The Great Resignation. The great wear and tear. Mass exodus.
The historic upheaval taking place in today’s workplace has been called many names, and for good reason. According to the U.S. Bureau of Labor Statistics, there were a record 10.9 million job openings at the end of July 2021. [1]
This unprecedented turnover will continue for a long time to come. Some 41% of the global workforce “is considering leaving their company in the current year,” while “95% of workers are contemplating changing jobs.”[2][3] In addition, the global workforce is “considering leaving their company in the current year,” while “95% of workers are contemplating changing jobs.”[2
All this turnover comes at a staggering cost: between 30% and 40% of annual salary for entry-level employees; 150% for mid-level employees; and up to 400% for highly skilled employees.[3] The cost of all this turnover is staggering.
Costs are particularly high in the sales function:
- It takes the average salesperson 15 months before becoming one of the best.[4] The average salesperson needs 15 months before becoming one of the best.
- A company spends an average of $106,374 on a salesperson’s salary, healthcare, etc., before the individual begins to reach his or her quota.[5] A company’s average cost is $106,374 for a salesperson’s salary, healthcare, etc., before the individual begins to reach his or her quota.[5
- The annual turnover rate for salespeople is 27%, twice that of the workforce as a whole.[6] The annual turnover rate for salespeople is 27%, twice that of the overall workforce.[6] The annual turnover rate for salespeople is 27%, twice that of the overall workforce.
An exercise in reflection leads us to a revealing conclusion: A company cannot be successful if there is a significant turnover of its sales force. The cost of the investment, the long period of time to wait for satisfactory results, the risk of a vendor dropping out and the opportunities lost along the way are financially devastating.
The key role of the Sales Director
Sales managers have an enormous influence on the difficulties and successes of salespeople.
Gallup found that managers are responsible for at least 70% of the variation in employee engagement scores across business units[7]. An article published in Harvard Business Review went even further:
Top-level sales managers recorded an average annual target achievement rate of 105%, compared to 54% for low-performing sales managers.[8]
The same article stated that when salespeople rate their boss as excellent or above average, 69% of them outperform the rate.[9] The same article stated that when salespeople rate their boss as excellent or above average, 69% of them outperform the rate.[9
So how can sales managers help their new employees?
Using SLII® with new employees
SLII®, the world’s most widely used leadership development solution, is a proven method for helping salespeople succeed. It classifies a person’s ability for a given task or objective into four categories:
- D1 – Enthusiastic beginner. He is usually in D1 when he is just starting to learn something new.
Remember how you used to look forward to riding a bike? You were in D1 on that target. - D2 – Disillusioned trainee. Inevitably you discover that what you are trying to learn is more difficult than you thought.
Pedaling, steering and maintaining balance was more complicated than it seemed in D2. - D3 – Able, but cautious. You need to gain confidence in using the new skill.
In D3 you can already walk around the block, but your first outing in a crowded park was a bit intimidating. - D4 – Self-realizer. Is highly competent at a task and is committed to doing excellent work.
When you reached level D4, you were able to help your little brother learn to ride a bike.
SLII® teaches managers to adapt their leadership style to an employee’s needs by using appropriate managerial and supportive behaviors. The four leadership styles are S1 (Directing), S2 (Coaching), S3 (Supporting) and S4 (Delegating). When leaders match their leadership style to an employee’s level of development in a particular task or objective, the person develops competence, motivation and confidence. And because their development leads to new career opportunities, they stay with the company.
New salespeople are at D1 or D2 on many tasks. They have considerable commitment (motivation and confidence), but little competence, even if they performed very well in their previous job.
Here are examples of Style 1 leadership that sales managers can use to get new employees off to a fast start:
- Establish clear objectives
- Set deadlines to achieve them
- Prioritize tasks
- Create a step-by-step learning plan
- Show what a good job looks like
- Facilitate access to resources
- Share generous comments on progress
Sales managers must also recognize the transferable skills and commitment of new employees. People who are dedicated to a specific task or goal are receptive when their commitment is recognized.
Sales managers can also give an image of success. This means showing the new hire what a job well done looks like rather than letting the person develop bad habits as they struggle to find their own way. This tactic works because the brain stores information in the form of images, not words.
Time well spent
Millions of people around the world are re-evaluating their careers because of the pandemic. Competition for talented sales professionals is fierce. What can a sales manager do?
Spend time investing in your new employees. Use SLII® when conducting. It will pay off for years to come.
You can learn more about the impact SLII® can have on your organization at https://facthum.com/aprendizaje-y-desarrollo/programa-liderazgo-slii-blanchard/.
Links
[1] https://hbr.org/2021/09/who-is-driving-the-great-resignation?utm_medium=email&utm_source=newsletter_daily&utm_campaign=dailyalert_actsubs&utm_content=signinnudge&deliveryName=DM150635
[2] https://www.microsoft.com/en-us/worklab/work-trend-index/hybrid-work#:~:%20research%%20that,major%%20or%.
[3] https://www.clickboarding.com/employee-turnover-what-is-it/
[4] https://www.indeed.com/career/salesperson/salaries
[5] https://www.sba.gov/blog/how-much-does-employee-cost-you#:~:text=There’%20of%,%20pin%.
[6] https://hbr.org/2017/07/how-to-predict-turnover-on-your-sales-team
[7] https://www.gallup.com/workplace/231593/why-great-managers-rare.aspx#:~:%20choose%,%20for%%20least,severely%%20worldwide%.
[8] https://hbr.org/2015/09/the-7-attributes-of-the-most-effective-sales-leaders
[9] https://hbr.org/2015/09/the-7-attributes-of-the-most-effective-sales-leaders
Note: This article is a translation of the original article by Doug Glener, editor-in-chief of Blanchard® .
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The Great Resignation. The great wear and tear. Mass exodus.
The historic upheaval taking place in today’s workplace has been called many names, and for good reason. According to the U.S. Bureau of Labor Statistics, there were a record 10.9 million job openings at the end of July 2021. [1]
This unprecedented turnover will continue for a long time to come. Some 41% of the global workforce “is considering leaving their company in the current year,” while “95% of workers are contemplating changing jobs.”[2][3] In addition, the global workforce is “considering leaving their company in the current year,” while “95% of workers are contemplating changing jobs.”[2
All this turnover comes at a staggering cost: between 30% and 40% of annual salary for entry-level employees; 150% for mid-level employees; and up to 400% for highly skilled employees.[3] The cost of all this turnover is staggering.
Costs are particularly high in the sales function:
- It takes the average salesperson 15 months before becoming one of the best.[4] The average salesperson needs 15 months before becoming one of the best.
- A company spends an average of $106,374 on a salesperson’s salary, healthcare, etc., before the individual begins to reach his or her quota.[5] A company’s average cost is $106,374 for a salesperson’s salary, healthcare, etc., before the individual begins to reach his or her quota.[5
- The annual turnover rate for salespeople is 27%, twice that of the workforce as a whole.[6] The annual turnover rate for salespeople is 27%, twice that of the overall workforce.[6] The annual turnover rate for salespeople is 27%, twice that of the overall workforce.
An exercise in reflection leads us to a revealing conclusion: A company cannot be successful if there is a significant turnover of its sales force. The cost of the investment, the long period of time to wait for satisfactory results, the risk of a vendor dropping out and the opportunities lost along the way are financially devastating.
The key role of the Sales Director
Sales managers have an enormous influence on the difficulties and successes of salespeople.
Gallup found that managers are responsible for at least 70% of the variation in employee engagement scores across business units[7]. An article published in Harvard Business Review went even further:
Top-level sales managers recorded an average annual target achievement rate of 105%, compared to 54% for low-performing sales managers.[8]
The same article stated that when salespeople rate their boss as excellent or above average, 69% of them outperform the rate.[9] The same article stated that when salespeople rate their boss as excellent or above average, 69% of them outperform the rate.[9
So how can sales managers help their new employees?
Using SLII® with new employees
SLII®, the world’s most widely used leadership development solution, is a proven method for helping salespeople succeed. It classifies a person’s ability for a given task or objective into four categories:
- D1 – Enthusiastic beginner. He is usually in D1 when he is just starting to learn something new.
Remember how you used to look forward to riding a bike? You were in D1 on that target. - D2 – Disillusioned trainee. Inevitably you discover that what you are trying to learn is more difficult than you thought.
Pedaling, steering and maintaining balance was more complicated than it seemed in D2. - D3 – Able, but cautious. You need to gain confidence in using the new skill.
In D3 you can already walk around the block, but your first outing in a crowded park was a bit intimidating. - D4 – Self-realizer. Is highly competent at a task and is committed to doing excellent work.
When you reached level D4, you were able to help your little brother learn to ride a bike.
SLII® teaches managers to adapt their leadership style to an employee’s needs by using appropriate managerial and supportive behaviors. The four leadership styles are S1 (Directing), S2 (Coaching), S3 (Supporting) and S4 (Delegating). When leaders match their leadership style to an employee’s level of development in a particular task or objective, the person develops competence, motivation and confidence. And because their development leads to new career opportunities, they stay with the company.
New salespeople are at D1 or D2 on many tasks. They have considerable commitment (motivation and confidence), but little competence, even if they performed very well in their previous job.
Here are examples of Style 1 leadership that sales managers can use to get new employees off to a fast start:
- Establish clear objectives
- Set deadlines to achieve them
- Prioritize tasks
- Create a step-by-step learning plan
- Show what a good job looks like
- Facilitate access to resources
- Share generous comments on progress
Sales managers must also recognize the transferable skills and commitment of new employees. People who are dedicated to a specific task or goal are receptive when their commitment is recognized.
Sales managers can also give an image of success. This means showing the new hire what a job well done looks like rather than letting the person develop bad habits as they struggle to find their own way. This tactic works because the brain stores information in the form of images, not words.
Time well spent
Millions of people around the world are re-evaluating their careers because of the pandemic. Competition for talented sales professionals is fierce. What can a sales manager do?
Spend time investing in your new employees. Use SLII® when conducting. It will pay off for years to come.
You can learn more about the impact SLII® can have on your organization at https://facthum.com/aprendizaje-y-desarrollo/programa-liderazgo-slii-blanchard/.
Links
[1] https://hbr.org/2021/09/who-is-driving-the-great-resignation?utm_medium=email&utm_source=newsletter_daily&utm_campaign=dailyalert_actsubs&utm_content=signinnudge&deliveryName=DM150635
[2] https://www.microsoft.com/en-us/worklab/work-trend-index/hybrid-work#:~:%20research%%20that,major%%20or%.
[3] https://www.clickboarding.com/employee-turnover-what-is-it/
[4] https://www.indeed.com/career/salesperson/salaries
[5] https://www.sba.gov/blog/how-much-does-employee-cost-you#:~:text=There’%20of%,%20pin%.
[6] https://hbr.org/2017/07/how-to-predict-turnover-on-your-sales-team
[7] https://www.gallup.com/workplace/231593/why-great-managers-rare.aspx#:~:%20choose%,%20for%%20least,severely%%20worldwide%.
[8] https://hbr.org/2015/09/the-7-attributes-of-the-most-effective-sales-leaders
[9] https://hbr.org/2015/09/the-7-attributes-of-the-most-effective-sales-leaders
Note: This article is a translation of the original article by Doug Glener, editor-in-chief of Blanchard® .