Some companies need to validate our validation.  Objective Management Group (OMG) uses Predictive Validity - the most time-consuming and expensive form of validation.  Unlike simpler methods of validation, Predictive Validity requires that we prove a connection to on-the-job performance.  The challenge is that our predictive validity is so good, some people just don't believe it and they want to revalidate it themselves.

One of the companies that insisted on validating our validation is moving forward with a license to hire 200 salespeople using our Sales Candidate Assessment.  I'll share the results of their own validation:

They conducted a 7-day pilot in April of 2012 and hired 23 salespeople.  

Our assessment recommended 13 of them, and did not recommend 10.  They reported that 9 of the 10 hired (who were not recommended) failed, and that 12 of the 13 (who were recommended) succeeded.  How do those numbers compare to our historical statistics?  

Historically, 75% of the candidates we don't recommend, who somehow get hired anyway, fail inside of 6 months.  In this pilot, 90% of the candidates that were not recommended failed.

Historically, 92% of the candidates we do recommend, who eventually get hired, succeed.  In this pilot, their success rate was also 92%.

Does it always work out like this?  Of course not.  Some companies just don't have the right sales management, sales process and systems in place so even the best candidates can fail or leave.  On the other hand, some companies, who have been using our processes, systems and tools for a while, consistently exceed these results.

The most common scenario where companies wish to do their own validation is when they are located overseas.  Despite the fact that our expansion overseas began more than a decade ago, some companies located outside of the US don't believe that a US-based tool will work in their country.  They have cultural differences to be sure, but those are more about relationships and the proper times and appropriate ways for people to interact in business settings.  Selling and what it takes for salespeople to succeed doesn't actually vary from culture to culture.  

Some countries lack selling sophistication - they're way behind - and are still selling very transactionally.  But if the company is ready to change, and their markets are ready for them to change, then they must be able to select salespeople who can make those changes as well.

Validation is an interesting process and if you look into it, you'll find that none of the personality or behavioral styles assessments use predictive validity because there simply isn't a correlation between their findings and on-the-job performance.

Yesterday a well meaning Sales Manager, in defense of his salesperson, asked me how a salesperson who made "Club" could possibly assess so poorly.  It's a great question with a dozen or more possible explanations.  Here are some: 

• One or two big hits - exceptions rather than sustained performance
• Existing accounts grew
• Accounts were inherited
• Had help closing his accounts
• Been in the industry for a long time and was well known and well respected
  
• Owns the biggest accounts
• Owns the richest territory
• All renewal business
• Large portion of call-in business
• Opportunity knocks - in the right place at the right time
• Had the opportunities in the pipeline forever and they finally closed
• Had exceptional marketing support to generate interest and leads
  

Rather than asking how someone who has achieved success could assess so poorly, what if I asked this tried and true question:  If you take away all of his existing business, customers,  sales manager, leads, call-ins and pipeline, and told him he had six months to go out and find and close 50% of a year's quota, how would he do?

Tomorrow (June 12, 2009) on Meet the Sales Experts my guest will be Bill Murray. Visit Meet the Sales Experts at 12 Noon ET to hear Bill live. 

(c) Copyright 2009 Dave Kurlan

Yesterday, I met with a long-time client who, in his previous company, used OMG's Assessments to identify what needed to change in order to double revenue from $30 million to $60 million.  In his new company, which is already about 12x that size, he wants to double revenue again.  He said, "I just wasted two years with the _____ Assessment."  The assessment to which he referred was a personality assessment marketed as a sales assessment.  It could have referred to any personality or behavioral-styles assessment.

Many people are not going to like this article.  I am about to expose the findings in personality-based and behavioral-based assessments which companies have been marketing as sales assessments for the last dozen years.

First, you'll need to read this piece, Personality Assessments for Sales - The Definitive Case Study.  Really, you need to read it first!

There isn't a tremendous difference between personality assessments and behavioral-styles assessments.  Popular behavioral-styles assessments, like the various versions of DISC, produce findings along four dimensions (categories) while some personality assessments, like those using the PF16 as their underlying instrument, can measure traits in as many as sixteen dimensions.

But Personality Assessments and Behavioral-Styles assessments are not predictive of sales performance.  They don't conduct Predictive Validity studies, as we do, because their assessments don't predict.  Instead, they conduct Construct Validity studies which only show to what extent an assessment measures a specific trait and not the traits about which you want to know, but the traits which they actually can measure.

Here's the problem.  Their marketing material usually says something like, "Salespeople must be able to Prospect, Question, Manage Objections and Close.  They must have Product Knowledge.  They must be accountable, have drive, be self-starters and be coachable."  You read those words and say, "Yes, yes. That is exactly what we need."  And the masquerade goes on.

As I wrote in the other article, personality-based sales assessments don't really measure what you need to know.  Instead, they report on what they can actually measure.  In the table below, I'll list some of the most common "findings" in personality and behavioral-styles tests (which are marketed as sales assessments), describe what is really being measured and compare those to what Objective Management Group (OMG) measures and reports.

These are just some of the most common findings.  Since OMG's Assessments are so sales-specific, there are literally dozens of findings covering everything which can possibly happen in sales including, but not limited, to prospecting, closing, qualifying, account management, farming, use of the sales process, ability to handle stalls, put-offs, objections, working remotely, growth potential, development needs and more.  What's most important to understand about assessments is that:

• The personality tests' questions are asked in the context of social settings, not sales settings, so none of the findings are sales-specific.
• Because personality assessments' findings are not sales-specific, they are not predictive.
• Personality assessments are generally one-size-fits-all, without regard to your market, its challenges, your competition, your pricing, the resistance your salespeople will face, your compensation plan and how specific selling strengths and weaknesses will impact those conditions.
• Assessments of your existing salespeople should be useful for development.  If you don't have sales-specific findings, you're only developing them as people, not salespeople.
• How is OMG different?  Assessments are only a minor part of an effective sales force evaluation.  The most important part is to be able to learn:
  • What impact sales management is having on the salespeople,
  • Whether you've been hiring the right people,
  • Whether your sales force can execute your strategies,
  • Whether your systems and processes support the sales force,
  • How effective is your sales management,
  • If you can develop more of a sales culture,
  • Whether the salespeople can make a transition such as account manager types to hunters and closers; presenters and quoters to consultative sales types; transactional sale to a solution sale, etc.,
  • Who can be developed?,
  • If you're attempting to down-size or right-sales the sales force, who are the individuals with the abilities to help you do more with less?,
  • How much better can they get?,
  • What it will take?,
  • What would be the ROI on development,
  • Why you get the specific results you get,
  • What's the quality of your pipeline?,
  • Etc.
• When used for Hiring and Selection, an assessment must be an accurate predictor of sales success for a particular sales role in your particular company, calling on your particular market, with its particular challenges and competition.  A personality assessment won't consistently identify the people who will succeed, but OMG's Assessment will, with its 95% Predictive Validity.  We can differentiate between Hirable (they meet our criteria and yours), Hirable - Ideal (they're hirable and will ramp up more quickly than normal), and Hirable - Perfect (they're hirable, ideal and meet additional customized criteria which match up with your most effective producers).

in summary, whether you're using a personality assessment, behavioral-styles assessment, psychological assessment, or psychometric (describes all of the above) assessment, it's the marketing that's sales-specific, not the findings.  Use them at your own risk.

(c) Copyright 2009 Dave Kurlan 

Several years ago I wrote a White Paper that described both the original research as well as the ongoing research that drives our world-class, incredibly predictive, customizable sales specific candidate assessments.

When it comes to our assessments, we strive for excellence, by venturing wider and deeper than anyone else.  We can be aggressive for two reasons:

     1.  Sales Specific - Since it was built for sales we have the data points that other assessment companies don't have.

    2.  Accuracy - Our predictive validity is around 95% - unbelievably high for an assessment.

During 2008, we worked to make our sales candidate assessments even more customizable and predictive.   We already had hirable and not hirable recommendations but we wanted to go even further.

We introduced Hirable - Ideal based on this article.

And we introduced Hirable - Perfect based on our ability to identify exactly what would make a perfect salesperson for a particular company.  We have to evaluate the existing sales force first and there have to be bona fide top producers - salespeople who not only produce more revenue than the others, but who are also strong salespeople as evidenced by their assessment results.  Then we can identify the exact requirements for our assessment to filter and produce a perfect candidate.  Pretty Cool!

For one company, our custom settings will recommend perfect candidates that are as good as or better than 96% of their top producers.

For another company, our custom settings will recommend perfect candidates that are as good as or better than 90% of their top producers. 

So it was already pretty cool that we could recommend a salesperson who would end up in the top half of your sales force within a year.  And it got even cooler when we could recommend an ideal salesperson - one who would ramp up more quickly than normal.  And now I think it's super cool that we can even identify the candidate who will rise to #1!

(c) Copyright 2009 Dave Kurlan 

I was on site at a client's last week to kick-off their training.  At the end of the kick-off I asked each salesperson for their three biggest lessons learned.  One salesperson had difficulty coming up with anything of substance.  It turned out that he was new to sales and when we assessed him two months earlier, our assessment indicated that he was not trainable.  The client wanted him in the program anyway because he had a hunch it would work out.  "Not trainable" manifests in different ways but usually has the same outcome - salespeople don't improve.

There were a number of other salespeople who weren't included in the program because the assessment indicated they weren't trainable either.  After the kick-off the client revealed that those salespeople were, as I predicted to him, relieved not to be included except for one who did want to take part.  The one?  The assessment indicated that this particular salesperson is trainable but the client did not want to include him.

Trainable salespeople behave differently than salespeople who are not trainable.  This provides a nice little glimpse into how they are different.  You can develop trainable salespeople but it's very difficult to develop those who aren't.  Trainable salespeople usually offer very little resistance to training and coaching efforts, while those who aren't trainable either don't care enough to participate, or they offer so much resistance that they ruin it for everyone.

By now you've read Jim Collins' book Good to Great.  The concept everyone takes away from the book is having the right people in the right seats.  With our assessment we not only have the ability to put the right salespeople in the right roles, but to put the right ones in the right training seats too.

(c) Copyright 2009 Dave Kurlan

A potential client wanted to know how Objective Management Group could justify the cost of a our license (unlimited candidate assessments for one year or until the specified number of salespeople are hired) versus what seemed at face value to be a lower cost for DISC assessments.

There are several factors here but they are all worth noting.

1. Actual Use.  Using best practices, and by properly using the assessment, you would assess candidates as their resumes arrive using our simple automation process.  Our data shows that you would assess at least 20 candidates per hire.  Don't know where you would find 20 candidates per hire?  We provide more than just the use of a great tool; we also help you build a process that impacts the quantity and quality of the candidate pool.  If you follow our process the candidates will come!
2. Predictive Validity.  Objective Management Group's assessment was built for sales and is only used for sales.  As such it is highly predictive of on the job success with a predictive validity around 95%.  92% of the candidates we recommend that are hired move to the top half of their sales force within 12 months while 75% of those we don't recommend who get hired anyway (clients who are smarter than we are) fail within 6 months.  Behavioral Styles assessments (like DISC) are not predictive of on the job performance.  But suppose the DISC was predictive.  How much more predictive would our assessment have to be in order to justify a higher price? If we were only one candidate more predictive it would more than justify the difference.
3. Case Histories.  More than one company has asked us to assess their top producers.  If they were applying for a job, our assessment would have recommended 90% of their top producers.
4. Intended Use.  Behavioral Styles and personality assessments were designed to show how people are different.  That's essentially their purpose.  Today they show the different ways in which people communicate, and how they might behave in different scenarios, given their tendencies and traits.  Objective Management Group's assessment was built to predict sales success in your company and industry, selling into your market, against your competition, with your pricing strategy, expectations, sales cycle and challenges all factored in. Ours isn't a one size fits all sales assessment.  Could you imagine using the same selection criteria for selecting a route salesperson selling Leggs to convenience stores as well as a salesperson selling 6-figure custom designed capital solutions?  That's how DISC and others like them are used.
5. Price Comparisons. - If one is to compare prices, it should be on the exact same assessment from different sources; comparing the price of DISC to the price of an OMG is like comparing the price of a Kia to the price of a Lexus!
6. Summary. I'm biased. I developed OMG's assessments nearly twenty years ago and continue to enhance them to be more even more predictive with every passing month. What is the cost of a single sales hiring mistake? And what is the upside to getting it right by selecting a strong, successful salesperson - each and every time?  Use the right tool within the right process and you'll avoid the mistakes that most companies make.

Doug McMillon, CEO of Sam's Club, was interviewed in the October 27 issue of Fortune.  He said that people are spending about the same money as before but on different things, as the cost of food and energy has reallocated their discretionary spending.

We were at Nordstrom's today and I noticed two things that were unusual for such a "dismal" economy.  Despite the fact that there wasn't a sale taking place and they don't have low-end or discount pricing, they were busy.  And they were staffed - three people were taking care of my wife - all at the same time - and they had more people to help if needed! Yet, if you walk into the discount stores and need someone to help you'd be out of luck. They are down to bare bones.

So what does this say about the state of the economy and more specifically, about discounting and trying to win business based on price?

I received an email tonight from a fan of Baseline Selling asking for help with his positioning statement.  Here's what he sent me:

"I've been very successful helping owners and CFO's who have had so many insurance quotes that it makes their head spin but who don't understand how to reduce their overall cost of risk in their business. I thought you might want to invite me in to learn how our free risk assessment helped other business owners reduce and predict insurance cost in all markets."

As most salespeople do, it was way too long, and focused on the wrong issues, using price as an enticement to get in the door.  He used "quotes", "reduce" (2x), "cost" (2x), and "free".  Do you think he sounded any different from the other agents that are calling these owners?  Do you think they want to talk with him?  Let's ut it this way, if they wanted to talk with him he wouldn't have emailed asking for help.

Here's what I suggested he use instead and, as you might expect, it follows the Baseline Selling syntax for an effective positioning statement.

I help CEO's who can't stand all of the insurance agents that always call at renewal time. Can I ask you a question?

I help a lot of CEO's and the two things I hear most right now are, one, they're not sure how to assess all of their risk, and two, they're not sure how to determine how much of that risk affects their premium. Does any of that ring true for you?

If you are not a Baseline Selling apostle, you may not understand the reasoning behind the choice of words or the message but you can still take my word for it that this will work for him.

Do your salespeople have formal positioning statements?

If they do, are they identifying the issues that differentiate you from your competition?

If they are, is it working consistently?

If your final answer was a "no", here are some more questions:

Is it their message or their ability to engage and deliver it?

Is it their lack of hunting ability or their lack of willingness to hunt?

Is it their willingness to hunt or do you have the wrong people?

Do you know how to find out?

Click Comments to read how the agent responded....

(c) Copyright 2008 Dave Kurlan

If you have heard me speak or you have completed a profile of your ideal sales hire than you know I believe that your products or services fit into one of four categories of resistance:

1. Your prospects need it and want it - like food - you have a lot of competition.
2. Your prospects want it but don't believe they need it - like a luxury car - still lots of competition. 
3. Your prospects need it but don't want it - like personal lines insurance - lots of competition.
4. Your prospects don't believe they need it or want it - like high-end consulting - much less or no competition at all.  Not that there aren't others in your space, but your prospects are probably not speaking with the others in your space.

Companies don't invest enough time and energy being strategic and tactical about competition.  The approach shouldn't be economic as much as it should be tactical.  Your approach should revolve around neutralizing your competition as opposed to being competitive with your competition.

For most companies, it's a foregone conclusion that your prospects will buy and the only question is from whom they will buy. But what if you are in group 4?   What if the question is not about from whom but IF they will buy?  What if your biggest competition isn't from another company in your space but it's from prospects that don't think they need what you have?  What if your prospects think that they can do it themselves? Do it in-house?  What if they simply don't want your help? What if your biggest threat is their sense of being able to do without?  That's a totally different strategy than one where you must outsell your competition.  The problem is that most of the group 4 companies use the "why you should buy from us" strategy when they should be using the "why buy at all" strategy.

If you're in group 4, you need salespeople that can create a need for what you have as opposed to salespeople who have mastered the ability to present capabilities and make presentations that focus on why you.

So what if you're a company in groups 1-3 and you have competition and instead of perpetuating the "why buy from us" strategy you adopted the "why buy" strategy from group 3?  If you did that you would suddenly be doing two things your competitors aren't doing.

1. you'd be creating a greater need for what you sell, which leads to the urgency that causes prospects to pull the trigger;
2.  you would be differentiating yourself from all of your competitors.

(c) Copyright 2008 Dave Kurlan

I'm sitting in the back of the room of a Rockefeller Habits two-days workshop being hosted by one of my companies, Kurlan Associates.

There are about 45 executives in the room, many of them clients of Kurlan Associates.  At two of the tables are clients that have been with the firm for so long, twenty years or so, that they have become great friends and two of them have become business partners at Objective Management Group.

One of the first exercises that the group participated in was Cash Optimization Strategies, and the first part of that exercise was Ways to Improve Your Sales Cycle.

Imagine my surprise when my oldest client (1985), my two best friends, my two business partners, identified "we need to follow a sales process" as the number one way to improve their sale cycle at their packaging company.

Forget that I wrote Baseline Selling - a sales process.

Forget that I'm with them quite often.

Forget that I trained them on a sales process 20 years ago.

Forget that these concepts are being discussed and reinforced on a regular basis.

Instead, think about how easy it is to get away from the fundamental processes, strategies and tactics that impact efficiencies, time lines, effectiveness, consistency, communication, confidence revenue and profit.

Take 3 steps back.  What have you gotten away from?

If you've gotten away from it, it's very difficult to remember what you don't do any more.

When I coach salespeople, I ask them to identify a call that didn't go the way they had wanted.  Most salespeople, the first few times through the coaching process, can't identify a single one of those calls.  It's hard to remember what you aren't paying attention to.

Sometimes it takes a sales force evaluation to identify the things your sales force isn't doing, never did, and can't do effectively

(c) Copyright 2008 Dave Kurlan

Not all sales assessments are created equal.

That's an understatement.

Yet it's when a client pushes back - not when they look at the recommendation or prediction and accept it - that we get an opportunity to bring our sales assessment to life.

Take the candidate who lacks desire or commitment - not in life, not in general, but for sales.  Clients can't believe it when a candidate they know, with a track record of success, is found to possess lack of desire or commitment. 

Of course, in these cases the clients are on a backward looking path while we are on a forward looking path.  What has happened in the past isn't a guarantee of what will happen in the future.  I won't get in to the factors that could cause an otherwise average or below average salesperson to have wild success in one position and fail miserably at the next but trust me when I tell you that it happens a lot.  That's why it is so important to look beyond what you see on the resume and in the interview.

When we bring a sales assessment to life and use the data points to tell the story behind the findings, then the sales assessment becomes a crystal ball.  How about the former successful business owner who must now apply for a sales position?  He is known in his industry and the client is all excited about hiring him.  Yet the sales assessment says, Lack of Desire and Lack of Commitment.  "How can that be?" The client pushes back because it doesn't correlate to his backward thinking experiences.  But if we look forward the story unfolds.  Can you imagine this former owner, used to running things, making cold calls every day?  Going on sales appointments every day?  Actually hanging in, being tough and closing business the way good salespeople do? Sure the candidate was successful - running his business. But it's not sales success that he wants or is committed to now. Right now he simply needs something to do and he needs to bring in some money.  There aren't many companies posting jobs for former owners and he has all of these industry contacts so why not a position in sales?

If you ask the client what he originally wanted his new salesperson to do he would tell you, "find new business."  And if you were honest about what this former business owner was capable of doing it would be run a business or possibly bring some former accounts to his new company.

While clients get discouraged and sometimes even upset about our ability to bring desire and commitment issues to light, they eventually appreciate their new toy - the crystal ball - their ability to predict the future sales success of every candidate.

Would you like to know why more executives don't use the crystal ball?  They'd rather not know.  They find it more comforting to use hope - and be wrong - than use information and have to try again.  After all, isn't the goal of sales recruiting to hire someone?  And why not the person sitting in front of me?  She has as good a chance of making it as anyone else..."

It's that kind of lazy, quick to the finish practice that leaves us with a sales force filled with under achievers.  The crystal ball will give you a sales force made up of over achievers!

(c) Copyright 2008 Dave Kurlan