The business case for good employee onboarding is nowhere more glaring than in the sales organization. Companies spend more to hire talent in sales than in any other part of the organization and also experience some of the highest turnover rates (25% to 30% annually). When a seller leaves, the departure can cost a company between $75K to $300K each year, before considering lost revenue (Cespedes/Weinfurter, HBR). After hiring a replacement, it takes an additional three to six months for a sales rep to become productive.
Benefits of Good Onboarding
Experts agree that a well-executed onboarding program can reduce risk, accelerate the path to productivity, and reduce attrition. CEB research on sales onboarding tells us that engaged employees are 9 times less likely to leave, and effective onboarding programs have the potential to increase employee performance by 15%. Research by Glassdoor found that organizations with a strong onboarding process improve new hire retention by 82 percent and productivity by over 70 percent.
The increasing business complexity and high demands we place on our sellers compound the problem. Today’s sellers are expected to:
- Lead with insights, not just product knowledge, to persuade increasingly savvy buyers,
- Navigate complicated portfolios of products and services, and
- Influence others internally to help drive results in complex, matrixed organizations.
Onboarding: More Than A Checklist
Developing an inventory of all the necessary sales processes and tools a new hire needs to know is an important first step, but you can’t stop there. The most progressive organizations know that a checklist is not onboarding. Rather, onboarding is an experience and a vital opportunity to introduce your new hire to your sales culture and set them up for long-term success.
Establishing desired outcomes and milestones for your onboarding program is crucial. We define onboarding success across the following five C’s:
- Clarity: Clear on role and responsibilities, goals for the year, and key objectives
- Connected: Access to tools, peers, and leadership
- Comprehension: Knowledge of products and services, sales methodology, and activities
- Confidence: Application of products, sales methodology, activities, and tools
- Contributing: Able member of the sales team and contributes with knowledge, skills, and insights
Design your onboarding program to support these milestones and take into account that the journey may not always be linear or without setbacks.
Crawl, Walk, Run
We recommend remaining sensitive to the overwhelming nature of those first three to six months. When designing your sales onboarding program, consider it your charter to not only help the new hires learn as much as possible, but also to ensure they are focused on the most relevant content to their role, team, and region. Inundating them with too much too early can backfire and erode the benefits of your onboarding program design.
Many of our clients look at their sales onboarding implementation in terms of crawl-walk-run. We like the idea that you can test and learn over a period of time as you work towards an end-state vision versus a big-bang approach. Defining these phases within your onboarding program will help you to frame your implementation:
- Crawl: Some may view it as a significant win to develop a sales onboarding checklist. This is a great place to start, but don’t stop there.
- Walk: As early as possible, consider the seller experience and key milestones you need them to hit to be successful. We've listed some of them above.
- Run: Technology-enabled sales onboarding is the final wrapper to a comprehensive program which is a must-have to remote and/or globally distributed sales forces.
Virtual Sales Onboarding
Not surprisingly, providers of sales technologies have written a lot recently about how to effectively onboard sellers in a virtual environment. Refer to Brainshark's 5 Tips to Create a Virtual Sales Onboarding Program.
Our colleague Rachel Cavallo has also written about fundamentals of effective virtual selling in our post 9 Steps to Improving Your Virtual Sales Calls: For a "Better Normal" and Building Trust and Customer Relationships in a Virtual Environment.
What You Get When You Get It Right
- Improved job performance: Employee performance can be improved with effective onboarding programs by 11.5%
- Higher employee retention: Department of Labor states that employee retention can be greatly improved with effective onboarding programs
- Greater revenue growth and profit margin: The most progressive organizations see 2.5x revenue growth and 1.9x profit margin over the least progressive organizations when they structure onboarding for new hires
A robust, targeted sales onboarding program is an opportunity for tremendous cost savings, better employee engagement, and faster ramp to revenue. Stay tuned for our Sales Onboarding Checklist to help validate that your onboarding program is hitting the mark.
Editor's Note: This blog was originally published January 2017 and has since been reviewed and updated for accuracy and comprehensiveness.