(Need to make some changes to your existing sales team before bringing on new talent? Read parts one and two in this series titled Knowing When to Say Goodbye and Do Your Sales People Make the Grade)
I recently attended a local Sales and Marketing executive meeting featuring a guest speaker on the subject of effective hiring practices. Having been in sales and sales leadership positions my entire career I have interviewed my share of sales candidates and almost did not stay for the presentation, but I am glad I did! As the presentation unfolded it became clear I had picked up some bad interviewing habits over the years and my candidate search planning was still in the sales 1.0 world. Since the goal is to attract great candidates I realized my processes needed some improvement. Most importantly, according to Brad Smart at www.TopGrading.com, the cost of a bad sales hire is 24X compensation so making a bad hiring decision can cost your firm millions of dollars.
The primary steps for an effective search are:
- Search planning
- Attracting well qualified candidates
- The interview process
- Successfully closing the candidate
Search planning starts by developing the job specification. This includes defining the primary duties and responsibilities of the position, reporting structures, resources and associated budgets. It also includes developing a compelling company story and the ideal candidate background. Make sure you are realistic in your requirements and accurate with your company story and facts.
Attracting qualified candidates can be accomplished using a variety of resources – both internal and external. You may have internal candidates that are qualified for your position. Internal candidates may have much faster ramp up time as they already possess knowledge of your products/services and understand the company culture. Externally, targeting competing industries and companies is an effective way of sourcing candidates. Using tools such as LinkedIn and InsideView can greatly increase your visibility to a potential candidate and their background.
Two common mistakes when sourcing candidates are not evaluating enough candidates and not creating a compelling company story. Also realize that depending on the level of sales person you are hiring you will need to screen between 50 and 100 applicants to find the right one, so be prepared to do your background work.
The interview process is typically the most relied upon candidate selection methodology and may be the least reliable. Interviews rarely reflect real live situations and don’t show the candidates true patterns of behavior. Some studies have suggested that 80% of hiring decisions are made in the first 10 minutes of an interview. (That is a startling statistic considering that in such a short time you may approve a bad hire that takes months to recover from – or pass on an ideal candidate who ends up selling for your competitor). When interviewing, make sure to follow the criteria for candidate selection you developed during your search planning process. Separate the ‘must haves’ from the ‘nice to haves’. Also, spend time exploring past success and failures of the candidate as habits of success and failure are often indicators of future performance. Discussing references during the interview is also important. Personal references are always biased so make it clear that you intend on speaking with past reporting managers as to the specifics of their duties, achievements, and ability to work internally with peers. Overly cautious responses can be a red flag and what isn’t said can sometimes be more telling than what is said.
At this point you’ve found your ideal candidate so how do you close the sale? Hopefully you had discussion regarding compensation as soon as interest was established by both parties. Discuss with the candidate the reasons for leaving and joining your firm. Have they reached the top of the career ladder, are they looking for an opportunity to build a new team? Does your firm command a leading position in your market? Whatever the reasons, you have to assume that your candidate is going to receive a counter offer from their current employer. Talk about the likelihood for a counter offer openly with the candidate but rest assured that by pre-determining the candidate’s motivation to make a move you have a higher probability of closure. Don’t get into a salary bidding war but do leave yourself a little room to maneuver from a salary and compensation perspective.
Yes it takes commitment, but effective hiring requires a significant investment in time and resources. Just remember that assembling a team of “A” players is your best avenue to a successful 2010.
Dan Hudson
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