Sales Onramping: Pay Now Or Later

It has been a few weeks since we have touched on the subject of onramping of salespeople so it is time to return to this topic. All too often we see management waste an opportunity to set the proper tone with their new hire. They then spend months, even years, trying to correct bad behaviors they allowed in the first place.  If you do a search on onramping or onboarding on the web, you will find many articles and all of them at some point will discuss the fact that setting the tone early is very important.

So why is this a reoccurring issue for so many new hires?  In my reading the past few days I came across this article on CareerBuilder titled  A Manager’s Guide to Planning Your Employee Onboarding Process.  I recommend you read the entire article, but I would like to  highlight 7 rules from the article:

  • Start at the beginning: The onboarding process should begin the moment the new employees accept your offer.
  • Begin with the basics: Don’t overwhelm your employees with too much information at once.
  • Pencil in some playtime: Break up the monotony of the meeting-, paper work-, and presentation-heavy first few days.
  • Make it a family affair: Think of ways to involve the new employee’s family.
  • Find out how they see you: Use surveys and one-on-one interviews to gain feedback and then use those recommendations to improve your onboarding program.
  • Stay in it to win it: Change your onboarding program as needed.
  • Know your velocity: Measure the impact of your program.

Over the past several months we have been dealing with managers that are struggling with their salespeople – from bending rules to not providing call reports to not coming into the office on a regular basis.  The one common fact through all of them has been a lack of setting the tone early.  Each one of these managers failed with rule number 1 in some respect.  Some made no effort at all with the onramping program, others only put in effort when they had the time and others ignored issues at the time they first surfaced.

I’m not condoning the salespeoples’ behaviors, but many of these issues could have been negated had the sales manager simply spent time early on setting expectations, rules and guidelines.  An old commercial tagline comes to mind, “You can pay me now or you can pay me later.”  Same holds true for the onramping process.  At some point you are going to have to invest time and effort in your employees and it is always best to make that investment at the beginning.

Onboarding, Onramping

We call it onramping because that is truly what occurs with new sales hires.  This area is often overlooked or under-served by sales managers.  They often hire new salespeople, offer some product/service training and then turn them loose in the field.

It is the sink or swim approach that leads to turnover.

SellingPower.com reports on this fact in On-Boarding: The Most Overlooked Part of Hiring.  Here is why this topic is so important:

Unfortunately, great sales on-boarding programs are still the exception, rather than the norm, says Stakenas. He says that most companies are missing an opportunity in the first three to six months of a new hire’s time to set the tone, discipline, and expectations. “To have them understand your desire for them to be successful, you must plan on using process, methodology, coaching, and technology to help them,” says Stakenas.

I don’t know if there is anything more important than setting the tone during that initial honeymoon phase.  Much of management resides in the smaller, less obvious pieces.  How you treat a new hire, the attention to detail in training, even the sales manager’s understanding of the process…these are all discernable during the onramping period.

The worst option is to ignore these responsibilities.  The benefit of this activity:

Stakenas also says that there are intangible benefits to ramping up a salesperson faster. “A guided salesperson that experiences success sooner is typically more loyal and more likely to stay longer than the average two years, reducing your need to hire year after year and bolstering your chances for long-term success,” he says.

10 Commandments Of Onboarding

We only work in the sales arena so we refer to onboarding as onramping since salespeople need to ramp up to revenue (production) during their initial employment.  That being said, CareerBuilder.com provides some excellent rules to live by when bringing a new employee on board (my editing).

  1.  
    1. Thou shalt not bear false witness against thy employee.
    2. Thou shalt give a written plan of employee objectives and responsibilities. A written plan detailing objectives, strategy and expectations of future results helps diminish any confusion about a new employee’s job functions and instead opens up the floor to discuss concerns or new opportunities.
    3. Thou shalt give thy employ thy undivided attention.
    4. Thou shalt have relevant paperwork ready 
    5. Thou shalt introduce thy employee to thy neighbors. 
    6. Thou shall set up thy employee’s workstation. An empty workstation is to a new employee what an unkempt home is to a houseguest. Before the employee arrives on day one, stock his or her workstation with everything from paper and pens to keys and, if possible, business cards. Make sure the phone and computer, complete with voicemail and e-mail accounts, are set up. Leave a copy of an organizational chart, staff list, and phone directory on the new hire’s desk.
    7. Thou shalt schedule one-on-one time
    8. Thou shalt create a balance.
    9. Thou shalt clarify the company culture.
    10. Thou shalt think beyond the first few days. After 90 days, request formal feedback on the new hire’s performance from his or her supervisor, and be sure to solicit feedback from the employee as well. Take this opportunity to address any issues of concern as well as note any accomplishments so that all parties are confident that the new hire is poised for success in his or her role.

We have a sales manager we know who took a job with a new company and showed up on his first day to find there was no office set up for him.  Instead, they told him to pick a cubicle.  All of the cubicles had junk stored in them so he had to move the junk out on his first day to create a space for himself.

As a sales manager.

I’m Too Busy To Coach Salespeople

Coaching in many organizations is an after thought at best.  What we see all too often is that the quotas are set and salespeople are expected to reach them on their own (to some extent).  These are the organizations in which we see far too little coaching by the sales managers of their teams.  Why is this?  In a post from Dave Stein’s blog he asks you to name one professional athlete that doesn’t have a coach.  Even amateur athletes have coaches, so why do organizations not require and equip sales managers to be coaches?

Dave makes some interesting points and I recommend that you go read the entire post.  He may get you to change your mind about coaching salespeople if you don’t already.  An interesting comment that he gets from managers when asked about coaching is that they are “too busy.”  His point:

It’s the old, “I don’t have time for you to show me your word processing software because I’m too busy changing the ribbon on my typewriter, plus I need to go out and by some more White-Out.”

I think that Dave is right on the money when he said that managers don’t understand the impact coaching could have on their team’s performance.  I would take this a step further and say that most organizations don’t understand the impact coaching could have on their organizations as a whole.

Turnover Reflects Your Onramping Program

When you look at your employee turnover are you content or confounded?  If confounded, what have you done to improve it?  You may want to start by reviewing your onramping program.  Managesmarter.com had an interesting article on this subject and provided the following findings:

  • 22 percent of staff turnover occurs in the first 45 days of employment. (The Wynhurst Group)
  • 46 percent of rookies wash out in their first 18 months. (Leadership IQ)
  • Companies that leave onboarding (ed. what we call onramping) to chance experience failure rates in excess of 50 percent when it comes to retaining new talent. (Egon Zehnder International, 2007)

More than a 50% failure rate?  Ouch!  I have seen firsthand the problems that arise from not having a defined onramping program.  The article makes a couple of great points; first, an employee will decide in the initial 3 weeks if they feel at home or not.  Second, 3 parties – HR professionals, hiring manager and the new employee – need to own up to making sure that an onramping program is in place and followed.  The author gives 3 specific areas that need to be addressed and how each party needs to handle these areas.

  1. Tell the truth about the job from the beginning
  2. Assure a Good “Fit”—Values and Interests
  3. Foster a Sense of Belonging and Connectedness

I recommend that you go read the article as it gives some great advice.  One point it makes for managers in regards to fit:

Help new hires learn the “culture”—the informal rules of the organization. Talk with new hires about the organization’s values. What counts for success?

How important is this?  Most employees who have been with the company for 6 months or more know all of the unwritten rules and they probably operate without even thinking about them.  A new employee has no clue unless they informed of these rules.  Without the knowledge, they will break some of these rules accidentally (and hopefully not spectaularly).

Let me illustrate with a personal example.  Several years ago I recevied a job offer and accepted the position with a new company after working for years at my previous employer.  After completing a background screening and going through a half-day orientation session, I showed up for my first actual day of work.  Without knowing it, I broke one of the unwritten rules.  The first meeting I attended was uncomfortable as I was not greeted by most of my new teammates.  I noticed a strange vibe.

After the meeting, I met with my new manager and was told by him that the owner of the company did not like facial hair and I would need to shave my goatee in order to keep my job.  Not the best time to be told of this one unwritten rule, but it actually put me a little at ease, because it explained why I was treated the way I was by my co-workers.  This rule would have been nice to know before showing up for my first day.

As a manager, make sure you lay the groundwork with your new employees.  Do not expect them to intuitively know all the rules of the office.  If they break an informal rule treat it as a training event, not a disciplinary action.  Invest the time and you will improve your odds of retaining your new hires.

The Absence Of Value

We’ve been working on this value topic because it is the single, most important aspect of any sales position.  A company that lacks a value proposition is destined to stumble through the market while being commoditized on price.

I saw this effect 6 years ago when doing sales calls in the field with a company’s reps.  After spending a couple days in a couple different cities, it became clear that they had to value proposition to offer the market.  This absence of value led to one consistent outcome – they had to compete on price.  Granted, some companies are positioned to compete in this format.  The company I was working with was not.

We’ve recently worked with another company that is in a similar predicament.  They have not articulated their value proposition but they have tried to fix it by bringing in new salespeople.  The quick fix in this approach is to make the new salespeople discover and define their value.  This approach hasn’t worked either.

This company is now on the path to defining their core competencies and their unique value in the market.  Thankfully for them, they have value.  But it is not sustainable to ask new salespeople to discern what that value is.  This task falls squarely on the sales manager’s shoulders and must be taught during the new rep’s onramping period.

If this task is not undertaken during the onramp, the end result is usually a salesperson who relies on the simplest value…price.  They will often become a price slasher, deep discounter.  Their justification will be that they have to be at that level to get the deal or that the competition is undercutting them on the price.  These justifications are made with the assumption that your solution has no other value.  As a sales manager, you have to stop this thinking before it takes root in the salesperson’s mind.

Marquee vs. Mundane

I’ve been working with a handful of sales managers recently as they onramp new salespeople and I have seen a stumbling block occur more than once.  The issue has to do with the sales manager’s perception of the typical sale.

Sales managers, in most instances, work primarily with large, high-visibility accounts as they should.  The issue that occurs is that the manager starts to view these marquee accounts as the model, or even norm, for all other accounts.  What happens is that the manager loses sight of the history of activities that went into earning that customer’s business.

Rarely do new salespeople fly out of the gate and close a marquee account.  In most cases, they start with “mundane” accounts – typically they are smaller opportunities or smaller companies.  Some will grow into marquee accounts, but most will not.  The advantage is that the salesperson learns about the sale, what objections they will face and how an order moves internally through the company.  These are all valuable experiences for the day they latch on to a large deal.

As sales managers, it is important to realize that the marquee accounts are not the standard for a new salesperson.  This means the salesperson probably does not have an established relationship to leverage.  They do not have familiarity with the customer’s decision-making team.  They are not going to have numerous topics to qualify for many different orders.

Simply put, these salespeople are going to be working less efficiently to earn a smaller deal than the power plays occurring at the marquee account.  I’ve seen sales managers get frustrated over this fact.  Frustration should wait until an adequate period of time has passed.  If the salesperson is still at the same level, then it is time to dig in deeper and attempt to kick-start their efforts.

The Essence of Sales Management

This is a tough topic because there isn’t a cookie-cutter sales manager template that fits for all companies.  Our experience has been that smaller-sized companies tend to expect the sales manager to carry a significant quota while larger companies expect the sales manager to manage without carrying a personal quota.  The department quota/goals are a different story.

Nonetheless, ManageSmarter.com offers up a well-constructed guide to sales management titled Executive Guide: Improving Sales from Managers to Salespeople.

A point that often gets overlooked in companies is the essence of strong sales management.  This excerpt sums it up nicely:

4. Track where your management team members are spending their time. As previously stated, good managers let their top people operate and focus on turning their “B” players into “A” players, their “C” players into “B” players or managing them out. There should be signs of steady improvement of sales staffers.

That truly is the gist of sales management, isn’t it?  This area is a pitfall for which we have seen more than one sales manager fall into.  The team is not hitting their numbers and the sales manager is expected to close business himself.  If this manager used to be the top salesperson, he or she often will revert to closing their own deals to protect themselves.  The incredible downside to this approach is that the rest of the team continues to falter and fail.

Most of the time there is a culling of the herd when it comes to the salespeople.  The sales manager is usually insulated through a handful of terminations before the Turk comes for them (to borrow a football phrase).

It is for this reason that we encourage our customers to have the sales manager manage the team.  At the most, they should only have a handful of accounts.  Anything more and they will be dealing with customer items disproportionately to improving their sales team.

One last point from the article:

1. Provide managers with information on their salespeople that is systematic and both objective and subjective. It should give them actionable insight into what areas need to be improved and how to do it.

This is an area in which we can help.

Onramping Is Everything

This ManageSmarter.com article – On-Board Your Sales Hires Faster – hits me where I live.  We ran into a serious issue with one of our customers where a salesperson we placed was terminated after 60 days.  I won’t go into specifics, but this gentleman never had a chance.  One anecdotal point – he never received business cards.  You get the picture.

We are working with our customer this week to establish a formalized onramping program for the next salesperson in this role.  Much, or even all, of the problems that developed were due to this small company not understanding what needs to happen to successfully launch a new salesperson.  Some of these items are rudimentary like having business cards for them on day 1 while others involve the manager-critical setting of expectations.

The truth here is that the first few months are the most formative in establishing future success:

1. Time is Fleeting
There is an opportunity in the first three to six months of a salesperson’s career at the new company to set the tone. And during this timeframe, you need to get your new hires to fully comprehend your desire for their success and that you plan on using process, methodology, coaching and technology to help them.

Exactly.  The third and final point in the article is also most relevant:

3. Belly Up to the Benchmark
Take the time before a salesperson is on board to integrate traditionally independent activities from multiple departments, and agree on the collaboration process. Create a plan that has specific objectives and milestones that pinpoint productivity from day one. Measure and track productivity, but measure in terms of activity rather than financial results. This allows for better tracking, measurement, monitoring and coaching.

We always tell our customers that they need to set activity expectations and then monitor them closely during the first 3 to 6 months.  This is the time period for course correction that sets up a successful employment with clear expectations.  Failure to engage in these management topics leads to early terminations and revolving-door territories.

The Cost Of Underperforming Salespeople

Here’s an interesting little article I stumbled across this morning from Seacoastonline.com titled Get the most out of your sales team.  The premise is simple and accurate – nonproductive salespeople are the bane of any small (or large) business.

A nonproductive sales team is among the top common dangers that cause many small businesses to fail.

Analyzed studies reveal that a large percentage of small businesses are unsuccessful because of underperforming sales people who bring in, at a minimum, 50 percent less revenue than top performers, according to researcher Dr. John Sullivan, professor of Economics at San Francisco State University.

Studies indicate that a common reason for poor performance in the sales department is a lack of focus and poor time management. It’s vital for struggling small businesses to get their sales team on the right track.

Those first 3 months of a new salesperson’s employment is the most critical time period in their employment.  The pattens for their employment are set during this time – expectations, rules, focus, communication…I could keep going, but you get the point.

My thought is that many small business owners are pulled in many directions and therefore cannot dedicate the needed time for their new salesperson.  Knowing this fact leads the owners to hire salespeople from their industry.  Their thought process is that an industry salesperson will require less training, if any at all.  This approach is what leads to recycling mediocrity within salespeople.

Sales success may be measured simply by results. Managers may have the opportunity to observe their staff in action and identify areas that way. However, sales assessment tools can also be a valuable way to determine what additional training may be needed to boost the success of your sales team.

These tools provide a balanced view of strengths and need-to-improve areas. They take the emotional piece of performance review out of the picture and provide the sales person with a very comprehensive evaluation, along with materials to chart out an improvement plan.

“Objectivity” is the keyword.  We use our assessments to measure a salesperson’s strength areas and weaknesses.  The key is to neutralize the weaknesses and develop the strengths.  Many times managers attempt to turn weaknesses into strength which usually ends up frustrating all parties involved in the training.