18 Sep What Really Works When it Comes to Sales Incentives
At some point, organizations or businesses of any size have to evaluate if their sales incentive programs are really working to improve their bottom line. The monetary value of incentives has traditionally been used to spark motivation and create competition among sales staff or channel partners to succeed. While some self-motivated sales people are sparked by monetary incentives it does not mean the case for everyone else on the sales team. The real truth is that roughly twenty percent of sales people in any given organization or sales team makes up 80% of the sales and profits. The other 20% for the most part perform on the same level with very little difference in performance. Most companies that adopt this sales incentive strategy think the cookie cutter approach works for everyone when in truth this is not the case.
So, how can this approach work against an organization rather than for them? Once your top earners that make up your 20% have earned sufficient money as part of incentives to cover their desired lifestyle, they will in time not be influenced by additional pay. Therefore, it does not become a sustainable model for most if not all organizations.
Incentive programs using monetary value communicate a message that results are all that matters. This too is not sustainable and can cause a decrease in morale and mistrust to company values. The message also attempts to negate the significant influence of those factors in sales results that are completely beyond the salesperson’s control such as economic downturns, travel delays, and other unforeseen factors. Again, salespeople feel disconnected and engagement decreases over time.
So, what works best for your organization’s incentive strategy? Performance incentives do. See below.
- Learn to “Mentor” Your Team
- Invest in your team’s strengths
- Developing the ability to concept to relate and listen to understand others
- Do regular joint calls on prospects and customers with salespeople
- Provide performance based (behavioral) tools.
- Obtain feedback from your team on what would be of value to them as incentives and make sure the targets are achievable
Performance incentives have more meaning and emotion behind it for sustainability. They constantly remind salespeople on any level of their successes over time. It creates a better playing field while encouraging teamwork for success rather than competition itself.
It is important to note that when it comes to performance-based incentives, that keeping them simple and goals that are attainable allows for greater consistency for success long term. It is important to emphasize the importance of being prepared and promoting up front to new levels of success achieved together as a team. Reward immediately and always be conscious to recognize others where credit is due.
Trends with performance based incentive programs tend to look at rewards that are customized to each team member’s taste. People are different. It may be an unconventional travel destination, an activity that creates a memorable experience or one that focuses on wellness. In addition, there can be a combination of financial and non-financial incentives.
Organizations can build sustainable results using this type of strategy to create a win-win environment. They are increases in company morale, loyalty, productivity, motivation, and vision. Others benefits to organizations include improved teamwork, higher retention, and lower on-boarding expenses.
So what are next steps for your organization? Evaluate your current situation and if not working begin to apply the suggestions provided here for a more sustainable model toward success.
To your health & prosperity,