Peter Irwin is president and CEO of the Canadian Professional Sales Association.
Turnover happens, but the more frequently it occurs, the more negatively it impacts your bottom line. The good news: you can take steps to limit it.
Recently at the Canadian Professional Sales Association (CPSA), we collaborated with Mercer Canada on a sales compensation report, which also reported data on voluntary turnover in sales. We found that rates fluctuate largely by industry, with retail and wholesale (8.9 per cent), high tech (7.3 per cent), and banking and financial services (5.7 per cent) having the highest reported turnover levels. Nevertheless, it does affect all industries.
Fundamentally, there are two main reasons for voluntary turnover in sales: underperforming (i.e. not hitting sales goals, losing out on compensation, and choosing to leave) and poaching. Some of the responsibility for both of those belongs to employers.
So, how do you retain top sales talent and attract strong new employees? The following four tips will help.
Hire the right people
As an employer, if your salesforce underperforms, you likely have the wrong people in place. But how can you confidently employ sales professionals that will make your organization stronger?
It can be difficult to know whether a prospective sales hire will be the right fit. When looking at experience, ask: do they know your industry? Success in sales in one area may not necessarily translate to a different sector. What type of skills do they have that will work in your favour? These might not always be exactly what you expect, so keep an open mind. And don't wing it. Invest the time to develop an effective, well-thought out interview process and stick to it, making tweaks as the process progresses.
Unlike hiring a doctor or engineer, there are no universally recognized credentials for sales people. At the CPSA, we are trying to rectify this by offering education models and certification programs, so we can ultimately introduce an accepted standard of skills and training, which will make it much easier to find the right people and, in turn, limit turnover.
Train, train, train
While it seems obvious, it cannot be overstated: salespeople cannot sell that which they do not understand. Make onboarding processes as comprehensive and current as possible. Whatever your industry, it will continue to evolve and your employees should as well. That's where you come in. Of course, they must stay abreast of any advancements that pertain directly to the service or product you sell, though you can go further. From a technological standpoint, new tools emerge regularly – take the time to ensure your salesforce is well-versed in them. And bring in third-party experts to shore up any areas that could use more knowledge.
Aside from equipping your employees to optimize their performances, training also keeps them stimulated and helps prevent voluntary turnover.
Because of the nature of commission-based earning, designing compensation models for sales professionals is exceptionally important. If you understand your sales cycle and industry, you can plan effectively.
At a former company of mine, I remember having a weekly sales-team meeting in which we would tell new hires that they would likely spend months pitching without many sales coming from it and that that was okay, as long as they were progressing through the sales cycle. It takes time to build a client base and some sales cycles are longer than others. In my example, we had to tailor compensation accordingly, structuring base salaries and bonuses in a flexible way. You can consider taking a similar route.
Recognize Strong Performance
As important as compensation is, it's not the only thing that matters to employees. Salespeople prize recognition and often see their work as a competition. With that in mind, create a culture and environment that rewards and recognizes their successes on a regular basis. Make this recognition public, through tools like leaderboards and above-and-beyond incentives, and you will likely speed progress. This can be a low-cost incentive that pays off in the long run and keeps people on your team.
Retention matters and some turnover is inevitable. By following the above advice, as well as creating a strong culture and a positive environment, you have a better shot at keeping your top talent in place.