Finding Great Salespeople -- A Systematic Approach

Publisher1

Grumpy, in his thread Professional salespeople I need your advice, suggested I start a thread about sales rep profiling and hiring. Here is the system we use. Note the process is constantly modified and tweaked but it is passing the test of time.

First you have to understand that great salespeople often don't make great sales managers. And you have to watch out for stereotypes (but don't ignore them -- they are relevant in subjective elements of your assessment). Are women better sales reps than guys? Possibly but how do you really know? And I enjoyed Brock's observation: "I would go young and dumb". Dumb, no (at least in my business -- who in the right mind is going to buy a product that requires literacy to use from someone without a brain!); young, maybe, but I got a real and (rude) awakening when in setting up a joint venture project, we ended up working with an 'old guy' who can sell circles around virtually anyone here. When I first met him, I thought: "Where did we find this guy" -- then learned he had built a truly successful business, sold it for a small fortune, but didn't really want to 'retire' His work brought in about $40K in revenue for a new magazine project in a matter of a few weeks.) In any case, you don't want to mess around with anti-discrimination (in the U.S.) or human rights (in Canada) legislation, and you don't need to with the system we use.

To start, let me clarify that we have two tracks. One is for outsiders responding to advertisements, the second is for referred candidates. People who know us (or sometimes clients and employees of former competitors) call and ask if we have opportunities. We cut or abbreviate some of the stages in this assessment process but not the key evaluation stages -- we siimply phrase things a little differently. This gives us an 'out' should someone come referred from say an important client who we really should not hire, but makes the process less daunting and intimidating.

So here are the stages:

Advertise widely in intended market
Free services are great, if you have to pay, test, but don't be afraid to spend a couple of hundred to a thousand or so dollars on this stuff. You want lots of resumes and responses.

Send everyone a job description and questionnaire
We've designed one that suits our own business. It expects the person who answers to be literate and cohesive. I realize this may screen out someone great for selling construction stuff who may not be a literary genius, but again, you don't want a dummy and you can keep the questions relatively simple if you wish. Just ask three or four questions. One should be to the effect: "We verify all references. Will be able to participate with us on a reference verification call for your employers over the last 10 years. If not, why." Reps with good references won't have a trouble with this one; bad ones will give excuses.

(Only about 20 per cent of the people who send in resumes bother to complete the questionnaire. You can either ignore the rest, or if you see anyone who looks good in the pile, follow up, but generally if they don't bother completing the initial quiestionnare, they are not worth hiring.)

Prescreen with brief phone interview
Do they communicate well, are they cohesive, do you form a positive impression?

Online sales test
We use the test from salestestonline.com. You need to buy these in packages of 20 or so tests, be ready to spend several hundred dollars, but you can 'test yourself' for free. They shut down their live service over the Christmas week, so you may not receive responsive answers right now. I like the test because it is fast, efficient, and can be adminstered online. I've run it enough times that I'm satisfied with its validiity -- you can't game it. The question is whether the test screens out people who might otherwise be really good. Maybe, but I'm not taking the risk (as a rule).

The working test
This is the most important part of our system. We don't do multiple interviews. We give the finalists a really long multi-day 'interview' -- we put them to work in the real world. Can they sell? We find out fast enough. This separates the fast talkers fromt the people who know how to bring in an order. We pay them a flat fee or by the hour for the assignment.

Reference verification
This can be the challenging spot in our system. Almost inevitably, our failures in hiring have been the people who pass through all the screnes but where we either failed to check references, or failed to really listen to them. I suppse these failures are relative, though. The reps who left us after passing all screens before not really doing well on references, sometimes started out really good, but flamed out. Here we were saved by a really solid employment contract, which allows us to dump people who don't perform quickly. You need your lawyer to help you draw this one up to comply with state/local as well as federal issues. But once it is done, it is a template which you can use over and over.

After developing our system, I read the book "Topgrading for Sales" by Bradford Smart and Greg Alexander. They don't believe in sales tests/profiling, but advocate multiple interviews. I don't quite buy that argument, but totally agree with their use of the pre-screen questionnaire to create a self-weeding strategy.

Do subjective elements enter in the picture -- would on average a young, agressive woman be a better sales rep than some old guy who has gone bankrupt? Possibly. Your goal is to get the wrong people to screen themselves out ideally before you spend any time with them, but at the latter stages, before you hire them! I've had some guys pass all the tests but the working evaluation and said, "Phew", after paying them a couple of hundred dollars to go away.

In the past month, I've asked our top sales rep to help out in the recruitment and screening process. (He has always 'met' his base, so effectively was working on commission. We agreed to pay him $10K per year in true salary to help co-ordinate the recruiting stuff). We are now building a rather impressive backlog of people who have passed almost all the key tests -- and are about to complete the working evaluation. I don't think we'll be able to hire them all right away, but everyone knows that the working test cannot be completed until after the holiday season, so we aren't draining our budget with payroll expenses right now. Of course, with the recession, more really good people area available than ever before!

Ed the Roofer

Ha-Ha!!!!

Are Mark The Coach and Mark Buchshon the same person.

I'm just joking Mark, (Publisher1)

It's just funny, because in that other thread, I made a request for more information about the Online Sales Assessment Test from YOU, but the Other Mark responded to that, with a pretty informative answer.

So.....Then I request for HIM to start another thread with that suggested title.

And now, YOU respond.

Dual personalities?

Actually, I am glad that you first caught on to making the start off with the first post, since I know for a fact that YOU have mentioned those Sales Aptitude Tests before, but I didn't save the links.

Thanks for getting the ball rolling.

Ed

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Ed the Roofer

Since you state that this Working Test they go out and show you what they have to truly offer, do you pay them a minimum stipend or commission just to see how or which they respond to better?

Ed

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Publisher1

We offer them a modest guarantee (hourly or fixed contract amount) and offer them commission if they sell above their base. Our system is somewhat liek a draw but not quite the same-- everyone is guaranteed the monthly minimum, which doesn't change, but we run a parallel commission track and if they exceed the minimum, we pay them effectively as if they are on pure commission. This provides a kind of safety net and allows new reps to get started and experienced ones to have an occasional 'bad' month without going broke.

Almost invevitably, the ones that fail the initial evaluation can't get an order but are panting for their brief pay stipend -- you need to realize we only go to this stage after they pass all the other screens; so they 'look good' but I'm sure glad we don't put them on permanent payroll.

We could of course make this a pure commission thing, but my attitude is that we want to really attract good people and the cost of the working test in cash is a lot less than the kind of multiple interviews/screening that you would need to do if you don't make the offer. Presumably, if you are paying on a pure comission basis, you could do this test on commission, as well.

The danger with pure commission is that you tend to say "I'll give you a chance" to everyone who applies -- no cash risk. But what you end up with is a kind of one sided barbell. One one side are real losers who can't get a job anywhere else, on the other are (fewer) entrepeneurial super stars who earn a fortune and can be a pain in the you know where. The 'working middle' is scared by pure commission even if they might really be good sales reps. Our system avoids the people at the bottom but creates enough interest for people at the top to want to join and stay. A few companies are able to build pure commission organizations, of course, by adhering to strict screening principals and refusing to hire losers -- they hire to the same standard that we would in determining: "Would we really want to risk a salary on them?"

PS "Mark the Coach and I have exchanged phone messages and I'm sure we'll connect sometime sooner than later!

pcplumber

I never had a woman salesperson, but I would rather have the older man with experience and even someone who filed bankruptcy. I find that most sales people don't know how to sell the the way I want them to sell. It is your job to teach sales people to sell the way you want them to. Therefore, why do you need experienced sales people. You need people you can teach.

See my Rolodex Watch Story in the File Swap thread. Maybe the story is boring and sounds stupid, but this is the system we swear by, and at least I put something in writing for my employees. We use this system and we close about 95% of the sales we attempt to close. As the boss, you must make a system to teach your people.

http://bestlineplumbing.com/RolexWatchStory.htm

I believe in the Multiple Interview theory. I can never tell what a person is like on the first interview. During the 2nd or 3rd interview, the applicant will start to show their true colors. Often, they will get sarcastic, and we know they are not for us.

We always make our applicants ride with our plumbers for no less than three days, and we pay them strictly commission, but for the test days, we pay them $100 per day. Afterward, they get absolutely no salary. All my employees get paid for production. See my payroll program and software in the File Swap thread. This shows the many commissions we pay our plumbers and sales people.

http://bestlineplumbing.com/PayrollSoftware.htm

It is better to turn your existing workers into your sales people. I usually hire a young employee with no experience. I have him work with me for about 3 to 6 months, and I teach him to sell. "Monkey See Monkey Do" Then, I put him in a truck when I am positive he can produce about the same as myself. Otherwise, I would lose money.

I think you should consider taking your existing employees and turn them into sales people. Have existing employees teach the new employees how to do construction. Then move the existing employees into sales positions. This is what we have been doing for 35 years