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THE BUZZ |
Egret Consulting eNewsletter |
March 2010 How much money can
I make? We
work with a lot of sales organizations across the country, helping them define
their needs for sales talent and shape the specifications or expectations of
attracting talent into their sales organization. Once we begin our recruitment
phase, we encounter every sales stereotype. We talk with salespeople who could
be described as complete professionals, or used-car salesmen, or
overly-talkative, or pushy or eloquent or articulate or 'South Chicagoan'. In
short, we understand sales people, since we are also sales people. But the one
question that always arises in every conversation we have with sales people,
from account executives to VP's of Sales... how much does it pay? Our response
is the same to every person we speak with; we don't know, but once you meet
the company, see the culture and the products you'll have a better idea of how
the company will change your life; culturally, ethically, life-balance and of
course... monetarily. I
just read Drive by Daniel Pink*.
Drive is a book that explores the motivation of people. It
reports a fair amount of research on the topic of motivation and the results
are surprising at first blush; in short, we are not motivated by money, we are
motivated by three core fundamentals: Autonomy, Mastery and Purpose. Now this
is assuming we have the basics of life covered: we're paying the bills,
eating, driving a car, etc. Mr. Pink reports of a small research project
on puzzle solving, where both animals and people will solve puzzles solely for
the benefit of mastering the puzzle.
, if you add an incentive into the task, the results are... worse! "Financial
incentives can result in a negative impact on overall performance." "Higher
incentives lead to worse performance" Federal Reserve Bank of It
turns out that creating financial incentive plans tend to set up counter
strategies. Years ago, I spent way too many hours of my life devising
incentive plans for my sales management team and I always remarked that every
bonus plan establishes an immediate equal and opposite reaction than the
intended desire. Sales people always want to find the 'loopholes' in incentive
programs, and there are always loopholes. According
to Mr. Pink, the motivation to perform well is intrinsic and it can be enabled
through coaching, for most people. It falls into our natural desire to direct
our own lives and live for a purpose. The underlining assumption of
compensation is that compensation plans are 'fair', for both internal and
external equity purposes; such that all sales managers within a company are
paid roughly the same amount and that the company’s compensation plans are
roughly equal or close to the industry averages, or slightly above. The
key though, isn't to introduce huge financial incentives. Monetary rewards
often 'cheapen' the value of the work. The ideal compensation plan for sales
people would include non-monetary rewards: praise, public
recognition or include added benefits; extra time off or a truly unique
'reward'. A company might offer an employee the
ability to work on something completely new to their 'work' during work hours
for a period of time each week. Mr. Pink reports on companies who
assign "FedEx Days" to their employees, where one day a week the
employees can work on any project they want, with the specific goal that they
must have a deliverable within 24 hours of the FedEx Day. This works
especially well in creative environments: engineering or marketing for
example. "How
much does it pay?" will eventually become anachronistic and the next
question may become: how much time can I devote to learning other sales
channels, or to learning Hindi or to developing new product ideas? Mr. Pink
feels that the culture of the 20's will be drastically different and that
the Boomers will lead the way to providing 'work' for rewards that are far
more intrinsic than financial rewards. Micro-managing to push someone to a
financial incentive is simply counter to the way we're wired. Allowing people
to solve the puzzle and benefit from the pleasure of mastering their craft
while paying them a fair wage allows for a far more adapted and productive
work force. In
short, we actually like to work. Money does not buy happiness. We are
intrinsically rewarded to do a good job because we are motivated to master our
craft and to work towards a purpose. Autonomy, Mastery and Purpose just may
become monetized in a new approach to compensation plans.
*Pink, Daniel H. Drive:
the surprising truth about what motivates us. New York: Penguin Group,
2009.
Some
Interesting links: Zhaga Consortium - Industry-wide cooperation for the standardization of LED light engines - Netherlands Smart
Home: Green + Wired - "Green home" exhibit at
the Museum of Science and Industry - Chicago, Illiniois
We are the #1
recruiting firm in the electrical industry. Isn't it about time you
called to find out... |
"The problem with communication... is the illusion that it has been accomplished." ~George Bernard Shaw~ |
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Industry Specialties - Electrical Manufacturing | |
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Ask an Expert Question:
I got a call from a long time
competitor who wants me to come to work for them. I'm with a pretty big
distributor now and have a nice territory that I've built over the last 6
years, I know this guy called me because I took one of their bigger accounts
so there's no mystery there. I thought since they came to me ...
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Survey
Please take 7.9 seconds to answer the question: Would you quit your job to make more money?
Last month we asked you
to tell us what your company's 2010 forecast for LED sales...
17% Nothing
34% 100k to 200k 20% 200k to 500k 12% 500k to 1 million 17% Over 1 million
Population:
51% Distributors
34% Manufacturers 15% Other | |
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Industry Events
Email
to schedule a meeting with Ted Konnerth
Upper Midwest Electrical Expo April 14 - 15 Minneapolis
LIGHTFAIR
May 10 - 14 Las Vegas
Wire
Expo 2010
May 12 - 13 Milwaukee | |
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Mergers & Acquisitions We offer confidential consulting services to help you sell, or re-capitalize your company. Our 25 years of industry relationships offer a unique process of confidentially identifying the 'right fit' buyers. Contact Ted Konnerth, tk@egretconsulting.com, for a consultation on marketing or re-capitalizing your company. | |
