Why do SalesPeople Leave?
As always, salespeople remain fickle about the companies they work for, but the reasons why they leave have changed. According to Compensation Resources, Inc. (CRI), a compensation and human resource consulting firm, the average voluntary turnover rate in sales is 15.9 percent, higher than the 14.3 average turnover rate for all jobs in 12 industries surveyed. CRI obtained turnover statistics and trends from a broad range of industries and company sizes. The results indicate that both voluntary turnover and overall turnover have slightly increased in 2006 over 2004 when the last data were collected.
The Hay Group, a Philadelphia-based management consulting company, had similar findings. After surveying about one million employees at 330 companies in 50 countries, they found that the employees "least committed to a company are its salespeople, 38 percent of whom planned to leave within two years.”
This isn't surprising news to many sales organizations; however, CRI reports that the survey identified an important shift in the motivators for leaving noted by employees. In 2004, the top reasons for moving on were better pay and better benefits. In 2006, the top reasons for leaving an employer is the desire for better opportunities and increased responsibilities. "More and more, employees are seeking to improve their abilities and be recognized for their work, and are no longer motivated by pay alone," says a CRI spokesperson.
Mary Delaney, chief sales officer at CareerBuilder.com, the nation's largest online job site, agrees. "Sales has always been a high-turnover job because salespeople are self -starters and independent," she says. "Salespeople love recognition and challenge and the grass is always greener on the other side. The minute we forget to recognize them, compensate them, and make work interesting, they'll look elsewhere."
Companies will also see an increase in the cost of sales turnover. Employers will spend big money for recruiting and training, not to mention lost productivity. To see just how much you can lose on sales team turnover, many recruiting firms such as Headway Corporate Resources, a full-service human resources support company, provide turnover cost calculators. Visit www.headwaycorp.com/employers/turnover.php for an example.
Once you've entered the realm of reality on turnover rates and costs, you may wonder how to alleviate loss. If, according to the CRI study, people are looking for better opportunities and more responsibility, companies are advised to focus closely on promoting from within. However, instead of blindly promoting, organizations need to make sure the employee and the position are the right fit by conducting objective assessments. Headway, along with many human resource and recruiting firms, also stands by its firm belief that in-depth testing and screening before hiring will help reduce turnover.
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