{"id":57564,"date":"2019-10-06T15:52:05","date_gmt":"2019-10-06T13:52:05","guid":{"rendered":"https:\/\/www.eurogroupconsulting.it\/2019\/10\/06\/smart-incentives-how-to-effectively-motivate-and-mobilize-sales-force-organization\/"},"modified":"2022-10-07T12:12:03","modified_gmt":"2022-10-07T10:12:03","slug":"smart-incentives-how-to-effectively-motivate-and-mobilize-sales-force-organization","status":"publish","type":"post","link":"https:\/\/www.eurogroupconsulting.it\/en\/smart-incentives-how-to-effectively-motivate-and-mobilize-sales-force-organization\/","title":{"rendered":"Smart Incentives \u2013 How to effectively motivate and mobilize sales force organization"},"content":{"rendered":"<div class=\"wpb-content-wrapper\"><p>[vc_row][vc_column][vc_column_text]<strong>There\u2019s a mismatch between what science knows and what business does.<\/strong><\/p>\n<p>As a matter of fact, social sciences have demonstrated for a long time that <strong>traditional incentives models, rewarding targets achievement, do not positively affect performances<\/strong>, especially in activities that require even rudimentary cognitive skills (<a href=\"http:\/\/www.ted.com\/talks\/dan_pink_on_motivation\">The puzzle of motivation, D. Pink<\/a>).<\/p>\n<p>Nevertheless, we all know that in a business environment what does not get measured does not get done and, despite social sciences\u2019 studies, companies continue to adopt t<strong>raditional sales force effectiveness models<\/strong>, based on:[\/vc_column_text]<div class=\"standard-arrow list-divider bullet-top\"><ul>\n<li>Standard sales process focused on <strong>optimization of cost effectiveness per customer segment<\/strong><\/li>\n<li>Incentive system which assigns <strong>individual reward based on quantitative targets achievement<\/strong><\/li>\n<\/ul>\n<\/div>[vc_column_text]Basically, <strong>traditional methods<\/strong> seem to be <strong>aimed to distribute rewards within the sales organization coherently with the contribution to the target achievement<\/strong>.<\/p>\n<p>But <strong>do they have a real impact on sales performances<\/strong>?<\/p>\n<p>Stimulated by this contradiction, we analyzed traditional incentives systems and identified <strong>four key limits<\/strong>:[\/vc_column_text]<div class=\"standard-arrow list-divider bullet-top\"><ul>\n<li>The result of a <strong>\u201cvertical top-down push\u201d approach<\/strong> of objectives setting totally depends on people understanding and engagement and <strong>can imply heterogeneity<\/strong>. Each salesman can understand and \u201clive\u201d sales targets differently from his colleagues<\/li>\n<li>Application of <strong>standard sales process can generate a feeling of reduced initiative and autonomy<\/strong>. Successes and failures cannot be clearly allocated (bad management decision or sales team faulty actions?) and no one feels responsible<\/li>\n<li><strong>Traditional models based on \u201chigh bonus to top performers\u201d<\/strong> do not tackle the majority of people who is in the comfort zone: salespeople who are very far from target achievement are not motivated to make effort on the field; salespeople who achieved the target could evaluate \u201csafer\u201d to postpone extra-sales to the next period<\/li>\n<li><strong>Typical customer segmentation model inevitably implies estimation errors<\/strong>. There is an additional business potential still unexplored that can only be grasped through direct contact with the customer<\/li>\n<\/ul>\n<\/div>[vc_column_text]Furthermore, we are experiencing a <strong>changing environment<\/strong> characterized by more complex products and services, multichannel communication and lower standardization level, which is <strong>pushing towards a more sophisticated customer engagement model<\/strong> and <strong>personalized sales approach<\/strong>, which is the context where social sciences show that traditional incentives methods do not work.<\/p>\n<p>So, <strong>how to effectively mobilize sales organization to have a real impact on performances<\/strong>?<\/p>\n<p>As science and practical experiences demonstrate,<strong> autonomous responsibility indeed drastically improve performance<\/strong>. That\u2019s why roundabouts autonomous responsibility has progressively substituting traffic lights with an increase in fluidity and reduction of accidents. <strong>Sales effectiveness<\/strong> is thus not only a matter of efficiency, but it is <strong>significantly improved by autonomous responsibility<\/strong>.<\/p>\n<p>We think that the focus should then be on:[\/vc_column_text]<div class=\"standard-arrow list-divider bullet-top\"><ul>\n<li><strong>low-average performance sales people<\/strong> vs top performers<\/li>\n<li><strong>business potential<\/strong> vs target achievement<\/li>\n<li><strong>customers<\/strong> vs products<\/li>\n<li><strong>trust, initiative and accountability<\/strong> vs central steering<\/li>\n<li><strong>management by support<\/strong> vs management by control<\/li>\n<li>teams vs lone fighter success<\/li>\n<\/ul>\n<\/div>[vc_column_text]<strong>How to do that<\/strong>?<\/p>\n<p>We are experimenting a new model <strong>integrating traditional incentive systems with a competitive mechanism between peers<\/strong> based on the following elements:[\/vc_column_text]<div class=\"standard-arrow list-divider bullet-top\"><ul>\n<li><strong>Teams \u2013 <em>I win if we win<\/em><\/strong>: bonuses are assigned to teams not to individuals<\/li>\n<li>P<strong>oints collection \u2013 <em>My performance is measured by collected points<\/em><\/strong>: teams collect points for each sales activity and result (proper scoring system in place)<\/li>\n<li><strong>Accountability \u2013<\/strong><em><strong> I\u2019m responsible of my team ranking<\/strong><\/em>: salespeople have a certain autonomy in their sales activities (although the scoring system addresses their focus)<\/li>\n<li><strong>Dynamicity \u2013<em> I\u2019m always visible in the ranking, there are no \u201canonymity areas\u201d<\/em><\/strong>: teams compete each other in small groups (like in football leagues) and each team can downgrade or upgrade to lower or upper leagues in each \u201cseason\u201d<\/li>\n<li><strong>Competition \u2013<em> I win on the basis of my team ranking<\/em><\/strong>: no more target achievement<\/li>\n<\/ul>\n<\/div>[vc_column_text]A proper <strong>scoring system<\/strong>, in line with the company strategy and objectives, is therefore needed. It should be based on the <strong>\u201cperfect sales process\u201d<\/strong>, assigning <strong>different points to specific KPIs<\/strong> related <strong>to sales activities and results<\/strong>. It should be also considered a <strong>capacity factor<\/strong> to enable a fair competition among not-homogeneous teams.<\/p>\n<p>Finally, it should be highlighted that this innovative model <strong>can be very useful in some regulated environments<\/strong>, such as banking and pharma sectors, where traditional incentive schemes based on sales target achievements are starting to face compliance issues.<\/p>\n<p>First implementation of this new model had <strong>significant impact on sales performance<\/strong>, bringing <strong>fun and motivation in the sales organization<\/strong>.<\/p>\n<p>For further information, please contact:<br \/>\nAngelo CENTRONE<br \/>\n<a href=\"mailto:a.centrone@eurogroupconsulting.it\">a.centrone@eurogroupconsulting.it<\/a><\/p>\n<p>Flavia GHISONI<br \/>\n<a href=\"mailto:f.ghisoni@eurogroupconsulting.it\">f.ghisoni@eurogroupconsulting.it<\/a>[\/vc_column_text][\/vc_column][\/vc_row]<\/p>\n<\/div>","protected":false},"excerpt":{"rendered":"<p>[vc_row][vc_column][vc_column_text]There\u2019s a mismatch between what science knows and what business does. As a matter of fact, social sciences have demonstrated for a long time that traditional incentives models, rewarding targets achievement, do not positively affect performances, especially in activities that require even rudimentary cognitive skills (The puzzle of motivation, D. Pink). Nevertheless, we all know&hellip;<\/p>\n","protected":false},"author":12,"featured_media":58426,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[379],"tags":[],"class_list":["post-57564","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles","category-379","description-off"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Smart Incentives \u2013 How to effectively motivate and mobilize sales force organization - Eurogroup Consulting<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.eurogroupconsulting.it\/smart-incentives-how-to-effectively-motivate-and-mobilize-sales-force-organization\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Smart Incentives \u2013 How to effectively motivate and mobilize sales force organization - Eurogroup Consulting\" \/>\n<meta property=\"og:description\" content=\"[vc_row][vc_column][vc_column_text]There\u2019s a mismatch between what science knows and what business does. As a matter of fact, social sciences have demonstrated for a long time that traditional incentives models, rewarding targets achievement, do not positively affect performances, especially in activities that require even rudimentary cognitive skills (The puzzle of motivation, D. Pink). Nevertheless, we all know&hellip;\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.eurogroupconsulting.it\/smart-incentives-how-to-effectively-motivate-and-mobilize-sales-force-organization\/\" \/>\n<meta property=\"og:site_name\" content=\"Eurogroup Consulting\" \/>\n<meta property=\"article:published_time\" content=\"2019-10-06T13:52:05+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-10-07T10:12:03+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.eurogroupconsulting.it\/wp-content\/uploads\/2019\/10\/Smart-Incentives-e1638380753737.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"627\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Laura Sciacchitano\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@eurogroupit\" \/>\n<meta name=\"twitter:site\" content=\"@eurogroupit\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Laura Sciacchitano\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.eurogroupconsulting.it\\\/smart-incentives-how-to-effectively-motivate-and-mobilize-sales-force-organization\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.eurogroupconsulting.it\\\/en\\\/smart-incentives-how-to-effectively-motivate-and-mobilize-sales-force-organization\\\/\"},\"author\":{\"name\":\"Laura Sciacchitano\",\"@id\":\"https:\\\/\\\/www.eurogroupconsulting.it\\\/#\\\/schema\\\/person\\\/e805387a96ccfc98339a7a343784781d\"},\"headline\":\"Smart Incentives \u2013 How to effectively motivate and mobilize sales force organization\",\"datePublished\":\"2019-10-06T13:52:05+00:00\",\"dateModified\":\"2022-10-07T10:12:03+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.eurogroupconsulting.it\\\/en\\\/smart-incentives-how-to-effectively-motivate-and-mobilize-sales-force-organization\\\/\"},\"wordCount\":799,\"publisher\":{\"@id\":\"https:\\\/\\\/www.eurogroupconsulting.it\\\/#organization\"},\"image\":{\"@id\":\"https:\\\/\\\/www.eurogroupconsulting.it\\\/smart-incentives-how-to-effectively-motivate-and-mobilize-sales-force-organization\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.eurogroupconsulting.it\\\/wp-content\\\/uploads\\\/2019\\\/10\\\/Smart-Incentives-e1638380753737.jpg\",\"articleSection\":[\"Articles\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.eurogroupconsulting.it\\\/en\\\/smart-incentives-how-to-effectively-motivate-and-mobilize-sales-force-organization\\\/\",\"url\":\"https:\\\/\\\/www.eurogroupconsulting.it\\\/smart-incentives-how-to-effectively-motivate-and-mobilize-sales-force-organization\\\/\",\"name\":\"Smart Incentives \u2013 How to effectively motivate and mobilize sales force organization - 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