Agenda: why?...we re here. where do we start? ...some wrap-up FUTURELAB

Transcription

1 Advanced Steps To Ensure YOU Don t Make ANY People Mistakes In Your Company Jim Hunter, President & CEO

2 Agenda: why?...we re here where do we start?...some wrap-up FUTURELAB

3 we re here

4 each time we try something to understand our people it s just the tip of the iceberg...

5 do we start?

6 step #1 give yourself an overall Talent Grade

7 sample scorecard

8 talent hiring grade Have a candidate sourcing / pool? Have accurate job requirements? Use consistent & disciplined hiring process? Have automated hiring process? Have a successful track record? a poll question? (1-5)

9 talent development grade See and track increases in individual productivity? Record promotions from within? Culture of learning & development? Have individual development plans? Know who to train on what? a poll question? (1-5)

10 talent planning grade Have a succession plan for each job function? Know which high level attributes are found in each role? Know who ALL your high potential individuals are? Have a Net that is cast wide & deep enough? a poll again (1-5)

11 talent measurement grade? ID d metrics which drive success? Do you track the measurement of those metrics? Id behaviors & competencies which drive success? Evaluation/measurement of competencies? one more poll (1-5)

12 and your score?

13 step #2 what makes your A players different from everyone else?

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17 step #3 replace low performers.yes, its very hard.

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19 step #4 using job descriptions that don t really match the job

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21 A-Source Profile - Vice President Sales Candidate Name: Ideal Employer/Job What are the Candidates Employment Goals & Objectives? Response Loves to manage people. Has a passion and entrepreneurial spirit. When he was at STAC, he started carrying a bag from scratch and built the whole operation (incl finance to 23 people w/in a year. Loves being part of a team in building companies. Currently working w/entrepreneur to define his business/opening doors (netgear, linksys, 3com). Money has to be there but wants to build. Carry the bag but work the strategic, analytical, marketing and getting feedback from clients... He's out of there if he can't sell (currently). Build the co 1st, making money 2, managing people 3rd. What's The Ideal Employer Culture and Characteristics The He's looking for a company where he can help build it from the ground up. A company would have the Candidate Is Looking characteristics & culture to look outside the box and be open to new ideas regardless of who created them. For (Big or Small Firm, Private or Public, etc.)? What's The Candidate's Ideal Role & Responsibilities? Part of the team that builds the company, plain and simple. What Does the Candidate Enjoy Doing Most Outside a Work Environment? Swimming a mile plus 5x/wk. Teaching French in his spare time. Fluent in German but can also speak 5 other languages pretty well.

22 Weighting Table (A30) Position Attributes Weighting - Vice President, Sales Requirements (Absolute Must-Haves) Candidate 1 Core Disciplines Leverage key executives (Rolodex) in industry/prospects. Proven record of calling on Executive and Middle Management. Demonstrated ability to Find, Qualify and Close Business in NEW markets with NEW products. Weight Score out of % % Background in building and growing sales groups 5.00% Strong understanding/experience of CRM, enterprise software mkt 35.00% Stong ability to create and implement sales strategies 5.00% Has surperb organizational and time management skills 2.00% Strong communication/presentation skills 3.00% Strong self-starter (Documented Personal Goals) 5.00% Totals %

23 step #5 use a topgrading interview format

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25 Sales Prospecting - Capable of prospecting for new business without constant supervision Under Developed 1. Finds it difficult to talk to strangers 2. Has difficulty dealing with steady diet of rejection 3. Unpleasantness of prospecting overcomes drive and self confidence 4. Always seems to find something else to do 5. Manager must make prospecting a non-negotiable or it will not get done Well Developed 1. Has little problem talking to strangers 2. Does not take rejection personally; willing to go through 98 no s to get 2 yeses 3. Recognizes the formula for success includes prospecting and cold calling 4. Makes prospecting a priority and tracks prospecting time and activity 5. Approaches prospecting at times of high energy Rating Scale Tell me about a job you have had where you successfully did more cold calling than you were comfortable with? How much did you do per week? What did you like about it? What did you not like about it? How did you make yourself do it when you didn t feel like it? What did your tracking system look like? What was your success rate? When prospecting, how many no s are you willing to go through to get a yes? How do you handle that level of rejection and remain positive? How did you come up with that number? How would you determine that a particular method of prospecting is a waste of time? What does a yes mean when doing telephone cold calling? Most would agree that cold calling and prospecting works best with a script. Give me an example of a script you have recently used Has this script been successful? Why? How long or often have you used that script? How long would it take you to develop a script for this company s product or service? Can you do it right now and role play?

26 step #6 implement specific onboarding & training plans for your people...

27 step #7 keep score

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29 Topgrading Sales Moving "B" & "C" Reps into "A" & "B" Reps Current Projected ABC Distribution of Reps # Reps % Total # Reps % Total "A" Reps 15 15% 23 23% "B" Reps 60 60% 62 62% "C" Reps 25 25% 15 15% Total % % Avg Transactions per Period "A" Reps 5 5 "B" Reps 3 3 "C" Reps 2 2 Number of Periods in a Month 1 1 Avg Transaction Value "A" Reps $ 1,000,000 $ 1,000,000 "B" Reps $ 800,000 $ 800,000 "C" Reps $ 700,000 $ 700,000 Avg Transaction Net Profit Margin (%) "A" Reps 2.0% 2.0% "B" Reps 2.2% 2.2% "C" Reps 1.8% 1.8% Avg Monthly Transaction Value per Rep "A" Reps $ 5,000,000 $ 5,000,000 "B" Reps $ 2,400,000 $ 2,400,000 "C" Reps $ 1,400,000 $ 1,400,000 Weighted Avg $ 2,540,000 $ 2,848,000 Avg Monthly Gross Profit per Rep "A" Reps $ 100,000 $ 100,000 "B" Reps $ 52,800 $ 52,800 "C" Reps $ 25,200 $ 25,200 Total Monthly Gross Profit % Incr "A" Reps $ 1,500,000 $ 2,300,000 53% "B" Reps $ 3,168,000 $ 3,273,600 3% "C" Reps $ 630,000 $ 378,000-40% Total $ 5,298,000 $ 5,951,600 12% Weighted Avg per Rep $ 52,980 $ 59,516 Incremental Gross Profit (Monthly) $ 653,600 Incremental Gross Profit (Annual) $ 7,843,200 Daily Cost of Doing Nothing: $ (21,787)

30 Turnover Cost Reduce Time Spent Interviewing by Pinpointing Only "A" Potential Candidates, and Reduce the Number of People "Voluntarily" Leaving the Company Current Projected Number of Employees Avg Annual Salary $ 100,000 $ 100,000 Current Avg Annual Turnover % 15% 10% Current Number of Employees Leaving per Year Opportunity Cost # Months to Ramp-Up 3 3 Avg Revenue per Month $ 2,540,000 $ 2,540,000 Avg Monthly Gross Profit $ 52,980 $ 52,980 Annual Lost Gross Profit per Employee $ 158,940 $ 158,940 Annual Lost Profit Contribution $ 2,384,100 $ 1,589,400 Recruiting Costs Ads Postings $ 1,200 $ 1,200 Interviewing Time ($100/hr x 4 hrs x 3 candidates) $ 1,200 $ 1,200 HR Department Time $ 200 $ 200 Expenses (Travel, Drug Screen, Ref. Checks) $ 750 $ 750 Relocation $ 10,000 $ 10,000 Testing $ 5,000 $ 5,000 Orientation Time( $50/hr x 40 hrs) $ 2,000 $ 2,000 Recruiting Cost per EE $ 20,350 $ 20,350 Annual Recruiting Cost $ 305,250 $ 203,500 Compensation Salary & 30% Paid Prior to Ramp-Up $ 32,500 $ 32,500 Annual Lost Compensation $ 487,500 $ 325,000 Separation Costs Severance (2 weeks salary) $ 3,846 $ 3,846 Outplacement Fees $ 3,000 $ 3,000 Management ($100/hr x 3 hrs) $ 300 $ 300 Administrative ($50/hr x 2 hrs) $ 100 $ 100 Separation Cost per EE $ 7,246 $ 7,246 Annual Separation Cost $ 108,692 $ 72,462 Total Turnover Cost (Monthly) $ 273,795 $ 182,530 Total Turnover Cost (Annual) $ 3,285,542 $ 2,190,362 Savings from Turnover Reduction (Monthly) $ 91,265 Savings from Turnover Reduction (Annual) $ 1,095,181 Daily Cost of Doing Nothing $ (3,000)

31 Training Increase Productivity by Identifying Appropriate Candidates for a Particular Training Program (send only those who need it), and Validate or Reduce External Consultant Costs and Training Budget as Indicated Class Data Inputs Length of class (in days) 3 Number of classes per year 15 Number of students per class 10 % of students travelling from outside the local area (require airfare, per diem, etc.) 30% Number of trainers per class 2 Estimated life of the training course (in years) 3 Cost Per Student Cost Per Class Annual Class Cost Student Costs Avg student compensation (salary & benefits) $ 80,000 $ 1,021 $ 10,213 $ 153,191 Travel & Lodging per Student $ 1,100 $ 11,000 $ 165,000 Total Student Costs $ 2,121 $ 21,213 $ 318,191 Instructor/Vendor Costs Avg Inside instructor compensation $ 65,000 $ 166 $ 1,660 $ 24,894 Avg Outside Instructor Per Diem $ 1,500 $ 900 $ 9,000 $ 135,000 Total Instructor Costs $ 1,066 $ 10,660 $ 159,894 Travel & Materials Expense $ 200 $ 2,000 $ 30,000 Facility & Equipment Costs $ 524 $ 5,242 $ 78,625 Grand Total Training Delivery Cost $ 3,911 $ 39,114 $ 586,710 Incremental Value of Training % of work time students spend on tasks that use training related knowledge/skills 25% Importance of tasks using this knowledge/skill set (1=normal or typical; 2=critical; 0.1=minimal) 1 Weighted hypothetical training-related task compensation $20,000 $200,000 $3,000,000 Students' average current effectiveness at tasks related to knowledge/skills covered by this training 65% Level of effectiveness students are expected to reach resulting from training 85% Expected increase in effectiveness 31% Value added to post-training task-related compensation $6,154 $61,538 $923,077 Potential Training ROI 57% $2,242 $22,424 $336,367

32 bonuses don t rely too much on ads and recruiters careful calling references that candidates supply too much time on unnecessary phone screens avoid asking illegal questions using performance reviews that work

33 blog.peoplebest.com