Baker Communications
Uses Data to Improve Performance
In conversation with Walter Rogers, CEO of Baker Communications
Baker Communications, Inc., the leader in data-driven sales enablement, has been quietly revolutionizing the Sales Training & Transformation sector by utilizing scientific data to eliminate the guesswork in sales team hiring and development. Just like physicians rely on bloodwork, MRIs, x-rays, CT scans, blood pressure cuffs, and other diagnostic tools to help identify and treat our health problems, Baker has been working with similar diagnostic tools to identify the detailed strengths and weaknesses of individual sales team members.
These tools have become quite reliable over the years, and today, they have a predictive validity of over 91%. According to Joe DiDonato, BCI’s Chief of Staff, “If the data tells you to hire a person – and you do – that salesperson has a 92% chance of making it to the top half of your sales team in a year. And conversely, If the data tells you not to hire a person – and you ignore that recommendation – 75% of them will fail in the first six months.”
Besides the obvious outcome of fewer hiring mistakes, when we asked why that was so important, Mr. DiDonato told us about another fact: The average sales turnover rate across the entire industry is 34.7%. That means that most companies are replacing one-third of their sales team every year. Beyond the obvious disruption at the client, that rate is nearly twice as much as the average of all other jobs.
Mr. DiDonato explained that it takes an average of 6.2 months to replace a salesperson that produces $1,000,000 per year. Beyond the cost of recruiting and training the replacement sales rep, the bigger cost is the lost revenue production over that 6.2-month period, or on average $516,667. All in, the cost is around $571,000 to replace that level of sales rep. “Imagine if you had a team of 100 sellers, and you had to replace 34 of them every year.” Mr. DiDonato went on to say. “That starts to add up between lost opportunity costs and replacement costs to a very daunting number.”
Turns out, that many of these candidates had already hit their peak, or maybe a new sales management team came in and cleaned house. But why would anyone get rid of their superstars? These are the hard questions to find answers for in an interview. “This is where our use of this enormous database of information has been able to really pay off, bigtime,” according to Mr. DiDonato.
At the time of this article, the proprietary database that Baker Communications uses has assessments from over 2,238,000 salespeople in it, from 200 different industries, 152 countries, and over 34,900 companies.
The company shared that 90% of the training done in a classroom is forgotten in the first 30 days after the class is over. It’s a phenomenon known as the Ebbinghaus Forgetting Curve. It’s not anything we’re individually guilty of, according to Mr. Rogers, it’s just a fact that if you don’t put that knowledge to use right away, you’re going to forget those concepts. “Think of it like learning a language” offered Joe DiDonato. “If you don’t get a chance to practice those words and phrases, they’re going to slip away. The same thing happens when you learn new selling concepts. You’re simply going to forget them if you don’t use them.”
But beyond that, the company said that attention span wains quickly when you’re covering material that’s already known to the participants. They tend to “zone out” or start looking at their emails or social media accounts. According to Baker, this is when they’re likely to miss the few minutes where their exact skill gap is covered.
According to the company, this is where their data-driven methodology can change things for the better. “By pre-assessing strengths and weaknesses, the system can recommend a personalized learning and coaching path” according to Mr. DiDonato. “This removes all of the material that the salesperson is already familiar with, and just presents the material that they need to close a skill gap.” According to the company, that can change the time in training from weeks to hours as well as significantly improve the student’s attention span and engagement.
By trading data for opinion, the company says that the improvements are substantial for their client base. In a study by Objective Management Group, the company that provides Baker’s highly predictive database of knowledge, customers are able to cut their turnover rates by 64%. And on top of those savings, the study showed that there was an increase in the number of sellers making quota of 88%. And of course, by removing all the extraneous course materials that each individual is already familiar with, the time it takes to move a sales professional to peak performance is drastically reduced according to the company.
In our opinion, this giant leap forward in methodology makes Baker Communications one of the most admired companies to watch and follow in 2022.
About the CEO
Walter Rogers, the founder and CEO of Baker Communications, said, “The data just gets more and more accurate every year and it’s now on par with the best predictive tools available. It just doesn’t make any sense to continue to recruit without the data. The proof is the average turnover rate that the industry has experienced.” Mr. Rogers then added, “Some of our customers were experiencing turnover rates of 50-55% in their sales teams. Imagine that level of inaccuracy combining with long sales cycles and the problem becomes intolerable.”
The conversation then turned away from hiring and to training existing sales teams. Here the discussion turned to the lack of quota attainment and the length of time it takes to get people to peak competency. Mr. Rogers said, “Quota attainment is averaging about 43% of the sales force. So here we have a few people carrying the bulk of the load.”
“Most of the sales teams use monolithic training venues, meaning that general courses are used to bring teams up to date and to eliminate sales gaps.” He went on to say that this is the least efficient process that teams can use. “We’re pulling teams out of the field to teach them things they already know, instead of focusing just on their individual skill gaps.”
