When Promoting from Within Fails
There’s a surprisingly strong business case for promoting from within. Studies have shown that external hires cost more while at the same deliver fewer results in terms of performance. External hires are also more likely to either be laid off or leave the job by choice. Internal hires already know the culture and how things work, which means fewer headaches and more performance early on. That is, if they know what they’re doing. While the business case for promoting from within is clearly very strong, organizations can still make a mess of it. One area in which this happens all to often is in the sales department.
In one sense, it appears that the sales function is one place in companies where the promote-from-within mantra has been taken to heart. A joint study by the Association for Talent Development and i4cp found that 55% of organizations find needed sales managers by promoting from within the company – not exclusively, mind you, but it’s the most commonly used source. Kudos to sales departments everywhere for saving the company all kinds of resources by promoting from within!
Unfortunately, these efforts often fall flat. The problem is in another statistic from the same study: Fully 52% of those same organizations don’t offer any training programs specifically geared towards new sales managers. It’s a classic case of business as usual – you have star sales people who get amazing results, so you promote them into sales manager positions, only to find that they falter and fail. Why does this happen? The answer is clear, just because you’re a star performer doesn’t mean you know anything about how to manage other people.
Patrick Gray has written about the same phenomenon in IT departments. He calls it death by promotion. “While you may feel that you’re rewarding a high-performing employee by offering a promotion to a management or leadership role, if don’t equip them with the skills to succeed, you’re doing the employee and your organization a grave disservice.”
If the employee winds up on the chopping block, then you’re really losing two positions. You lost the great results they were getting before in sales, and then you still need to fill the sales manager position. What a mess.
I challenge all learning professionals reading this article to seriously ask yourself – does your organization do enough to train people who are suddenly promoted into management positions? More specifically, are you providing management training to your new sales managers? If you’re not, that is something your department should proactively lead a change effort to address.
Scott Weiss, who founded IronPort Systems, learned this lesson early from his father, Alfred “Bud” Weiss, who owned a car dealership. Bud understood this problem in a really simple, straightforward way and explained it to a young Scott this way: “Son, you never, ever promote your best salesperson to be the sales manager. This is a classic mistake that other car dealers make. A bunch of my top producers came from their failed attempts as sales managers at other places. You commit two wrongs with these promotions: First, you take your top producer — someone raking in two to five times the average salesperson — off the sales floor. Second, you put them in a new job that they are totally unqualified to do successfully. This usually ends in disaster for everyone involved.”
The operative phrase is put them in a new job that they are totally unqualified to do successfully. That’s a darn good reason to either never promote from within or, as I am arguing here, never promote from within without sufficient training.
I hope your organization avoids the all too common situation of killing two birds with one stone that happen from poor promote-from-within practices. You need those birds! Wouldn’t you rather feed two birds with one hand? That’s what training is all about – smart promotions with all the support needed for success.