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Wednesday, 30 November 2011

Is it true that 87 cents of every dollar spent on Sales Training is wasted.

 

87 per cent spent on Sales Training is wasted.

Google shows: About 555,000 results (0.22 seconds)


The “87 per cent belief” is widespread,
it is quoted endlessly,

But, is it TRUE?

 

In “The Challenger Sales” Book they write:

“Research by Neil Rackham has shown that 87 per cent of sales training content is forgotten by reps within thirty days”   (location 2705 the Challenger Sale - Kindle edition)

What is this REALLY all about?

The 87% Statistic was first published in the “American Society for Training and Development Journal” November 1979 and is credited as a Huthwaite Study. At first Publication it was an “87% loss of a “New Skill”, later in Neil Rackham’s 1991 book “Managing Major Sales”, the Graph fig 5.1 Page 130 is titled as : “Sales Training without systematic coaching wastes 87 cents in the Dollar”. However, seldom quoted is the comment on the previous page 129:
“Some Sales people showed a skills GAIN.
Where this happened, they had been systematically COACHED following training.”

And in 2001 Neil Rackham published an impassioned white paper
“The Coaching Controversy”, where he puts the context thus:
http://www.ascenticg.com/hw_survey/hw.htm
“The Xerox Corporation carried out several studies, one of which showed that
in the absence of follow-up coaching 87 per cent of the skills change brought about by the program was lost. That’s 87 cents in the skills dollar. Knowledge training, on the other hand, generally shows a much smaller loss.”

xerox copierSo, now we have a clear view of what it is all about.
Neil Rackham uses the 87¢ (cents) statistic,
taken from a study made before 1979,
(Part of the “Newcastle” Study?)
at Xerox based on the SKILL loss post-Sales Training of Photocopier Salespeople.

Indeed it is qualified, to distinguish between
SKILLS and KNOWLEDGE,
the latter showing far less “Loss” than the former!
And, then it is further qualified (logically) to be
The loss of the Skills ‘Gained’ during the Training”.

 

 

 

 

This is a long way from:

The '87cents' has grown and changed into a "proof".

“Research by Neil Rackham has shown that 87 per cent of sales training content
is forgotten by reps within thirty days” (The  Challenger Sale)


This “Proof” is used to support
“Sales Training doesn’t work!”
usually followed by the Hollow Claim
“Except MY Sales Training, which is the only one which works!”

Neither is likely to be true!


Here are some other Statistics from before 1979:

http://info.cancerresearchuk.org/cancerstats/types/lung/smoking/#percent

In 1979 40% of males smoked versus 20% today a 100% change.

If we used the 1979 Data we would be 100% WRONG in its usage!

Why didn’t we instead focus on the KEY Information
Published in Neil Rackham’s Classic book “SPIN Selling”. Page 12

“Potential Customers remember just over 5 key points from the 8 key points presented during the Sales Presentation.  Just SEVEN DAYS later,
they can only recall just over 2 Key points.
A 50% Memory loss and a drop from “likely to buy” to “unlikely to buy!”

And “statistically speaking” it’s not just Sales:
“The average organization is losing an amount equal to 7% of their annual sales because of poor leadership practices.
The three main side effects of poor leadership practices are increased employee turnover,
decreased customer satisfaction, and reduced employee productivity,
according to David Witt, Program Director at The Ken Blanchard Companies.”
http://www.kenblanchard.com/Business_Leadership/Management_Leadership_Newsletter/December2011_main_article/

Really I just will not leave without talking about MY own Sales Training Courses

By design, my Sales Training Design takes “Skill Loss” into account. The use of Aide-memoires and Practicing the new skills in Simulation with both Video and Observation feedback helps. I recently had a comment from a delegate whom I trained over 25 years ago, he remembered vividly the story I told so he could learn the Sales Skill of “Supporting” !  I haven’t trained that particular skill for some 20 years,
but it was a very vivid story!

 

However, I cannot stress enough that Sales SKILLS Training includes
BOTH Training and Coaching, you MUST do both.

I don’t call Sales Skills Coaching “On-the -job Training” because it IS NOT.
Sales Skills COACHING is the COMPLETION of what you learned during the Training Event.

O
n-the- Job ‘training’ is somebody showing you how
to fill in your monthly expense report!

 

The right way to Sales Skills COACH can be found at:

http://brianmaciver.blogspot.com/2011/10/true-secrets-of-sales-coaching-for.html
and
http://brianmaciver.blogspot.com/2010/09/how-do-you-make-great-sales-people.html

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