Why Do 30% of Your Sales People Leave You?

revolving-doors

(And how you can fix this problem for almost no money!)

Are you a sales leader or a CEO with sales people reporting to you?

Is your company looking for a larger top line revenue rather than just business as usual?

Are you offering your sales people a great opportunity to make money and be part of a rewarding career?

If you answered yes to any of these questions, why then is there so much turnover at your firm?

But before we answer that question…

Have you ever quantified the cost of this revolving door? I have. And it can cost 30%-50% or more in lost revenue.

That’s huge.

Think about all money and time you spend on training, on buying leads, on marketing, on the clients who left with the rep, on the deals dropped somewhere before they were closed. How many wasted hours has your sales manager spent with sales people who are gone?

So the question remains, why are they leaving?

The Top Reasons People Quit

Research shows that the top reasons people quit are:

Boredom. Better pay. Inadequate Salary. No recognition. Unhappy with management or how they were managed.

So what’s the one thing you can start fixing…..without increased costs…..today?

The answer may surprise you.

It’s got something to do with the saying “People leave people, not jobs”.

It’s you.

In study after study, roughly 30% (30%!!!!) of folks switch jobs because they just don’t like their boss.

Their sales manager demotivates them. He may be a jerk. Or she may have no clue about what it’s like “out there”. They may have unreasonable expectations, or not train their staff properly and then throw them to the wolves.

It happens one out of every three times.

Chances are that you too can look back and think of a few jobs where the worst part of the job was your direct supervisor. Right?

Think about the number of jobs you’ve had where the #1 problem was your boss….try to count the number of positions…and then come back…..

You see, few people think of themselves as a “bad” boss. But bad bosses come in all shapes and sizes. They are not all tough and arrogant people. They can just be uneducated about what it takes to be a sales manager or just downright clueless. They may have the job because they are the well-meaning brother-in-law of the owner. Or they were once great at sales, and got promoted to management. The reasons go on and on….

And the view “from the top” may be fuzzy.

As in, a manager may be very impressive to the leadership of the company (the leadership has no clue that this “boss” sucks big time). They may play nice with their supervisors and pass all the blame down to their direct reports.

The Disease & Diagnosis

Imagine if your company had a disease called Revolving Sales Staffitis, and your doctor told you that there is a one in three likelihood that the disease was caused by a bacteria known as Badbossatosium, wouldn’t you do a test to see if that’s the case?

A 30% chance that a certain bacteria is causing a disease? You would definitely take a test to find out. No question about it.

So let’s focus on what to do about this problem/disease. First, we diagnose.

Here are the first two steps:

  1. Recognize that if there is a lot of turnover in your department, there is a high likelihood it’s caused by a department manager.
  2. Institute a 360 Assessment (of competency) of that manager.

We will get to what a 360 is, but first, if you are the manager with the problem, you can bury your head in the sand as long as you want, or you can have the maturity to zero in on what the root cause of the problem really is- and stop the revolving door.

If you are an owner or principal of a firm, you need to, likewise, be ready to take some bad tasting medicine and assess the manager who reports to you. You may love her. She may be great. He may be your son or your (gasp) father-in-law. He may be the top salesperson in the company who delivers timely reports to you and works diligently. And finally, that person may be you – the CEO of a small firm who also heads up the sales department. You may be a terrific CEO, with a terrific product, vision, ideals, morals, you name it. But you may not realize that you’re not so hot as a sales manager.

Sales management has dramatically changed over the past 30 years. Most small firms are still playing catch-up. We will get to what you can do to put a modern sales process in place though, since you can’t rightly fire yourself if you are the owner.

But back to the diagnosis, here we are – you can’t keep a salesperson for longer than a year, and only a few, perhaps, are hitting their quotas.

So let’s figure out if it really is the manager, and if it’s not, at least we can focus on other issues, like your offer, your marketing, your pricing, your sales process and even the possibility that perhaps you don’t really give your sales professionals such a great opportunity.

Here’s how:

The 360 Degree View

A 360 Degree Assessment, or 360 Degree Feedback is a system or process where an employee receives confidential AND anonymous feedback from the people who work around them. This can include the employee’s manager, peers, and usually the most important, direct reports.

There are three ways of conducting a “360”:

  1. An online assessment – Good.
  2. A facilitated program with confidential questions conducted by a competent consultant – Better.
  3. A combination of 1+2 – Best.

Let me break it down . . .

An online assessment, done via tests/questionnaires where the subject is the manager in question, who assesses him/herself. Then, the subject’s direct reports assesses their manager’s competency, then the supervisor does too. In addition, good 360’s have at least two or more peer assessments for the subject.

This assessment gives a true 360 view of the abilities and inadequacies of that particular person. Since the 360 information is aggregated and might I add, confidentially submitted, the direct reports of the subject feel more freedom to point out negatives and this data is calculated and given as an average.

Research shows that 360 assessments are much more accurate than assessments based on what a supervisor appraises. Much more!

The reason is that someone can be an excellent direct report as we pointed out earlier, but they still may be a lousy manager.

There are several dozen leadership development firms and assessment organizations that offer reasonably priced 360 assessments that can be taken online.

If the assessment comes back and you see shortcomings in the management competency for the subject, at least you now see the issue, possibly a major one, in your sales department. Maybe the sales manager doesn’t have the right tools to manage his team. Perhaps there is no process for sales and they are doing the best they can. Perhaps there are issues with the product or the real problem is boredom or lack of pay/opportunities for advancement within the firm. Feedback is most beneficial when the assessment results are used for developmental purposes.

The assessment may also come back with stellar findings. When that happens, at least you have some objective data to weed out a potential roadblock in your firm’s quest for revenue growth. So take what you find and make good use of it.

Some people though, don’t trust the findings from an online assessment and/or fear their answers will not be kept confidential.

So in comes the one-on-one interviews….

This same 360 assessment can be facilitated by a consultant, who can ask a series of confidential questions aimed at the subject, their supervisor, peers and subordinates.

I have done this process at companies large and small, and I have yet to find a firm where folks don’t reveal important information to me. I highly encourage you to hire an outside firm or consultant to do this work. Subordinates may not reveal the whole truth to an internal employee, even an HR person, for fear of reprisal. Employees tell me things they would never tell another soul at work, especially their supervisor.

And we can usually, quickly find out if there are other issues within the sales department as well, such as product issues, opportunity issues, etc.

As a 3rd party, I make it clear to each person I interview that I will only deliver the information in aggregate. Their answers are safe from reprisal.

It is also a terrific team building and morale boosting event: “Finally, someone wants to hear what’s on my mind!” is what so many folks I interview say to me in one way or another. Their candor is quite profound and they feel like they can make a difference in their firm by telling all to the consultant.

When you combine both the findings of the one-on-one meetings and an online assessment, the picture gets even more clear.

If the subject, the manager, is truly the problem of the sales department, the next step is to find a way to develop this person’s management skills, or re-assign them to work that is more suitable. But if the results come back and you find that the management skills are what needs to be upgraded, there are solutions, or a “cure” to this disease.

There is a wide chasm of knowledge for the typical sales leader. While technology has changed dramatically during the last 30 years, most sales teams still sell like it’s 1990. Harvard Business Review researched this subject and concluded that, on average, 92% of purchasing decisions are already made by the time a prospect speaks with a sales person. Yet we are still selling like the sales person is important.

Many sales trainers will focus on out-dated closing techniques and ploys. CRM companies want you to track every call and meeting. However, there are, in fact, 17 factors that can affect your sales process. Closing and tracking are just two. While this article is not a primer on sales re-engineering, business leaders have to start creating a sales process, what I call, a “Sales Factor” within their firm. There have been thousands of percent increase in productivity for nearly every business function, except sales. If you think you can still sell like it’s 1990, you will never grow.

Do you Need a Sales Process Engineer?

So if after all of this, you find that the disease is something different from your sales manager, great. It’s time to start re-engineering sales at your firm. Even small and medium sized businesses will benefit and can afford [how can they not?] to hire not a sales trainer, but a sales process engineer to institute processes that take advantage of technology and the modern advances we have seen in efficiencies in factories, high tech, and other industries.

This is a conversation I am happy to have with you. This is what I do. I want to make your work satisfying, pleasurable and profitable. Isn’t that important?

And that goes for finding or re-training your company’s leaders, if that is the challenge.

We have all worked for supervisors who were a pleasure to work for. They knew when to be kind and when to give constructive feedback. They were knowledgeable about the work at hand and true leaders we loved to follow. This is the kind of person who inspires action from their direct reports and folks want their approval.

This is the kind of sales manager you want leading your company. Right?

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