Many businesses face problems with turnover, but in sales, it can be a particular challenge. Oftentimes, sales positions emphasize lower base salaries with rewards or bonuses for meeting or exceeding quotas, as an enticement to keep revenue flowing in. Problems arise when revenue generation slows, and salespeople’s income suffers as a result. Although managers are tempted to classify this as a performance issue, it stems more commonly from poor leadership strategies. With this guide, sales leadership will understand the critical role that ownership and management play in sales success and retention.
What Does High Sales Turnover Look Like?
It may seem like high sales turnover would go hand in hand with decreasing revenue, but it does not always present that way. High turnover in sales is an early indicator of underlying sales management problems, which means that the company might still be bringing in great revenue as salespeople increasingly abandon the organization. Once enough of the talent pool has left, revenue generation can slow at an alarming rate. This is why businesses that wish to address retention issues should pay close attention to rising turnover rates as a warning of problems to come.
What Causes High Turnover?
High turnover usually starts with a mismatch between company expectations and employee experiences. Dissatisfaction among the sales team often mirrors issues that workers report in other fields, including:
- Lack of purpose
- Poorly defined or supported roles
- Feelings that management does not care about employees as individuals
This lack of employee engagement, as defined by Gallup, contributes to a rise in turnover. Workers who do not understand what they are expected to do, or who face an exceptionally challenging set of requirements with little support, are more likely to look for better opportunities elsewhere.
How Can Business Leaders Increase Retention?
Empower Salespeople to Succeed
While strong leadership is associated with higher employee engagement, there is a fine line between effective management and micromanagement. In the ideal world, businesses can hire salespeople who have the necessary skills and provide support so that they can succeed. For management, this goal requires a delicate balance between assisting and standing back and allowing independence. The Gallup survey showed that regular conversations with sales teams help employees feel supported while maintaining the right level of professional empowerment.
Provide Sufficient Rewards for Performance
Performance should return rewards for the employee, and not just in money. When salespeople feel like the expectations are too high to meet or the support is too low, monetary rewards feel much less rewarding. Sales managers who provide high rewards for meeting quotas and harsh punishments for those who fail to perform may be more likely to lose even the good performers.
Gallup reported that more than half of employees who leave a company might have stayed if their managers had engaged with them about their feelings concerning their job and performance. Adequate rewards might include the establishment of a livable base wage for new hires, recognition for a job well done, or career development opportunities.
Update the Hiring Process
The hard part of sales is that it requires true passion, and not just about the process. Some companies may focus on hiring the best salesperson without considering whether they have excitement about the product or service that naturally lends itself to sales. Companies that are struggling with revenue generation through sales should consider updating their hiring processes to screen candidates about their general interest in the industry, product, or service.
Utilizing sales recruiting services can provide even small businesses with the tools they need to find the right candidates who have the skills and enthusiasm to increase their own success.
While retention can be a common problem in sales, it does not have to be an unending struggle of wasted resources and lost leads. When businesses take charge of the sales environment and give their salespeople the power to succeed, they can increase retention and performance.
AUTHOR BIO: Ty Culver is the Client Development Director at CulverCareers, which provides strategic talent acquisition and workforce solutions for a diverse portfolio of local, national, and global clients. With over a decade of experience in the recruiting industry, Ty has developed deep expertise in executive search, executive benefit programs, and scalable hiring strategies for both SMB and enterprise-level organizations. Ty’s leadership spans high-volume recruiting for companies in transition to hyper-targeted executive placements. He oversees a high-performing team of Talent Acquisition Specialists, Executive Recruiters, and Client Success Managers at one of the most respected recruiting firms in the country.