SALES TRAINING RETURN ON INVESTMENT
Sales Training: A Million Dollar Investment
The biggest cost of sales training is the sales revenues lost while salespeople are out of the field and in training. For example, a salesperson with a $2 million annual quota may lose up to $10,000 in sales for each day he or she spends in training. Thus, if 20 salespeople spend 5 days in training, the cost to the employer can amount to $1 million in lost sales.
So, with this potential to lose significant sales volume, how can sales training provide a good return on your investment? The bottom line is that the program must be structured to produce significant results and have a high likelihood of success. Our approach, in which we address key performance issues and customize our programs based on sales best practices proven to be effective in your business, helps achieve a great return on investment (ROI). This tailored approach reduces program length and time out of the field by providing greater emphasis on proven, highly successful sales techniques while minimizing the time spent teaching lower-payback or less relevant skills. So, for example, by shortening the length of a sales training workshop from 5 days to just 3 days through customization, a $1 million loss in sales time can be reduced by almost 50%.
Training Effectiveness Monitored
We utilize a number of means to monitor training effectiveness and make any mid-course corrections needed. These methods include:
- Frequent daily and cumulative sales training class evaluations
- Optional pre and post training skills tests
- On-the-phone and in-the-field sales exercises
- Evaluated role-plays in each sales training class
- Management-initiated sales process measurements and conversion rate tracking
- Optional development and use of a sales call behavioral monitoring checklist
Benefits of Sales Process and Behavioral Measurements
- Rapid identification and correction of skills deficiencies that inhibit sales
- Improved pipeline management
- Quicker ramp up time for new hires
- Enhanced ability to pre-empt competition
- Improved sales forecasting
- Better sales training class return on investment
- Improved alignment between sales and marketing efforts
- Ability to pinpoint sales “leverage” factors
Results Vary: Sales Decline or 2900% Payback
A landmark study, conducted by the Xerox Corporation, of sales training results concluded that many sales training classes actually result in sales going down rather than up right after training occurred! Thus, the return on investment was actually negative!
However, a number of industry leaders have piloted customized sales training classes to achieve documented results. A major advocate of sales training is Motorola. Their internal studies, which have been published by the American Society for Training and Development, indicate they receive $29 in profit for each $1 invested in sales training!
Key to this high return on investment is utilizing customized sales training classes that incorporate company and industry-specific best practices, involve management in training program design and use ongling post-training coaching.
