September was a look back at a series of posts that started in 2013 with an exploration of the idea of eliminating tips in restaurants and how that might be a clue toward eliminating commissions for certain sales positions. Even the BBC recently published an article, “Is This the End of Tipping?,” proving it is definitely a current subject. The post “Following-Up: Amazon’s Fire Phone and Tipless Restaurants” had the details and was soon followed by the post “Rethinking Sales: Part 9 – Sales Without Commissions.” There is obviously a lot to say on this controversial topic so the post “Sales Without Commissions – Some Additional Thoughts” was published three days later.
Along the way, an informational post discussed better writing in “MailChimp Publishes a Guide to Effective Communication,” IOS and Android went head to head in “Some Thoughts About… Android Versus IOS,” and some useful advice for everybody was provided in “Who Knew It Could Be So Easy to Curb Our Cravings for Sex and Food.”
However, back to the big question: Can a sales team be successful without a commission based compensation plan? As usual, “Yes, No, Maybe” is the answer. Yes: In my experience commission motivates salespeople to act in the self interest of maximizing commission, but does not always lead to more or better performance. In specialized markets, salespeople do not seem to perform worse without commission, but pursue projects based on other motivational factors: prestige, interest, and compatibility. No: With a well designed compensation plan, those self interests are aligned with company interests such as maximizing motivation, sales, and profit. Maybe: Examining specific company cultures and sales environments can lead to a reduction or even elimination of commission structures. Human motivation is complex and sales are a company’s lifeblood, the right balance can lead to higher levels of organizational health and success.
As a bonus to newsletter subscribers, here is an articled linked to by Phil Schiller, the senior vice president of worldwide marketing at Apple, “What It Means to Be Great” by Horace Dediu. Horace is known for his analysis of Apple’s business strategy and predictions of their financials, but to me he is more of a technical poet. It is one of the best articles I have read recently. He says:
“Greatness is transcendental. It’s hard to pin down. It inspires debate. It divides as much as it unites. It creates emotions as much as thoughts. It builds legends. It engages and persists. It lives in memory and penetrates culture. It implants itself in our consciousness persistently, to linger and dwell in our minds while we are bombarded with stimuli.”
Here’s to greatness!