Why do so many sales incentives target the same small group of high performers and completely miss the middle?
That's the topic of this month's cover story by writer Bennett Voyles. (See page 12.) He found that many companies lose a majority of their salespeople's interest practically from the minute they kick off their programs. “Everyone knows who's going to win the trip, who's going to join the Chairman's Club,” says Michelle Smith, vice president of business development for OC Tanner, a Salt Lake City — based incentives company. Those who are probably out of the running won't even bother trying, she says.
Part of the problem is that the rules make it hard for most salespeople to compete, focusing on metrics such as highest sales. But also, many companies don't bother to find out what type of trips would excite those people who aren't part of their President's Club — they only poll last year's winners to see where they would like to go.
There is new evidence this is also happening with nonsales incentives. A recent survey by Maritz Inc. of 1,002 full-time employees in a variety of industries found a huge gap between how the average employee is rewarded and how he or she would like to be rewarded. For example, only 27 percent of the respondents who want to be recognized with incentives such as merchandise, gift cards, or trips are recognized that way, and only 29 percent who want to be recognized with cash are recognized that way.
The other piece is knowing what motivates different generations. Young people (who make up an increasing percentage of midrange performers) want contests with continuous feedback and immediate rewards — which does not describe your average sales incentive.
When it comes to your incentives, if you're doing everything exactly the way you did it last year, step back and ask why. It would take huge gains from your top 10 percent to equal a 10 percent improvement across the board by your middle 60 percent or 70 percent. Your midperformers could just be your biggest asset.
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