Hiring Salespeople: Are Your Methods Accurate?

Every so often I come across some really fascinating stuff. Take this one, for instance. The Bureau of the Census released data from the 1997 National Employers Survey. In this report, a sample of 5465 employers were asked how regularly they obtained pre-hiring information from the following sources (always=5, regularly=3, never=1). Here is the average of their responses:

(Adapted from Wilk and Capelli (2003), “Understanding the determinants of employer use of selection methods.” Personnel Psychology, 56, 103-12.) Pretty interesting, huh? Interviews rank at the top and work examples rank at the bottom. Now let’s add some information gathered from a summary of thousands of relevant research studies. The next chart shows the accuracy of each method predicting actual job performance.

Notice anything interesting? The worst predictors are the most popular, and the best predictors are the least. These folks must: 1) not care about performance, 2) have never read the research, or 3) refuse to use it. They have a pre-hire “screen door” with gaping holes in the wire. The door keeps out larger pests, but the holes let in plenty of flies! There is no conceivable way an organization can maximize sales production if it is staffed with an abundance of sales-flies ó can’t be done. The effect will be like a dream where we desperately try to run, but our legs move verrrry sloooowly. Corporations try to build sales using training, coaching, incentives, and termination. But what does experience tell? How many training programs turn poor salespeople into good ones? How often do sales managers coach poor salespeople into good ones? How many poor salespeople excel as a result of incentive programs? Who does termination really hurt? Okay. We have a problem. We recognize it. And we know the only way to fix it is to do a better job pre-hiring. Now why do you suppose organizations don’t do that? Here are some common sales-hiring myths. Myth:

Interview performance accurately predicts selling skills. Fact:

• Interview data predicts on-the-job performance about 50%.
• Salespeople are born “schmoozers,” who know how to get people to like them.
• Interview decisions tend to favor attractive white males at the expense of minorities and less attractive females.

Myth:

Tests are more risky than interviews and should be avoided. Fact:

• The DOL Uniform Guidelines considers any method that separates applicants into “qualified” and “unqualified” groups to be a test (including interviews).
• It recommends using validated tests that accurately predict job performance.

Myth:

Sales managers are generally good judges of sales skills. Fact:

• How do they explain why some salespeople are great and others are terrible? Do they intentionally hire a few sales duds so they can practice coaching skills?
• Anyone with a brain knows it is virtually impossible to accurately measure things like motivation, problem-solving ability, planning skills, and so forth using interview data.
• Admitting bad hiring decisions is politically unpopular.

Myth:

Recruiters are not responsible for hiring poor salespeople. Fact:

• Suppose I wanted to hire a chamber orchestra. I call my talent scout and tell her I need three string players, two flutists, and a pianist. The scout places ads, interviews musicians, and starts sending me candidates. I quickly learn that most applicants can play a little, but few can play like the pros I need. The talent scout never invited them to try out, audition, or even send a tape recording. What responsibility does the talent scout have?

Myth:

You have to hire a certain percentage of minorities. Fact:

• I know of no law that forces companies to hire unqualified salespeople.
• Legislators get very bothered when qualified people are rejected because they are minority, otherwise you can reject all the unqualified people you want.

Myth:

Selling is mostly persuasion. Fact:

• Few people are compelled to part with their money based on a sales pitch. They usually have to agree they have a problem ó and the salesperson can solve it.
• Most salespeople don’t learn enough about the prospect before they start pitching. Being pitched irritates most people. The ever-popular, “sell me the pencil” question is a sales pitch.
• Salespeople who cannot (or will not) learn the product line think selling is all about personal persuasion.

Myth:

High potential will always be a chance event. Fact:

• High potential sales talent can only be achieved by following three steps:
  1. Clearly define how much raw brain power is needed to learn and problem solve. Define how much planning ability is required for organizing and selling. Identify what kind of interpersonal skills are necessary to make the sale. Understand what kind of attitudes, interests and motivations are associated with exceptional sales performance.
  2. Accurately measure how much raw brain power a candidate has to learn and problem solve. Evaluate how much planning ability the candidate has to organize and sell. Observe what kind of interpersonal skills the candidate has to make the sale. Measure what kind of attitudes, interests and motivations they have.
  3. Since your pre-hiring process will be more rigorous and screen out more unqualified people, be willing to kiss more frogs to find your prince or princess.

We only have two choices: discover unqualified people before hiring, or discover unqualified people after hiring. Which do you think is cheaper?