Recently I’ve spent quite a bit of time talking to heads of sales and sales development about the needs of their organizations. Eventually the topic turns to their hiring practices. In most cases they describe a very rigorous process with having multiple people in their organization conduct interviews, checking references, and verifying W-2s. Many say they only hire experienced salespeople with more than 10 years in the industry.
This hiring sounds practical and likely a process that would net top candidates. However, it isn’t foolproof. Even if you follow this process exactly, you may still end up onboarding reps who are members of what Accenture calls the “Frozen Middle”– underperforming B reps. Or worse- you may be hiring your next fire.
The Research Says…
In the 1990’s, Frank Schmidt and John Hunter published a meta-analysis of 85 years of research on how well assessments predict performance. They looked at 19 different assessment techniques and found that typical, unstructured job interviews are pretty bad at predicting how someone would perform once hired.
The research revealed that unstructured interviews can explain only 14 percent of an employee’s performance. Reference checks explain 7 percent and the number of years of work experience…only 3 percent.
Google Hires This Way…
I recently read an article detailing Google’s hiring process put into place by Laszlo Bock, the SVP of People Operations at Google. Bock refers to the Schmidt-Hunter work as validation for Google’s reliance on pre-hiring assessments. Potential employees are evaluated based on both their decisions to hypothetical situations and behavioral questions.
Bock’s team understands that the best predictor is a work sample test. By placing a prospective employee into a situation that exemplifies work similar to that which they would do in the job, and assessing their performance at it- you can predict their performance on the job- whether they are a Google coder or IBM sales rep. According to Schmidt and Hunter you can predict 29% of future performance on assessment performance.
Obviously there is no substitute for real life and seeing someone’s skills on the job. So even though a simulation can’t predict performance perfectly creating metrics around the actual situations appears to be the best approach to finding the best candidates.
Avoiding The 50% Failure Rate
According to Schmidt-Hunter, 50% of sales hires are a poor fit. Is it any wonder why, according to CSO Insights, sales turnover across all industries is 25%?
Should we be surprised by the stat from The Bridge Group that sales quotas have risen 33% but the percentage of reps making quota has fallen by 25%?
Research shows interviewers make a determination of outcome in the first 5 minutes based on a handshake firmness and other first impressions– then spend the rest of the interview trying to validate their impression.
You Don’t Have to Be Google
The UPtick™ platform takes this methodology to an entirely new level by putting salespeople in 3D virtual business environments where they direct the conversation with Customer-Avatars. These assessments, provide a line of sight into the future performance of your next hire.
Perhaps sales success starts with using more rigor and data analytics to hire the next rep and less on the first 5 minutes impression of your team of interviewers. The stakes are high and forward thinking organizations can reap the benefits of utilizing data analytics to improve overall team success.