Reduce Tech Churn by Accurately Aligning Jobs
As part of Solutions Review’s Premium Content Series—a collection of contributed articles written by industry experts in enterprise software categories—Ted Grossman, a Principal and leader of Technology at Alexander Group, explains how companies can reduce tech churn by improving how they align jobs.
The job market in the United States remains ever-evolving—despite an estimated 253,000 jobs created in April, there have been as many as 200,000 layoffs in 2023 in the technology industry alone. This turbulence underscores businesses’ need to retain their best talent. As the job market continues to react to the broader economic landscape, business leaders must also ensure they align their people operations with the present reality.
On both an organizational and individual level, there can be significant consequences when jobs don’t align with the current market: increased turnover, low job satisfaction, or reduced revenue and earnings. These issues are especially prevalent in the technology industry, which has historically grappled with high turnover and low satisfaction—even in the C-suite. Leadership teams at technology companies must take preemptive action to ensure their teams are intellectually satisfied by their duties, welcomed by the company culture, and compensated fairly.
Technology companies can create happier, more productive employees by leveraging two key processes to realign role responsibilities and pathways: job architecture assessment and sales compensation assessment.
Job Architecture Assessment
Job architecture assessments call for a full-scope, holistic audit of an organization’s role offerings. These audits should be performed by a team comprising both human resources and functional/departmental leaders. By deep diving into key responsibilities, requisite core competencies, role hierarchies, and career advancement pathways, leaders can better understand their employees’ perspectives and potential sources of frustration or dissatisfaction.
Special attention must be paid to the sales team’s job architecture, as there are additional nuances related to how those roles are defined (e.g., specific product assignments, customer bases, sales deployment methods, etc.). This complexity can lead to an almost infinite variety of sales roles and responsibilities and an increased likelihood of unintended consequences and management challenges. For many reasons, including the fact that sales teams have a direct line to clientele, business leaders must ensure they clearly understand their sales reps’ roles and career pathways.
These assessments must be performed through one-directional audits, organizational chart reviews, role analyses, and via collaborative interviews with employees themselves. What may be presented as policy on paper may not be an employee’s lived experience, and those discrepancies must be identified and addressed. If business leaders are invested in understanding and improving their employees’ experience at their organization, they must put in the work to perform job architecture assessments, identify opportunities for redesign and take corrective action where needed.
Sales Compensation Assessment
Beyond examining the overall job architecture within their organization, business leaders must make concerted efforts to understand their sales teams’ compensation. According to a recent study by LinkedIn, the turnover rate for sales professionals has increased by an estimated 39 percent—likely due to the high demand for salespeople. With transferrable, tech-forward skillsets and enticing offers from competitors, sales reps may find career-hopping worth the short-term effort, especially if they don’t feel appropriately satisfied or compensated in their current roles.
To retain their trusted sales professionals, organizations must conduct sales compensation assessments to gauge their offerings’ relative competitiveness in the market. Because sales compensation plans tend to be more complex than non-sales roles (due to factors like commission), it’s essential to give them special attention.
At a basic level, organizations should conduct audits of their sales teams’ base pay and pay mixes (i.e., the blend of base pay versus commission) and compare their findings against key competitors. Next, look at on-top-of-earnings pay, which may include equity awards, overtime pay, and SPIFFs, a catch-all term for incentive pay.
Leaders at technology companies may consider evaluating the required balance of communication versus technical skills. At the same time, a sales development representative may only need a basic level of technical understanding, whereas an engineer offering product demos must be an expert in customer communication and product value demonstration. In performing this audit, not only will team leaders gain an objective view of how their organization stacks up against the competition, but they can also take inspiration for new offerings and practices.
Performing sales compensation assessments is essential for all industries, especially technology, where losing top performers can result in significant productivity losses. Onboarding new sales talent, especially when the product is a high-tech software offering, can often require an on-ramp lasting six months to a full year. Technology organizations and leaders must take great care to ensure their sales compensation strategies are competitive and aligned with the broader market. Otherwise, they risk losing their sales teams to competitors with better offerings.
Retention Doesn’t Happen In a Vacuum
By taking the time to perform job architecture and sales compensation assessments, technology leaders can dramatically improve their organization’s employee experience. Tangible results—like increased clarity of role expectations, boosted productivity, increased tenure, and reduced tech churn—require tangible efforts, and leadership must ensure these assessments are performed with careful thought and attention. Organizations can keep their teams happy and productive by putting in the work.
- Reduce Tech Churn by Accurately Aligning Jobs - June 15, 2023
Ted Grossman
Theodore (Ted) Grossman is a principal in Alexander Group's San Francisco office. He is responsible for business development and managing key accounts and consulting engagements. Ted has extensive experience in business strategy, business process re-engineering, and organizational structure and design, with a functional specialty in sales force and channel effectiveness. With 25+ years of experience, Ted has an extensive industry background in software, telecommunications, high-tech, and manufacturing.
