ABSTRACT
In an effort to address these questions, Chally studied salesperson performance data over four years from a leading financial services provider. The average annual sales per sales representative was nearly $1.1 million. However, performance across the sales force was highly variable, with poor hires averaging about $300,000 in annual sales. Thus, if the company had hired an “average” salesperson instead of a poor performer, it would have generated almost $800,000 in additional sales. Multiply this figure by the number of below average performers and the number of years a salesperson is expected to stay with the company, and it becomes apparent that avoiding hiring mistakes can dramatically increase profitability. Each time a territory is filled with a poor performer, the company loses a great deal of potential revenue.
