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Finding good people may be the first priority of a rapidly growing company. Here, Inc. 500 alumnus Pat Kelly shares his system* * *
Explosive growth is a fire that needs a lot of fuel. Resources -- money, equipment, people -- have to be poured into the furnace at an alarming rate to keep it stoked. Not only do you need a lot of everything, but you need it everywhere -- and there's little margin for error.
Pat Kelly, for one, leaves no room for hiring mistakes. His company, PSS Inc. (formerly known as Physician's Sales & Service), in Jacksonville, Fla., is driven by door-to-door sales of medical supplies to physicians' offices. To conquer such a highly competitive market, Kelly needs a large, reliable, and effective sales force.
To get one, he developed a comprehensive sales-training program in 1985, when the company had only three branch offices but still had big plans to go national. That way, PSS could tackle new territory as quickly as sales representatives graduated from the training program. Kelly's strategy was rewarded with a low 5% sales-force-turnover rate, annual sales of $20 million, and a spot on the 1989 Inc. 500 list (#302).
The problem was, PSS was losing its competitive edge: the steady stream of highly trained sales representatives was drying up. By 1989, 30% of the trainees were dropping out of the program. As it turned out, overworked branch managers were hiring candidates too quickly and letting the training program take care of separating the best from the rest. At a cost of up to $20,000 per recruit, it was a luxurious hiring method the company could scarcely afford.
"I figured if we could identify who would make it through the program on the front end, we'd lose a lot less later on," Kelly says. He called a meeting with some sales managers to ascertain the behavior traits that distinguish PSSers -- the company nickname for its sales representatives -- from the dropouts. "I also needed to develop a tool to help my managers stop talking and start listening." The group sketched out the PSS Sales Interview Guide to help managers identify the qualities they wanted in their employees. In 1990, armed with that secret hiring weapon, PSS managers interviewed more than 800 candidates. Only about one in five answered well enough to warrant being sent to a neighboring branch for a second interview. Of those, the regional manager interviewed 100 and made offers to only 70. That works out to a one-in-10 chance of being hired, rewarding PSS with sales trainees of a much higher caliber. To keep branch managers focused on finding the best, they're given a $2,000 bonus for each candidate they hire who makes it through the program.
When Kelly and his staff first hashed out the guide, there were only about 10 branch offices. Today there are 32 PSS branches, made possible in part by a steady stream of candidates. The guide is now in its third printing and has become a thorough 32 questions long. In 1990 PSS sales climbed to $90 million, with 220 sales representatives on the road. The guide has even given Kelly the confidence to delegate all hiring to his branch managers, who on average are 27 years old.
What's great about the guide is that very little of it is about sales-related experience per se, so its format could be adapted very easily to any kind of recruiting effort. As Kelly is fond of stating, "PSS hires behavior, not experience."
On the following pages, Kelly uses the guide to walk us through the evaluation of a recent candidate, noting what PSS looks for and helping us read between the lines. "Remember," he cautions, "this is only a tool to help you get to know a recruit. There is no minimum or maximum score needed to get hired. This form functions as a gut-instinct check."
Psyching Out the Test "People always try to answer questions the way they think you want them to. We are 'listening for' answers that someone trying to trick the interviewer wouldn't usually predict. We also want to hear specifics, examples, details. It lets the interviewer know right off the bat if there's anything worth pursuing."
Icebreaker The first four questions loosen up the candidate and set the tone for the entire interview: the interviewer asks questions, and the candidate talks -- a lot. "We're looking for a lot of things here: values, attitudes, ability to communicate," says Kelly.
Target Behaviors "Each of these questions is designed to reveal the behavioral trait or attitude indicated below it. There are five we focus on more than the others because we have found them to be particularly good gauges of success in our organization." Here are those personality traits or types and the questions used to gauge them: (1) Assertor: Is the person a doer? (2) Persuader: Can the person persuade a customer? (3) Values: Is the person honest and trustworthy? (4) Relator: Does the person get along with others, and can he or she build long-term relationships? (5) Ego: Does the person have self-regard and a high confidence level? This particular candidate was good enough to be passed on to a follow-up interview with the regional manager (Jim Boyd). Note that the questions Boyd focused on (indicated by his second set of comments) concentrate almost exclusively on the above five qualities.
Measuring Integrity PSS likes candidates who have already had their ethics put to the test. Only two questions on the form address values directly, but all questions are designed to reveal whether a candidate is trustworthy. This candidate tells a story about enforcing a college drinking rule in his own fraternity. "He probably had to take a lot of heat for that. Now here's a person of integrity, if the story is true," says Kelly. And if it isn't true? "It's hard to keep lying about your integrity through three interviews. Plus, other questions will bring out contradictions."
Winning Isn't the Only Thing -- But Wanting to Win Is "We look for people who want to win every situation they approach," says Kelly. "Remember, in a sales environment there can be six other sales representatives in the lobby, selling products identical to yours. As CEO, I know there's a competitor in Oklahoma City trying to figure out how to take away my business. Sales is a gladiator business, and we must win more battles than we lose. I can't explain the euphoria of beating someone out of the sale when you don't have the lowest price. Professional salespeople love the hunt and the thrill of winning a sale."
Measuring Motivation You don't need a degree in sales to get this answer right. "We like to hear the word 'money,' " Kelly says, "but I can't tell you how many candidates say 'talking to people.' PSS steers clear of big talkers in favor of careful listeners."
Powers of Persuasion "This is a classic sales-interview question, but the answers still tell us a lot about how developed a person's persuasive powers are," says Kelly. "To a seasoned businessperson, the desired answer, 'By asking questions and finding a need,' may be obvious, but to a green kid out of college, it's not. Many times a person will say, 'I'll cut the prospect a deal.' If a candidate gets this answer right, we know he or she is way ahead in the game."
Looking for a Relationship-based Salesperson For many companies, generosity in a salesperson would set off the alarm that this is someone who will give away the farm on every sale. But not for Kelly: "At PSS, it tells us the person can probably develop long-term customer relationships and work with others easily."
Doers' Profiles According to traditional sales-psychology books, there are four types of people: Doers, Talkers, Pacers, and Controllers. Not surprisingly, Doers make the best salespeople.
"Doers will respond to this question aggressively," says Kelly. "They have no doubt that if their integrity was questioned, they would be upset, and they would be emphatic about it. A strong value system forces a strong response to the question. It indicates that the candidate is the take-charge type of individual we are looking for."
The Essence of Selling "It's very hard to change someone's mind," says Kelly. "But that's what a salesperson must do on almost every call. Selling comes down to providing people not with something they don't need, but with something they didn't know they needed."
Measuring Maturity "You'd be surprised how many candidates draw an absolute blank on this question," says Kelly. "Some actually say their goal is to replace me, and I love to hear that, but I'm really looking for some honest, clear thinking here -- some sign of maturity and goal orientation."
The Tally "This candidate scored 16 out of 16. Rarely do both interviewers have that much confidence in a candidate. An average score is 12 or 14. He did score five minuses, but they were in categories we consider to be less important to the job, so we don't count them here."* * *