As a sales leader, you view the revenue planning process as a tug-of-war between reality and board expectations. Did you have a killer year where you blew past your number? The board wants 15% more on top of that next year. Bookings are down due to macro trends that are out of your control? The board still wants growth next year. It’s no wonder that the average tenure of a VP of sales hovers around 20 months. What does it take for a sales leader to drive year over year revenue growth? The answer is that sustainable year over year growth begins and ends with recruiting, developing, and maintaining premier sales talent. Read on to see what you can do to ensure you retain the best team in these volatile times.
Before we dive into how you retain the best reps, keep in mind that talent is only one piece of the puzzle when driving revenue growth. Check out our Revenue Growth Maturity Model and take the diagnostic to see how your organization currently ranks across sales, marketing, pricing, customer success, and all of the other components of revenue generation.
At first glance, you may think that times of high unemployment make it easier to retain your top sales talent. However, a volatile employment environment often serves as the catalyst for change amongst top talent as tempting new opportunities are continuously opening. You will need to work harder than ever to ensure there is not a talent exodus every time the going gets tough.
Let’s break it down into the 5 Cs of talent retention:
Compensation – The number one way to ensure you retain the best talent is to ensure they are always incentivized with comp plans that closely align with their performance. Things like hard commission caps are going by the wayside as they actually incentivize your top reps to stop performing and/or push deals to the next quarter or year after they hit their number. Obviously, you need to protect yourself from runaway cost of sale, but you can do this with a windfall clause or a reduced commission rate after a certain threshold. Never a hard cap. Keep your reps well informed of any upcoming comp changes and make sure their voice is well represented in your compensation governance committee. Curious how your compensation plans stack up to benchmark? Check out our Compensation Plan Benchmarking Tool.
Culture – While compensation will always be the number one driver of retention, competitors will have no issue matching or raising a top-performing reps current comp in order to attract them to their organization. This is where culture and the other remaining 3 Cs come in to play. Culture means a lot of things to a lot of people. It is a bit of a corporate buzzword. But unlike some other overused buzzwords (think ‘Big Data’ & ‘Low Hanging Fruit’), culture is meaningful and can be a powerful driver of retention. Put yourself in your rep’s shoes. Would you want to try and sell in an organization where marketing and sales are at each other’s throats or where they are aligned and work together as one? The answer is obvious, and it really is as simple as that. Reps want to work in an organization that makes it easy to focus on the task at hand; they do not want to be met with mini internal roadblocks every step of the way.
Contribution – Organizations with a strong culture often excel in this third C as well. The days of leadership ruling with an iron fist have come and gone, and while Bill Lumbergh from Office Space may be upset, that style of leadership is gone for good. Retain your tops reps by including them as stakeholders in strategic initiatives, ask them for their input during sales meetings, and generally give them a chance for their voice to be heard. Reps that feel like they are part of something are less likely to flee towards perceived greener pastures when the going gets tough.
Customers – Jeff Bezos famously said, “The #1 thing that has made us successful by far is an obsessive-compulsive focus on the customer.” While Amazon has truly made the customer king, the B2B world is also following these footsteps. Your best reps should be aligned with your best customers. Think twice the next time you want to transition a poor performing territory to your best reps. It may seem like a good idea as you would think they have the skills to turn the territory around, but you need to take a good look at why that territory hasn’t been performing well. Perhaps those customers are not aligned with your ideal customer profile, or there are product-market fit issues. Whatever the cause may be, it’s not always as simple as throwing your best reps into the mix and telling them to fix it. All you are doing in this situation is increasing the risk of losing your top reps and taking time away from serving the rep’s existing top customers.
Coaching – You may think your best reps do not require coaching. This is not true. Even the elite of the elite have always professed a need for coaching. Michael Jordan once said, “A coach is someone that sees beyond your limits and guides you to greatness.” Many studies have shown that top performers are also most likely to possess personality traits such as insecurity and ‘never saying no.’ They think they can handle everything thrown their way but get caught up in trying to do things perfectly. Your role as a leader is to provide guidance and coaching to help your top performers maintain focus so that their skills can continue to shine and they don’t get burnt out and start looking for other options. If you are looking for some guidance on how to coach your high performers, check out our A-player 1:1 coaching guide.
In these volatile, travel-limited times, it is even harder to attract, fully vet, and ramp new hires. For this reason, it is more important than ever to retain your top talent. Remember, there is more than just compensation to consider when you are trying to retain your top-performing reps. Your organization requires a comprehensive, cross-functional approach to retaining talent, and if your organization isn’t aligned, you run the risk of losing your top performers. If you haven’t already done so, take the RGMM diagnostic to understand current areas of misalignment within your organization.