Does Status Trump Financial Reward?
What motivates employees most? Is it status or money? A recent Dutch study looked to address these very questions by examining the impact of team sales contests on sales growth in the retail sector and found that under specific conditions employees were motivated by both financial incentives and status amongst peers, but most predominantly by status. The style of manager leadership was also found to increase employee performance, with a transformational leadership style having the greatest impact.
Key Topics: Sales contests; Employee performance; Status; Incentives; Leadership style
Does Listening To Customers Matter?
Companies employ various methods of sales compensation to get the most from their sales teams, with one popular method being the sales contest. A recent French study examined if such contests can have a negative effect on aspects of salespeople’s behavior, particularly the quality of their customer listening, which in turn would affect their relationships with customer. The results indicated that under certain conditions customer listening was adversely affected by sales contests.
Key Topics: Sales compensation; Sales contests; Customer listening
Variable compensation plans are generally seen as one of the best ways of motivating salespeople. A US study examined the impact of various types of variable compensation system changes (VCSCs) on the job satisfaction and performance of salespeople. Focusing on the various VCSC dimensions, such as the size and frequency of changes, the researchers found that VCSCs do impact significantly on salespeople’s job satisfaction and performance, but the size of the impact can differ based on various environmental factors.
Key Topics: Variable compensation system; Sales compensation; Job satisfaction
Salespeople are often painted as being only interested in making money. A study of US salespeople looked at the impact on employee performance of three organizational reward types frequently used by companies to motivate and engage employees, namely financial incentives, recognition, and feedback. Examining sales employees in the retail sector, the results indicated that all three reward types increased employee performance, and that financial incentives and recognition were substitutes, with feedback being independent of the other incentive types.
Key Topics: Monetary incentives; Feedback; Recognition; Sales performance
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