• Sue Berry
    8
    In our recent webinar on setting reward, I was asked to elaborate on my comment that commission payments don't work. Here are my thoughts.

    Commission is about incentivising someone to do some work. That's fine, as long as the person doesn't have to be a team player. Why would anyone help others to complete their roles if they are then distracted from achieving their own targets. As a sales rep, would you really pass on a sale to your colleague if it meant they moved closer to their target and you obviously didn't. Managers need to incentivise the right behaviour. If teamwork is wanted, that's what needs to be rewarded.

    Also, a small incentive is unlikely to cause someone to work harder. If it's a small incentive (let's say £3,000) and there's only a 20% chance that it will be achieved, that equates to £600. So, does the sales person go and spend quality time with their young family or work extra hours for a likely £600 payment? Unless incentives are significant (compared to their normal wages) and very likely to be paid in full, they don't incentivise.

    If you want to read more, check out our blog on setting incentivising commission payments.

    I'm not a huge fan of commission payment. I don't believe they work. I don't believe they incentivise the right behaviour. I'd be interesting to hear your thoughts.
  • Andrew Kerr
    2
    All interesting. Lots of mangers believe in commission. But it is interesting that there's a high turnover in sales, particularly in instances where the sales person is paid a significant part of remuneration through commission.
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