I am here to remind you comp drives behavior in part two of this series. In our previous post, we talked about commission and quota frameworks. This post digs into sales strategy pitfalls. While there is some overlap, these pitfalls can sour motivation—with or without the right comp plan—and are worth mentioning all on their own for how often I see these mistakes made.
3 common sales strategy pitfalls
Selling multiple business lines at the same commissionable rate
If you’re a sales leader with a tech firm, a reseller, Managed Service Provider or agency, you’ve got multiple technologies and service lines you want to sell to customers (regardless if you have co-primes or specialist sellers).
What will your sellers decide to focus on if they just have the full book available at the same or similar commissionable rates? The sales that bring the most money (or margin), with the lowest risk, and are the easiest to sell.
This is a hard habit to break, and I see this play out frequently post-acquisition. You acquire a new practice or product category, but your existing sellers don’t sell it. Why?
All sales are not equal
How do you incentivize sellers to sell across your portfolio? Sure, enabling them helps, but if you’re an MSP or a firm with many, and sometimes competing service lines, enablement is just one more required training session that sellers attend while scrolling Instagram. I once worked with a large MSP that made a lot of money over the years with Avaya, selling phone systems and their contact center solutions. They made acquisitions to sell cloud and Salesforce services to open new revenue streams with customers, but the pivot didn’t work - They didn’t offer incentive comp to sell newer acquisition services or technology.
The “all things are equal” comp structure caused guarded behavior from account owners who didn’t need to sell anything new in order to retain their accounts, make quota or keep their commissions.
The fix: There are a few sales strategies to try instead:
Drive engagement in new service or product lines with a targeted sales team to get some wins, then SPIFF these sellers VERY well for extra motivation (time-limited)
Comp your new service or product lines at a higher rate
Assign specific quota for your new line of business
Bonus motivation if you make those lines easy to sell.
Read our previous post on 5 ways to squander your merger or acquisition of a Technology Services Practice for mistakes on the sales side for more on this.
Player-coach team models
Giving sales leaders an individual quota on top of a team quota is generally NOT a recipe for success once you get beyond a team of one or two sellers. This also doesn’t play out well if you put a sizable individual quota on sales leaders.
I consulted with a tech services firm a few years back whose sales leader had a team of 10 with a team quota, PLUS an individual quota that was larger than the quotas for individual team members. What kind of behavior does that drive? Well, the sales leader won’t do much coaching, because they have to close so many deals.
The fix: If you want a sales leader to focus on growing the team’s success, comp them for that — team quota plus other metrics, not individual quota plus team quota.
Everyone is billable
Consulting firms sometimes make the decision to make everyone billable, including sales and customer-facing roles, because it looks better for profitability. In these cases, sellers are no longer incentivized to be customer-centric. They may “make money” for the firm through billable hours, but at what cost to trust with a customer? Motivation for selling gets tarnished, creates stress and burnout because it’s too hard to focus on selling when you also have to submit timesheets.
The fix: Keep sales and customer-facing roles non-billable. What you gain in customer satisfaction will more than make up for what little you’ll lose on the balance sheet.
How Partner Diva can help
It's essential to think through comp plans while working on your Go-to-Market strategy. I’ve helped numerous teams find the winning balance to drive the right seller engagement. An Executive Advisory engagement is perfect for this kind of strategy work.