By Jim Gibson

October 2010 – There’s a point through which every early stage HIT company must pass on its road to viability. If you’re a CEO, you know this, and your investors most assuredly know this. Handling it well will have lasting effects on your company and contribute significantly to its ultimate success. Poor execution could lead to the dreaded “stall” in the growth trajectory or, worse yet, to the outright inability of the company to deliver on its promise.

I’m referring to that point after proof-of-concept and before commercial success when you feel it’s time to break out. The product, while perhaps incomplete and imperfect, generally works. The value proposition is sound. The market has a clear need. The competitors – if you believe there are any – can’t deliver the solution you can. It’s been a long time in coming, with lots of hard work to get here. You’re finally ready to hire a direct salesperson.

Congratulations. This is clearly an achievement milestone, one you should relish. This could be one of those points in time that you look back on and say, “That’s when it really started to take off.”

However, if not handled correctly, it can be one of your biggest disappointments. Let’s face it, for many C-level execs who have never been quota carrying salespersons, sales remains a mystery. Nothing screams this more than the familiar refrain, “I want to hire a thoroughbred and let him have at it.” Yikes.

Sales is also the area with the highest turnover and often the greatest source of exasperation for the early stage CEO.

But it need not be feared. There are ways to mitigate your risk while raising your odds of success. (If you’re past the point of hiring your first salesperson, these principles mostly still apply. Their application may be different, but they remain relevant.)

From what I’ve seen, there are three stages to a successful sales hiring process:

• Readiness Check
• The Hire
• Commitment to Success  

Readiness Check

Recognizing how difficult it is to get a second look with a prospect if you don’t come across well the first time, make sure you’re ready before putting feet on the street. This is about avoiding the ready – fire – aim scenario.

Do you have a tight, cogent pitch aimed at the right audience? Are they likely to “get it?”

Have you done a brutally honest assessment of your positioning? Have you determined your vulnerabilities and developed a coherent, plausible plan to address them? Every company has vulnerabilities. They can be functionality; technology; size relative to competitors; or other issues. Regardless, if you haven’t articulated a plan to address them, you’re not ready. Take a step back.

Do you think your solution is so obviously superior, that it should practically sell itself? “Who wouldn’t buy this?” Take TWO steps back. You’re not ready. Confidence and enthusiasm are hallmarks of the entrepreneur. They get you through the tough times and enable you to keep at it, day after day. But they must be countered with passionate dispassion, a self-imposed discipline to evaluate your business devoid of any emotion. (If this was as easy as it sounds, there would be far fewer management consultants.)

Are you ready to truly support the person(s) you hire? One of the reasons the thoroughbred mentality is so widespread is because it’s so appealing. It implies a plug-and-play solution, with little or no maintenance. Just hire her and watch the sales come in. Sounds great but it usually doesn’t work that way. A successful sales operation requires active support from the organization, starting at the top.

Are you otherwise prepared? For example, do you have enough delivery resources to support increased volume resulting from realistic sales success?

The Hire

Volumes have been written about hiring, so I’ll simply list some things to think about, which apply more to sales hires than others. This is certainly not an exhaustive list.

• Look for someone who has succeeded at more than one place. This will help avoid someone who was in the right place at the right time, even if it lasted for a few years.
• Align past experience with your environment. Has the salesperson succeeded in an early stage company with very limited resources, rather than being a big company person?
• Seek signs of success in times of adversity, such as when the company was heading in the wrong direction or beset with highly visible problems. Or has this person survived multiple RIFs?
• Insist on someone who can attribute success to other than being good or lucky, such as a sales methodology or process. Good salespeople know how they succeed. Be cautious to distinguish between being exposed to the popular sales methodologies and using them with conviction and success. These programs (Miller-Heiman, Spin Selling, etc.) are generally excellent, but only if used religiously and systematically.
• Keep “the rolodex” in context. It may reflect an ability to get doors open, but without past results to back it up, it does not ensure the ability to get the deal done. Getting in and getting the deal done are two very different things.
• Remember, you’re looking for someone that is a good salesperson, not a good interviewer. They all seem to interview well, since they sell for a living.

In the spirit of building an organization that doesn’t rely on superstars (see “The Myth of the ‘A Player’” https://wp.me/p9aMrG-op) don’t expect to hire an outlier. Instead, hire someone good and give him a fighting chance to succeed … better yet, to excel.

Commitment to Success

That’s your commitment, and it’s critical. It begins with your decision to have sales (not just sales results) remain one of your top priorities. At any given time, it won’t always be your top priority, but if it’s subject to slipping far down your list, then don’t bother.

Once committed, let the organization know your feelings and that your commitment is genuine. It’s not unusual for non-sales people to have a dim view of these “overpaid, prima donnas.” Your other employees, and even your closest advisors in the C-suite, may have brought to your company prejudices from their past experiences. You owe it to yourself, and them ironically, to help them shed these negative perceptions. Like children with a parent, they will watch you for signs of inconsistency or a wavering commitment to sales.

Make sure they know you believe their contributions are just as important, but it’s in everyone’s interest to have mutual respect and support. The same message should be delivered to the new sales hire.

Knowledge transfer and possibly pitch development / refinement come next. You may have been doing all the selling until this point. If you’re the founder, you may have given birth to the idea. You know this stuff inside-out and backwards. It’s in your bones. Challenge yourself to effectively transfer that knowledge to the newly-hired outsider. This will take time and may even take the form of an ongoing mentoring role.

Assuming you hired an experienced HIT sales professional, make the knowledge transfer a two-way process. Pick her brain about the industry; competitors; target market; potential business partners; and anything else relevant. Then together, and maybe with others, work this newfound knowledge into your pitch as appropriate.

Be prepared to listen well and objectively to feedback from the field. The salesperson will be your eyes and ears to the market. You need to apply your knowledge and judgment to what you hear, but remain open to listening, even if you don’t like some of what you hear. Many a tweaked offering has been the result of intelligence from the field. Also, good salespersons will push the organization from time to time. Listen well. It could take you in new directions or at least result in closed deals.

Have a competitive compensation plan and don’t hesitate to pay well for performance. A good salesperson expects to be well compensated for delivering results. The fastest way to drive this person away is to interfere with that expectation. You don’t have to overpay, but you do have to pay market compensation. If you won’t, others will.

If you follow these suggestions, the salesperson’s obstacles will have been removed; now it’s show time. Hold him accountable.

Hiring a salesperson is probably the trickiest of all hires. If you increase your odds of a successful sales operation, no matter how small it starts, you’ll be more likely to remain on the growth curve you and your investors envisioned.

About the Author  

Gibson Consultants is a search firm specializing in executive and management level hires for healthcare IT companies. Most clients also ask for help finding sales resources, given the challenges of making a good sales hire.

Jim Gibson founded Gibson Consultants in 2002 after careers in healthcare IT and group health insurance. At Dictaphone Healthcare he was responsible for sales of speech recognition solutions to providers in the northeast. Working with the product management group, he also helped position Dictaphone’s automated coding, NLP, and handheld charge capture solutions. As vice president of sales for HSS (now part of Ingenix), Jim was responsible for nationwide direct and third party sales of coding, case mix classification, and prospective payment system (PPS) software to hospitals and payers. Before HSS, Jim sold the DIAMOND payer administration system for Health System Design and clinical guidelines and administrative services for Health Risk Management. Prior to his healthcare IT career, he spent nine years with Prudential Healthcare in sales, sales management, and hospital contracting.

You can reach Jim directly at (910)444-4484 or email jim@gibson-consultants.com