Strategic Account Management: The Cost of a Ghost: The economics of poor hiring decisions in sales A webinar for SMMConnec...
<ul><li>This program was presented by SMMConnect.com as a live webinar.  To view the recorded webinar: </li></ul><ul><li>F...
A ghost: <ul><li>A sales person who: </li></ul><ul><ul><li>Holds a sales position. </li></ul></ul><ul><ul><li>Draws a sala...
A ghost: <ul><li>A sales person who: </li></ul><ul><ul><li>Holds a sales position. </li></ul></ul><ul><ul><li>Draws a sala...
Participant poll: # sales people fired or quit in last 5 years? (post answer in the chat box)
Participant poll: # sales people hired in last 5 years? (post answer in the chat box)
Participant poll: % ghosts hired? (post answer in the chat box)
Hiring  Compensation Maintenance Severance Lost opportunities Disruption TOTAL $ 23,000 151,000 14,000 25,000 250,000 100,...
http://www.objectivemanagement.com/NewGhosts2005.htm Estimate how your company compares to the average with the cost of a ...
If you have  50 sales people 20% underperform You have 10 ghosts Who cost you $5,630,000
Participant poll:  Use the sample of $563,000 per ghost to estimate your company’s costs of ghosts: # sales people x % gho...
How to fix the ghost problem: A screening tool that hires sales people who can execute your strategy effectively…. …… 96% ...
Diagnosing a sales person’s likelihood to succeed is a  complex process.  The Center for Business and Industrial Marketing...
How to fix the ghost problem: The key:  What is the sales task?  Step one: define the sales task. (which defines the kind ...
How to fix the ghost problem: <ul><li>The key:  What is the sales task?  </li></ul><ul><ul><li>Facilitating repurchase? </...
How to fix the ghost problem: The Center for Business and Industrial Marketing process Define the  sales tasks  and the id...
How to fix the ghost problem:  Playing the hand you’ve been dealt: You also need to assess your current sales force and di...
How to fix the ghost problem:  Finding the ghosts. If you rank your sales people by sales produced, sales forces often fal...
% sales people 6% 33% 61% % revenue 64% 5% 31% How to fix the ghost problem:  Finding the ghosts. Many sales forces looks ...
How to fix the ghost problem:  Discriminating between ghosts and “baby whales” Define the  sales tasks  and the ideal sale...
How to fix the ghost problem:  It’s not always the sales person’s problem. Underperforming sales people are often due to  ...
Sales management can almost always spend more time coaching, motivating, and holding accountable CBIM research shows that ...
Sales management can almost always spend more time coaching, motivating, and holding accountable Coaching Motivating Accou...
Sales management capabilities. 65% = desired In addition to measuring the amount of time sales managers devote to each bes...
Pipeline analysis Discussing which prospects to spend time on is one of the most important topics for sales managers to wo...
The complete list of 19 questions about pipeline quality,: Compelling reason to buy from us Commitment to buy Funding exis...
Of the 19 questions about pipeline quality, six have the highest impact for this particular client 6 high impact questions...
Eight skills areas: The CBIM assessments evaluate each sales person on eight sets of sales skills that together comprised ...
Hunter skills Qualifier skills Closer skills Sample sales force skill analysis:
Sample Plot of % Sales People practicing each closer skill 41% Controls emotions 32% Gets to decision makers 51% Have no n...
Definitions of sales person characteristics Hunter skills Closer skills Qualifier skills Prospects consistently Gets past ...
Ambassador skills Timid sales skills Develops bonding and rapport Gets referrals and introductions Knows how to handle peo...
Analysis of Buy Cycle Elements <ul><li>The CBIM assessment analyzes several patterns of thinking and behavior that tend to...
Executive Inside sales Outside sales Executive Inside sales Outside sales Executive Inside sales Outside sales Executive I...
The Major Sales Competencies Coping with Rejection Desire Commitment Responsibility Outlook Need for Approval Talking Mone...
Sample Summary of training needs We develop a training curriculum for your sales force based on the issues we identified M...
Economic value of addressing the developmental issues All of our assessment analyses and reports are presented in an econo...
A final word CBIM is committed to supporting our clients in realizing the value of developmental coaching.  And our assess...
Do you screen your sales candidates? <ul><li>A Yes, we have job specific screening tests. </li></ul><ul><li>B Our screener...
Do you assess your sales people? How often? <ul><li>A Yes, we have job specific assessments </li></ul><ul><li>B Our assess...
Dr. Wesley Johnston Director, CBIM [email_address] (404) 413-7851 Karl Hellman Executive in Residence, CBIM [email_address...
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Karl Hellman and Wesley Johnston's "The Cost of Ghost" Webinar - Presented by SMMConnect

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Hiring for strategic selling is one of the most important aspects of effective execution. Hiring an ineffective strategic sales person-we call him a "ghost"-can cost your company hundreds of thousands-perhaps millions-in lost opportunities.



This webinar will arm you with facts and formulas you can use to estimate the cost of a ghost for your company. You can use these estimates to justify a fact based, professional hiring process.



We will also describe best hiring practices, including the criteria and processes you should be using as well as approaches to assessing candidates.



Who should attend:

* CEOs and CMOs will gain insights into how to increase their ROI by avoiding the costly ghost.

* Sales people will value the best practice criteria, processes and assessment tools.

* HR professionals tasked with the critical job of finding strategic selling talent.


About Dr. Wesley J. Johnston

The Executive Director of the Center for Business and Industrial Marketing at Georgia State University (http://robinson.gsu.edu/marketing/Centers/CBIM/index.htm), Dr. Wesley Johnston is Professor of Marketing at Georgia State University. Dr. Johnston is one of the leading experts in B2B marketing and sales management. He is author of a textbook on Sales Management and is currently writing Strategic Selling Playbook (co-authored with Karl Hellman) based on his workshops and consulting practice in strategic selling.



About Karl Hellman

Karl Hellman is President of Resultrek, (www.resultrek.com) a global marketing consulting firm dedicated to creating great marketers and sales people. Karl is also Executive in Residence at the Center for Business and Industrial Marketing at Georgia State University. Karl's most recent book, The Customer Learning Curve, explains the power of The Customer Learning Curve through 24 "real life" marketer examples: scenarios readers can call their own. Karl is co-authoring Strategic Selling Playbook with Dr. Johnston.

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  • GBF003_032203_Tactical Marketing_v19
  • Karl Hellman and Wesley Johnston's "The Cost of Ghost" Webinar - Presented by SMMConnect

    1. 1. Strategic Account Management: The Cost of a Ghost: The economics of poor hiring decisions in sales A webinar for SMMConnect Wes Johnston Karl Hellman Center for Business and Industrial Marketing Georgia State University
    2. 2. <ul><li>This program was presented by SMMConnect.com as a live webinar. To view the recorded webinar: </li></ul><ul><li>Follow the link* below to: </li></ul><ul><li>View the recorded webinar </li></ul><ul><li>Download all the materials </li></ul><ul><li>View other recorded webinars in this series </li></ul><ul><li>Register for other live webinars in this series </li></ul><ul><li>http://bit.ly/StrategicSellingPlaybookGroup </li></ul><ul><li>*If you aren’t already a member of SMMConnect.com, you’ll need to register along the way. It’s quick, free and privacy-protected. </li></ul>
    3. 3. A ghost: <ul><li>A sales person who: </li></ul><ul><ul><li>Holds a sales position. </li></ul></ul><ul><ul><li>Draws a salary. </li></ul></ul><ul><ul><li>Is given a territory to cover. </li></ul></ul>
    4. 4. A ghost: <ul><li>A sales person who: </li></ul><ul><ul><li>Holds a sales position. </li></ul></ul><ul><ul><li>Draws a salary. </li></ul></ul><ul><ul><li>Is given a territory to cover. </li></ul></ul><ul><li>But….. </li></ul><ul><ul><li>Cannot execute your sales strategy. </li></ul></ul><ul><ul><li>Allows the territory to atrophy. </li></ul></ul><ul><ul><li>Prevents you from hiring an effective sales person. </li></ul></ul>
    5. 5. Participant poll: # sales people fired or quit in last 5 years? (post answer in the chat box)
    6. 6. Participant poll: # sales people hired in last 5 years? (post answer in the chat box)
    7. 7. Participant poll: % ghosts hired? (post answer in the chat box)
    8. 8. Hiring Compensation Maintenance Severance Lost opportunities Disruption TOTAL $ 23,000 151,000 14,000 25,000 250,000 100,000 $563,000 The cost of a ghost: our experience:
    9. 9. http://www.objectivemanagement.com/NewGhosts2005.htm Estimate how your company compares to the average with the cost of a ghost calculator:
    10. 10. If you have 50 sales people 20% underperform You have 10 ghosts Who cost you $5,630,000
    11. 11. Participant poll: Use the sample of $563,000 per ghost to estimate your company’s costs of ghosts: # sales people x % ghosts x $563,000 (post answer in the chat box)
    12. 12. How to fix the ghost problem: A screening tool that hires sales people who can execute your strategy effectively…. …… 96% of the time.
    13. 13. Diagnosing a sales person’s likelihood to succeed is a complex process. The Center for Business and Industrial Marketing (CBIM) has evaluated 20 of the most popular assessment tools. Most assess sales people’s psychological traits. The one we have found to be best not only asks about personality traits, but also asks about company-specific and job-specific capabilities.
    14. 14. How to fix the ghost problem: The key: What is the sales task? Step one: define the sales task. (which defines the kind of skills you’re looking for.)
    15. 15. How to fix the ghost problem: <ul><li>The key: What is the sales task? </li></ul><ul><ul><li>Facilitating repurchase? </li></ul></ul><ul><ul><li>Hunting for new opportunities within existing accounts? </li></ul></ul><ul><ul><li>Prospecting? </li></ul></ul><ul><ul><li>Customer process innovation? </li></ul></ul>Most sales forces are called upon to perform more than one of these tasks.
    16. 16. How to fix the ghost problem: The Center for Business and Industrial Marketing process Define the sales tasks and the ideal sales person profiles Document the sales strategies Identify the sales processes and systems Customize on-line surveys for sales people/sales managers Analyze survey responses. Send only qualified candidates to be interviewed.
    17. 17. How to fix the ghost problem: Playing the hand you’ve been dealt: You also need to assess your current sales force and distinguish between the ghosts and sales people who have the potential to develop into successful contributors to your company. If you just identified and eliminated ghosts, you’d get the same sales at a significantly lower cost. If you replaced ghosts with contributors, you’d increase revenue at lower incremental cost.
    18. 18. How to fix the ghost problem: Finding the ghosts. If you rank your sales people by sales produced, sales forces often fall into tiers: A’s, B’s, and C’s. <ul><li>Participant poll: </li></ul><ul><ul><li>What % of your sales people are A’s? </li></ul></ul><ul><ul><li>What % of your revenue do the A’s generate? </li></ul></ul><ul><ul><li>(post answer in chat box) </li></ul></ul>
    19. 19. % sales people 6% 33% 61% % revenue 64% 5% 31% How to fix the ghost problem: Finding the ghosts. Many sales forces looks like this: A B2B financial services product.
    20. 20. How to fix the ghost problem: Discriminating between ghosts and “baby whales” Define the sales tasks and the ideal sales person profiles Document the sales strategies Identify the sales processes and systems Customize on-line surveys for sales people/sales managers Analyze survey responses. Create training programs for common needs . Create individual coaching programs for individual needs . Assess your current sales people — for development opportunities:
    21. 21. How to fix the ghost problem: It’s not always the sales person’s problem. Underperforming sales people are often due to sales management issues: Are sales managers allocating time correctly? Do sales managers have the required skills?
    22. 22. Sales management can almost always spend more time coaching, motivating, and holding accountable CBIM research shows that best practice is for sales management to spend 75% of its time on three performance enhancing activities: Coaching Motivating Holding their people accountable 25% 25% 25%
    23. 23. Sales management can almost always spend more time coaching, motivating, and holding accountable Coaching Motivating Accountability Recruiting Internal Issues Compensation Organization Strategy Direct Selling CBIM Ideal Client’s target Actual sales managers Crisis Management An actual time allocation example: Participant poll: Why don’t sales managers spend time coaching? (post in chat box)
    24. 24. Sales management capabilities. 65% = desired In addition to measuring the amount of time sales managers devote to each best practice activity, our assessments determine how well each manager is performing five best practice activities . Sample: As a motivator As a coach As a mentor As a recruiter As a performance master Skills:
    25. 25. Pipeline analysis Discussing which prospects to spend time on is one of the most important topics for sales managers to work with their sales people on through the coaching and mentoring processes . The CBIM assessments facilitate this critical aspect of developmental coaching by asking sales people to evaluate a sample of their prospects on 19 specific dimensions . In this sample overview pipeline analysis over a third of the sales force’s pipeline is of low quality, reflecting the very common, human tendency to prospect where it’s easiest, rather than where there is the greatest return if key barriers are overcome. High quality Medium quality Low quality 35% 25% 40%
    26. 26. The complete list of 19 questions about pipeline quality,: Compelling reason to buy from us Commitment to buy Funding exists Client knows price range Competitive issues handled Indicated preference toward us Dissatisfied with incumbent vendor Decision within 30 days Delivery timeframe is appropriate No need for competitive quotes We have a solution Quoting decision maker Decision upon quoting Compelling reason to solve their problem Will be profitable Prospect is credit worthy Developed strong relationship Existing clients not impacted Differentiated ourselves from the competition
    27. 27. Of the 19 questions about pipeline quality, six have the highest impact for this particular client 6 high impact questions Prospect is dissat w current vendor Compelling reason to solve prob Our proposal solves the prob Prospect committed to buy We are differentiated from comp Prospect has money
    28. 28. Eight skills areas: The CBIM assessments evaluate each sales person on eight sets of sales skills that together comprised the sales job. These eight sets of skills are : Hunter skills Closer skills Qualifier skills Farmer skills Account manager skills Intellectual skills Ambassador skills And what are termed Timid skills Matched to sales strategies and tasks
    29. 29. Hunter skills Qualifier skills Closer skills Sample sales force skill analysis:
    30. 30. Sample Plot of % Sales People practicing each closer skill 41% Controls emotions 32% Gets to decision makers 51% Have no need for approval 19% Has supportive buying cycle 8% Gets prospect to make a decision 8% Won’t make inappropriate quotes 5% attempts to close 0% Won’t accept put offs 3% Has closing urgency
    31. 31. Definitions of sales person characteristics Hunter skills Closer skills Qualifier skills Prospects consistently Gets past gatekeepers Gets to decision makers Gets to decision makers Gets appointments when prospecting Receives plenty of introductions Will prospect Has no need for approval Recovers from rejection Gets prospect to agree to make a decision Won’t make inappropriate quotes Gets to decision makers Attempts to close Has closing urgency Won’t accept put offs Has supportive buy cycle Has no need for approval Controls emotions Uncovers actual budget Gets to decision makers Learns why prospects buy Learns how prospects buy Does not assume Comfortable talking about money Has high money tolerance Has no need for approval Controls emotions Has supportive record collection Farmer skills Account manager skills Intellectual skills Has closing urgency Attempts to close Controls emotions Won’t accept put offs Has supportive buy cycle Has difficulty recovering from rejection Has need for approval Won’t prospect Develops bonding and rapport Gets to decision makers Uncovers actual budget Knows how to handle people Effective time management Lacks closing urgency Has need for approval Won’t prospect Believes—”I should be their friend” Inappropriate follow up calls Attempts to close Uncovers budget Gets to decision makers Learns why prospects buy Learns how prospects buy Has at least 10 skills Has need for approval Has non-supportive buy cycle Has self limiting records Has money issues Has difficulty controlling emotions
    32. 32. Ambassador skills Timid sales skills Develops bonding and rapport Gets referrals and introductions Knows how to handle people Enjoys selling Inappropriate follow up calls Wasting time—selling system Believes—”I should be their friend” Skills limited to first three of this list Has low self esteem Has need for approval Has difficulty recovering from rejection Uncomfortable talking about money Has outlook problem Is not money motivated
    33. 33. Analysis of Buy Cycle Elements <ul><li>The CBIM assessment analyzes several patterns of thinking and behavior that tend to obstruct a sales person’s progress and success. </li></ul><ul><li>One of the unique insights of the assessment is that the way a sales person thinks about buying products and services themselves affects how they sell. That is, if sales people comparison shop themselves, of if they wait and think before buying, they will accept these put offs and delays as natural in their prospects and customers. </li></ul><ul><li>Five aspects of these non-supportive behaviors and attitudes are: </li></ul><ul><ul><li>Non-supportive buying cycle </li></ul></ul><ul><ul><li>Vulnerable to think it overs </li></ul></ul><ul><ul><li>Vulnerable to comparison shoppers </li></ul></ul><ul><ul><li>Vulnerable to price shoppers </li></ul></ul><ul><ul><li>Low money tolerance (they flinch at their price before the prospect does) </li></ul></ul>
    34. 34. Executive Inside sales Outside sales Executive Inside sales Outside sales Executive Inside sales Outside sales Executive Inside sales Outside sales Executive Inside sales Outside sales 92% 100% 83% 75% 83% 67% 50% 67% 33% 42% 50% 33% 17% 17% 17% Vulnerable to comparison shoppers Non-supportive buying cycle Vulnerable to think it overs Vulnerable to shoppers Low money tolerance Sample Analysis of Buy Cycle Elements
    35. 35. The Major Sales Competencies Coping with Rejection Desire Commitment Responsibility Outlook Need for Approval Talking Money Here are the dimensions of competency, behaviors, and attitudes our assessment evaluates:
    36. 36. Sample Summary of training needs We develop a training curriculum for your sales force based on the issues we identified Mastery of a more powerful selling system Training Area Core Competency Training module % Group needing this training Discovering why prospects buy Selling process 100% Getting prospects to agree to make a decision Gets commitments and decisions Selling process 100% Improve selling skills Discovering why prospects buy Selling process 100% Improve productivity Consistent effective prospecting Prospecting 98% Better closing skills and execution Gets commitments and decisions Closing the deal 92% Fewer inappropriate time wasting decisions Effective listening and questioning Hot buttons 92% Getting stronger appointments Reaches decision maker Hot buttons 92% Eliminate put-offs Doesn’t need approval Objections 85%
    37. 37. Economic value of addressing the developmental issues All of our assessment analyses and reports are presented in an economic context. Based on the data collected from the sales people and sales managers in the assessment process, we calculate the economic impact you can achieve by addressing your key developmental opportunities, your systems and process issues, etc.. The economic value has two dimensions: Improvement in the quality of your sales pipeline, and increases in revenues from sales. In this sample case the organization as a whole had six major issues, which, when addressed would improve the pipeline by $9 million and increase sales by $19 million. Here are the six issues, and the economic value of addressing each:
    38. 38. A final word CBIM is committed to supporting our clients in realizing the value of developmental coaching. And our assessments are designed to provide sales managers and sales people with the specific feedback and insights to create their own, customized, highly specific development plans.
    39. 39. Do you screen your sales candidates? <ul><li>A Yes, we have job specific screening tests. </li></ul><ul><li>B Our screeners are general “personality” tests </li></ul><ul><li>C No, we don’t screen—but are interested in doing so </li></ul><ul><li>D No, not us </li></ul><ul><li>E Other, comments (post in the chat box) </li></ul><ul><li>How effective do you find your screeners? (post in the chat box) </li></ul>
    40. 40. Do you assess your sales people? How often? <ul><li>A Yes, we have job specific assessments </li></ul><ul><li>B Our assessments are general “personality” tests </li></ul><ul><li>C No, we don’t assess—but are interested in doing so </li></ul><ul><li>D No, not us </li></ul><ul><li>E Other, comments (post in the chat box) </li></ul><ul><li>How often do you assess your sales team: (post in the chat box) </li></ul>
    41. 41. Dr. Wesley Johnston Director, CBIM [email_address] (404) 413-7851 Karl Hellman Executive in Residence, CBIM [email_address] 678 793 7343 <ul><li>Contact CBIM: </li></ul><ul><ul><li>To discuss Sales Force Screening best practices </li></ul></ul><ul><ul><li>To ask questions about your Screening Program </li></ul></ul><ul><ul><li>To learn about the Center’s Assessments and Screening </li></ul></ul>
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