In the last few weeks, several executives lamented losing some of their salespeople to competitors. They were upset because the originators had been courted with outrageous sums of money — an unsustainable strategy for any company’s long-term success. They wondered why their former employees did not recognize the risk and opted for short-term gains with a company that sooner or later will crash and burn due to its high expenses.
This situation is becoming commonplace as the war for talent in mortgage banking heats up. The next few years will be even harder for companies to retain their best talent. In many ways, “the chickens have come home to roost” in our industry. In my opinion, there are three reasons employees do not feel loyal to their current companies:
• The management strategy of leaving the best talent to go it alone. The thinking here is that top producers already know what they are doing and don’t need management interaction. Wrong! Top producers are the most frequently recruited because they feel ignored by management. They need to feel that they are important to the organization and should be continually solicited for their ideas and input.
• The producing manager structure has allowed individual producers to be managers who are not matched to developing originators. Typically, producing managers do not possess the core competencies to excel at coaching. Read more about this critical issue here.
• The focus on hiring “experienced” originators has lead corporate managers to believe they do not need to provide additional sales training. Most companies do not have training in place to help producers improve their sales skills. Failure to commit to ongoing training leaves employees feeling they are not learning and progressing in their careers. With no development, originators are in a dead-end job justified only by the money.
How can companies prevent poaching of their originators? A recent Harvard Business Review article recommended these tactics to safeguard sales talent:
• Watch for signals. There is always a trigger event that makes an employee unhappy. Many times, it is how changes are rolled out that can cause problems. Changes need to be thought through before being announced. Companies should ask themselves: How will they be introducing changes? Conference calls are not always the best way.
• Personalized retention plans. Keeping your best employees should be an ongoing effort by senior management. When was your value proposition last updated? Have you mystery shopped your own employees to know what they are thinking about their manager and the company? This is not done enough. Weak or ineffective managers need to be addressed. Employees say they leave for more money but the real reason is always something else, most notably, the quality of their direct manager.
• Keep it in perspective. While some amount of turnover is to be expected, it is critical for companies to have new players on the bench ready to replace salespeople who leave. Just as sports teams lose players to free agency, smart companies have new employees in the wings to take their place. Rookie programs are a key solution set to this issue.
Have you put a succession plan in place for your sales organization? Call me to discuss.