Help Your Sales People Get Rich

I am constantly amazed at how short-sighted some managers and CEOs can be when it comes to the compensation of their sales people.  In America, it is common for sales people (GOOD sales people) to make more money than the president of the company.

We all have to recognize that sales drives the business.  Sure, all the other departments are important... finance, operations, marketing, etc.  But without sales, the company comes to a grinding halt.

In a recent FORBES article, I read about the amazing turn-around accomplished by the new VP of Software for Hewlett Packard (HP).  Seems that the software division was losing money until the new guy came in and made some sweeping changes.  One of the first change he made was to take all the caps off of the sales peoples' commissions.  Now HP has several sales people in the division making more than $1MM per year.  Good for them!

CEOs and sales managers must remember that sales commissions are a variable expense.  The more money the rep makes, the more money the company makes.  Sales is not an easy job, and retaining great sales people is even more difficult.  If you want to keep the best, you must pay the most.  Taking limits / caps off the top end of the commission program is a great place to start.

Dedicated to your success in America...

Jim Worrell, CEO