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Beware of Hiring Your Competitor’s Salespeople

by Jun 3, 2009, 5:13 am ET

Hiring salespeople from the competition always seems like a no-brainer, but there are many pitfalls with this hiring strategy.

Life would be grand if we could sprinkle a few seeds in the ground, fertilize, add water … and a great salesperson would sprout. This is truly a pipedream, but one often pursued by small business owners and sales management executives in their quest to find great sales talent. Rather than grow their own, they attempt to steal the crops from their competitors. Why not — their competitor is much better at growing a sales organization than they are. They will grab some magic from their competitor’s land and they too can enjoy great success.

When did the competition begin building a better sales organization than your company? Before you harvest their crop, consider these five myths when hiring your competitor’s salespeople.

“Hiring from the competitor means the salesperson will hit the ground running with no training.” Some of the attraction to the competitors’ salespeople is sheer laziness. Hire a salesperson from the competitor today … instant revenue tomorrow. No need to train them; they already know everything. Needless to say, this is flawed thinking. Salespeople always need training and development regardless of who their former employer was.

That said, every once in a while, lightning will strike and you will hire a rainmaker. More often than not, this approach is a recipe for a making a bad hire. A thought: What salespeople do you really think are available from the competition? Rarely is it the top performers. It’s the bottom 20% that, truth be told, the company is glad to see leave.

“Our industry is so complex that we must hire a salesperson from within it.” How can this be true? No one ever came out of the womb mastering your industry — not even you. You were taught it and so was everyone else. If you truly feel that industry experience is the top requirement, be prepared for another major challenge: scalability. There are only so many people in your industry and very few that you will consider hiring. At some point, your talent pool will run dry.

Salespeople need to have a certain level of knowledge to effectively sell in an industry. Determine what they need to know to be effective and develop training tools to quickly get them up to speed. Identify resources in your company that can help them with their questions. Test their knowledge assimilation along the way to make sure they are getting it.

“They’re going to bring a book of business with them.” Before you buy that argument, consider these three points. First, despite what they tell you, it is extremely difficult to move clients. The pain of change is not one that is easily resolved with clients. It is rare to find a salesperson with that strong of an influence to overcome that issue.

Second, the salesperson doesn’t own those clients; their employer does. While non-competes don’t usually hold up in court, client list protection does. And, you can be at risk in the mess. Do you really need that headache?

Third, don’t think for a minute that the salesperson you hire today will one day retire with your firm. They will leave your employ some day. Imagine your salesperson attempting to take your clients with them when they go. It doesn’t feel overly ethical, does it? And, it’s a flawed reason to hire a salesperson.

“We’re a little firm and we could really use a salesperson who comes from one of our large competitors.” This statement is true if, and only if, your company and the large competitor are identical twins. A synergistic match between your company and the candidate is needed to put together a long-lasting sales marriage. There are a number of nuances that affect this synergy.

The flaw with this statement is that it assumes a complete sales culture match. Every sales organization is different, even within the same industry. The large competitor may have a ton of sales support for prospecting and presentations, while in your company the entire burden is on the salesperson. The salesperson at the competitor may enjoy great name recognition in the marketplace while you do not. Thus, a different skill set is needed to get in the door with prospects. The list goes on and on. The key is develop a profile of your ideal sales candidate with the required and desired attributes and interview accordingly.

“Since they have been in the industry, they are passionate about it, and passion sells.” Absolutely true! Passion sells, but it’s an incorrect assumption that these salespeople arrive with passion. Salespeople who bounce from company to company in an industry become “vanilla.”

Years ago, I had a salesperson on my team who had sold for three of our competitors prior to joining our company. I participated in a ride-along sales call with her, and the meeting was interesting to say the least. She could have had any of her former employer’s business cards in her hand, or ours for that matter, and everything she said was accurate. There was no passion. It was all vanilla information that failed to arouse any excitement in the prospect.

Sales hiring is daunting for companies of all sizes. The key is to have a profile of your ideal sales candidate and interview the prospects against it. This will help you find the right sales talent for your team whether they worked for your competitor or not. Need help interviewing sales candidates? Send me an email for my 28 favorite interview questions for sales candidates.

This article is provided for informational purposes only and is not intended to offer specific legal advice. You should consult your legal counsel regarding any threatened or pending litigation.

  • Nick Fishman

    Brilliant article Lee. I think you nailed every aspect of this issue. Hiring “experienced” sales people from within the industry always appears to be “The Holy Grail”. We find that more often than not, it doesn’t bring as much success.

  • Lisa Barrera-Vaporis

    Thank you so much for posting this! This has been our current strategy and I don’t think it is working. Hopefully, this article helps me plead my case.

  • Kevin Morris

    I love this article Lee. Excellent article.

  • Todd Raphael

    Lee – does it ever depend on the scope/size of the industry? If you have a field that’s relatively small and very niche, where everyone knows everyone … can it be more advantageous to hire an insider, not because an outsider can’t understand the technology and industry, but because tighter-knit communities are harder to break into?

  • http://www.SalesArchitecture.com Lee Salz

    Thanks for the question, Todd

    While I can appreciate the scope/size issue, it doesn’t supersede the importance of ensuring the candidate meets the key criteria of your ideal candidate profile. All of the aforementioned ramifications can result if you hire strictly because they worked for a competitor.

  • Ross Clennett

    Spot on, Lee. You articulate accurately what I hear consistently from recruitment agencies with respect to hiring a recruiter from a competitor. Mostly it ends in tears because at least one of the myths you outline does not translate into fact after the hire has been made.

    Even thought you didn’t state this I believe you have listed the myths in their order of ‘most commonly stated and believed by hiring sales managers’. Great stuff.

  • John Smith

    Spot on! There is also the credibility issue, if you have been selling your client a product or service because it “is the best”, and then come back to them representing the leading competitor because “it is the best”, what message is that sending to the client?

    It’s a lot easier to train a new employee than it is to re-program someone that came from a leading competitor.

  • Howard Adamsky

    This is such a good article.

    Lee is a very smart guy. His style is so engaging and his content is right on the money. I need to get some writing lessons from Lee.

  • http://www.completecolour.com.au Geoff Lawyer

    A very good article by Lee, I have made many of these mistakes over the years, however I believe employing a “Sales Professional” from outside the industry will adapt and come into your business without any encumbrances, as such they are easier to train!

  • Robert John

    Outstanding article, Lee. Being a recruiter in a tight niche market, and in one that I personally spent over 19 years, I always get the ‘find a person from within the industry’. Honestly, I have prided myself (and have been successful) on only recruiting from within my industry.

    However, I can see the benefits for hiring outside. Again, that being stated, trying to sell that to clients is very difficult.

    Also, right on with the ‘bringing the book of business’ with them. If I had a nickel…

  • Rashica Ward

    Great article!

    As a recruiter I would certainly be interested in your 28 favorite interview questions for sales candidates. My email is rward@wardrecruitingconnections.com.

  • http://www.findnewcustomers.net Jeff Ogden

    Amen, Lee. I had an experience a few years ago that goes right to the heart of this article.

    We had three salespeople work the global GE account:
    1) The experienced rep who handled GE in the past.
    2) A brand new rep who never handled GE.
    3) The GE rep from our #1 competitor.

    All three did the job, and one dramatically outperformed the other two. As you might guess, it was #2 — the guy 99% would never hire.

    Why was #2 successful? He was the only one who devised an outside the box, customer centric approach. His fresh perspective worked. The other two used the tradition vendor-centric approach.

    Jeff Ogden, President
    Find New Customers
    http://www.findnewcustomers.net
    jogden@findnewcustomers.net

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