Here is a critically updated DATA set for your SERIOUS consideration!
Turnover in B2B sales teams, pre covid, on average, was over 34% per year!!! That is data that has been confirmed and verified. The implications of that fact and what it causes are huge and extremely negative, and yet as a professional body of leaders and individual contributors we blindly accept that as somehow “normal”. That level of turnover kills all hope that an organization has to make a difference for those they serve. On top of that rate of loss, the average length of time that a salesperson stays on the job before moving on was less than 18 months—no time to truly onboard anyone, not even remotely possible in any level of complex sales environment. Find them, hire them, teach them about your “stuff” and they are out the door. How is that even remotely acceptable? It’s not, yet it continues.
Current data sets from 400 sales leaders show that they are experiencing a 58% higher turnover rate in 2021 than the prior year and the data on 2022 will likely grow from there. And the tenure time is now something more like 15 months. THIS HAS TO CHANGE!
And you all know it, see it, feel it, and live it daily! This is not acceptable! It does not matter what the absolute data shows. The causation is consistent and the outcomes are absolutely predictable and left to their own. AND it is in our power to alter the outcomes by changing the process!
Further data points show that technology and software companies have it even worse with 67% more salespeople leaving than in other companies. The “work from anywhere” concept has its challenges, especially as most corporate management teams are “hoping” that will just be a “phase”. And it is simply adding fuel to the turnover fire as the causation feeds the negatives.
Now, as in the past, the number one reason for salespeople moving to greener pastures is compensation. Not simply the dollar level, but driven more by the extremely manipulative, demotivating, not understandable, ever-changing, game played by corporate management, called quotas and commission. Having written on the POISON KNOWN AS COMMISSION before I won’t dig in deeply to all of that data, but just to reiterate… Quotas and Commissions are the single biggest root cause of dysfunctional sales efforts by good, caring, hard-working teams. I don’t care what “sales tool stack” you have or what process you use, if your compensation is focused on quotas and commissions, you are doomed to mediocrity.
In this new age of work-life balance, corporate values, culture, and inclusion, everyone is stuck into a commission model because “they always have been”, or everyone “knows” that salespeople are “coin-operated”….desperately need to step back and look at the real picture and see what really great teams are creating as they serve those that they choose to serve.
Quotas and commissions need to go away! They are the oldest thinking of all. They are the biggest impediment to helping others make a difference, and until you get to that acceptance you will be stuck in the “mud”, spinning your wheels, going nowhere quickly.
Shifting to a values-based compensation system, non-commissioned is easily doable. Been there and helped a lot of great companies in that shift. It takes hard work, which is the biggest challenge. You will need true leadership, not managers, doing a LOT of true coaching. It will not cost the company more, and in fact, with the inclusion of current turnover rates as a baseline you will find the cost to shift will save money, amongst all of the other attributes that it delivers. My personal data from my own past across a global team of 1700 client engagement professionals at the multi-billion dollar revenue level had a turnover rate of 3%, not 35% or higher now… 3%. It’s real, it’s doable and you owe this level of excellence to your teams and your corporation.
Got enough courage to help those that you lead? Stand up for what is RIGHT! Non-commissioned sales teams are the RIGHT thing…. NOW more than ever!!! The time for making this change is perfect right now. Reach out if you would like to dig in and understand more. You will find a lot of resources at your disposal to help.
Having shifted last week into innovation mode, I have changed my sign-off to this blog. It will now be…
Innovate the THINKING…
…to be DIFFERENT!