Are Sales People Coin Operated?

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We are facing a crisis in sales retention. Average tenure for sales people and managers has plummeted to 16.5 months. As I speak to sales executives and managers about the reasons for the increasing voluntary turnover, too often, they respond,

“It’s all about compensation! Sales people are coin operated, if they have the opportunity to make more money some place else, they will go after that opportunity.”

But the data shows a completely different picture. In a Gartner survey of over 200 sales people, the following shows the top 10 reasons about why sales people leave.

Compensation is the leading reason, but only beats manager quality by 1% point. But what this chart shows is there are a lot of other reasons that cause sales people to leave or to be unhappy. People rarely leave just because of compensation, but because of a number of reasons.

Yet, somehow, too many managers ignore those reasons, choosing to do nothing about these.

The crisis in sales person retention is, in reality, a leadership problem. Managers are failing to create workplaces where people feel valued, can grow, develop, and contribute.

Focusing on compensation is irresponsible management–it both increases the costs of selling, but it fails to address the other factors that cause people to leave. Stated differently, we don’t fix the attrition problem just by fixing compensation.

There’s a lot managers can/must do to fix retention, first in their own behavior and people management skills. Then in creating work places that attract and retain the right people.

Talent will become the greatest challenge to sales performance in the coming years. We don’t fix this problem solely through the comp plan.

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Responses

  1. @david.brock great write-up! Couldn’t agree more that solving sales talent by tinkering with sales comp isn’t always the best approach.  Sales leadership is key AND for sales ops, understanding the current state of your sales talent will help us be better informed and provide sales leadership with alternative considerations beside sales comp. My recent blog post here http://bit.ly/2o2dbpQ , we need to take sales talent into account – not just for coverage, comp, and role, but for this type of dialogue as well.

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