August 22, 2019

How to Create A Sales Incentive Program That Guarantees Growth?

The proverbial ‘dangling carrot’ is one of the oldest motivation tricks that understood the heart of human behaviour, psychology and, in this, employee incentive program. The reason why the technique stood the test of time is because it works! For those who say, 'it doesn't work', don’t execute the elements of the technique properly — therefore leading to under performance and failure. Having the same old sales incentive programs can become dull and disappointing for both you and your salespeople. It's time to look for a program that motivates your sales staff and trigger productivity.

“Without change, there is no innovation, creativity, or incentive for improvement.”

- William Pollard

Why are not all salespeople motivated?

  • The 80/20 rule in sales performance: According to the 80/20 rule, aka Pareto principle, 20% of your company's salespeople generate 80% of the sales revenue. In such cases, a universalized sales incentive program that is geared for the entire sales force is the wrong choice. No one size fits all. You see, the top 20% are already motivated. You need an incentive program that not only lights a fire under their belly, but is also adaptive, and tracks the growth of every single performer in a seamless and cost-efficient manner.
  • The KISS principle The KISS principle, an acronym for "keep it simple, stupid" or "keep it stupid simple" says that system works best when they are kept simple, rather than being complicated. This holds very true to salespeople. Their nature is like electricity; they always embark the path of least resistance. Many incentive programs fail because of their complexities in recording, reporting and rewarding system. They are the recipe of confusion and failure.

The Solution

Incentive program needs to be sweet, smooth and doable. There should be no room for ambiguity. Apart from that, your incentive program should also have the following elements -

  • Educate people about your program: For an invention to sell, you need a salesperson and customer to understand it's value. Similarly, for your incentive program to work, you need users and administrators to understand it. Most motivational programs fail to work because they are either not rolled out or managed properly. Hence, you need to understand the program you (or your team) designed and then educate the users and administrators (who will lead the application of it).
  • Right kind of program promotion: We all have heard of the line - "Timing is everything!" This is a piece of excellent advice for an incentive program planner. Incentive programs, like new movie releases, should be exciting and anticipated. The right amount of promotion ensures greater interest and acceptance from users (salespeople).
  • Immediate Reward: What ticks your salesperson the most? It's the reward and incentives that they get when they close the deal successfully. However, when the time taken between winning and getting a reward is too long, the situation becomes anticlimactic, and your employees become unmotivated. Successful incentive programs reward immediately! Faster the reward is delivered, the higher the enthusiasm for the incentive program.
  • Recognition: We all know that there is no such thing as too much recognition. Like any other performer, salespeople by nature are drawn towards the limelight. Hence, achievements, acknowledgement and recognition - on time - can go a long way. The pursuit of recognition in itself can make a big difference in targeting that critical 20% on the sales achievement ladder. Another thing that is often overlooked is that recognition is the least expensive (it's usually free) means of motivation. For example, shaking hands form the CEO/Founder of the company can quickly galvanize the need to win.


While designing a sales-incentive program, there are no definite answers to the building blocks a company should adopt. The key is to strike the right balance between the design that comprises the elements mentioned above and the plan focused on making it easily understandable for the sales team. In the end, your decision should be based on a company's overall sales strategy, key goals and its go-to-market model.

Poonam Das