor, was hiring sales people.  It’s a favorite subject of mine.

Needless to say the issue of lying on resumes (CVs over here) was of great interest. I’ve seen estimates suggesting that as many as 50% of job applicants lie on their resumes. That’s across the board for all positions. With respect to sales candidates, I would expect incidents of lying would come in at an even higher percent. It’s a real problem.  And with the down economy it will get worse before it gets better.

The Sales Hiring Epidemic

As I mentioned in my earlier Springsteen post, I’m in Ireland, “on tour” delivering a series of workshops for sales executives.  One module covers hiring sales people.

Directly responsible for hiring the wrong sales people are the sales leaders who haven’t developed that skill and don’t have a process. At the root of the problem, however, is the inability of many CEOs to hire effective sales leaders. This situation has reached epidemic proportions. The average tenure of a sales leader isn’t much more than six quarters.  That’s three quarters trying to ramp up, two more of waiting until things get better, and one last quarter for executing the exit strategy.

Let me share with you one scenario: Being on board just a year, with performance far below expectations, a VP of sales was fired by the CEO that hired her. A colleague of the CEO recommended “a terrific candidate” with whom he had worked “a while” back. The CEO interviewed the candidate, they hit it off, and they came to terms.

Since the new VP was never put through a comprehensive and objective assessment, the CEO didn’t know that that VP had two major weaknesses. First, the VP didn’t have the skills required to hire the right people for his team.  Second, the VP was weak in team building skills as well.