Dear Sales Dev/Sales/Channel Sales/Customer Success Reps,
I am sorry that I have been ruining your life by accidentally designing bad commissions plans for years. Even if you made a lot of money off of those plans, I have done you a massive disservice.
I write this to explain what I have come to learn since I’ve started carrying a bag myself and since I’ve done the research to understand psychologically and scientifically, how rewards impact motivation, learning, and fulfillment.
I feel this deserves an explanation to the broader audience because I have now seen literally hundreds of commissions plans, that are just as bad or worse. You deserve better, and so do the people who design and administer your plans.
As many of you know, plan design and quota setting is at best a massive cluster, and at worst totally made up. Quota is an insanely complex puzzle that requires your finance and ops team to balance the overly-ambitious targets that investors and execs love with the realities of your go-to-market motions, your region, and your product. Invariably, we do our best to be fair, put you on outcome-based plans, and pray they work.
That process is hinged on a few unfair assumptions:
1. That you need to be “hungry.”
When I was in finance, I didn’t have to worry about managing cash flow in bad months, because I still got my salary. I could always stay focused on doing what was best for the business. How much better would you perform if you didn’t worry about paying for your rent, or your car payment, or that trip to Disney World?
2. That commissions aren’t a priority for anyone but you.
For a variety of reasons, calculating your commissions is on the back burner, sending you reporting to show how you performed is a scramble, and we sometimes miss the deadline to give it to payroll. One month is a long time to fly blind, let alone to go unpaid. How would you perform if you had timely reporting showing you how you were doing as the month progressed?
3. You should Always Be Closing.
You are meeting your customers where they are, and helping them solve the real things that cause them stress, anxiety, and unhappiness. You’re the one in their corner. How would you perform if you were paid to make long-term investments in your customer relationships?
4. You are coin-operated.
Sales reps are greedy and love money. This is the most subtle, insidious assumption in my mind. And it took selling for a few months for me to understand it better-- you choose a job in sales because you want control of your own destiny. Yes, money is a part of that, but money is not the end goal. How would you perform if you were given the respect and independence to perform?
So, I propose a new way of thinking.
Your company builds incredible products around PEOPLE. You give your customers the security of knowing that their work will be completed on time. You give them the reporting and ability to see their performance and master new skills You enable your customers to better connect with their internal and external customers. And, you give them the autonomy to get out of the weeds, and find something better to do.
When it comes to sales comp, we forget that we are also building around PEOPLE. You need the same things that you give your customers: security, mastery, connection, and autonomy. How much better would we all do if we harness all the motivation that money can drive, while eliminating the stress and compulsive behaviors that it usually creates?
I’ve tried to right many of these wrongs along the way, but I am still learning. Concert is our team’s best effort to create a platform that designs and administers people-centric comp plans that help you, your company, and your admins grow. First, we don’t support some of the most ineffective (and frustrating) types of plan rules. Second, and more importantly, we put you in control again, with real-time pace-setting and feedback.
I can’t go back and fix the comp plans you were given over the last 15 years, but, I will always be willing to help your companies understand how your incentive comp can and should be smarter, like this cat.