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Don’t Tell Your Salespeople to “Put on Their Company Hats”

Don’t Tell Your Salespeople to “Put on Their Company Hats”

March 20, 2018

In my three decades in distribution, I’ve sat in many meetings in which I’ve heard leaders try to get the support of sales people for an initiative that costs them commissions or bonuses.

Usually, the idea is about a new program for which the sales reps aren’t being paid (like a new website) or a technology initiative (like CRM). Generally, the leader says something like, “Look, team, I know you don’t like this, but you really need to put on your company hats.”

The conundrum here is that the vast majority of great sales people don’t have company hats. And if they did, they wouldn’t be great sales people. Asking a sales rep to put on a company hat is like asking a hungry tiger not to pursue tasty prey: you can’t make them stop by asking nicely. Hunting is in their nature.

For all its flaws, capitalism works better than other systems because it takes advantage of the reality that most people tend to act in their own self-interest. Great sales people are almost always pure capitalists and a leader’s job is to ensure the compensation system properly rewards the company and supports its goals while motivating and rewarding sales reps.

One of the underlying challenges is that all sales compensation systems are bad in at least one way or another. The leader’s job is to find the comp system that is better than the rest – for your company, meaning the right answer for you may be different than what other distributors do.

Many “company hat” requests emerge from leadership’s frustration about aligning new initiatives with a sales comp system that wasn’t designed to accommodate them. New eCommerce sites are a great example. If you reward your account managers on geographic sales, a new website will often result in the company paying commissions on sales that the reps did nothing to generate. On the other hand, if you don’t pay commissions on website sales, account managers will actively work to persuade customers to call them directly instead of ordering online, dooming your expensive new investment before it has a chance to work.

Even if you solve this problem by paying sales reps for online sales, they might still push back because they feel they are losing control of the customer relationship. Also, Account Managers often view websites as a threat because they see self-service purchasing as a step towards eliminating sales positions. And even if your plea for sales people to put on their company hats gets tacit agreement when you make it, you may find those hats in the trash when the meeting ends. 

Before you conclude that I have a negative view of sales professionals, let me tell you that I absolutely love them. Great sales people are rare, wonderful, nearly-magical revenue-generating machines. You can’t possibly find enough of them, no matter how much you pay them.

But the better the sales rep, the less likely she will ever wear a company hat. It’s a nearly perfect inverse correlation.

Probably the only thing worse than asking great sales people to wear company hats is to try to “spin” an initiative that hurts them as a positive. Because while great sales people do not have company hats, they do have highly sensitive and well-calibrated B.S. detectors. If that needle goes into the red, you won’t just have sales reps undermining your new initiative – you’ll have them looking for work with your competitors.

There’s no easy answer to all of this. Distribution leaders face the daunting task of developing compensation systems that please the sales force and support company initiatives – even the ones you haven’t thought of yet. Almost always, other leaders have developed solutions that work in situations like yours and you need to have a network you can activate to get expert advice when you face problems like this.

Just don’t try to sell your sales force on initiatives that are bad for them – and for heaven’s sake, don’t ask them to put on their non-existent company hats. Keep your tigers hunting prey for you and not for your competitors.

As always, I’d love to hear your input. You can leave a comment below or write to me at ian@mdm.com.

 

Sales GPS 2018

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