February 5, 2015

Why Your Sales Team Turnover Rate is so High

7-reasons-best-salespeople-leaveEmployee turnover can be very damaging for employers. Companies hire in order to fill a void, but when a candidate fails to fulfill the job’s duties, that void still exists.

The slack is then picked up by other employees who become overworked. The resources invested in that employee are a net loss for the company, as is the pay, possible 401k contributions, and other benefits.

Why is salesperson turnover so high? The issue could stem from any number of reasons, and maybe your salespeople are good workers, but they leave for other opportunities.

Read on to learn about some of the most common preventable reasons for high turnover.

 

1. Picking the Wrong Salesperson

How do you select a good salesperson? Track records can speak for an established salesperson’s skill, but what if the potential salesperson sitting across from you is fresh out of college? What if the candidate had a background in another industry and recently decided on a career change? Can he/she find success in sales? How can you evaluate him fairly?

One of the most important factors you can and should evaluate all sales candidates on is Drive. Drive measures key traits in salespeople like Need for Achievement, Competitiveness and Optimism – all necessary in successful salespeople.

With a highly-developed sales skills assessment,you can test the level of Drive a potential new salesperson has to continue striving for excellence after being hired and achieving some success.

You can also measure how the salesperson might respond to obstacles, which could be very telling as to how well he will fit within your company.

2. Employees Do Not Stay When Management is Poor

There is a saying among the more reflective hiring managers that employees do not leave companies, they leave managers.

Good salesmanship is required of the sales force, though some sales managers forget that those same selling skills apply to governing salespeople.Managers need to be able to develop some measure of flexibility around new salespeople and make concessions for different personalities.

The following are the most common ways sales managers can alienate new salespeople:

  • Focusing only on ROI. Profit margins are crucial to the company’s success, but are less important to individual salespeople. Salespeople are motivated by high sales volume, either because they are competitive by nature or because their success is based mostly on commission.
  • Lack of Empathy. Salespeople want to feel that they can come to management with their concerns and their problems and that they are respected as individuals, apart from their performance.
  • No Vision. Salespeople need to know in what direction the company is headed and what the goals are of its leaders, apart from sales and marketing benchmarks. If they do not feel their work contributes to the larger picture, salespeople’s efforts may be lackluster.
  • Response to Challenges. Managers who lose their cool or respond negatively in the face of obstacles will only distress salespeople and lead to resistance. Calibrate your responses based on employee reaction. It is better to work with an employee to surmount an issue.
  • Lack of Engagement. Feeling like they have a voice in the company and that their feedback is heard is important to most employees. Though you may not be able to act on all employee suggestions, showing that you value their ideas and opinions may keep them from walking out the door.

3. Lack of Challenges

Are your salespeople given the encouragement to net new prospects or does management accept the status quo? Static routines can lead to boredom or insufficient revenue, but challenges reinvigorate employees. This is even truer for salespeople, since success in their positions require a strong Need for Achievement.

Remember that different employees respond to different goals – there is no universal “carrot on a stick.” Study what kinds of challenges your individual salespeople respond to and be sure to make the challenges achievable.

4. Too Much Work

overwhelemed-salespersonA stubborn or inattentive sales manager can forget how much work is too much, and assume that a highly-Driven salesperson can always handle more. Some managers may write off swamped salespeople as employees who cannot handle the stress of the job.

In reality, being stressed by too much work is a legitimate reason for burn out and high turnover.

Are all of your salespeople complaining about the work load? Have you experienced a sudden rash of employees leaving? These might be signs that the team needs more manpower or that you are asking too much of your salespeople.

Consider having your existing sales team members take a personality test to determine their fit for the position. Salespeople high in Drive and who have passion for the job may have legitimate claims regarding their workload.

5. Little Upward Mobility

What opportunities for advancement are offered in your sales department and at your company? Salespeople should perform in their current positions, but most also want to advance their careers. Are promotions available in your company for high performing salespeople?

If your company offers few opportunities for upward mobility, salespeople may leave to find higher level positions in other companies.

Take a look at your company’s structure to see whether career advancement is an option for your salespeople, and make sure that such opportunities are clearly communicated to your employees.

6. Missing Culture

A strong and positive corporate culture can strengthen teams and the work force as a whole. Employees spend most of their lives around their coworkers. Fostering a nurturing environment increases the chances that they will want to stay at their job.

Do you hold team building exercises, or offer educational seminars or athletic competitions? Have you scheduled retreats, parties or picnics? Do you recognized birthdays or work anniversaries? Do you offer flex time?

When trying to build your company’s culture, be wary of goals or exercises that destabilize the team environment. Avoid competitions that pit your employees against each other in a negative way, and learn to recognize when certain practices are hurting morale.

7. State of the Organization

In some cases, the financial or legal situation of the company can be incredibly important. If salespeople feel that a high-profile lawsuit or shaky quarterly reports forecast a negative future, internal trouble may follow.

Bad press, valid or not, can shake the faith of employees and stockholders. Mass firings can leave employees wondering “who is next?”

In short, to lower your turnover rate, listen to your employees. Work with them and try to see things from their point of view. This is the key to effective leadership that will increase loyalty through respect.