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Don’t
Rush to Fire That Underperformer
Article 8
What is generally the first thing a sales manager wants to do when a salesperson is not performing? If the manager works for a small or medium-size company, he or she normally wants to fire the rep. A sales manager at a larger corporation might want to put the salesperson on a performance plan before deciding to terminate. But here is a question that few sales managers ever really consider: How much will it cost to get rid of the person? I caution my
clients to think through the impact of the whole firing process before
they make a decision. As a sales manager, you need to consider the consequences
of your action and possible alternatives. * Your company could be faced with severance pay, an increase in unemployment insurance—even litigation. * You will have to expend the cost and effort of hiring a replacement salesperson. * Your company will have the additional cost of training that new salesperson. * You risk lost business and revenue. Do you know how much business was in the fired rep’s pipeline—business that will fall through the cracks if you don’t know about it? How much revenue will your company lose as a result of having a nonproducing territory in the three to nine months it takes to get the new rep up to speed? Studies show
that on average, it costs a company $25,000 to hire the wrong person—for
any position. That finding serves to underscore the importance of hiring
the right person for the position in the first place. But just because
a person isn’t performing up to par doesn’t mean he or she is
a bad salesperson. There could be a hundred reasons for the rep’s
lackluster performance. In fact, you could be the reason the salesperson
isn’t performing. You might have the right person and just not know
it. You might have the rep miscast in the wrong type of territory or dealing
with the wrong type of customer. As a manager you can do several things to improve your people’s performance: * Carefully screen and interview sales candidates to help you make the best hiring decisions in the first place. * Do a job-fit analysis of all your salespeople to ensure that each rep is in the position or territory that best matches his or her personality and abilities. * Spend more time working with and coaching the underperforming rep. * Manage your people as individuals. Even minor adaptations in your management style can help you get maximum performance from each of your salespeople. * Bring in an experienced sales consultant to give you an unbiased assessment of the underperforming rep and to supply an action plan for making the person successful. DON’T
RUSH TO FIRE
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By
Terry Booton, President