Research Brief:
Sales Representative

Setting:
A company specializing in the sale of custom built homes sought to incorporate an assessment of personality into the employment selection process for future sales representatives. The company achieved success as the leading seller of custom built homes in the United States through the sale of homes built through a process known as controlled construction. Sales representatives offer clients vast customization options and then interface with local builders who assemble the finished components that have been transported directly to the jobsite. In doing so, sales representatives offer clients value and speed in construction, while allowing the client to customize homes to their unique needs.

Of secondary importance to the formation of the selection model, the company hoped to identify the personality characteristics of top performing sales representatives in order to build effective coaching and development programs for incumbents. For these purposes, the company provided a sample of 41 incumbent sales representatives, for whom CPQ results were matched with performance and tenure data. The resulting sample provided the basis for the local validation of the sales representative selection model.

Model:
Based upon the data provided by the company, a selection model was tested using quantitative sales performance criteria. Specifically, the model identified ideal ranges for each of the CPQ's "basic eight" scales and calculated an overall score based on the individual's results in comparison with the ideal. This score was reported as a low, moderate or high rating based on an overall assessment of compatibility to the sales representative role.

Findings:
The model provided a statistically significant correlation (r=.545, p<.05) to performance based on the 2003 sales data provided by the company. Specifically, incumbents scoring in the high ranges of the sales representative model earned average sales of approximately $2,317,113, compared to an average of approximately $1,121,192 and $594,841 for the moderate and low scoring incumbents respectively. Additionally, high scoring sales representatives were 200% more likely to reach the top rank (based on performance rankings among their peers) among active sales representatives when compared to all others.

Conclusion:
The substantial difference in performance demonstrated above clearly indicates that a high level of financial impact (ROI) could be anticipated from utilizing the CPQ for the selection of sales representatives. The selection model indicated that higher scoring incumbents performed at a level that was 200% greater than that of lower scoring candidates (representing an average difference of $1,540,073 in annual sales). Thus, the sales representative selection model yielded a highly predictive means of identifying individuals with the propensity to reach desired levels of performance based on the CPQ scales (measuring drive, motivation and selling style). This study provided strong evidence of criterion validity as well as financial impact (utility) to support the utilization of the sales representative model for employment selection and sales coaching purposes.