There’s a sales talent crisis — but it’s solvable
Friday, November 02, 2018
According to the 2018 Sales Talent Study, a new report by CSO Insights (the research division of Miller Heiman Group), only 16 percent of sales leaders think they have the talent they need to be successful in the future. However, the global survey of more than 320 sales organizations also reveals that only 22.6 percent of companies are making changes to hiring profiles.
On average, it takes over a year to find and onboard a new salesperson to full productivity. According to the survey, it takes 3.7 months to find and hire someone, and an additional 9.2 months to train that person.
What's causing the shortage of sales talent?
"With low unemployment, there is a greater demand for sales talent, opportunities for junior sales talent to move up in the hierarchy, and pressure on earnings that companies are not responding to," according to Erik Charles, vice president of Strategic Marketing at Xactly.
Another issue is trying to identify candidates that would be ideal hires. In the survey, these are the factors that sales leaders believe will lead to success:
- 62.8% Industry, product, company knowledge
- 60.2% Skills (presentations, questioning, etc.)
- 51.9% The intangibles (work ethic, emotional intelligence, etc.)
- 39.5% Ability to execute sales process
- 30.4% Their past experience
- 24.2% Cultural fit within organization
- 9.7% Their education level
- 4.7% Other
However, this might not be the best approach. "Sales is becoming an increasingly data-driven field, and the best sellers today are the ones with the analytical abilities and learning agility to take advantage of new technologies and generate compelling insights to help buyers solve business problems," according to Seleste Lunsford, managing director at CSO Insights
Lunsford says there are not a lot of candidates with this profile, and understandably, they’re in high demand and short supply. However, she doesn’t believe the real problem is a talent shortage — instead, it lies with the sales organizations themselves.
"Sales organizations are struggling with even identifying those hard-to-find attributes using outdated hiring techniques," she says. "And if they do manage to find and succeed in hiring the ‘right’ sellers, they fall short in effectively developing those salespeople to maximize their potential."
While a lack of talent is prevalent, she doesn’t believe that it’s inevitable. "A small subset of organizations is succeeding in the battle for talent, and they show positive results." Lunsford says.
What can companies do to attract — and keep — qualified sales talent?
According to the survey, the current attrition rate is 15.75 (10 percent voluntary and 5.7 percent involuntary). Salesperson attrition, long hiring and recruitment processes, expensive training costs, and underserved territories can take a toll on a sales organization.
So, what’s the solution? "Sales executives have channel strategies, compensation strategies, coverage strategies and more — but to survive and thrive in a shortage of sales talent, sales organizations must include comprehensive sales talent strategies in that mix as well," according to Lunsford.
And she explains that a talent strategy is owned by the Chief Sales Officer. "It encompasses a vision for talent, a continuous current state evaluation as well as an evolving ideal for future state, and a systematic way to close the gap through human capital management practices."
Lunsford says the elements nested underneath such a strategy include the following:
- A clear vision for how talent fits into the overall sales strategy
- A data-driven approach to determining the best talent
- Predictive and behavioral assessments
- A systematic way to source and hire desired talent
- A dedicated sales enablement discipline which supports both sellers and managers through onboarding and ongoing development and coaching
- Data-driven approaches to succession planning, off-boarding and other restructuring initiatives
- Formalized means of collaboration with legal, finance, and human resources
- Up-to-date job descriptions, competency models, and hiring profiles for key positions
- Organizational branding, employee value prop, and other internal selling mechanisms
- Voice of employee insights collected from those in organizational roles as well as those leaving the organization
- Ownership and accountability within the sales organization by those who have a personal stake in its success
The use of data can also affect the sales talent shortage in another way. Xactly recently announced its Sales Performance Artificial Intelligence platform, which is integrated with Salesforce.
Using machine learning algorithms, the platform analyzes 13 years of salary and performance data (including 50 unique data elements) to predict the risk of future employee attrition. Companies can use this data to determine which salespeople are at risk of leaving and take steps to stop them.
However, there are limitations to data. It’s still up to companies to create the type of environment that attracts and retains employees. "Companies need to differentiate themselves in the hiring process," recommends Charles.
He says that too many firms are relying on last year’s stale pay surveys to recruit new sales talent, instead of updating OTE (On Target Earnings) to reflect current market rates. "Be ready to show your prospective hires how they will be trained, paid, and given a real opportunity with an optimized territory."
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