A critical factor in the maintenance of a high performance sales force is an organization’s talent management system: the people, tools, systems and processes that give it the ability to attract, hire, develop, reward, and ultimately retain talent.
Responsible for its development and execution, today’s human resource leader faces unique challenges and increased pressure as the demands from interdepartmental stakeholders rise.
For many HR executives, the greatest talent management challenges come from their counterparts in sales.
Taking an integrated view of talent management is essential:
Beyond Hiring: An Integrated Approach to Talent Management argues that hiring is just one component of a 5-part approach to managing talent, with a healthy talent culture as the capstone.
In this article we’ll examine three areas where human resource leaders can work with sales leaders to build an integrated approach to sales talent management — one that goes beyond talent acquisition — employee engagement, performance management, and leadership development. We’ll also highlight emerging and established technology platforms that have helped HR gain leverage in these efforts.
Once talent leaders usher an A-player through the door, they must invest in that employee’s engagement in a number of ways to keep them highly productive and fulfilled. This also contributes to the all-important work of long-term employee retention, which has material implications: a Salesforce analysis reports that companies can lose up to $1 million in lost revenue, productivity, and replacement of a single core sales rep.
An effective onboarding process is one of the first places HR can make an impact after hiring. (In fact, candidate onboarding should start when you extend an offer.) Accelerating the initial performance gap can have a direct impact on revenue, with the average sales rep spending 20% to 40% of their time at the company in a less than optimally productive state. One study shows the average ramp-up time for new reps is 5.3 months with an average tenure is 26 months, while a B2B-focused study shows that reps onboard over 10 months with 24 months of average tenure, leaving approximately 14 months to achieve ROI.
B2B sales teams with excellent onboarding programs get their new hires to reach peak productivity 3.4 faster than those with ineffective onboarding programs and show a correlation with a 10% higher sales growth rate, according to research from The Sales Management Association.
For support in creating an onboarding program, see our free eBook The First 90 Days – Your Guide to Making New Sales Hires Produce Fast.
Another key area of employee engagement is to invest in robust sales trainings and continued learning. The quality of training has a direct impact on an entire organization’s performance, and companies that are not investing in training suffer from higher turnover and lower productivity.
HR professionals should develop and support a structured, repeatable, sustainable training program that is aligned with the requirements and efforts of the sales organization. Sales leadership legend Brian Tracy tells us that the highest-performing sales organizations train every week. “One of my clients, the sales manager of a division of a multinational company, told me that he started a weekly sales training program that consisted of playing one sales video per week, followed by discussion. Within one year, this division was turning in the highest levels of sales and profitability in the worldwide organization. He said that the day after the sales training day was the highest sales day of the week.”
Some of the industry’s top sales training firms include:
- In The Funnel
- Jill Konrath
- Business Lockerroom
- Levitin Group
- Sales Elite, LLC
- The New Sales Coach
- Star Results
HR leaders are harnessing technology to inform their employee engagement strategies, predict and counteract employee attrition, and get the most out of their new hires.
Companies leverage tools such as:
Finally, the best HR leaders work hand-in-hand with sales managers to track these 8 key human capital metrics to measure the effectiveness of their onboarding, training, and engagement programs.
The second key focus area for HR and sales leaders to collaborate on is conducting structured performance evaluation and management systems. According to Frank V. Cespedes and Steve Maughan, the most under-utilized lever for improving sales is the performance review. “Busy sales managers tend to treat reviews as cursory, drive-by conversations that are mainly about compensation, not evaluation and development.”
HR teams can work with sales managers to introduce rigorous structure and regular cadence to this practice, which is arguably more important in the sales function than in any other department due to the influence these discussions have on sales behavior and activity levels. In addition to quarterly and monthly check-ins, managers can meet with reps weekly or daily when needed – with HR providing managers structured meeting templates to ensure performance management standards are in compliance.
An important part of sales performance management is a rigorous set of standards, with specific deadlines for quantifiable goals and discrete metrics, such as:
- Number of prospecting emails
- Number of prospecting calls
- Number of meetings
- Number of presentations
- Number of demos
- Number of site visits
- Sales by week
- Pipeline value
- Pipeline stage value
HR and sales leaders should also work together to craft clearly defined compensation packages that incentivize the aforementioned behaviors. Typical sales compensation ratios for non-leadership roles include 50 percent base pay (for stability) and 50 percent commission (for incentive to reach higher). You can also tailor your company’s compensation plan to support the business model and the type of growth you want to see (for example, HubSpot sales head Mark Roberge customized compensation for different stages of HubSpot’s evolution).
For more information on the compensation packages you should be offering your team, download our 2017 Sales Compensation Study here.
Technology platforms to manage performance reviews, goals, and rewards include:
HR leaders should be forward-looking and create a promising talent pipeline for the sales leadership team. Few companies are happy with their leadership pipeline, with only 22 percent of executives reporting that they view their own pipeline as promising. Another survey reported that leadership development was executives’ number-one concern.
As growth organizations scale and established players refresh their sales teams, the need for critical front-line and regional management talent is essential for sustained revenue growth.
Here’s what one sales leader said – “We need them to be great with our customers, we need them to be great with their teams and we need them to be great business minds. What we expect from our first-line managers today is so complex, varied and unstructured that we don’t even try to make sense of it anymore.”
Does your organization fall into this camp?
If so, investing in leadership development that focuses on the core leadership skills and competencies is crucial. Creating career paths for top salespeople to allow them to stay as individual contributors or switch to managerial roles, based on their skillset, is a channel that needs to be capitalized on but approached with caution since top salespeople are not always great managers.
Technology platforms to manage to plan for succession management and aging workforces include:
Strengthen ties between HR and Sales
Human resources leaders don’t stop when they’ve filled their headcount requirements. They stay alongside them as they deliver sales and reach new heights.
This is why it’s so important for HR to deeply understand the operational needs of sales, while sales managers must consider talent management a core responsibility. Strengthening ties between HR and sales supports the creation of a powerful talent management system that stretches beyond recruiting, to engagement, performance management, leadership, and beyond. When HR and sales objectives are coordinated in a deep way, your company’s revenue will reflect it.
Latest posts by Keith Johnstone (see all)
- New York Sales Salaries: Compensation Benchmarks for Sales Reps, Managers, and VPs in New York and the Tri-State Area - October 7, 2019
- How to Hire A Salesperson Who Truly Delivers - September 12, 2019
- Sales Salaries 2019 [Infographic] - August 12, 2019