Why Must You Pay Sales People Commissions?
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Re: Why Must You Pay Sales People Commissions?
#2A strong argument would at least consider the systemic consequences of commissions, rather than just extolling the assumed virtues in a circular argument. What is their impact on product? On support? Engineering morale? On the customer experience itself? Just a myriad of effects not even considered here when commissions are looked at in isolation, the system be damned.
It's probably very true that it's not plausible to do anything but commission-based sales in this market, and competing with other companies offering so much more money for the same job is just not worth the effort. But it's lazy to assume that their isn't a better holistic model, taking into account the whole company system, and not solely myopic sales metrics.
Edit: is Pluralsight a big enough counterexample? Maybe some food for thought from Aaron Skonnard here: https://www.inc.com/aaron-skonnard/why-sales-commissions-don...
Re: Why Must You Pay Sales People Commissions?
#3Why do sales people get commissions and engineers don't? Because the sales person knows exactly how much money they bring in and can claim "if I didn't make the sale, that money would not be coming in" even though it's not always true it's a good story. An engineers actions are so far removed from revenue that they can't make a claim so directly. Also, if they did want to claim a portion of product revenue they could just as easily be fired and the revenue would still flow. Such is the delay between engineering work and revenue.
Re: Why Must You Pay Sales People Commissions?
#4A strong argument would at least consider the systemic consequences of commissions, rather than just extolling the assumed virtues in a circular argument. What is their impact on product? On support? Engineering morale? On the customer experience itself? Just a myriad of effects not even considered here when commissions are looked at in isolation, the system be damned. It's probably very true that it's not plausible…
You have to find a way to measure it though. As long as you can't that it doesn't matter if there are a more holistic way to think about it (my guess is that there are but it requires a lot more data pick-up-point)
Re: Why Must You Pay Sales People Commissions?
#5I like how he inadvertently admits that engineers are compensated less well in part because they mistake their jobs for something fun they'd do anyway.
Re: Why Must You Pay Sales People Commissions?
#6A strong argument would at least consider the systemic consequences of commissions, rather than just extolling the assumed virtues in a circular argument. What is their impact on product? On support? Engineering morale? On the customer experience itself? Just a myriad of effects not even considered here when commissions are looked at in isolation, the system be damned. It's probably very true that it's not plausible…
You have to find a way to measure it though. As long as you can't that it doesn't matter if there are a more holistic way to think about it (my guess is that there are but it requires a lot more data pick-up-point)
Do you though? At an individual level? The only measurement that matters is profit, which is pretty easy to measure.
Re: Why Must You Pay Sales People Commissions?
#7Why do sales people get commissions and engineers don't? Because the sales person knows exactly how much money they bring in and can claim "if I didn't make the sale, that money would not be coming in" even though it's not always true it's a good story. An engineers actions are so far removed from revenue that they can't make a claim so directly. Also, if they did want to claim a portion of product revenue they could…
Also personality. Good salespeople are... Good salespeople. They apply their craft when negotiating compensation. What am I going to do, make a single page app about why I should be paid more?
...actually that's not a bad idea.
Re: Why Must You Pay Sales People Commissions?
#8Are there any examples of competitive sales organizations that don't pay commission of some kind?
Re: Why Must You Pay Sales People Commissions?
#9Why do sales people get commissions and engineers don't? Because the sales person knows exactly how much money they bring in and can claim "if I didn't make the sale, that money would not be coming in" even though it's not always true it's a good story. An engineers actions are so far removed from revenue that they can't make a claim so directly. Also, if they did want to claim a portion of product revenue they could…
Also personality. Good salespeople are... Good salespeople. They apply their craft when negotiating compensation. What am I going to do, make a single page app about why I should be paid more? ...actually that's not a bad idea.
I wonder if that's how Glassdoor was started.
Re: Why Must You Pay Sales People Commissions?
#10Best advice I've ever heard on this subject is never hire just one. Sales teams need competition to thrive so it is to be at least two people.