Money Changes Everything
You've heard it before, you'll hear it again: Money Changes Everything. In this story it's the fastest path to screwing up a sales department.
If I haven't said it before my job is a little different than most. 1st of all I am a Funeral Director, the least of all thought of positions on the college enrollment forms. The 3rd most likely profession to result in suicide, right behind Attorneys (lying, cheatin, bastards), and Dentists. Interestingly enough the 4th most likely is Embalmers (Note same as Funeral directors). But the second part of my job is a Pre-Planning counselor. I've written before on the importance of pre-planning and I truly believe that people should do this, but in the end most of my compensation comes from the selling of pre-need.
About 3 months ago our company in their infinite wisdom decided to change our compensation plan and make it more heavily weighted towards pre-need sales. Before we were paid a good hourly rate to be a funeral director and then compensated on bonus for exceeding certain 'Gates' or pre-need targets. Worked fine I would say it helped balance the 'Service' side of our business against the 'Sales' side of our business, and I am fortunate to work with a group of individuals who truly put the Service before the Sale which is why they are so successful. I
In an effort to increase sales and lower costs they decided to incent our group to sell more by lowering the hourly wage up to 1/3 and increasing the bonus for the top tiers of our compensation plan. And so far it has done nothing but fail. The people in the middle who felt their personal wages were targeted just got upset which depleted their energy and enthusiasm, yes even in a mortuary you need energy and enthusiasm to sell, and the people at the bottom just feared for their ability to pay the bills. And thusly we are all in a position now top, middle and bottom of fearing for our jobs. What a GREAT PLAN!
This lead me to think this morning that there is NEVER a good way to change a comp plan for a sales team. Once established it doesn't matter what you do you will always end up with less sales for a while, at least. Let's say for instance that you increase compensation, well the likely result is that you will sell more of that product for a while, but soon the salespeople will settle back into their income comfort zone, and only sell enough to get their bills taken care of. If you lower compensation you will destroy enthusiasm and loyalty and loose people (most likely your best) .
Every comp change must be looked at long term to get through for the sole purpose of necessitating a cost issue, changing comp plans for the purpose of increasing sales will always fail.
If I haven't said it before my job is a little different than most. 1st of all I am a Funeral Director, the least of all thought of positions on the college enrollment forms. The 3rd most likely profession to result in suicide, right behind Attorneys (lying, cheatin, bastards), and Dentists. Interestingly enough the 4th most likely is Embalmers (Note same as Funeral directors). But the second part of my job is a Pre-Planning counselor. I've written before on the importance of pre-planning and I truly believe that people should do this, but in the end most of my compensation comes from the selling of pre-need.
About 3 months ago our company in their infinite wisdom decided to change our compensation plan and make it more heavily weighted towards pre-need sales. Before we were paid a good hourly rate to be a funeral director and then compensated on bonus for exceeding certain 'Gates' or pre-need targets. Worked fine I would say it helped balance the 'Service' side of our business against the 'Sales' side of our business, and I am fortunate to work with a group of individuals who truly put the Service before the Sale which is why they are so successful. I
In an effort to increase sales and lower costs they decided to incent our group to sell more by lowering the hourly wage up to 1/3 and increasing the bonus for the top tiers of our compensation plan. And so far it has done nothing but fail. The people in the middle who felt their personal wages were targeted just got upset which depleted their energy and enthusiasm, yes even in a mortuary you need energy and enthusiasm to sell, and the people at the bottom just feared for their ability to pay the bills. And thusly we are all in a position now top, middle and bottom of fearing for our jobs. What a GREAT PLAN!
This lead me to think this morning that there is NEVER a good way to change a comp plan for a sales team. Once established it doesn't matter what you do you will always end up with less sales for a while, at least. Let's say for instance that you increase compensation, well the likely result is that you will sell more of that product for a while, but soon the salespeople will settle back into their income comfort zone, and only sell enough to get their bills taken care of. If you lower compensation you will destroy enthusiasm and loyalty and loose people (most likely your best) .
Every comp change must be looked at long term to get through for the sole purpose of necessitating a cost issue, changing comp plans for the purpose of increasing sales will always fail.
posted by Cemseller at 8:17 AM
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