Sales funnels are the most important part of your business. Get an early glimpse into how they can help your business by reading this early draft excerpted from my Sales Funnel Bible book.
Traditionally, human resources and sales funnels have been thought of as separate entities, with the sales funnel as the money-earning system and HR as the department that ensures the business is fully staffed. I don’t mean to suggest that HR and sales funnels each operate independently, and at cross purposes. Rather, I mean that each one has its own purpose and those purposes aren’t always aligned because business owners haven’t made the connection between the two.
Consider the typical scenario where the founder of a small business realizes that they are too busy to run things on their own so they need to add someone else to their business. They might look at what skills they lack and hire for that. Or they might look at a particularly time-consuming aspect of their business and hire for that. Or they might look at an area of the business where they want to grow and they hire for that.
This practice happens a few times until there is a small handful of staff in the growing business. This hiring practice is okay because it addresses the immediate problems and challenges that the business is facing. But as the business continues to grow and change, those problems and challenges change and the people who were hired to deal with them may or may not keep up.
Before long, the business gets to the point where they need to add even more staff, as well as support staff. So the business owner (or, at this point, perhaps an Operations Manager) starts thinking about what roles need to be filled. They look to traditional job titles and traditional job descriptions. Then they pass the hiring responsibility on to a Human Resources department who continue with the traditional job titles and traditional job descriptions.
So the hiring process starts off as a gap-filling effort and later it changes to become an effort of filling traditional roles.
There are problems created by this type of hiring:
- Not sure who to hire first: A new business owner who has a busy business that they need to staff up is faced with the very difficult decision of determining who should be hired first. Their business isn’t big enough to bring in an HR expert to help them so they have to just figure it out on their own – and that is not easy.
- Now sure what hiring model to use: Should the business owner hire full time? Part time? On contract? Can they hire a freelancer? Should they pay more for a specialist or someone who is a little more of a generalist? Should they hire someone with little experience but who will learn on the job? Does the job need to be done on-site or can it be outsourced over the web?
- Hiring the wrong person too soon: Early efforts by the founder to fill gaps aren’t necessarily the best way to hire because the risk exists that they will spend too much on a staff member whose skill set doesn’t fully contribute to the growth of the business.
- Fixing hiring mistakes: There’s a disconnect between the first type of hiring and the second type of hiring HR staff may need to fix the hiring problems created when the business owner was in gap-filling hiring mode.
- Reliance on traditional roles and growth models: When an HR department is created and tasked with hiring, their job is to staff up the business in a way that can contribute to growth. However, every business is different and adding people in traditional roles to a dynamic organism like a business is like putting a square peg into a round hole.
- Employees lacking direction: Square peg employees who are hammered into the round hole are given a job to do and although they might understand what the business does as a whole, they may not necessarily see how their job is part of that whole. Rather, their focus is on completing their job. They have a direction for their job but not necessarily for their job as part of a larger picture.
- Performance review challenges: There is an expectation of employees to perform to certain standards. But what standards should be held up as the ideal? A human resources department might have some ideas about this but businesses need to review employee performance long before they hire someone to do it for them.
- Businesses that turn into kingdoms: Employees who are hired for a role in the business can often feel pigeon-holed from the other employees, as if each employee (and later, each department) becomes its own little kingdom. Those kingdoms generally get along and work together but things can get territorial. The bigger the business gets, the more conflict arises between those kingdoms.
The problems created by this scenario can potentially be solved by sales funnels:
During the early days of a business, when a founder needs to staff up, they should be hiring with their sales funnel in mind. Although there might need to be some gap-filling issue that also helps to inform them, their sales funnel should inform them about who they need. As much as possible, business owners shouldn’t be gap-filling in their business but rather they should be hiring people to contribute to their sales funnel. The business’ sales funnel can also inform the business owner about the roles that need to be filled: Staff should be hired based on the sales funnel, with roles and job descriptions built around the different steps, activities, and channels that the staff member can fulfill. The scope of the step will help the business owner know whether to hire full-time or part-time, on-site or outsourced.
The sales funnel also becomes the bigger purpose for the employee, as well as the ideal used for performance review. Employees should be trained to see themselves as a key part of the sales funnel, with other staff members also contributing to the sales funnel, and everyone working together to move people to the point of sale (which, hopefully, improves an employee’s sense of direction and eases the kingdom issue). And if metrics were effectively added to the sales funnel before they were hired, they have a benchmark that they can be measured against.
The hand-off from business owner to Operations Manager and then to Human Resources is much smoother, too, because sales-funnel-focused hiring is much more scalable than the gap-filling method that morphs into the traditional roles.
For new businesses, the sales funnel should be the most important system built up in the business and all hiring decisions should be decided upon using the sales funnel as a jumping-off point.
And once the hiring process is firmly in the skilled hands of the Human Resources department, the sales funnel should continue to be the go-to system against which HR can make hiring decisions. Of course there will still be roles that might be argued are not specifically tied to sales funnels but most can be (and should be!) and that will help to align the entire business toward the most important common goal.
This chapter is excerpted from an early draft of my book. Comments and constructive criticisms are welcome. Please be aware that the chapter content and chapter order may change by publication.