Part Four
Dr. Dave Barnett
Editorís Note: In issue 04:02:99, Dr. Dave Barnett introduced the concept of sales tests and the common objections recruiters have to them. In this issue, Dr. Dave continues with the second-most-common objection to sales testing.
Objection #2 ó "Tests are too expensive and just add to the cost of hiring."
This objection is being heard more and more as the cost of hiring a sales-flop soars well into the six-figure range for many sales organizations.
Testing candidates for a sales position can save you money in three significant ways.
Sales tests can save you the cost of a bad hire.
The average cost of making a hiring mistake in the typical U.S. sales organization is between $10,000 and $12,000. In organizations paying new recruits a salary during an extended training period, the flop figure can balloon to ten times that amount. A validated test such as SalesMAP™ is worth its weight in gold if it saves you from a $100,000 blunder. A good rule of thumbópaying anything less than 1 to 2% of your bad hire cost for a selection test is a bargain if it significantly reduces the chances of bringing a dud on board.
Sales tests can drive down the cost of training.
Making the right hiring decision in the first place means your training programs donít need to be transformational, but informational. That is, without testing or some means of objective evaluation, every new-hire must go through the same remedial cookie-cutter-training program. This automatically gears curriculum to the lowest common denominator of sales inexperience. You waste valuable time and resources trying to transform civilians into a sales force rather than recruiting the most highly qualified candidates in the first place. Itís faster and more cost efficient for training to be primarily informational (product knowledge, administrative details, etc.), not primarily about teaching Johnny or Joanne how to sell.
Some companies believe they can minimize the cost of a bad hire by hiring only experienced salespeople. The reasoning goes something like this.
Experienced salespeople donít need as much training and will hit the ground running, thus lowering our costs. An additional bonus may be that the new recruit brings along a ready-made client base.
In fact, hiring sales people from competitors can be extremely risky. Non-compete clauses donít only hamper productivity, but increase the risk of lawsuits if the salesperson doesnít know or does not tell you about a previous employment contract. Additionally, if that salesperson was doing so great at the other company, why is he or she willing to join you? How long before he or she jumps ship again?
Testing can lower training costs by giving you a clearer picture of the veteran salespersonís skill-level and personal issues. Just because someone has experience in your industry doesnít mean it was good experience. She may have learned bad habits that will impair her ability to be productive in your organization. He may have developed a blind spot to issues critical to success with your clients.
Our sales profiles do an excellent job diagnosing potential training issues in veterans as well as assessing the needs of rookies. SalesMAP™ training and coaching reports allow you to customize developmental programs, skipping unneeded training to focus on skills that maximize productivity.
Sales tests reduce turnover.
Hiring the right people not only impacts the bottom line of profitability, it should also contribute to higher team morale and thus reduced turnover. This happens in two ways.
First, people who actually make sales are happier and tend to hang around longer. Good salespeople want to sell, not sit through hours of indoctrination or remedial training. Testing allows you to identify people with communication and sociability skill-sets already in place. Why are communication and sociability skills important in sales? Because salespeople get paid first and foremost to meet and engage prospects and clients. Sales selection services are most valuable if they help you weed out candidates with emotional barriers to contact initiation.
Thatís the strength of SalesMAP™. It diagnoses and measures behaviors in this critical aspect of sales productivity. Research shows the faster you can get a salesperson producing, the better producer that individual is likely to be throughout his or her career and the longer they are likely to stay with your organization. SalesMAP™ helps you reduce the costs associated with high turnover because it identifies those who will sell the most in the shortest amount of time.
The second way sales assessments reduce turnover and save you money involves team dynamics and selling style. Putting a bossy control freak into a sales organization dominated by touchy-feely types is a prescription for disaster. Some salespeople are better storytellers than listeners. Some reps will take to a customer-oriented consultative sales approach almost instantaneously. Others will want to close sales quickly. There are those in sales who have a "technical" sales style, and become unglued when they donít get to quote data. There are many, many sales types. You as a manager must be able to figure who will work the best with whom. That is one of the strongest reasons for utilizing a testing method.
Watch for the final installment of this article in the next issue.
