The Wrong Salespeople are Hired 77% of the Time

Posted by Dave Kurlan on Tue, Nov 13, 2018 @ 07:11 AM

fired

94% of sales managers are optimistic about their salespeople.  That's a very surprising statistic for a couple of reasons:

  1. 50% or more of their salespeople won't hit their quotas this year and haven't since at least 2008.
  2. Objective Management Group's (OMG's) findings from the evaluations and assessments of 1.8 million salespeople show that 50% of all salespeople are weak.

Sales managers believe that 50% of their salespeople are good and 44% of their salespeople have potential.  Of course, they are using subjective, rather than objective approaches to measuring what "good" is.

How do you measure good?

  • Salespeople consistently meet or exceed quota or expectations
  • You like your salespeople, they work hard, don't give you any trouble, are positive, don't miss quota by too much, sometimes bring in good customers, are advocates of the company and brand, and are good influences, etc.

Unfortunately, a lot of sales managers choose the second option.

Why? Many sales managers aren't very good at what they do!  Only 10% of all sales managers are effective at  both coaching and coaching consistently and when it comes to holding salespeople accountable, they aren't much better.  Review the table below: 


wrong-hires

  •   60% of all salespeople make excuses for their lack of performance
  •   37% of all salespeople lack commitment for sales success
  •   20% of all salespeople are not motivated to achieve sales success
  •   67% of all salespeople lack the minimum required Sales DNA for success in their roles

It's no wonder that sales managers are ineffective.  While there is clearly work to be done in the area of coaching, the real problem is that they begin with the wrong salespeople!  [Note - Michael Lang asked me to insert a table below with the same data - but for sales managers - so here it is]

mgr

Between sales management and HR, the wrong salespeople are selected as often as 77% of the time!  And then we wonder why their salespeople don't hit quota, why sales managers can't coach them up and why sales managers aren't quicker to terminate and replace under performing salespeople.  There's a fantastic chance that they'll replace them with someone even worse!

The first set of numbers above are for all salespeople.  When we focus on the bottom 50% - the ones that don't hit quota, the ones who make up the majority in all sales organizations, it looks even worse:

  •   67% of weak salespeople make excuses
  •   53% of weak salespeople lack commitment for sales success
  •   30% of weak salespeople are not motivated to achieve sales success
  •   97% of weak salespeople lack the minimum required Sales DNA for success in their roles

Obviously, the biggest difference between all salespeople and the bottom 50% is their Sales DNA.  And the difference between weak and the elite top 5% is 4850%!  That's why when good and bad salespeople interview for sales positions they appear to be essentially the same.  Their Sales DNA, or lack thereof, rarely surfaces unless you know which questions to ask and how to ask them.  So if you're wondering whether you can be fooled when interviewing salespeople, the data would suggest that if half of all salespeople are weak, and 97% of that group have inadequate Sales DNA, then you are being fooled at least half the time.

There are also two huge gaps, one that shows the elite top 5% are highly motivated 2,000% more often and have strong commitment 1766% more often than their weak counterparts.  This amazing article shows the correlation between motivation and performance.

That's the primary reason why more and more companies have turned to assessments. According to CSO Insights 2018 Sales Talent Study, companies that use assessments have 61% quota attainment and 14.6% attrition, versus 49% quota attainment and 19.8% attrition for those who don't use assessments.  Companies that use assessments are 25% more successful at quota achievement and that data is not even for any particular assessment.  Imagine how much better the results are for the companies that use OMG's accurate and predictive sales-specific candidate assessments. Data from companies who have hired salespeople that were recommended by OMG shows an attrition rate of only 8% and quota attainment of 88%.  

If you use OMG's sales-specific candidate assessments to filter and select your salespeople, you are less likely to make a hiring mistake than if you use an assessment that lacks predictive capabilities, and far less likely to make a mistake than if you don't use any assessment.

Assessments are main stream - there are hundreds of them - and companies that ignore them are knowingly adding unnecessary risk and stunted growth to their revenue streams.  According to Forbes, the cost of a bad hire is $240,000.  But that's not for a sales hiring mistake - that's a generic hiring mistake.  Factor in lost opportunities, lost customers and lost revenue and that number can quickly and easily exceed $1 million per salesperson!

Why wouldn't you invest a tiny fraction of that to avoid costly mistakes?  It's not like there's any risk.  Take OMG for instance.  As you can see from the screenshot below, it's been used on more than 1.8 million salespeople to hire more than 76,000 salespeople in more than 26,000 companies in 200 industries from 43 countries since 1990.  That says proven and time tested. 

2018-11-09_12-42-25

As for the accurate and predictive part, consider that of the candidates who are not recommended by OMG, but get hired anyway because the company is either desperate or stubborn, 75% fail within 6 months.  And of the candidates who are recommended and eventually hired, 92% rise to the top half of their sales organizations within 12 moths.  Very accurate and predictive. 

Check out OMG's Sales Candidate Assessments here.

Join the discussion of this article on LinkedIn here.

Image Copyright iStock Photos

Topics: Dave Kurlan, hiring sales candidates, sales recruiting, sales assessment tool

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Best-Selling Author, Keynote Speaker and Sales Thought Leader.  Dave Kurlan's Understanding the Sales Force Blog earned a medal for the Top Sales & Marketing Blog award for six consecutive years. This article earned a Bronze Medal for Top Sales Blog post in 2016 and this one for 2017. Read more about Dave.

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