Salespeople are motivated by many factors, but the primary, most common motivation is Utilitarianism.  The drive is for a return on investment.  Most people first think of money which is a good example, but it is bigger than that.  It involves a return on time, effort, energy, resources, etc.  72% of the top salespeople in any market or company are motivated by Utilitarianism.

Now imagine a salesforce that is not compensated in some manner by commission – a group with a strong Social motivation.  You would then have this story from the Boston Globe – A noncommissioned sales force? You’re crazy:

What is it that Little, vice president of sales for the semiconductor company Microchip, says to prospects that makes them stare at him with incredulity? He tells them that his sales force does not work on commissions. He tells them: “We are the only noncommissioned sales force in the industry. We are here to serve, to help customers solve problems.”

This VP claims it has worked for his team.  I’m a Utilitarian myself and struggle with this entire concept.  Obviously helping customers solve problems is mission critical, but what about prospects?

Little replied: “The normal sales call has the customer mind-set of, ‘Tell me about your product, give me your lowest price and go away.’ We break down that wall. Once the customers understand that we really are there to serve, they start asking for our advice and our expertise. We become part of their planning process – what are we working on five years out?”

Again, I struggle with this approach.  The discussion focuses around customers, but what of prospects?  There are many prospects out there who would enjoy a salesperson who walks in and shares his or her advice and expertise for free.

What about the size of the opportunity?  If I am a salary-only salesperson, where is my motivation to close a large opportunity that is going to require more work than a smaller, simpler opportunity?  We saw this effect first-hand at a previous customer that had a heavily-loaded salary plan (with some commission).  That sales team was simply the most unmotivated group of salespeople I have ever seen.  They were indifferent to losing an opportunity since it was of little material cost to them.  I realize there are more factors at work than just compensation (sales management, culture, etc.), but it was the weakest team we have ever assessed.

But Little explains part of the success this way:

“We don’t have to waste time on the games,” he said. “My peers spend 40 percent of their time on figuring out how and what to pay, on arguing who gets paid or what.” And it isn’t just sales managers’ time spent on the games, of course: Add in all the time typical salespeople spend calculating commissions, plotting how to get credit for sales and checking the reports from headquarters to make sure they got everything they were entitled to.

In fact, if you’ve been a salesman, or worked around them, just think of the time spent daydreaming about commissions, sitting with the calculator and working out, “If I sold X Company Y amount, that would mean I’d get Z.” Take that time, convert it to helping customers, and you’d see a transformation in the profession.

It sounds like Little is a successful VP so I give him credit for that, but I just can’t buy into this approach.

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