Sales Productivity: ABR vs ABC
I was reminded recently of Glengarry Glen Ross, the 1992 all-star cast film, which shows the day to day life of sales.
The film has many famous scenes, which over the years have been re-quoted by salespeople and managers alike in the industry. None more famous than the A-B-C of sales….
ALWAYS BE CLOSING
As a rep for many years, this rang through my head to ensure every opportunity was taken to close out deals.
However, as I have spent the last 10 years in leadership, I actually think beats ABC every time.
ALWAYS BE RECRUITING
The sales productivity puzzle
Sales productivity is an art form for managers. To ensure that we continue to mitigate risk and increase productivity, there are many factors we have to consider in this process:
- A high-quality talent pipeline
- Onboarding of employees
- Performance Management
All of these factors can significantly impact the level of productivity we receive from salespeople, but recruitment remains at the foundation of the puzzle. Without a steady stream of good quality salespeople, who are intelligent, coachable, with character and a good track record - the other parts of the process become impossible.
Why is a talent pipeline so important?
It’s all about risk.
At any point, all employees are at risk of leaving their role - and fall into 3 categories:
- The surprises - they leave unexpectedly
- The promotions - their great work reaps rewards for them, and they move on
- The under performers - the ones we usually worry and procrastinate about
This is more relevant in sales than in any role.
The sales team is the front line to revenue.
The market, regardless of COVID, is pretty buoyant. In a candidate driven market, salespeople have choice.
So, in a team of 5, if we work on the rule of 3 above - we have to be planning for departures everywhere - just in case.
By not pipelining talent for those ‘just in case’ moments. You are not managing the risk.
If we are surprised, or promote someone unexpectedly, without a backfill available - we will significantly lose productivity in the team.
Just do the maths on a ‘surprise’ salespeople you’d like to retain.
- Candidate resigns day 1.
- Perhaps you counter day 2.
- You agree they are leaving day 3. You phone a recruiter *
- Typical search & interview process 4-6 weeks. You are now at day 33.
- Offer admin lag 1 week - day 40.
- Their notice and perhaps a week’s holiday - 5 weeks - day 65.
65 days = ⅙ of the year. Say the average ARR per rep is $1m - $166k has been lost.
Then you have the onboarding tax on top.
Therefore, we must always be ready to plug this gap and shrink the hiring process as fast as we can.
[* According to HBR - 50% of employees who accept a counter offer, leave within a year, which is worth noting. A counter will be delaying the inevitable unless you can address their reason for leaving.]
Driving a 'Talent Pipeline'
A talent pipeline needs to be driven like a sales pipeline - following the same process:
Pipeline Generate => Progress Deals => Close
Just like in sales a mistake frequently made is when the pipe is full (you have enough deals) we stop pipeline generating.
Pipeline and talent pipelining must be a weekly task, which never ends. It needs to be habitual and considered every day.
The best approach I would advocate is a weekly review of your team to consider the risks - then be thinking about x3 candidates for every surprise, performance issue or promotion.
Each candidate needs to be maturing in the process, so that they are ‘offer ready’ at the point at which you need a hire.
Seasonal peaks in hiring obviously need to be factored in too. If you always hire extra in a particular period, these need to be on top of your ‘normal’ pipeline.
No headcount - then a dance is required
One of the most common ‘obstacles’ to creating a talent pipeline is that your team is full, and you have no headcount.
I’d argue this is incredibly short sighted and one of my biggest frustrations with internal talent teams and how they are measured.
If our goal is to fill roles quickly when available, the pipelining MUST start before the job requisition is open.
My recommendations are this:
- Ignore the fact you have no open heads. Act like you have at least one open all the time and act with urgency.
- Pool your candidates with other teams. If you are lucky enough to be in a large organisation with multiple teams, pool your candidates, so if anyone gets a surprise - you can fill the role quickly. Note though, candidates will need to meet all managers and there is a risk they prefer one to another - so you may have to juggle teams.
- Use great recruiters. In my mind, this is where great recruitment relationships are worth their price in gold. If you have not been too active in the market, but need someone in a hurry, having great relationships with recruiters who can divert talent pipeline to you, is so important.
Risk mitigation is at the core of sales leadership. We have to find ways to work the system to mitigate the risks, increasing productivity.
Sales leadership must have talent as the #1 priority
It’s our job as leaders to manage our outcomes and sales productivity.
It is too easy to think that just making sales is our primary job - however, continuous recruitment and increasing the productivity of our existing teams through training - is just as important as closing business.
So, no excuses on the pipelining talent! Every business is a people business. Without them, we don’t have a business.
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