war for-sales-talent-retention

whitepaper: Winning the War for Sales Talent 2 – how effective

assessment drives talent retention strategy

online sales talent assessment

... hire the right person for the right role...

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Forward–looking talent assessment enables organizations

not only to select talent most suited to existing roles but

to assess potential to grow along with the organization –

enabling employers to ‘hire for the future’. At the same time,

employers benefit from a far wider pool from which to select

talent because they have the knowledge and understanding

to confidently hire candidates based on underlying role

competencies, irrespective of current role or market sector.

Benchmarking talent against a ‘High–Performer’ profile for

specific sales roles enables organizations to deploy talent

where it will be most effective and provides a robust and

objective route to off–loading under–performing talent.

The Sales Talent Assessment and associated analysis tools

provide the means to build and support a coherent sales

talent retention strategy, which is forward–looking, agile and

highly responsive to changing market demands. Such a model

continuously optimizes an organization’s talent–fit with the

demands of the market and engages top talent in a shared

journey with the employing organization.



Executive summary

Effective talent assessment has long been the element missing from sales talent retention strategies. This key element enables organizations to formulate an effective talent retention strategy and transform from passive to Active Talent Retention. This mind–set helps drive retention strategies for key sales talent which start long before onboarding and even prior to the hiring process.

2 | whitepaper: Winning the War for Sales Talent 2 – how effective assessment drives talent retention strategy

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The importance of retaining top talentNobody would deny the significance of retaining key talent

– particularly in sales. Since the final decade of the previous

century, commentators like McKinsey & Co have stressed the

importance of rethinking the way organizations plan to attract,

motivate, and retain employees. The seminal ‘War for Talent’1

and subsequent work has supported this approach yet found

employers still largely unprepared for this challenge.

In 2008 and some 15 years on from the original research,

the authors of another McKinsey report2 had this to say:

‘Companies like to promote the idea that employees are their

biggest source of competitive advantage. Yet the astonishing

reality is that most of them are as unprepared for the challenge

of finding, motivating, and retaining capable workers as they

were a decade ago.’

Indeed, the importance of retaining top talent is more acute

than ever today. One issue is the sheer cost of turnover and

routinely replacing lost talent; another is a severe shortage of

the right kind of talent making top people hard to replace; a

third is the lost opportunity cost due to the disruption caused

by talent turnover, particularly in sales; and a fourth is the

likelihood of revenue following the sales talent, particularly at

the highest levels. Running through all this has been the issue

of identifying exactly what top talent looks like, and where to

find it.

In a January 2011 research brief3, Aberdeen Group’s Jayson

Saba stressed the cost side of the equation, when discussing

the recruitment of six–figure earners. It found that employers

were especially keen to reduce employee turnover and improve

retention at this level: one of the factors was that large

organizations face estimated replacement costs of around 86%

of annual salary at this senior level. With a typical 10% annual

turnover rate, this would cost an organization employing 50

six–figure earners a hefty $500,000 each and every year.

So what has gone wrong? In the sales environment, one

vital component has been missing. There has been no easy–

yet–reliable way of simultaneously assessing an individual’s

suitability for a specific sales role – in comparison not just with

the best available in an organization but matched against the

profile of a truly global High–Performer – while also identifying

their potential to develop and grow in step with their employer.

How an effective talent management strategy drives competitive advantageAn effective talent assessment tool – particularly in sales –

opens the door to developing a coherent and cohesive strategy

for managing talent. But the right tool enables organizations

to go much further than that: it provides them with the means

to engage with their employees in Active Talent Retention

along the lines recommended in the The Talent Management

Handbook4. In this classic work, the authors explored the

importance of systematically identifying, keeping, developing

and promoting an organization’s best people. They identified

three key steps to a human resources strategy that would drive

an organization’s success in terms of its talent:

• identify, select, and cultivate what they termed

‘Superkeepers’ – those employees an organization could not

afford to lose;

• locate and develop highly qualified backups for key

positions, which are critical to organizational continuity; and

• allocate resources to employees based on actual and/or

potential contribution to organizational excellence.

In another key work, Good To Great: Why Some Companies Make

the Leap ... And Others Don’t5, author Jim Collins highlighted

how having the right people in the right roles is what gives the

most successful organizations their competitive edge.





He wrote: ‘We expected that good–to–great leaders would

begin by setting a new vision and strategy. We found instead

that they first got the right people on the bus, the wrong

people off the bus, and the right people in the right seats – and

then they figured out where to drive it. The old adage “people

are your most important asset“ turns out to be wrong. People

are not your most important asset. The right people are.’

Talent is key to growthRecently, McKinsey’s Lowell Bryan and Claudia Joyce6 have

echoed this seemingly simple proposition, this time looking

at the talent issue from the perspective of organizational

design. They concluded: ‘Your workforce is the key to growth

in the 21st century. By tapping into their underutilized

talents, knowledge, and skills you can earn tens of thousands

of additional dollars per employee, and manage the

interdepartmental complexities and barriers that prevent real

achievements and profits.’

Using Collins’ analogy, how then is it possible to shape the

organization for optimum current and future performance by

getting:

• the right people on the bus;

• the right people off the bus; and

• the right people in the right seats?

The key is effective talent management and, specifically,

Active Talent Retention which drives the hiring, onboarding

and development process. This approach builds and maintains

an effective talent pipeline with a view to retaining the talent

most suited to the organization today, while also future–

proofing it for tomorrow. It is important to note also that Active

Talent Retention is part of a dynamic system: once you have

the right talent for current market conditions, the process

doesn’t just stop; the market will continue to evolve and both

organization and individual talent will need to keep pace.

What good looks likeThe fundamental key to effective talent retention is the ability

to understand what good looks – which talent is suitable,

which needs to be redeployed, where you’re headed in terms

of development, whether there’s room for growth, which talent

you want to retain, what will motivate an individual to perform

and feel comfortable in a role – which is why an accurate and

highly predictive assessment tool underpins the whole process.

Such a tool needs to accurately assess an individual’s fit

with a specific role (not just a generalized sales role) and

compare them with the best–in–class – what we term a global

High–Performer. It should look in detail at the underlying

competencies (behavioral, motivational, intellectual and skills–

based) that drive performance in any specific role. The tool

must accurately highlight any gaps that will limit performance

while also assessing growth potential for the current and

future roles.

And because such a tool works on the underlying competencies

that convey the ability to thrive in a particular role (rather

than investigating past performance), this instantly opens

up the opportunity of hiring from a far wider talent pool than

previously might have been available to an organization.

Equally, the tool itself also needs to be dynamic and responsive

to changing market conditions, such that the employing

organization can be confident that it is hiring, developing and

retaining top talent in line with current and future market

expectations.


salesassessment

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Winning the War for Sales Talent 2 – how effective assessment drives talent retention strategy


The talent retention pipelineTalent retention at the higher echelons starts long before the

‘onboarding’ process when a new employee actually joins an

organization: it begins with the search for the right candidate.

However, the key to attracting quality candidates is often an

employer’s reputation in the talent marketplace.

For many companies – our clients included – effective

recruitment at the top levels depends on reputation –

their ‘hiring brand’ is vital. Word of mouth and peer–group

recommendation are key factors in a candidate’s decision

whether or not to join an employer.

The search and hiring processThe way that employers conduct the search and hiring process

is an important factor in retention: our clients tell us that using

a credible assessment tool as part of this process not only

helps them to determine whether or not the person concerned

is right for the role under consideration; it brings the additional

benefit of underlining the professionalism of the employer

to the candidate, and consequently, its attractiveness as an

organization to work for.

With its ability to assess potential as well as precise fit to

a specific sales role, the right assessment tool enhances

the hiring process by transforming it into a forward–looking

activity, empowering organizations to ‘hire for the future’

rather than just the current opportunity. The ability to assess

an individual’s current competencies alongside future potential

is a very powerful combination. The right tool enables an

employer to assess key motivators within the individual, their

ability to cope with change, and their capacity to evolve and

develop with the business, even at this early juncture – such

that the retention process has already begun.

The onboarding processContinued through the onboarding process, this Active Talent

Retention approach becomes ever more powerful. New hires

who are well–supported by their employers almost inevitably

come up to speed faster and start making a contribution earlier

– a fundamental consideration for people in a sales role. This

drives success which is an important motivational factor.

A clear view of an individual’s motivators – these are not

always money – enables the employing organization to tune

performance and create a development environment best

suited to the needs of both parties. As a result, the retention

process becomes a dialogue between individual talent and the

employer.

Appropriate ongoing assessment can provide organizations

with a development needs analysis for every employee,

while offering the means to work in partnership with them

in creating a personal development plan. This forms the start

of a development journey that employee and employer will

make together. From the employer’s perspective, this provides

the opportunity to feed in its view of how a specific role will

develop and how that role will grow with the individual.

In terms of effective retention, it is of paramount importance

that the employer communicates the concept of this shared

journey right from the outset.





The development journeyUniquely, the Sales Talent Assessment tool not only measures

suitability for an existing role with considerable accuracy but

also predicts potential or ‘headroom’ for a candidate to grow

into a new role (or, indeed, the need for them to be redeployed

into a more appropriate or less challenging role). This opens up

the opportunity for creating a dynamic process whereby talent

is developed for and deployed to suitable roles where they can

perform at their best and be most productive. At the same time,

the roles themselves can continuously be aligned to the needs

of the marketplace.

This creates an immensely powerful opportunity to optimize

talent for specific roles, to engage in succession–planning

and to drive organization change, while also maximizing

talent retention opportunities by ensuring that roles, talent,

aspirations and competencies are well–matched.

Figure 1 indicates how organizations can assess an individual’s

role fit and skills when considering their suitability for a specific

role. The individuals who fall into the upper–right quadrant –

the ‘stars’ – are best suited to the role. At the same time, those

in the bottom–left quadrant are least suited.

This is an important consideration. Tolerating under–

performers has long been a weakness in the corporate world.

Unfortunately, it can have an overwhelmingly negative impact

on the very talent that an organization is seeking to retain –

the High–Performers, according to McKinsey’s ‘War for Talent:

part two’. ‘Companies that neglect these imperatives pay the

price. Tolerating underperformers – especially underperforming


salesassessment

.com

High–Performer

Uncomfortable – wrong role

Focus on development

Skills

High

High

Low

RoleFit

Under–performer



Figure 1: suitability for a specific sales role – the importance of the correct role–fit. When hiring or positioning an individual for a specific sales role, high role–fit indicates potential for High Performance in the role. Subject to appropriate motivation, individuals with high role–fit/high skills are the High–Performers, while those with high role–fit/low skills can be developed to address skills gaps – both are potentially suitable for the role in question. However, our research shows that a significant number of people fall into the bottom two quadrants, and are poorly positioned for their current role. This is often the result of poor hiring practice or unsuitable promotion from a previous role in which they were performing well. This can lead to individuals becoming disillusioned with their new role and leaving, adversely affecting talent retention for both the current and previous roles.


bosses – carries the highest price of all. Sub–par managers

drive talent from companies and pre–empt positions that could

have been used as development opportunities. Last year, nearly

60 percent of the respondents strongly agreed that they

would be delighted if their companies were quicker to dismiss

underperformers or to move them into less critical roles.’

Those with high skills but poor role–fit may be more suited

behaviorally or intellectually for a different role, while

people in the top–left quadrant could be moved towards

star performance with suitable learning and development

intervention.

This new understanding brings with it major benefits on the

part of the employer because assessment lights the way for

organizations to optimize development budgets by focusing

development where it will deliver most return: employers are

able to focus development precisely when and where it is

needed.

As Pierre Gurdjian and Oliver Triebel pointed out in the

McKinsey Quarterly7, many training programs don’t yield the

desired results. One reason is that they are usually launched

without sufficient knowledge of where the gaps in employee

skills exist. An effective assessment tool, along with a suitable

analysis dashboard that provides a detailed overview of skills

gaps at individual and team level, fills this void.

In turn, such an approach brings further benefits to the

organization and to individuals, who understand that the

organization is not only making a substantial investment

in them but is also aiming to avoid wasting their time with

poorly conceived and repetitive development programs. Such

individuals are more motivated and engaged.

ConclusionThe concept of a shared development journey – facilitated by

an appropriate talent assessment tool – is very powerful, both

for employee and employer. With motivation and engagement

comes a sense of empowerment that employees can not only

shape their own destiny but that of the organization itself: as

they develop, the organization develops too. It has profound

consequences for the way organizations formulate their talent

retention strategies.

Enlightened organizations are using this concept to imbue a

sense of responsibility in their key employees and to drive their

sales talent pipeline and retention strategies. A sense of shared

investment helps foster engagement and ‘ownership’, which

in turn, helps drive retention – and this brings with it massive

competitive advantage.

References1 ‘The War for Talent’, by Elizabeth G Chambers, Mark Foulon,

Helen Handfield–Jones, Steven M Hankin and Edward G

Michaels III, McKinsey Quarterly August 1998 and ‘War for

Talent: part two’ by Elizabeth L Axelrod, Helen Handfield–

Jones and Timothy A Welsh, McKinsey Quarterly May 2001.

2 ‘Making talent a strategic priority’ by Matt Guthridge,

Emily Lawson and Asmus Komm. McKinsey Quarterly,

January 2008.

3 ‘Challenges in Sourcing Six–Figure Talent’, Aberdeen Group,

January 2011.

4 The Talent Management Handbook: Creating Organizational

Excellence By Identifying, Developing, and Promoting Your

Best People, edited by Lance A. Berger & Dorothy R berger,

McGraw–Hill Professional, 2003.

5 Good To Great: Why Some Companies Make the Leap ... And

Others Don’t by Jim Collins, October 2001.

6 Mobilizing Minds: creating wealth from talent in the 21st

century organization by Lowell L Bryan and Claudia I Joyce,

McGraw Hill, 2007.

7 ‘Identifying Employee Skill Gaps’, by Pierre Gurdjian

and Oliver Triebel, McKinsey Quarterly May 2009.





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