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Ever made a bad hire? Be honest now. If you’re like most sales managers, you hired Fred on Friday, only to wish two weeks later you had picked Wayne from Wednesday’s interview. Fred seemed great in the interview, but somehow between the offer and his first day on the job he forgot how to sell.
A bad hire is terribly expensive. According to the U.S. Department of Labor, it will cost you one-third to one-half of Fred’s annual salary to replace him. And these numbers don’t reflect the intangibles such as lost customers, lost knowledge and increased ramp time. But if you don’t make a change to get Fred off the bus, then he’ll likely quit anyway. The Harvard Business Review says 80 percent of turnover is caused by bad hiring decisions.
Here’s why your current style of selecting a new sales rep doesn’t work. Let’s pretend you need to hire a great account manager to call on resellers. Your recruiting department advertises for an “Experienced Sales Representative” with (insert fluffy requirements here) and ends up sending you four candidates: Katelyn, Jerome, Mindi and Reggie. But … here’s what you DON’T know:
- Katelyn is the only one of the candidates who can actually sell, but she hasn’t interviewed in years and her résumé looks terrible.
- Jerome doctored his résumé and is extremely seductive in his hyperbole.
- Mindi has read every sales book she could get her hands on but is really a marketing assistant and has never closed a deal.
- Reggie, who has never carried a quota, has been professionally coached on interviewing skills for several weeks. His well-rehearsed answers will blow you away.
Your challenge is to spot the impostors and pick out the one candidate who can hit the ground running. Do you have enough confidence in your interviewing skills you’re sure you won’t be fooled? Are you willing to bet half of their annual salary that you can? Do you think your standard “what is your greatest strength and weakness?” interview question will ferret out the top sales person? How about this gem: “Why do you think you’re right for this job?” Those questions should have been retired when people stopped smoking pipes at their desks.
Guessing on a candidate is about as good as putting all your money on clubs at the roulette wheel. Actually it’s worse! A study conducted by John and Rhonda Hunter at the University of Michigan on the predictors of job performance found that a typical job interview increased the likelihood of choosing the best candidate by less than 2 percent. Sure, you can increase that to 55 percent by using “behavioral interviewing,” but that’s still not good enough.
So how do you significantly increase the odds of getting the right person in the seat without breaking the bank on a professional recruiter (and that isn’t a guarantee either)?
Well, the answer is more straightforward than you may think. If you were a swim coach and wanted to select a team, you wouldn’t ask them their greatest swimming strength or weakness. You’d ask everyone to jump in the water and race against the clock. You would also analyze their stroke in the water. If you were an editor, you’d ask potential reporters for a sampling of the articles they had actually written. You may even ask them to write a paragraph on the spot.
But you’re a sales manager, so you make them sell!
Yes, it’s a simple answer … but difficult to execute, and that’s why few companies actually go through the trouble of restructuring their hiring processes.
A strong hiring process that really tests sales talent, such as MarketStar’s SalesStarTM Assessment Center, takes candidates through a litany of exercises, designed to measure their performance in real-world, selling situations (including pressure).
Here’s a sampling of a few Assessment Center techniques you’ll want to consider:
| Assessment Center Module | Designed to test: |
| Predictive Indexing | Whether the candidate fits into general behavioral patterns, specific to the job. |
| Letter to the CEO | The ability of the candidate to write a clear, concise, persuasive and grammatically correct, C-level business letter. |
| Group Introduction | The chemistry of the candidate as they try to establish a connection with a new group (and make themselves memorable). |
| Sales Scenario | The selling skills of the candidate by making them sell a product live (or over the phone if this is an inside sales position) to an end customer or reseller. |
| Q&A with Potential Colleague | Whether the company is a right fit for the candidate (it goes both ways). |
| Behavioral-Based Interviews | Responses to a variety of real-life situational questions. |
A typical Assessment Center will last two or three hours and run candidates through a gauntlet of activities. From the time they walk in the door, candidates are constantly being assessed and scored. Even the questions they ask about the company or how they interact with the other candidates (in the group modules) is a good indicator of their thinking processes and overall persona.
MarketStar clients who have used this system have seen dramatic results in terms of lower employee turnover, increased sales and greater employee satisfaction. And the unexpected bonus is that managers, working in teams to assess candidates, learn from each other and feel much more engaged in the hiring process.
For more information on MarketStar’s SalesStar Assessment Centers, contact us at pstout@marketstar.com.
I do agree that the hiring process should include a more rigorous procedure like you describe. Even if candidates can familiarize themselves with the MarketStar’s process you may so be able to select the better person for the job. Integrity of the prospective employee still remains the most difficult aspect to assess, which is probably done in the BBI.
Having said this, maybe a more outside the box hiring procedure should be introduced. When one buys a car, a test drive is usually part of the selection process; no strings attached. I truly think that the right candidate would accept to be test driven for a period; even without strings attached. This will minimize the risk for the company. I believe that committed candidates would feel comfortable about this and be able to prove themselves.
Having been on both sides of an Assessment Center, the combination of techniques gives a unique perspective to both candidate and interviewer that traditional interviews cannot reveal. Even behavioral interviews have an element of predictability since experiences can be categorized into typical traits associated with a position for easier preparation. Assessment Centers encourage a more substantive exchange by virtue of requiring a candidate to think on their feet through a variety of interactions compressed into one process. A less than stellar performance during one assessment technique may be redeemable as the process unfolds, and likewise, being stellar in one venue does not guarantee success. Add the collaborative analysis of Assessment Center managers as a kind of checks and balances, and you’ve increased your likelihood of gaining the best candidate by a good deal more than 2%.
It’s good that your company is parting ways with the traditional resume/interview paradigm. I actually got a job once because I was good in the interview, but it didn’t take long before realizing I really didn’t want to be in that job. I think it’s really odd that companies will base a decision as important as a career on a very superficial, 30-minute interview. If I ran a company I would definitely try doing something like what MarketStar is doing.
Paul outlines a compelling approach to the hiring for any discipline. We have used elements of the Assessment Center Module but I like the well-rounded approach Paul has outlined to identify the best candidate for consideration based on multiple criteria not just the candidate who measures well on one criterion. Measure twice cut once is a good maxim for the hiring process.
Assessing multiple people for one position – a critical factor is spending the time and effort to go from a pile of resumes to the select few that will be assessed. That is a very important part of the process.
Once the assessment center is populated with selected candidates, having managers with varying experiences looking at the same people should give the hiring manager the input needed to decide to hire or to continue looking for the right candidate.
As Paul Stout stated, this process is less expensive than a professional recruiter, and I’d say it’s more dependable.
I certainly agree with Paul’s assessment and execution of a solid sorting system, utilizing many different available methodologies to secure a successful candidate. In my career I have found that another powerful way to ensure that you hire the right person for the right job is to first create a bullet proof job description supported by a competency model. What I mean by that is that a company really needs to put in the time and effort to create a success profile and have the end in mind. Most companies spend very little time and effort to develop a model that will stipulate the requirements needed for the position. In my experience some companies are not even aware of competency models and success profiles. When this model infrastructure exist the interview questions are geared more specific towards the skill sets and talents needed to successfully fulfill the job. In many ways this eliminates the ability for someone to be well coached and pass with flying colors not truly possessing the skill, knowledge, and expirience required, because you are interviewing with complete focus. Using these tools will increase securing the right person for right job by a considerable percentage.
I am not in sales but work as a software engineer. Recently I saw one company miss out on an excellent hire because the guy told the interviewer that a certain process would not work for the company. He wasn’t hired though he was right about the process not working.
Another instance saw an excellent candidate not hired for a government technology project because the government was too cheap to offer a competitive salary. The vacancy remains unfilled. Of course the government is set to compound this type of problem with a wage freeze that will further increase the difficulties of acquiring highly qualified employees.
So one can miss out on great employees by not hiring the right people.
I agree with this process and have tried to stay true to it regardless of whether or not I get pressure to “hire more people – we need more sales people so we can get more sales, and we need them hired by 5 o’clock”.
A sales person, in my opinion, is one of the hardests to make a good hire on, or at least to select the best at actually MAKING sales happen on a consistent and high level basis.
Years ago I went through a two day course called “Success By Selection” and it drove home all the aspects Paul lays out above. There is, however, that “hidden person” in every candidate that may not ever come out in the selection process, but if you interview and assess the candidate, like Paul lays out, your likelihood of success is greatly increased. The more thourough the assessment, the greater the your chances of making a good hire becomes. It may cost more time and money up front, but oh, how it pays off down the road.
Paul I feel that you have outlined a good approach. Having been through this process and having been hired after going through it. I can say it is effective more often than not. I feel that this method is better than running credit checks and the like to determine hirability. I can see where this method in theory points out the best candidates. In my current position we use a similar method of testing people to see if they can actually perform the job they are applying for. There are some who still get through who should not have been hired. For the most part it is effective.
Paul makes some really great points. Many times a candidate is hired because of a personality fit with the team and then the realization is the candidate does not have the skills for the position. The accessment center module finds the candidate that excels in all areas for the position (kind of like form, fit and function). Great tool for finding the right candidate for the job and the right company / position for the candidate. A true win-win-win for all!
Been on both sides of an Assessment Center. Great opportunity as a candidate to shine and show what you have to offer. On the other side, have been able to identify talent in a group setting and depending on my peers to share their observations. I find the different tasks an accurate measure of skill sets and personalities. It is an effective process.
After reading this posting I convinced my company to use this method in our current hiring. It was the best decision we’ve made. Our department has suffered from poor hiring decisions for the last several years and we’re hoping this will gave us a chance to avoid the hassle and cost of constant underperformance and turnover. In our recent interviews, we could easily see who had been prepared only with rote answers to the normal interview questions. Each segment of the interview clearly separated those who could perform in various situations and many aspects of each applicant emerged, which we would never have seen in a traditional interview.
More employers are using various techniques in order to better their hiring decisions. In an ever-changing marketplace for different types of sales representatives it is always important to consider the position first. Once the job requirements, company culture, and logical opportunities for future advancements are considered it becomes much easier to look for a fit.
The above approach gives the candidates an opportunity to better show strengths and weaknesses before being hired. The only potential threat I see in using a series of skill tests for new hires is choosing the order and difficulty. It is important that the first test is manageable to stimulate confidence for the individuals to be engaged in the tests to follow. It is also important for the employer to pick a first test, which well represents the job role and the company. The first test will narrow the field of prospects and will be a first impression of the company to the remaining potential candidates.
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