The topic of sales commission structures and whether they should or shouldn’t exist is a widely debated one. Whatever your view, the fact is the vast majority of sales teams are operating with one so I guess at least for now, there’s a strong argument for them as opposed to against. What I can say from experience is there are signs your commission structure may need a re-think. Look out for the following:
Is there’s a flurry of new deals won shortly after your quota period ends
If you find that there’s a wave of new sales that come in shortly after the month or quarter deadline, you’ve probably got a commission structure that heavily incentivizes hitting a target but doesn’t incentivize performance over the target, certainly not in an attractive enough way. Your sales people are ‘sandbagging’ to give them the best chance of hitting their revenue goals for the next month or quarter rather than helping the business to reach the best possible number of new sales for the current quota period.
