Recruiting and onboarding new employees is expensive. When you factor in actual cost and resources, it can seriously burden your business which is why it’s important to make the right choice. While different research sources have typically pegged the cost of a new sales hire as somewhere around $4,000, Koru recently claimed this number is not even close to realistic.
Koru agrees $4,000 may be somewhere near the cost of recruiting, but then points out the need to consider other components.
In addition to recruiting, sales organizations need to consider the cost of:
- Lost Revenue Production (reflection of poor performer vs. high performer)
When they added in estimates for these additional points, the new cost of a bad hire was as astounding $400,000.
The cost of poor recruiting and high turnover is seriously detrimental to your business. Follow these three tips to help increase employee retention and decrease your hiring related costs.
The first way to cut down on costs associated with bad sales hires, is to improve your recruiting process.
Start by analyzing past hires and correlated performance. What did your current top performers have in common during the hiring process? Was it a rockstar interview, characteristics, or a certain type of experience or background? Using a consistent assessment system during the interview stage will help you track metrics that you can review and compare at a later date.
This data should help pinpoint exactly which attributes are most important in selecting a candidate that will be successful at your organization.
You can also involve more stakeholders in the interview process. Many organizations use peer interviewing to keep their hiring process in check because people have different takeaways when it comes to first impressions, and using a variety of individuals increases your chances of catching red flags.
Streamlined Sales Onboarding
Even the best candidates can turn into bad hires if your sales onboarding process isn’t on point. High employee retention will drastically cut down on recruiting and new hire costs, and onboarding is an important part of the equation.
Take the following steps to improve onboarding so you have a better chance of keeping the great hires that you find:
- Add mobility. Make your onboarding collateral accessible from anywhere with mobile technology. Your reps will stay more engaged with information they can interact with and reference on-the-go. Better resources give them more confidence, and a more positive job experience.
- Make it interactive. Use technology to keep onboarding engaging. Include mock demos, role-play conversations, and video recorded pitch practice to keep sales reps interested, improve retention, and build skills faster.
- Focus on culture. Training is a huge part of onboarding, but getting your new reps immersed in the culture is important too. Share your company culture and mission, and plan opportunities for social interaction to help get your new reps connected for the long haul.
Regular Professional Development
Even with great candidates and high-quality onboarding programs, way too many businesses are losing valuable hires. Stop great hires from turning into bad investments by incorporating regular, engaging professional development into your repertoire.
Professional development should be a mix of internal initiatives, like sales coaching, and external opportunities, like conferences and certifications.
Providing new hires with a road map that includes opportunities for professional development and career advancement helps them stay invested in their role at your organization, and lowers your sales rep turnover rate.
By improving your hiring process, upping your onboarding game, and investing in professional development for your team, you can stop wasting resources on bad hires and start retaining your talent.