Salespeople are different and so is the typical structure of the sales reward plan. But it can be interesting to consider more closely the reasons why these things have come to be.
Research conducted a few years ago by Sibson Consulting found that salespeople:
- Are more motivated by compensation (82% versus 62% for their fellow workers)
- Are more engaged (57% versus 51%)
- Have higher career satisfaction (57% versus 52%)
- Have a greater sense of commitment to (68% versus 62%) and affiliation with (67% versus 60%) their organizations
A Harvard Business Review post this week Are Top Salespeople Born or Made?, by sales strategist and author Steve M. Martin, explores similar ground in examining the sales psyche and its underlying motivational forces.
Based on his own research, experience and observations, Martin concludes that over 70% of top sales performers are born with natural instincts that play a critical role in their sales success. Less than 30% of top salespeople are "self-made". He also notes that for every 100 people who enter sales without natural sales traits, only 20% will ultimately perform at an above average rate. So Martin turns his attention to this question: What can make a self-made salesperson successful? His own research and experience suggest four key elements: language specialization (the ability to converse in the specific language of business operations, experience modeling (the ability to model the right sales approach based on past customer calls and interactions), political acumen and ... greed.
Yes, greed. As Martin tells it:
We normally associate greed with a corrupt character or miserly scrooge. While this may be society's definition, in sales, "greed" takes on an entirely different meaning. In sales, greed and self-respect are closely intertwined. Greed can be thought of as the desire to be fairly paid for one's time. Time is a salesperson's enemy because time is finite. Time is the governor that determines how many deals can be worked and where effort should be focused. Salespeople are on a mission to learn the ultimate truth, "Will I win the deal?" Greed compels the successful self-made salespeople to push themselves beyond their comfort zone and ask difficult qualifying questions while continually pushing for the close. Conversely, the lesser successful self-made salespeople do not possess this inward drive.
If salespeople are more motivated by money than their fellow workers and greed (as Martin defines it) is indeed an important factor in raising the performance of those who may not have the "natural born" sales instincts to fall back on, what does this mean for sales rewards (Dan Pink's jokes about salespeople being coin-operated aside)?
In designing sales rewards, I don't think we can ignore the greed factor at play. The key is to remember that greed - even using Martin's more innocent definition - can be our enemy as well as our friend. On the one hand, we must design sales compensation plans that harness the drive and energy present in a group pre-dispositioned to be motivated by money. On the other hand, we must consider and genuinely account for the kind of narrow focus that these kinds of incentives will produce to ensure that the right things happen and the wrong things don't.
My thoughts. How about yours?
Image courtesy of the1percentdifference.com
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