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Salespeople Will Do What You Pay Them to Do

I wish I could remember where I first heard, “salespeople will do what you pay them to do.”  That’s a timeless truth about selling if there ever was one.

During the research process for an article I’m writing, I came across a piece written by Maureen Hrehocik entitled, “Secrets of a Successful Comp Plan.”  Only now do I remember having been interviewed for the article.  I also remember passing the name of my colleague Steve Grossman, a partner with Mercer, along to Maureen.  He is quoted in the article as well.  He’s an expert in compensation, among other areas relating to sales effectiveness.

I am bringing this up because compensation is another dysfunctional area within many companies.  During the past quarter, I’ve been engaged with several clients where “errors of commission” are preventing them from achieving their team and corporate goals. 

There are a number of symptoms of a dysfunctional comp plan.  Here are two:

  • Salespeople aren’t selling what the company needs to achieve its corporate goals and objectives.  The best example: a company has a goal of bringing on a 150 new accounts during the year and the salespeople are mostly selling add-ons to existing customers.  On the present course the company will fall far short of the objective. 
  • Salespeople are distracted and confused because the products or services they are being paid to sell don’t match their customers’ requirements.  Deals are lost and when deals are won, new customers are dissatisfied.

One important point: Having the right people in sales jobs comes first.  The best comp plan in the world doesn’t mean much when the salespeople it is intended to motivate don’t have the requisite skills and traits to succeed. 

Rather than repeat what I and others said in the article, I recommend that you read it.

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2 Responses

  1. You brought back some great memories with this post! In my early days at Xerox, most customer rented their copies.

    In the late 1970s, the Japanese (Savin, Canon & Minolta) invaded the country and had the audacity to actually SELL their copiers. Xerox rapidly started losing market share – as well as significant cash flow.

    So one January, they announced a change in compensation plans. Effective immediately, sales reps would be paid twice as much for selling copiers vs. renting them. It was amazing how fast we changed our sales approach.

    Later that year (September), Xerox’s rental revenue had dropped so dramatically, that the company decided to change courses again. Starting October 1, sellers received twice as much for renting copiers.

    The very next day, I found myself talking to customers about all the exciting new developments in the industry and why they rent they should their their copiers – at least for a short while. That way they could easily upgrade when new systems were announced.

    That was the year that I learned the power of the compensation plan.

  2. Perfect! Thanks, Jill.

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