BOSTON - Defining and implementing the proper incentives is the key to getting the most out of your sales force, says Harvard Business Review.
The Management Tip of the Day offers quick, practical management tips and ideas from Harvard Business Review and HBR.org . Any opinions expressed are not endorsed by Reuters.
"A few progressive companies have been able to coax better performance from their teams by treating their sales force like a portfolio of investments that require different levels and kinds of attention. Here are some ideas:
1. Get rid of commission ceilings. Caps on commissions incentivize salespeople to sell to the quota and then stop. Without them, you'll likely see increased revenue and happier salespeople.
2. Offer over-achievement commissions. For those who surpass their quotas, increase the commission rate. This will keep your stars working hard during the fourth quarter, which is often when customers are most ready to buy.
3. Allow multiple winners. This will boost sales effort and improve performance better than contests with winner-take-all prize structures." - Reuters
- This management tip was adapted from "Motivating Salespeople: What Really Works" by Thomas Steenburgh and Michael Ahearne.