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1 posts from August 2008

08/19/2008

Don’t Interrupt Sales Momentum by Moving the Food Bowl.

Darby the wonder Collie is a terrific partner for our family.  She is protective, obedient, affectionate, and has a great vocabulary.  But if there is one thing I’ve learned in living with canines, don’t move the food dish.  For days after you make a decision to change where they are fed, they will return to the spot where you fed them originally and be disappointed.  They finally get it, but it takes time. 

I don’t mean to compare a dog’s behavior with salespeople, but the similarity is interesting when it comes to food bowl decisions.    If you make changes in your sales compensation program at mid-year it may take considerable time for salespeople to figure out how they are compensated.  While they are figuring it out, valuable sales hours are being lost, they spend time scrutinizing their incentive compensation statements, and if asked how they get paid and why, most look as lost as Darby looking for dinner.

Compensation is an emotional issue; don’t mess with it.  The reason most often cited for changing compensation programs at mid-year is to boost sales.  This is an oxymoron.  Changing their compensation program interrupts a salesperson’s momentum and defeats the original purpose of the change.   If sales are down the salespeople have enough to contend with without having to wonder how they will be paid.  When you ask a salesperson why their compensation program has been changed, most will immediately say, “The company is trying to save money and reduce what they pay me.”   Their exact wording is more graphic but I cleaned it up for publication. 

Of course, you can add a Spiff (1) or a bonus at anytime during the year, but don’t toss the whole program in the air and expect business to increase or even be normal.  It isn’t likely to happen.   

Note:  [1] Spiff  commonly stands for Special Promotional Incentive Fund.  Spiffs are payments to encourage sales of specific products.

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