Have you ever felt duped by the empty promises attached to the latest sales incentive management tool? Years of business experience involving my own sales activities, managing other people and actually building software applications, which were intended to bring credibility to the process, have convinced me that no other software vendors actually capture the essence of incentive management in their products.
I recently reached the conclusion, however, that it was unlikely that the deception that I have personally sensed was actual deception at all. Rather, it could be more accurately described as the perpetuation of common misunderstandings and misinformation resulting from anecdotal-quality information. Who builds the system and how this is accomplished has less influence on its usefulness and value than the concept behind it. I have yet to meet a VP of Sales who didn’t want to effectively compensate his or her employees. Yet, over many conversations with those of you who bear that ultimate responsibility, I have learned that very few of you actually feel that you do. Further, the reasons for this ubiquitous disconnect lie not in how sales commissions are established but how they are defined and managed.
It’s my experience that almost every company would like to move to some form of a pay-for-performance compensation model. The benefits of this are fairly clear: Employees feel that their contributions are recognized and their efforts fairly compensated; the company gains more confidence that it receives an honest day’s work for an honest day’s pay, and corporate strategies become more meaningful as costs become more effectively aligned with revenues and productivity. Yet, the companies that successfully move to true pay-for-performance models remain in the minority. Why do businesses continue to fail in their attempts to modernize this critical element of profitability, in spite of all of the technological advances that have modernized virtually all other aspects of conducting business? The answer to this question is more complex than one might think. To learn more, click on one of the links below: