D&M 005: To train or fire poor performing sales people

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  1. In this session of the Dan and Matt Podcast we discuss the controversial topic of whether to train or fire poor preforming sales people. Daniele Lima explains his three prong approach to reengage struggling sales performers and Matthew explains the positives of keeping their heads off the proverbial chopping block.

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1.Free Video’s From Dan and Matt?-?https://www.danandmatt.com/free

Transcript:

Matt: Hi and welcome to the Dan and Matt podcast, and today our fifth episode, we’re going to be discussing the important topic of whether to train or fire poor performing sales people. ?And as always, I have with me as always, Daniele Lima.

Dan: ?Good morning everyone and welcome.’

Matt: ?Now obviously the topic of to train or fire poor sales people is definitely a topical one. ?I know for myself I’ve spent at least four or five podcasts in the last few months discussing this topic. Daniel, why do you think this is such a hot topic at the moment?

Dan: ?Look Matt, it’s because essentially your most important resource as it’s always been has been human resource and for example if you’re a sales manager or director, it is absolutely vital that you keep, not only the best sales people on board, but the team that you’ve got in place. You’ve got to keep it firing on all cylinders and optimised for optimal performance.

Matt: ?Definitely, definitely. ?And look from my point of view, I think that there has to be a line though. ?I mean, a lot of people say, “Look, just fire sales people. ?Sales people, there is a natural ability and if they don’t have it, you should just get rid of them and work with the people that can sell.” ?What do you think there?

Dan: ?Look I think that’s easy to say and certainly if you’re starting a team from scratch, you’ve got the luxury of hand picking the best that are available. ?But for a lot of people, Matt, as you know, you become a sales manager, you go into an existing situation where you may inherit a team of 10, 15, 20 people and it’s not so easy to do. ?You’ve really, the onus is on you to perform a gap?analysis on each of those people and really help them come up to the mark if they’re not already there.

Matt: ?Look, I’m with you and I keep getting asked this question, I mean it’s a topic that we talk about on the danandmatt.com program that we have available at the moment on sales and niche marketing. ?That so many people think that sales is a natural ability and if they don’t have them, they ship the people out. ?But you’re right, there needs to be a gap?analysis, you need to work out whether or not that person is A committed, and I think committed is a very important fact to learning the concepts of sales. ?But secondly, that they have a, I guess some sort of skill set that they want to adapt. ?As in, they understand that there is a hole, a concept that they don’t know and they actually have a want to fix that.?I think those are the two important qualities – the willingness to move forward and achieve and perform better. ?And then secondly, their understanding that they aren’t achieving now and that it’s just a gap, it’s not a failure in ability. ?And I think Dan, you’ve got a very good step process on, I guess unfreezing a person to that specific I guess problem.

Dan: Yeah look I think you’ve really captured that perfectly, because as you know in a former life I was a national sales manager for a major pharmaceutical company, Bristol Myers. ?And it’s incumbent on all of us who have got that sort of a role to work people through this process. ?Matt, before I go into that three step process, I really want to just establish two important terms that we need to have to work with.

One of those terms is coaching. ?Now, if you’re improving someone’s skill set, they’ve got to be coachable. ?And what I mean by that is, they acknowledge, “Yes, look I – there’s a skill here or a number of skills that I don’t do well, I understand I need to do them well to do the job effectively and I want to learn.” ?So if someone as you’ve hinted ticks all those boxes, in my book they’re coachable. ?You can actually help them to get better.

On the other hand, if someone says to you, “No, I don’t believe I need that skill,” Or, “Yes, look I know I need that skill but I don’t want it.” ?Then, they’re not coachable. And unfortunately, when they’re not coachable, we go into another camp of counselling. ?And I think we’ve really got to differentiate these two camps because if someone’s in the coaching camp, certainly you can train them and you can make them better and hopefully you keep them. ?But if they’re not willing and able to do it, then they’re in a counselling camp and unfortunately Matt, as we know, you’ve got to start managing them out of the company based on failure to meet the basic KPI’s.

Matt: ?Now, I think at this point it’s important to recognise that what we’re specifically saying here is that there will be a group of people that do want to make a change and that do want to get better.

Dan: ?Absolutely.

Matt: ?On the other camp, there will be a group of people that don’t want to or don’t see the purpose or don’t see it as achievable. ?And for these people, normally the process would be to cut and run with these people, call what you’ve spent on them thus far sunk costs and fire them all or just stop their employment and move on, hire somebody else. ?However, this person generally has a lot of core competencies and a lot of knowledge about your company. ?So if it’s save-able, why not at first try? ?And the response will generally come that they don’t want to learn. ?And before we look at moving them out, we need to try this three step counselling process that Daniele will now run you though. ?Which the purpose is to get the person to become on board, with the idea that first change is possible and secondly, they want it.

Dan: ?Absolutely. ?And Matt, let’s assume we’re sitting down with a representative, we’ll call them Fred or Helen, any fictional name. ?And when we sit down with them, and remember to any aspiring sales managers or current managers, when we’re talking to anyone about performance, it’s vital, it’s imperative that we only talk about actual behaviours, because actual behaviours are things that we’re seeing and hearing, and they’re the things we need to comment on. ?And that’s just as a matter of law, they’re the things we need to review with this person.

But understanding that we’re sitting down with Fred the rep. ?And we’d say, “Fred, the reason we’re here is because you are not meeting this KPI. ?This behaviour or set of behaviours that we said initially was vital to the success of your role. ?So these behaviours you’re not doing.” ?Now at this point if Fred said, “Well I don’t believe that’s important,” or, “For whatever reason, I don’t choose to do it.” ?Then here are the three steps Matt that you’ve suggested. ?Number one, you would talk to that person about the impact these behaviours are having on their own outcome in this firm.

Matt: ?So Dan, I just want to clarify here, it’s not the purpose to then say straightaway, “Well this is affecting me.” ?And I can assume for an employer, especially for a person that’s giving up perhaps their own meal on the table to make sure that the employee can go home and feed their family, this would be quite an emotional thing. ?So, would require a little bit of self-regulation to make sure that they handle talking about the person first. ?So what’s the motivation with talking about how it affects, what’s the impact on the employee first?

Dan: ?Yeah, look good point and you’ve made two good points there, the fact is as managers, you mentioned self-regulation, which of course is a critical aspect of emotional intelligence, that self-control. ?And really one of the must have qualities of any manager is that ability to have that awareness of how they’re feeling in what could be a very tense situation. ?And as you’ve said, regulate their behaviour. ?So I just wanted to highlight that, because I think that’s critical in any of these discussions.

But then to answer your question directly, why are we stuck starting with the employee, simply because many people, their primary focus is specifically that – how is this going to impact me? ?So if this person is primarily focused on, well we call it self-interest, then it’s the most logical place to start. ?”That Fred or Helen, if you continue to pursue this line, this is going to be the impact on you.” ?And that might be something as mandatory as a first warning, “That you’re in breach of the KPI’s that we’ve agreed on, and there’s a first official warning against you.” ?So that’s very powerful and I’ve got to tell you Matt, that I’d say probably three quarters of people, when faced with that tend to come straight back into coaching mode. Because they start to realise the gravity of the situation and they say, “Well, have I misjudged this?” ?And generally three out of four will step straight back into, “Ok, what do I need to do, coach?”

Matt: ?So I think the important thing to point out here about this step is that a lot of people, at least the people that I coach, frequently say, I understand that if I address them and tell them about the impacts, I’m almost playing police officer here, and they may say, “Yeah, now I’m really interested and I want to learn.” ?But are they really telling me the truth? Or are they going to go home and say, “That person, they’re really pressuring me, I don’t really see the point, but I had to say I was interested because otherwise I was probably going to lose my job.

Dan: ?Well, that possibility exists but that’s why we need to set up ongoing KPI’s that we review regularly, because this person has to understand that they’re on thin ice. ?And I’ve got to pre-empt Matt by saying that especially if this person’s a fairly new employee to a company, where typically they’re on a six month probationary period, it becomes a lot easier to move someone on if they’re within that time frame. ?So, I think it’s very important that the person understands through all of these discussions that we’re not just testing the water here, this is what’s going to happen if we don’t straighten up and fly straight.

Matt: ?I think it’s also that in a lot of cases and yeah you’re right, in some cases, sometimes more so than others, people will say, “Yes I understand, I’ve got to go with what you’re saying here,” ?and then go home disgruntled none the less. ?But people are innately wanting to achieve in the business forum or in their workplace. ?They don’t just, although some people do, a lot of people – most people in fact, want to achieve and want to be successful at what they do. ?They spend 40 hours, a large percentage of their awake time, sometimes more than 40 hours, working in a business. ?To have that being unsuccessful is not what they want. ?So, sometimes it’s a required motivation, to get people going in the right direction, just needs to be, A – explaining the impact, and then doing it in a way that you believe in them.

I mean, you clearly hired them for a reason and I’m a big believer and I say this quite frequently. ?No one hires somebody for the reason of getting rid of them. I mean, staff sometimes say, “Oh my, boss is trying to get rid of me.” ?Well no, we hire staff because we want them, we believe that they’re going to make our lives easier and better. ?And sometimes those just understanding that will allow them to realise that you originally believed in them, something has happened to cause you to not believe in them, and that will have an impact on them personally. ?And as a result, you still want to believe in them, but they need to create action and take on perhaps coaching now to be able to get the outcomes that you’d desired for them originally.

Dan: Yeah, totally. They’ve got to understand that there’s a gap there and that gap cannot be left unfilled and that’s the bottom line.

Matt: ?Look, I agree with you and that’s the first part. ?Most people are predominately motivated by self. ?So talking about the impact on them is very, very important. ?However, there are also a large group of people that are motivated by the success of the organisation they’re working in. ?Which brings us into the second step Daniele, which I’ll let you talk about.

Dan: ?Yeah, absolutely and as you’ve said, for some people, almost counter-intuitively aren’t going to accept that first point of reference to say, “Look this is going to adversely affect you.” ?And they’re going to say, “Yeah, look I’m not interested, I don’t agree that I need to do this thing that you’re saying I need to.” ?So at that point, the second level of discussion is to discuss the impact on the business itself that, “Ok look if you don’t do this, apart from putting yourself at risk, you’re actually hurting the company and its chances of achieving what it’s trying to achieve in the marketplace. ?And as you said, a lot of people understandably do have pride in their workplace and the company that they’ve potentially represented for many years. ?And of that 25% that didn’t come across the coaching with the first line of attack, I’d say that about another 10% will say, “Yeah, ok you’re right. ?This company’s done a lot for me, I do owe it. ?Although I’m probably not totally convinced that this is an important skill, I’ve got enough faith in you and belief in the firm to give it a go.”

So, as you said, it might not be a perfect motivation, but they say, “Ok,” and they come back into coaching. ?But that’s good enough, because at that point you can start training them with the right approach, so we get them at that level.

Matt: Now there is a delicate balancing act to making sure the business doesn’t seem as unstable as a result of poor sales, potentially. ?So when you’re dealing with staff that have a portion of their job dedicated to sales and then other staff that have their sole purpose is sales. ?Talking about the organisational goals are one thing and you need to talk about the fact – people follow football teams and people will sometimes do more for their football team or more for their community group than they would for themselves. ?And these people are motivated by helping others. ?So talking about that really helps.

Dan: ?Yeah, that’s a great point, it really is Matt. ?That especially when you capture it like that, because when you follow a football team or a sports team, because you’ve got passion for the organisation, and I think that’s a really good point. ?That in some cases you may be more likely to do the right thing for someone other than yourself.

Matt: ?And I do talk about community for one other reason, and obviously a sporting team is about following the company or the business that you have decided to dedicate yourself to. Sometimes you’ve just decided, which means you believe in them to take you to your next step. ?Or secondly, you’ve been with them for a long time, therefore you have a commitment. ?And the reason why I talk about community as well, which brings us into step three Daniel, is a lot of times, people may not value the business that they work for as much as they do the staff that they work with, their colleagues. ?The inter-relation and the community dynamic they have with perhaps the administration team or the sales group or the friends that they perhaps work with but also maybe catch up for a beer with after work sometimes and would hate to see anything happen to them due to their poor performance.

Dan: ?Yeah, you’re spot on that’s why that’s really a powerful third card to play. ?That once they’ve said, “Look, I’m not really fussed by the impact on me, I’m not really fussed by the impact on the company.” ?Then that third one that you’ve pre-empted is also very powerful. ?”Well, Bill or Helen, Fred. ?What about the impact on your colleagues, your team mates? ?Do you realise that if you don’t perform this behaviour, do this thing that’s critical to your role, it’s going to affect the ability of all your team mates to meet their targets, to achieve their incentives etc. ?And it’s going to have a profound impact on their situation and potentially their lives. ?And again, most – I would say yeah most, I’ll leave that word – will have some degree of concern about that.

And I’ve got to say that those people that I’ve sat down with in this scenario, that said, “No, not interested the first thing, not interested in the second thing.” ?They’ve pretty much all been grabbed by that third prong. ?Where they’ve said, “Ok, yeah I don’t want to hurt anyone else’s chances of having success.” ?And that’s actually been a very powerful motivator in bringing them back into the coaching realm.

Matt: ?Yeah look, I’m definitely with you and I think that as a result of going through those three steps, you work out whether or not you have a person that you can coach, or you have a person that you need to move on. ?If you can see after that, that you get a buy in, a motivation to improve, then you know that that person’s worth spending your time on. ?As I said, you’ve already spent a lot of time working on them, so as a result of that, you know that it is of more of a benefit to train then to get rid of, as long as they’re on board. ?And once, as a result of this conversation – you either have party A that wants to improve anyway and is willing to go the extra mile and will bleed to become a sales person that you want them to be. ?You then have party B that doesn’t perhaps want to, and as a result of this conversation realises that they need to dedicate themselves. ?And as a result of that, then we’ll go the extra mile for training. ?And then obviously party C that you’re going to move on.

And obviously what I want to do know is focus on, I guess that the training versus the moving on rule, because I can see a lot of people saying, and it’s a well-known rule – the 80/20 rule and that a lot of people say that 80% of your income comes from 20% of your staff. ?So why wouldn’t you just fire if you’ve got ten sales people, fire eight of them. ?Or if you’ve got five sales people, fire four of them and all of a sudden you’re going to be making substantially more profit. ?And that is true in the short term, and I guess the reason why I say it, think about this with caution. ?And while the concept seems lovely, if you only have one or two sales people generating your entire income, there is an innate problem with that.

Who actually owns the business from that point onwards? ?Do you or do your sales team? ?If your whole income is dependent on one or two people and those sales people know that, they’re not replaceable, they start to have control of your business. ?They choose their own hours, they ask for additional income and all of a sudden, the business that you work hours for, and that you created, you become almost the sales people’s admin person, because you’re dependent on them. ?And that is the last thing you want to be.

So obviously I’m talking about extreme circumstances of firing all of the people that aren’t succeeding as much as the best two or three or five or even one sales person. ?But what I would suggest is that you go through the process of A – identifying people within your business that want to do better. ?And B – identifying the people that don’t recognise that they need to and follow the three step process of explaining the impact on them, the impact on your business and the impact on their colleagues if they don’t got the extra mile.

And those two groups of people that then decide they’re willing to go the extra mile, spend time modeling your best sales person and the Dan and Matt program talks about the process of scripting everything your best sales person does, modeling what works for them. ?And then training that to your less performing sales people. ?And look, I’ve had many successful businesses and I constantly work on the process of scripting a sale. ?And surprisingly how easy it is to script the best sales person. ?All you do is record a few of their sales pitches, write it down – transcribe it, and add in the portions that came out from the other sales calls that you’ve recorded. ?And give that to the poorer performing sales people to learn verbatim.

The people who go the extra mile will actually dedicate themselves to learning it. ?I mean, sometimes you’ll find that you’ll be like, “That’s 10 to 12 pages, why would anybody learn that?” ?The people that want to learn will put in the effort, they’ll spend the time learning. ?The people that don’t will go by the wayside. ?I mean, it is possible to do it that way, I mean you go to a Shakespeare performance, it’s more than 10 or 12 pages of text. ?You just break it down into chapters, and there’s a great video if you go to danandmatt.com/free, you’ll be able to gain access to a video, the second video on the free videos that are there actually breaks down the sales process. ?And you’ll be able to break the entire sales process into seven steps. ?And as a result of doing those seven steps with the modeling process, you’ll be then able to download it to your poorer performing sales people. ?To the point where you should be able to say, “Read chapter six to me, read chapter three to me.” ?And they should be able to do it verbatim.

I would keep them in office until they knew how to do it back to front and then send them out with that new skill set. ?All of that extra knowledge, just the ability to have all of that extra knowledge should make a substantial difference. ?But you’ve also allowed them to show their buy in and the fact that they really want to succeed. ?And if they won’t do that, then again you can go through the three step process, perhaps you can work on it a little bit more, or maybe those people are just not trainable, or not trainable within your business for what you are trying to achieve. ?I would still go through all of that before you move a person on. ?Because it only takes about a week to model an entire sales pitch. ?It takes maybe a week more for the next person to learn it.

And for a week or two investment, it can make all the difference. ?To A, have really strong sales people and B, ensuring that those people are just as committed to you as you are to them. ?Because they’re going to remember that you spent all of this extra time helping them to achieve the goal, and while the shining star sales people, the 20% could sell for anybody and go anywhere with their skill set that they had when they first came to your business, the 80% or the 60% perhaps that survive that level of intensive training, will always know that they owe their success to you. ?And that will create loyalty and a business that grows beyond the sales of two or three people. ?It becomes a business that perhaps you can set up for sale, and a business that has a lifeblood of it’s own, rather than just a couple of sales people and you.

Dan: Yeah, I totally agree with that Matt and can I lay a seed here that one of the, I guess, reasons why people decide, “Look, no this is not important,” is because they’re embarrassed to say they don’t know how to do something. And I think for those that do eventually hop on the coaching boat, that get the extra training and skill set, they become inherently more motivated because they become empowered to do well in the role. ?And as you’ve said, they realise, “Well, there’s a definite debt here – that this person helped pull me out of a bad situation.” ?So I totally agree with that.

Matt: ?Exactly right, and if the person ever starts to fall off the bandwagon ever again, explaining – going through that three step process once they know that you’ll put that level of effort into them. ?When you start talking about the impact on the business, they’ll really get behind that. ?So with that guys, I’d really like to thank you for tuning in again to the Dan and Matt podcast. ?You can find us on Twitter under @danandmatthew or on Facebook under Dan and Matt. ?Or if you have any questions or things you’d like us to talk about, go to the danandmatt.com website, go to the “contact us” page and list your question or query on there.

The other thing I’d really urge you to do is have a look at the free videos on danandmatt.com/free. ?Especially for this episode, the second video that’s there because I think you’ll find it really helpful if you choose to go down the sales scripting process. ?To model your best performers to help your least performing sales people. ?Thanks again.

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