It's a lot of little brushes that paints the big picture

Commission sales force – questions, no answers

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You go to, well… used to go to, a CompUSA. No one in the store can tell you why the two printer prices are so different. But they can tell you that all printers fail and you need a service contract.

You go to a car lot. A person casually, in a hurried walk, intercepts you in route to a line of parked cars. They welcome you, ask if they can help, then proceed to not be able to tell you much more than interior color options. But, they can get you financed, job or not.

Why wouldn’t sales folks take the time to learn their product line to present it better? Wouldn’t that result in more sales and more commissions for the sales force? My brother in-law sold cars for a while… he was a car guy so he was able to put a car with a person for a faster car sale. That is what he thought, his boss thought that most people coming in either knew what they wanted or buyers don’t care. We were both shocked by that answer.

That same brother in-law was a business partner in a small (profitable) company we ran for 10 years together. One step we asked all sales people to do for _every_ customer was to present their filter next to a new one. Don’t comment unless asked, then ask for the sale. That is it… with that they would hit 35% closing rate since our clients needed a replacement every third visit. If the employee hit that percent of closures, we gave them a percent of every sale they made.

Our bookkeeper brought to our attention that the numbers for the previous year just couldn’t be explained. He just happened upon it after looking at activity across several of our locations. It took me several weeks scanning traffic through our sales software before I found the process needed to get around the sales accounting. Wow… how long did it take someone to figure out how to cook the system?!

Doing a little social engineering, I found out that one employee who had a programming background kept playing for several months to ‘get in’. He then spread the word to his coworkers across our networks so everyone got in on commissions without selling – making it so there was no single point of irregularity. I had time to crunch numbers over a holiday while I was cooling my heals in the San Francisco airport waiting on fog to clear. The effort to show the filter next to new would have taken no more measurable time a day than it did to go through the steps to alter the system. Was asking for the sale so difficult that it was worth risking jail time.

Perhaps no one believed we would press charges. There was some surprised faces when we let three level of management go in four locations one day… we would rather work 24/7 than ‘allow’ this activity to happen. Looking the other way encourages wrong doing elsewhere.

In one part of my day job, I manage a sales comp system that handles 100+ field sales people and another 40 phone sales people. The system isn’t ‘mine’. I am the go between, programmers and the ‘client’ (users). The current system is a marriage of several legacy systems rules into a full new system. When we started, we were taken back by the rules upon rules for how commissions would be handled. Investigating, it became clear that the rules were made over years to block tricks the sales force was able to come up with to get around the system.

Blocking some of the new system gaming discoveries has caused us to start on a third version of our ‘new’ software. Why do we spend so much time and money writing and re-writing the system to block these shortcutting tactics? Because management wont do anything to enforce the rules. They fear that if the sales force is punished, they will ‘stop selling’. Not really sure they are selling now.

How do you motivate sales people to do the right thing?

I think a little fear of being caught and prosecuted wouldn’t be a bad thing. Hiring people with pride in their work and an understanding that when they make the business successful, they are successful. And finally, simplifying payout plans offers less points to toy with. Have you had successes with your sales force?

 
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Posted in: Lessons Learned

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