Wednesday, 12 August 2015

If You Want Increased Sales Productivity - Focus On Culture Fit

Can you place a monetary value on the strength of a corporate culture? Is there any way to prove the value of employing people that fit?

I recently had the opportunity to look at a group of sales people and see if their culture fit predicted quota achievement for the year. 

This is an effective test that relies on some 'hard' data from the finance folks, and some 'softer' data from the HR team. A positive correlation proves that people who align more closely with the organisation they are part of will perform better, especially in high pressure situations. 

Below are illustrations from two sets of data, one taken at mid-year, showing quota achievement against the culture fit of the individuals in question. The second one shows full year results.

The first chart shows a group of 37 sales people making a flying start - everyone over 40% of their quota lies in the top half of organisational culture fit, while not a single person from the bottom half is doing well.

(For the statistically minded this whole distribution shows a weak, but positive correlation using Pearson's method)

The second chart shows the full picture for the year, again illustrating that those in the top half of the organisational culture spectrum are outperforming those in the bottom. In this case 38 people achieved more than 100% of their designated quota, while not a single individual in the lower half made their target.
Note that the actual financial rewards are not shown, these have to remain confidential - but over 30% of revenue came from that top right quadrant. Naturally hiring processes have changed at the company in question - who now place a great deal more emphasis on how potential employees fit with their culture and working practices.

You may also notice that there are no 'brilliant jerks' in this analysis. No high flying sales person with a terrible culture fit. This is clearly a company that took Reed Hastings advice to heart.

If you're paying really close attention, you may also notice the grey markers on the charts - these are people who left the organisation. In the first half of the year, these were generally at the higher end of culture fit with low to medium quota achievement, in the latter half they were predominantly the under-achievers (this is after all a sales organisation).

Culture fit is no cast-iron guarantee of sales success, but the probability of better results increases when you find people that share common values, behaviours and aspirations with the rest of the organisation. 

Defining that fit and working it into the interview process is critical - as is ensuring you can truly define what your culture looks like today. 

Why not take some time do this analysis on a sales team in your company and see if you find similar results? It's a great way for HR teams to contribute directly to revenue improvement.

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