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Recruitment - avoid hiring mistakes
Posted by Colin Wilson
In Jul 08
Some time back I answered a question posted on LinkedIn by Bob Apollo…
“How can small, fast-growing companies avoid hiring mistakes?”
Although it took Bob sometime to read his many replies he eventually got through them and nominated my answer as the best… thanks Bob!
I have copied my answer below as I believe that in today’s economic climate my answer is more poignant then ever…
In my experience the founders are the biggest part of the problem.
The founders can sell because they know exactly what they can do, they have a huge amount of passion for what they do, they are personally involved and they are agile to customer requests… they can change and adapt their offering on the fly… all this can make their proposition very compelling and it’s why they get their early sales. The customers are buying the founders as much as they are buying the products / services.
Now, bring in dedicated sales people and you have instantly lost a major part of your value proposition… they won’t have the same passion, they won’t have the in-depth knowledge of the founders, they won’t be able to adapt on the fly, they are going to have to work a lot harder to make those sales.
So, the first thing the founders need to do if they are going to bring in their first sales people is to make sure they are not part of the value proposition, to make sure their products / services are in a ‘productised’ state that can be sold by people other than a founder.
We now have the first part sorted and the founders are no longer a part of the value proposition… so let’s go hire some dedicated sales people.
Hiring sales people is an expensive business. It is also a very risky for small businesses because they can burn lots of cash for no return. Equally, if you don’t increase sales then the business does not develop –it’s a predicament. The solution is to reduce the risk as much as possible… and here is the next problem. Founders see risk as burning too much cash, so they often buy cheap… which is completely the wrong thing to do as the risk is… not making sales… and therefore to reduce risk they need to buy expensive.
There are a lot of people in sales – not surprisingly there are good ones, average ones and bad ones. I reckon the split is 20% good, 60% average and 20% bad. If this is their first foray into hiring dedicated sales people then they need to hire from the top of the pile. Obviously never hire a bad sales person. Average sales people are Ok if they have good sales management around them, but small businesses don’t and therefore they need to hire the best… these people manage themselves. Buying cheap ends up costing more because you end up doing exactly as you describe… “I’ve observed some companies go through a cycle of recruit > disappoint > fire and recruit again.”
The last thing to look at is what type of sales person is required. New companies need new customers and so account managers should be out. They need hungry door bashers who thrive on outselling the competition. If you are selling products then there are a number of people out there to choose from, however if you are selling services then good sales people are more difficult to find. Getting a product sales person selling services can be disastrous particularly without strong sales management support. For selling professional services you must take from the top of the pile and take people with industry expertise and people with industry credibility.
Lastly, they need to hire people with relevant contacts. This allows them to hit the ground running. People buy from people and there is nothing better than bringing someone onboard who have their own list of ‘suspects’ who know them and trust them… sales come much quicker this way. If you hire expensive, then they must have their own list of suitable contacts… and the best sales people will always have a list.
Therefore, in summary…
1. Make sure the founders are not part of the value proposition.
2. Make sure the offering is in a ‘productised’ state.
3. Hire from the top of the pile – the best and therefore the expensive.
4. Hire the right type – new business, not account management.
5. Hire appropriate expertise… product v services.
6. Hire the ones with their own list of relevant contacts.
That’s it… simple… I wish!
6 Comments
Hi Colin,
Great article. The only thing I’d “disagree” with is that often founders aren’t great salespeople. They have the passion, the knowledge and the flexibility - but they often lack the resilience and the ability to survive rejection that a successful salesperson needs. In short - they just don’t like selling!
Ian
Colin - good advice. You know that Linkedin was one of just 3 new sites added to the About.com Top 10 Employment site list. The 3 new sites are:
http://www.linkedin.com
http://www.realmatch.com
http://www.indeed.com
Whole list here:
http://jobsearch.about.com/od/joblistings/tp/jobbanks.htm
When I am hiring I always try to find the best people in the marketplace and then offer them the top salary I can. If they try to negotiate upwards I simply tell them my philosophy is to hire the best people I can afford not the lowest cost people I can find. I then explain that I am offering the very top salary I am authorized to offer, and that it is a take it or leave it deal. I have never had someone walk over money.
To often we (sales managers) hire BOB (body on board). This wastes leads, and leads you to need to hire again prematurely wasting your precious time on training.
-Brad
Colin,
I think that hiring is one of the overlooked science/art components of sales and sales management. An associate once told me to hire slow and fire fast, adding some of the elements you highlight can help round that notion out.
Tibor
[...] Salesman Blog, writes about the perils of hiring the right rep, and how to avoid them. In Recruitment - avoid hiring mistakes, there are a number of key points, what struck me was the need for a small business founder looking [...]
I think there are two very critical and important ideas that were not suggested.
First, make sure there is a detailed and documented sales process from which to train and guide salespeople. Making the assumption that salespeople know how to sell YOUR product is a big mistake. If the founders can effectively sell the product or service then the best selling practices or “story” they use should be forwarded to the sales team.
It is my experience that most of the internal best practices of even line management don’t get transferred to the sales team. The only way to insure this is to document the process and have that document as a part of the training, coaching, and selling by the team.
Having a powerful sales process in place raises the skill level of all involved.
Second, it is imperative that very high degrees of motivation be one of the attributes of the salespeople that are hired. You will NEVER find a truly successful salesperson that is not motivated.
The motivation test needs to be applied to why they left or are leaving their last job and why they would want this one. If someone cannot make a powerful case for coming to work, they will not be motivated. And if they are leaving a previous job for reasons other than their motivations this should be questioned.
In my opinion, hiring a salesperson that doesn’t obviously display motivation is asking for trouble, no matter what his or her track record. People frequently move from a superstar status to a new position and fail to attain similar results.