RECENT RESEARCH by the Chartered Management Institute in the UK reports that the rate of salary increase for managers, although still higher than for the economy in general, has slowed as employers look to provide other benefits to address recruitment and retention issues. Yet the same report tells us that the proportion of managers who left for other jobs rose to seven percent last year compared to 4.6 percent in the previous 12 months. Whatever these companies are doing (and the report cites an increase in child care vouchers and life assurance schemes), it clearly isn’t working.

So what is top talent looking for? In my experience, from working with talented employees in companies such as Alfred McAlpine, RWE npower and Cable and Wireless over the last 10 years, financial reward (and this includes perks such as child care vouchers) is merely a hygiene factor. Far more important to the ambitious and motivated employee is a clear career path – and this isn’t necessarily a vertical career path straight to management – and opportunities to stretch and develop.

The trick for HR is to harness individuals’ desire for development, link this to reward and opportunity and embed the process into critical HR procedures with the sole aim of driving business success. A project carried out by talent management company Get feedback and telecoms provider O2 demonstrates how to achieve this.

O2 tackles retention and development

In early 2006, Get feedback was invited by O2 to tackle the issue of retention and development within its top sales team. In recent years the corporate telecoms market has become far more complex. The advance of network capability has meant that more sophisticated data products and services have emerged that can be closely matched to the needs of the client. O2 recognized that successful delivery to this market would require an in-depth knowledge by the salesperson of the customer’s business. Customers would value an ongoing relationship with an account manager who has in-depth knowledge of their needs and can build current systems solutions that address future problems.

This would mean that corporate salespeople would need to stay with the company longer to build both their understanding of the company’s more complex offering and the current and future needs of their customers. Experience had shown that financial reward alone was not the answer.

 

Moving towards a solution
The business leadership team realized that for O2 to continue to be successful in this changing market, it must:

• Address the overall skills level of the sales team.
• Put clear blue water between the competencies of the sales team and its competitors by establishing a set of trusted adviser competencies unique to O2.
• Build a pipeline of talent.
• Address attrition levels.
• Understand in more depth the potential of the sales force to better match individuals to future roles.

Having invested in previous skills development programs without achieving sustainable gains in the past, the team also wanted to find a new approach to developing its sales teams. This approach would be measurable, supportive, transparent and firmly embedded in the reward process. In this way, each individual would know exactly what they had to achieve, would be given the support to achieve it and would be rewarded when they had done so.

Identifying the challenges
A sales talent development team was created and subsequently began a six-month research phase. This included looking at the approaches of other companies, revisiting previous O2 activities and consulting with internal and external stakeholders. Further external research established that only 0.2 percent of 7,000 sales forces surveyed were seen by their customers as world class 1 and that as much as 85 percent of spend on sales training failed to deliver results due to the lack of a proper organizational structure.2 The sales development team also identified the following key challenges that would be vital to address if any plan was to succeed:

 

• Initially securing senior buy-in, support, financial commitment and resources to deliver a program on this scale.
• Defining the evolving role of an O2 sales manager from the “super salesperson” to the “sales performance coach.” Sales managers needed to be moved to a more “hands-off” role, encouraging and developing their team rather than stepping in to close the deal.
• Cultural adoption and the reluctance of salespeople to change behaviors that had made them successful in the past, especially when they could still be reasonably successful using their old practices.
• Engaging the senior management team from sales director down, to really drive change. There is a need to constantly communicate and reinforce consistent key messages and management policy.
  

Finding the solution
The sales development team recommended the introduction of a bespoke “sales academy” for its 450-strong sales team, but this academy would be firmly embedded in O2’s HR processes. Training would not be stand-alone, as improvements in behaviors and skills would be measured and fed back into the performance appraisal and would directly impact on the individual’s reward and opportunities for further advancement. In this way, the academy would impact directly on O2’s bottom line. The academy had three main objectives:

• To enhance the productivity of each individual.
• To differentiate O2’s approach from that of the competition.
• To deliver the best customer experience.

The O2 Sales Academy was based on the transition from transactional salesperson to trusted adviser. The program was rolled out in two phases. Initial emphasis was placed upon helping sales staff to develop strong consultative selling skills and sales managers to develop strong coaching skill levels (these were labelled as “bronze” and “silver” levels of achievement). The second phase took the top talent identified during the first phase and focused on moving these individuals from a consultative salesperson role to one of a trusted adviser (these were labelled as “gold” and “platinum” levels of achievement).

 

Phase one – the “O2 Way” for everyone

The skills of the O2 sales force had been identified as the potential point of differentiation between O2 and its competitors. Consequently, as a first step, the Sales Academy team spent six months consulting with more than 40 representatives from across sales to define best practice standards and behaviors for the bronze and silver levels.

From this consultation, what became known as the “O2 Way” emerged along with the selection of the Creating Client Value (CCV) competency model from Imparta, against which all O2 sales people could be measured. Different behaviors and skills were identified for achieving each level, so that progress could be mapped and a set of training and coaching interventions put into place to support it. Results were measured and data logged and calibrated on a quarterly basis across 450 people. Measures included:

 

• A set of tailored competency models that measure skill development.
• A FAF (field accompaniment form) process that measures the quantity and quality of manager coaching.
• A set of observations that measure the adoption and application of the O2 Way.
• Other business measures, such as sales performance, customer satisfaction and coaching quality of managers.

These measures were fed into each individual’s objectives and annual performance review, which in turn determined levels of remuneration and opportunities to progress within O2. In this way the program became fully integrated into critical HR processes, which in turn drove business success.

Engagement of the sales force was, of course, a critical challenge that the academy needed to master if it was to become successful. Excellent communication was key, and a one-day workshop explaining the business case for the academy – how it would benefit individuals, the journey from transactional salesperson to trusted adviser, key principles around accreditation metrics, reporting and measurement, etc. – was held for 50 managers. These managers then cascaded the information throughout their sales teams, using bespoke animations and the academy’s i-coach portal.

Additionally, quarterly company-wide sales meetings were used as a platform to report on overall and individual achievement and began over time to show how the progress of the sales force through the academy could be directly linked to the successful achievement of targets and thus the bottom line.

 

Phase two – identifying the most talented

Having successfully embarked the 450-strong sales team on the bronze and silver levels of the academy, the talent development team turned its attention to the gold and platinum levels. Individuals seeking to attain these levels would truly represent O2’s top talent, so holding on to these staff in a competitive labour market was a major concern. The gold- and platinum-level programs were therefore designed to stretch sales staff and retain their talent for the benefit of O2.

 

Specifically, the objectives of the gold and platinum levels are:

• To recognize, reward and retain gold
  accreditation achievers.
• To broaden capability, and to enhance the customer experience through the development of new complimentary skills and behaviors.
• To strengthen the sales talent succession process and create personal development programs that are tailored to individual needs.

The platinum level has the following additional objectives:

• To identify, reward and retain top sales talent within O2.
• To leverage the talent within the platinum community in order to strengthen both the sales directorate and O2 business strategies.

A framework of leadership competencies

Standard behaviors in the bronze and silver stages of the academy had been based on CCV competencies. To move the top sales team to the next level the talent development team realized it would need a new framework based on leadership competencies. Business psychologists from Get feedback were brought in to carry out research among sector managers, the academy team, top performers and senior managers in order to establish what “great” looked like.

Using the Schroder high performance framework as a model, a new O2 trusted adviser competency framework was created that covered areas specific to O2 – for example, commercial acumen and strategic thinking. Accreditation and maintenance metrics for each level were also established.

Communication was key
Again, good communication was seen as key to the success of the academy. At each stage the Sales Academy team consulted with internal stakeholders. Many one-on-one conversations with the sales team took place to ensure concerns were taken on board. Separate briefing sessions were held with senior stakeholders to ensure consistent messaging, and this culminated in a gold and platinum launch event.

The aim of this one-day event for sector managers was to describe the key business challenges that were driving the need for this new phase of the academy, as well as what the new phases would involve. Sector managers then cascaded key messages of this phase to their team members using the tools and communication collateral given. A specific five-minute animation was created to ensure that the key messages were delivered consistently and with impact.

Going for gold
Eligibility for the gold level was based on attaining significant CCV competencies, achieving business targets, achievement scores and successful completion of a case study. Eighteen gold achievers attended the first two-day Academy Centre of Excellence, run by Get feedback in November 2006. Achievers had previously completed online psychometric tests, and these provided a rich source of data that was fed into the development event.

A business simulation based on Dragons’ Den, a television program on which entrepreneurs appear to try and win investment backing from four “dragons,” formed the first day of the event. Achievers were observed making a business case for Jude and Jim’s Juice Company (organic smoothies) and Delicateski (a Polish deli chain). Virtual businesses were selected that did not operate in typical O2 markets to ensure this was a test of behaviors and competencies, rather than knowledge. Following a gold achievers’ celebration evening event attended by top O2 leaders, day two centered on individual assessment and action plans. Each achiever attended a one-to-one session with a business psychologist, where results from the psychometric tests and the business simulation were discussed and fed into a personal development plan.

To remain in gold, achievers need to go up one level in two competencies over the course of one year and maintain their sales metrics. Achievers can enrol on two of six trusted adviser two-day courses centered on six clusters of competencies – for example, Advanced Communication, Advanced Coaching and Strategic Thinking. Additionally, gold achievers can attend certain Inspiring Interventions – half-day programs where an inspirational figure such as Sir Ranulph Fiennes, coming from outside the industry, talks to them about their experiences.

Platinum performers of the future
From the Academy Centre of Excellence it was forecast that the top 3–5 percent of those people achieving an externally benchmarked standard in their role would be invited to join platinum for one year. These participants would become leaders and advocates for O2 sales, both within the company and externally, and receive enhanced rewards. In the first year, one individual was identified to proceed to platinum level. This individual received additional development funding that they could invest as they wished.

 

Additionally, platinum performers of the future will be encouraged to engage with the highest levels of management in O2 and will be given the opportunity to input into the company’s business strategy. In the fast-changing world of telecoms, the O2 board recognized the contribution that those who are interfacing with the customer on a day-to-day basis can make to future business strategy.

Measuring success
It was essential to the HR team that clear measures of success be established to gauge the worth of the investment. The following results show this success.

Business results

• More than £60 million of revenue can be directly tracked by O2 to the adoption and use of CCV and the O2 Way. Each quarterly academy campaign generates an additional £5 million of immediate sales opportunities within the first 12 weeks of launch.

Individual success

• In 2006, sales staff who achieved silver accreditation outperformed those that had not by over 10 percent, on average.
• In the second quarter of 2006, the people who made the largest positive competency shifts overall outperformed those that made the smallest by over 40 percent.
• The average overall competency across all sales has shifted from 1.8 to 2.6 over the last year (the maximum score is 4).
• O2 Corporate recently won its largest corporate deal in the last five years, worth £5.5 million, through one of the highest-performing account managers within the academy.
• O2 sales people themselves, on a quarterly basis, consistently rank the Sales Academy initiative as one of the top differentiators they have to maximize their success within the market place.

Customer satisfaction

• Over the last 18 months, corporate customer satisfaction relating to O2 sales and account management has risen from an indexed score of 67 to 73 – a market-leading score.3
  O2 is a provider of mobile services to consumers and businesses in the UK. O2 UK employs 12,984 people and has its head office in Slough aswell as call centers in Leeds, Preston Brook, Bury and Glasgow. It is part of the wider O2 group, which is a wholly-owned subsidiary of Telefónica S.A.

Forward-thinking HR practitioners should no longer see reward as a stand-alone function or think of it in terms of financial packages. O2’s outstanding success with its Sales Academy is proof that top talent is looking for more than bonuses. Reward for them should be based around developing their own skills, recognizing their talent and giving them a voice on the direction of the company.

 

 

 

References:
1. HR Chally Group
2. Gartner Group
3. ”CSI,” a survey carried out by Taylor Nelson Sofres on behalf of O2