The Gartner Sales Podcast
Three Guiding Principles for Sales Compensation in Uncertain Times, with Steve Herz
Jul 1, 2020
Steve Herz, a sales compensation design expert, shares his insights on navigating uncertain economic times. He discusses the trade-offs sales leaders face between motivating sellers and managing cash flow. Herz emphasizes the importance of updating incentive plans quickly to boost morale but warns of potential future adjustments. He advocates for strategic, flexible compensation structures that align with long-term business goals, and highlights innovative approaches to incentives that adapt to market shifts.
36:43
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Quick takeaways
- Sales leaders must balance the financial stability of salespeople with corporate profitability, necessitating clear guiding principles to navigate uncertainty.
- Establishing transparent communication and adaptable compensation structures helps maintain sales team morale and engagement during unpredictable market conditions.
Deep dives
Navigating Difficult Trade-offs in Sales Compensation
Sales leaders face challenging trade-offs in managing compensation during uncertain times, particularly between ensuring salespeople's financial stability and adhering to profit margins and corporate profitability mandates. Many leaders may not have previously grappled with these financial metrics, and navigating this tension becomes vital. This situation harkens back to the 2008-2009 economic downturn, but the absence of recent experience in such conditions amplifies the difficulty of decision-making. It is crucial for sales operations leaders to establish guiding principles in advance to guide their decisions and avoid reactive choices that may misalign with the company's cultural values.
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