Let’s talk about sales! The financial consequences of high rep turnover have always been massive but now they are getting even bigger. The US economy is feeling shortages in numerous ways and one to the shortages we are experiencing in the corporate workspace is a crisis in sales talent. Organizations and their leaders are struggling to keep the salespeople they have and having an even harder time locating and developing sales reps to replace the ones attritting.
“More and more, we find ourselves in conversations with CEOs, particularly in the technology industry, who are scrambling to find and keep sales talent,” says Kale Sims, a Vice President of Sales from Leading Edge Connections, who helps dozens of organizations build high performing revenue teams. “We’ve seen companies lose 90% of their talent following an acquisition. Fast growing businesses in attractive and growing markets are unable to keep pace with that growth almost entirely due to their inability to attract and retain sales talent. The new norm is seeing firms lose 25% or more of their sellers in a single quarter.”
The financial consequences of this “sales talent crisis” on your revenue goals, selling costs, and margins can become catastrophic for many businesses. Something as simple as a four percent increase in sales talent attrition can increase the cost of selling by 4-6% and reduce total revenues by 1-3%. For low margin companies salesforce attrition can wipe out revenue plans and margins if nobody picks up the slack. The revolving door of salespeople can damage customer relationships as well and further damage revenue.
Why is it so hard to find and keep sales reps?
A large portion the issue can be attributed to economy and the job market related to sales. According to the US Department of Labor and Statistics (DLS) the economy created 10 million new jobs in June of 2021. The second portion is in regards to the propensity of younger workers, who make up the majority of the sales ranks now, but move jobs more frequently. The DLS reports the median tenure of workers ages 25 to 34 was just 2.8 years, less than a third the length of those 55 to 64 (10.1 years). That’s a major shift.
But the problems are actually much deeper. “People are basically unhappy with traditional employment,” according to Jon Juliano, COO of Leading Edge Connections. “While potential employees value being part of a traditional employment community and the skill development, mentorship, benefits, and income security that come with it, they are increasingly dissatisfied and overworked and are pursuing flexibility and control over their portfolio of work experience, geography and work mix,“ The modern sales person wants flexibility more than they want pay and security.
In addition to all this headwind, the sales crisis in selling talent is also a process problem. Most companies don’t focused on a modernized way to attract, hire ,and support their new sellers through the productivity ramp phase. Typically, there isn’t a clear owner for this process. It’s just something that happens. HR or a sales manager hires someone, sends them off to training and then sends them into the field to sell. Although a lot has changed, nothing has changed. Companies are still using old “sink or swim” methods and the “NEW Generation” of salespeople are sinking like they have concrete blocks tied to their feet.
How can growth leaders get control over all this?
There are a 7 best practice steps any organization can take to improve the process of attracting, recruiting, developing, and retaining top sales talent.
- Turn the sales recruitment, ramping, and retainment cycle into a cross functional business process
- Offer new sellers solid Value Propositions and better balance
- Offer a meaningful variety of flexibility growth opportunities
- Modernize coaching, training, and mentoring methodologies to fit this generation of seller
- Focus heavily on “seller experience” (SX).
- Create KPIs that make sense, motivate and drive real performance
- Constantly reevaluate for improvements and evolve quickly.
These 7 basic steps are a fantastic start in a better direction, but for many organizations out there the mountain is too high, and the timeline is far too short. Couple that with a potential lack of existing expertise to pull all this off and there is big trouble. That’s why more and more organizations are deciding to leverage Sales as a Service options like the ones offered by Leading Edge Connections. With an outsourced expert sales team leaders can focus on the portion of their business they do best while our sales expert teams handle the rest. For more information on how LEC can assist your brand in sales enablement and sales execution with talent, techniques and technology fill out our contact form.