Arno was kind enough to point my attention to this great video presentation from Dan Pink on the science of motivation.
Dan uses science, examples and case histories to tell us that almost everything we thought about motivation is wrong....or is it?
Now he never mentioned sales, selling, the sales force and salespeople specifically, but we do know he said this:
"When the focus and goal are clear - incentives work great."
That condition is certainly in play for incentive programs, contests, rewards and awards. And it's in play for many compensation plans too. But are the focus and goal always clear? When salespeople take our assessments, one of the questions asks by how much they exceeded or missed their quota or goal. The data shows that a significant percentage of salespeople don't have a goal or a quota! He also said:
"When you don't want the worker focused, and you want them thinking on the periphery, then incentives don't work."
That condition is certainly in play for new companies, start-ups finding their way, finding a market, finding partners, and that have no existing revenue stream. A salary is the appropriate way to compensate the first salespeople on board in this scenario.
If we look at the data from the 450,000 salespeople that have been assessed by Objective Management Group, the percentage of findings showing lack of money motivation, especially among higher income earners, has been increasing each year. It's not that they aren't money motivated anymore, as much as they aren't as money motivated as they were earlier in their career, when their money motivation got them to their current income level.
The bottom line - for your salespeople - is that everyone is different; everyone is motivated by different things and for those who are clearly motivated by money, and where you have a clear goal and focus for them, their compensation should and must be commission based. When you have people who are motivated more by recognition, awards, competition, time-off, public service, or philanthropy, your compensation program should be flexible enough to compensate them in an appropriate manner too.
If you found this article helpful, you might find these articles on the subject of money motivation helpful too:
Motivation and the Sales Force
Money Motivated Salespeople
10 Factors for Getting Salespeople to Over Achieve
Complacency
Compensation - The Unchanging Role
Cultural Differences with a Sales Force Evaluation
The Challenge of Developing Sales Engineers
Motivating Your Unmotivated Salespeople
5 Ways to Motivate Your Salespeople
(c) Copyright 2009 Dave Kurlan