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Why I Won’t Get Out of Bed for Less Than 3% Commission

April 10, 2009


Salesmen are hated for two crimes: making cold calls and collecting commission checks.  Fortunately for our profession, at least one of the two is on the decline.

The concept of the sales bonus is quite bizarre; in no other corporate function do employees require variable compensation to perform basic tasks such as responding to email and returning phone calls. 

But no sir, I am a salesman!  Most mornings I wake with an empty glass of Veuve Clicquot in my hand, light a cigar and begin phoning through my rolodex starting with the prospect most likely to cover the next payment on my Bentley.  If only life was that simple…

Still commission checks nicely spice up otherwise dull customer interactions.  Negotiating a million dollar contract is much more fun when the individual recommending the solution personally stands to pocket enough dollars to purchase a small speed boat.

The trouble is I’ve always felt quite awkward with such an elephant sized conflict of interest in the room “Doug – go with option B – it’s great for you and I can finally pay off my wife’s credit card bill.”  I am disorientated at the thought of addressing a room of my smartly dressed peers who are all mentally calculating how much cash I am personally going to skim off this deal.

One loving prospect, who made my life hell for two years, asked in our first meeting “so what kind of crazy commission structure are you guys on over there?”  I wanted to politely inquire what color underwear he was wearing but refrained.  Predictably, we never went beyond me bidding on laborious proposals while he called back with the same predictable outcome… ad nausea. “You won’t believe it but your company came in second.  Again! Who would have thought it?”  What goes around comes around my friend.

Oh, to be a buyer for just one day, to look down with contempt upon all who come to plunder the company’s precious funds peddling their wares and value driven elixirs of differentiation.  The interesting thing is that this mercenary attitude frequently extends to our own management teams.

“Buddy, we wanted to keep you motivated this quarter, so I’m introducing this month’s Mega Ball Bonus Commission Multiplier”. The New York State lottery’s copy editor could learn something from this guy.  Thanks – I’m already amply motivated at the thought of us all losing our jobs without you adding a biblical dose of greed into the mix.

Personally, I do not believe there is any statistical correlation between variable compensation and sales performance: high salaries keep top performers – they don’t make them.  When I go to pitch against the big boys from Accenture or IBM with their functioning marketing departments, I relish the competition.  Whether you pay me 1%, 3% or 8% factored by a 1.2 President’s Club One Time Bonus, it will all have zero influence on the outcome of the deal.  I shalt go to win and slayeth the giant.  The client doesn’t care if you’re paying double commission for business signed this month or if we’re behind on our quarterly figures.  In this economic environment, decisions are made on business judgment with a healthy dash of personal trust.

The day you’re going after business to catch a flying commission check is the moment you’ll lose the deal. Who appreciates a commission check when they’re anonymously handed out by payroll to the egotistical cries of “Give me my money!”  So what’s a sales manager to do? 

No, the best bet is a discretionary bonus paid twice a year so no one jumps ship too soon.  Bonuses come from “Me to You” and I remember to say “Thank You” on my way out of the office.  If variable compensation must be offered then keep it simple and predictable.   A recent report by Dan Ariely at Duke University suggested that the higher the bonus on the table the greater the stress and the worse the employee performance.  Bizarre?  Yes.  Believable?  Absolutely… well in socialist France anyway.

So what’s a Closer to do?  Throw your up eyes to that fading motivational poster that hangs in the staff canteen and read the immortal lines.  “Love like you’ve never been heartbroken.  Dance like no one is watching. Sell like you don’t need the paycheck” Sod it, take the money… how can a man close without a Mont Blanc pen in his pocket?

2 Comments leave one →
  1. aahang permalink
    April 12, 2009 5:36 am


    Thanks for your point of view.Unfortunately the TED link did’nt show up.

    I have just added a post – Blog like it will never be seen.

  2. May 11, 2009 8:53 pm

    Dude, I’m glad you posted on my blog. Now I’m bookmarking yours. You write some good MOJO!

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