What motivates sales people?
Motivation leads to better performance and improves the efficiency level regardless of the activity that is carried out. Through motivation, people usually manage to take action in order to achieve their goals at professional or individual level.
A person’s motivation can come from within, or it can be external. As far as external motivation is concerned, in order to motivate an individual’s performance at work, organizations adopt different strategies, as they are aware that unmotivated or poorly motivated employees can affect overall performance. This is also the case of sales managers, who need to motivate their sales team in order to reach their targets and achieve their goals.
Strategies of motivating sales people range from bonuses and performance-based rewards to engaging employees in the decision-making process, as it is presented in an infographic on how to motivate sales people, available on Salesforce.com. These motivational factors can fall under two categories: financial and non-financial incentives.
Since, as it was shown by a study on what motivates pharmaceutical sales people, conducted by Dr. M. Wiese and Dr. R. Coetzee at the University of Pretoria, money is not the only factor that motivates individuals, organizations should resort to more than money to motivate sales people. Managers should show recognition for team or individual achievement with the aid of performance reports, they should support and encourage good habits, and also inspire initiative. Moreover, managers should provide coaching and one-to-one real-time feedback.
Motivating sales representatives can be a complex endeavor for management since people are different and they are motivated by different things. To motivate their sales team and get the most of their productivity, managers are faced with the need to adapt their strategy of motivating sales people to each individual.
The article written by Thomas Steenburgh and Michael Ahearne, published in the Harvard Business Review, highlights this very aspect. It makes reference to 3 types of sales people:
- The laggard – needs guidance in reaching targets;
- The core performer – usually gets the least attention but is the most likely to act in meeting the goals set, especially if well motivated through incentives; most sales people fall under this category;
- The star – the performer who surpasses the targets set, or the overperformer.
Furthermore, based on this typology, a different approach in designing an incentive scheme is put forward for each type. Therefore:
- For laggards the plan should comprise quarterly bonuses and social pressure;
- For core performers it should focus on multi-tier targets and sales contests;
- For stars the program should include overachievement commission rates and no caps on pay.
While, indeed, financial incentives are important and should not be disregarded, it seems that equally valuable are the non-financial incentives, since the amount of individuals motivated exclusively by financial rewards is decreasing. Therefore, sales managers should focus more on these in order to motivate employees. Ultimately, motivation can trigger an increase in performance, and, why not, even a higher retention rate. Managers should try to drive employee motivation not only through financial bonuses, but also through showing recognition, saying “Thank you!”, giving feedback and encouraging employees to take initiative, among others.
References:
- Austin, D. (2013), How to Motivate Sales People [Infographic]
- Steenburgh, T. and Ahearne, M. (2012), Motivating Salespeople: What Really Works
- Wiese, M. & Coetzee, R. (2013), The importance of non-financial motivators to pharmaceutical sales representatives: A demographic study
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Tags: Employee Motivation, Incentives, Sales People
