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Retaining Top Sales Talent: Motivating the Key Players You'll Need in the Coming Upturn
By Dennis Spahr and Sheila McCarthy, with David Insler

Keeping an organization’s top sales reps focused, motivated and on your team (as opposed to the competition’s) is more important than ever because these are the people you will need when the economy turns around. With even the best reps finding it difficult to make their numbers — and reap the rewards — what can organizations do?
To find out what’s working, we asked companies across industries and across the country, “What are you doing now to both motivate and retain your key sales reps?” Most of their responses fell into one of the following categories: 

• Making short-term tactical changes intended to help sales reps “ride out the storm”
• Implementing longer-term program shifts intended to better align sales rewards with the strategic direction of the company
• Undertaking broad reviews of the sales employee value proposition (EVP) to create a more dynamic bond with the sales reps

Short-Term Fixes
Most companies have implemented changes to “stem the bleeding” during the current economic situation. These include:

• Engaging in “temporary quota relief.” A sales rep who achieves 80 percent of quota would be considered “at target” and would receive at least a portion of the perquisites and benefits of reaching quota, including recognition awards. 

Another option is to provide a bonus to the whole sales department if the entire company achieves plan. In other cases, lower thresholds for performance or quotas set on a quarterly basis allow a company to be more responsive to market conditions.

• Increasing the upside for over-target performance. Recognizing superior performance, the funding for this option comes from lowering payouts for below-target performance — the “reverse Robin Hood” mechanism. This sends the message to top performers that the company recognizes and will reward results that are difficult to come by.

Longer-Term Fixes
Some organizations are using the current economy as an opportunity to make innovative and sometimes overdue changes to better align the salesforce with the company’s rewards strategies. These include actions such as:

• Changing long-term incentives. This may include altering the stock option program to expand eligibility, increase volume, provide more attractive vesting schedules and improve buy-in prices.
• Revisiting adjunct rewards such as SPIFFs, fast-start bonuses and spot awards. Study the longitudinal impact and motivational value of these compensation dollars. Limiting these programs to channel these rewards to high performers who have a high strategic value to the sales organization.

The best way to ensure correct delivery of these changes is by being the messenger. Management should involve the salesforce as early as possible in communicating any changes to the incentives and rewards program.

First, the beneficiaries need to trust the motivation behind the change. They need to see it as the company’s way of recognizing valuable contributions, not as a cost-cutting measure in disguise. Next, management must be prepared to honestly answer all questions. These may include: Whom will this change affect? Is it temporary or permanent? How will the new earning opportunity compare to the old plan? What happens if sales continue to decline? What happens when the economy turns around? If the answers to these questions are not readily available, the best answer is “We don’t know. But when we do, you will be the first to find out.”

Review the Sales EVP
In addition to these tactical short and long-term changes, smart organizations are taking a hard look at the total rewards they offer their sales employees. While sales people are certainly motivated by compensation, best-in-class organizations maximize the value of all the rewards, including affiliation, work content, career and benefits. 

THE SALES EMPLOYEE VALUE PROPOSITION
 
Source: Sibson Consulting

Many of the companies that review their EVP have been able to improve the engagement of their sales talent through a variety of actions, including:

• Gaining involvement of the sales staff when pursuing key company initiatives. One company that experienced a sudden increase in competitive pricing pressure engaged a cross sample of sales representatives to help develop innovative solutions to improve sales performance. Because leadership collaborated with these sales representatives, these key sales people not only embraced the changes, they led them.
• Reviewing sales roles to ensure market competitiveness. A computer manufacturer is currently completing a skills inventory for their key sales roles. A proliferation of sales roles has made it unclear what roles require what skills. The organization has identified many specialist roles that are incorrectly categorized as general sales roles and is re-matching their pay levels and practices to the market. 
• Redesigning the sales process to minimize non-selling, non-customer impact activities to improve the line of sight to business results. One telecommunications company is working with its top sales people to understand what sets them apart from the rest of the sales organization. Any changes to work content (e.g., freeing up time currently used for non-customer-related activities) will have the endorsement of top sales people. 

Dennis Spahr is a vice president in the Chicago office of Sibson Consulting. He works with companies to develop and implement sales strategies and processes to improve their performance and profitability. He can be reached at 312-456-7905 or dspahr@sibson.com.

Sheila McCarthy is a senior consultant in the Chicago office of Sibson Consulting. She works with organizations to improve their sales, service and marketing channel performance through people- and process-based solutions. She can be reached at 312-456-7946 or smccarthy@sibson.com.

David Insler is a senior vice president in the Los Angeles office of Sibson Consulting. His primary expertise is in sales force effectiveness, organization performance and executive compensation. He can be reached at 310-231-1743 or dinsler@sibson.com.