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Hire Smart to Increase Profits

By Dan Kohl

Wall Street continues to increase earnings expectations for companies that have usually already downsized, right-sized, or
re-engineered more than once over the last decade. Consequently, most companies are placing increasingly heavy performance
expectations on their remaining employees at a pace exceeding anything that has ever occurred since the industrial revolution.

The result of such often heavy-handed performance demands is high turnover, increased stress, absenteeism, lowered morale,
litigations, frequent disciplinary needs and even sabotage or theft. The hidden cost of just replacing a $36,000 dollar a year
employee is $11,700 according to the Saratoga Institute, a nationally recognized organization that benchmarks HR practices in the USA.

A Phoenix, Arizona branch of a national health care company found itself in just such a costly no-win situation. Faced with an over
100% turnover rate within the sixty member HMO sales force and ever decreasing sales in one of the most competitive markets in
the nation, it was in trouble. The company took action by hiring one of the top Sales Director in the company from a distant state,
moving him and his family to Arizona to solve the problem.

The new Sales Director had over seven years of experience with the company and had earned his "top gun" status by functioning
under one firm belief that he had learned decades earlier from a mentor. The conviction is that profitable sales growth can only
be achieved through a strong foundation of motivated, skilled and dedicated employees.

During efforts to implement his proven practices he found himself essentially thwarted at every turn. He learned, for example, that
his competitors provided salaries and benefits to their sales force and he found himself in a position where he could only have a
commissioned sales force. Prospective employees were looking for salary and benefits since the company was a noted health care
provider.

Unabashed, he worked long hours hiring, training, reviewing, extolling and hand-holding the sales people. He had some success, but
not to the levels he had previously achieved, partly because of the endemic low morale and motivation of the sales force.

Finally, the beleaguered Sales Manager put to use some relatively new technologies that enabled him to:

• Double productivity resulting in the top:
  • Sales Month
  • Sales Quarter
  • Sales Year

• Beat the highest production record for his branch

• Achieve the best company wide sales record per sales person in the Nation in competitive markets.

• Reduce the sales staff by 55 percent (from 60 to 28 people) while:

• Reversing the 80/20 sales rule with 80 percent of his sales force becoming top performers.

• Increase average per person sales from a previous high of 17 to an average of 34 per month.

• Hire a Top Performer 75 percent of the time

• Eliminate the vicious cycle of recruiting, interviewing, training and monitoring through a significant reduction in employee turnover

• Establish a climate of trust in the workplace resulting in:
  • Improved morale
  • Expanded motivation
  • Positive attitudes
  • Higher performance standards and norms

• Create time to develop new initiatives for lead generation providing more quality sales calls for the staff

• Gained a strategic competitive advantage