The psychology of sales and the advantages of group pay for performance

by on June 17, 2009 · 0 Comment POSTED IN: HR Info Center

Accommodate different types of people with pay for performance

So, also think about the psychology of the salespeople . Most of them if they’re kind of up the scale from farmers to hunters want to make the most of a pay for performance system.

The hunters want to make as much money as possible. Everyday, they get up and they look themselves in the mirror. And, they say they’re going to hit the ball out of the park and they’re going to make a lot of money, today. It takes that kind of personality to be a good salesman.

But, one of the things that they want to do is the least amount of work. If ever there was a truism it’s that time is money it’s for these kinds of guys. They don’t want to waste money or time on things that are not going to pan out for them.

The characteristic of salespeople, though, is the fact that they are optimistic. They have to be optimistic, in order to do these kinds of jobs. So, they’re also better at talking rather than writing in which may explain, why they’re not really fond of a lot of the process and procedures that most of us take for granted and have to follow in companies. So, they’re not real fond of bureaucracy. It means, it takes them away from actually doing the selling and actually earning money and racking up pay for performance benefits.

One of the things you have to consider in this is how much of a sale is done through individual pay for performance accomplishments. And, generally, these are the farmer – are the hunter types versus team accomplishments.

Certain types of salespeople in the sales area, actually, should be rewarded on the team basis or a group pay for performance plan as opposed to an individual plan.

Examples could be sales engineers. Sales engineers provide the technical support to the hunters or the new business developers. Once a potential client has been identified, they go in and give all the specs and answer all the technical questions. And, in many cases they actually may be responsible for the closing of a particular job.

The technical people may actually be the primary reason a client or a customers signs on the dotted lines. Even, though, they may not have gone out in gotten the lead or the first contact with the client. However, it’s hard to measure what their contributions are in that sale.

Consequently, lots of sales jobs, actually, should be rewarded on a team basis as oppose to an individual pay for performance basis, primarily, because it’s harder to determine what their contributions – what contributions were involved by them.

So, it depends on who’s really involved in this – in the sale. You may, actually — you may credit — you may split sales credit in certain areas. How much of an override – let’s call them override for sales management, should they take off of each one of the other salespeople.

Edited Remarks from “Incentive Talk: How to Design an Incentive Plan that Works for – Not Against – Your Company’s Goal” by Rick Olivieri

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