Are Bonuses the Best Sales Motivation Reward?

I recently talked with a salesperson who was working towards a record sales quarter for the year. He explained that his manager had offered a bonus to the salesperson that made the most sales for the final quarter of this year. The bonus was more than the sales person usually made in a month of commissions. So the salesperson was drastically cutting prices in order to make a lot of sales in a shorter amount of time. He was willing to cut his commission some in order to get the sales and of the course the bonus.

I’ve heard similar stories in the past, as this is a typical sales management strategy when there seems to be a need to make a lot of sales in a short amount of time. The plan is to boost profits or possibly look better to upper management. However, is this the best motivational practice and does it really bring the desired rewards to the organization? Is giving a recognition bonus to one person and encouraging internal competition the best way to achieve the goal? Yes there may be more sales as a result, but are the smaller profits per sale adequate to meet company goals? If the salesperson is cutting their commission to near cost, is there really any profit once labor is paid? Is the spirit of teamwork or company loyalty compromised by such contests?

As I talked more with the salesperson, he explained his manager made this decision and offered this “most sales” contest based on the previous month, which had the lowest sales in the company history. However, this particular industry has a record of increased sales in the final quarter of every year due to the holiday season. The salesperson I talked to revealed that so far sales were up as usual for this quarter even though the overall numbers for new customers were still smaller than previous years. He assumed this was due to the current economy making a slower comeback than expected. Not only are the numbers going to be smaller due to the economy, if every salesperson is thinking the same as the one I talked with, then the reduced prices will also result in less dollars coming in for the sales the company does get.

I believe before starting any rewards program to motivate employees, management needs to review what it is they wish to accomplish and what will actually motivate the desired performance. To start with managers should review the 3 P’s of reward and recognition. Then once they have determined to proceed, managers need to ask these questions of each other before making the final decision and communicating the program to employees:

• What is the best way to do our reward and recognition program?
• What should the performance level be in order to get rewarded?
• How is this program expected to affect both profits and morale?
• Now that the program design seems ready, is this really the best method for our organizational goals?

Have you experienced any mismatches in company reward and recognition programs to the organizations goals? How did it affect the bottom line? What did or will your company do to change the process and programs to get more desirable results?

Have you checked all aspects of your business for alignment with your vision and plan?

Recently I had the opportunity to observe a great business. In the process, I learned lessons around planning and execution that I want to apply to my own business. I want to share one of those lessons with you now. In building and implementing your plan, make sure you have included a process for checking all aspects of the business on an ongoing basis and insure they stay in sync with the vision.

While on vacation in California, I happened upon an outstanding BBQ restaurant. Right from the start I was impressed. With flyers in the hotel lobby, top billing on the recommended list in the room, a "Ya gotta check it out" from the desk clerk, and an "Ooh, Yeah" from our friends, it became a must do part of our trip.

The next night we changed plans and went for ribs. We become instant fans. The lot was full. The place was festively decorated, Live blues streamed from the building. And the doors opened as we approached with a smiling hostess welcoming us. Just inside the door, the take-out counter had a line. This was going to be special.

It was obvious the owners had put a lot of thought into this. They recognized which aspects were critical for success and mastered the implementation of each. They had a great neighborhood marketing campaign. They understood the benefits of good ambiance and relevant decor. They knew how to play to their concept.

We were quickly seated and greeted by a friendly waiter. He explained the restaurant's history and suggested options for maximizing the menu. We discussed how great the place was and we hadn't even ordered.

The food came, and all I can say is, Wow!! It was some of the best barbeque ever. Even my non-meat eating friend ordered a half-rack to take home.

We were thrilled, and yet, as we paid the bill and walked out, we couldn't help reflecting on one element of the night. One facet of the service was so bad, we left, not talking just about the great food, but rather also the bad service. And it was only one person. Was it possible for one person to ruin an otherwise excellent time?

As good it seemed, as much as they had thought things through, this one person could have ruined the experience. This person was so bad, the great work done in advertising, marketing, decor, cooking, and ambiance was almost overwhelmed by her impact. While the overall service was excellent, this one person, through her attitude, her performance, and general rudeness, caused us to walk out, not raving about the great ambiance and food, but rather her rude behavior. When recounting the trip later, we couldn't get through the story without adding our view of this person's performance.

These leaders had thought of everything. They had set a great vision. They had built a nice plan. They had put it all in play. They forgot, however, to inspect all aspects of the business, and insure that everything, and everyone, was in sync with the vision. They forgot that one person, or process, or issue, could undermine all their other efforts.

What about your business? Have you inspected all facets? Have you checked to insure that all parts are in sync? If not, get to it. The ribs are waiting.

I've Looked at Change from Both Sides, Now

In the Joni Mitchell song "Both Sides, Now", she looked at clouds, love, and life from both sides (now.) So I thought it would be interesting to look at change from the side of the organization and from the side of the individual in an organization.

From an organization's viewpoint, it is critical to change to survive. There are many outside forces that impact an organization including the economy, technology, environmental, legislative, social trends, demographics, etc. These forces change the environment where organizations do business, so to not change may mean disaster, including the ending of a business. Organizations must also change to meet customer demands and expectations. If a customer is not getting the service or product they want from your company, they have choices and may take their buying dollars to a competitor.

It is not easy to make changes in an organization. Processes, communication methods, working relationships, systems, and tasks and responsibilities may need to change. All change involves the people in an organization.

From an individual's side, change is seldom easy unless you are truly dissatisfied with the status quo. Try an experiment…clasp the fingers of your hands together. Now notice which thumb is over the other one. Now unclasp your hands and clasp them again making sure your fingers and thumb are the opposite way they were before. So how did that feel? Uncomfortable, not normal, awkward? If I asked you to clasp your hands again you probably would do it the way you always have done it. There is really no reason to change the way you do this, so why not go back to your normal way that feels more natural?

As an individual, you may cognitively know that your organization must change with the outside world but that doesn't make it easier. You may really like your job, your colleagues, the way you do your job and where you to it. It may feel uncomfortable with the change and the way a job now needs to be done in a different way, and may keep slipping back to the old way or spend time wishing for the "way it was."

So how does an organization look at both sides when implementing change? Here are a few tips:

· Reason for Change – Share the reason for changes with members of the organization. A great way to do this and involve your employees is to conduct a Force Field Analysis. On one side have employees brainstorm the driving forces for the change (why the change is happening) and other side ask employees to list the barriers to the change.

· Identify Action Plans – Enlist employee ideas in overcoming barriers to the change by having everyone create a personal action plan on how they will implement the change. Individuals will then customize their own change plan further by requesting the information and resources they need to effectively implement the change.

· Reward Early Adopters - See someone who is a role model for the change? Thank the individual and have them share their positive experiences about the change and the benefits they have seen since implementing the change.

What do all three of these ideas have in common? They bring the needs of the organization in line with the needs of the individual to have some control over the change process. The ideas consider change from "both sides" which will lead to a more successful change initiative.

Travel Tricks 8: Prep and Communication are Important

I think this is the last of my series on travel tricks. I will end with some preparation ideas you might want to consider if you are ever stuck at the airport overnight. Be sure you set the alarm on your cell phone just in case you actually get some sleep so you won’t miss the first morning flight to your destination. Have toiletries in your carry on in case you need to clean-up in the restroom before rushing to that morning flight for immediate dispatch from airport to a meeting.

Below are 2 articles you may want to check out for more great tips when planning your next trip.
How to Find the Best Airfares for your Travels
How to Make Free International Calls while Traveling

More quick advice - never assume the airline employees are announcing all they know about a situation. Ask and maybe they will let you in on more details. Once when my luggage was taking a long time to get from the plane to baggage claim, the baggage person was just telling us every 15 minutes they would be there soon starting after we had waited a full 30 minutes. After being told this multiple times some frustrated passengers asked what was going on, then the person in the baggage area who had been making the annoying announcements decided to let everyone know there was an equipment problem holding up the bags. Knowing why made the wait more bearable and stopped the complaining I was hearing from all around me. Communication can work wonders with customers!

Another time when I got out of a meeting early, I traded the seat on my scheduled flight for an earlier flight. Then that earlier flight got cancelled! I thought I would be stuck there for a while since lots of flights were getting cancelled but I checked at the gate of my original flight and they still showed I had that seat so they let me on. I was thrilled to finally get home even if the first flight was 2 hours late leaving at least it did not get cancelled. Just goes to show it never hurts to ask. These examples are not the best customer service situations, but they go to show you might get better service or at least a little information if you are just willing to speak to the right person. Communication from customers can work too!

Since my first travel tricks post, we have shared a few funny mishaps, frustrating stories, and some good tips. I hope you found something new you could use. I also hope you chose to share something that works for you with our readers as well.

Constructive Comments Contest

The purpose of the To Be Productive Blog is to help others to become more effective and productive both personally and professionally. We do this by sharing ideas, tips, suggestions, inspirations, and expertise. In order to better do this, we thought it would be a great idea to invite our readers to add their own helpful tips and ideas along with ours by using the comments option. To encourage readers to provide suggestions that have proven effective for them, we decided to offer a Constructive Comments Contest. Below are a few simple rules for the contest and an explanation of how it works.

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The Human Side of Change Starts by Asking WHY

Do you ever ask yourself, “What am I doing?” It can be a hard question to answer. It’s not hard to answer from a cursory casual point of view. You might say, “I’m making a phone call, writing a letter, developing a project” or a thousand other factual answers. But WHY are you doing what you’re doing? That’s the deeper question you may struggle to answer. The human side of change often begins by asking “WHY”.

Change was a big topic of discussion and focus in the training and consulting world during the 90’s. Everybody was concerned about change and how rapidly it was taking place. Guess what? Things are changing faster now than ever before and for many people in a not-so-positive direction. Downsizings, foreclosures, loss of life savings, loss of self esteem and much more are eating like a vicious cancer into the American psyche. Can you identify with that statement?

Positive change, for an individual or a company usually starts with dissatisfaction with the status quo. When the norm becomes so distasteful, disgusting or points to our obvious destruction we think seriously about change. Personal change of any magnitude typically only comes with great desperation or inspiration.

Faced with high blood pressure, chronic coughing and wheezing or shortness of breath you may be ready to quit smoking. Experiencing low back pain, high cholesterol and a potential heart attack could force your attention towards a serious diet and exercise program. Likewise, a large downsizing, chapter 11 bankruptcies or company closure may cause you to scramble toward reorganization. But change of this magnitude is difficult.

On the other hand, how appealing is the alternative to the needed change?

Asking the question ‘WHY’ on a daily basis may help you avoid these types of drastic and monumental changes. Change forced on you for your survival is difficult. Change that you make and design on a daily basis is always easier and more quickly achieved.

Changes that are smaller and more incremental may seem simple and more efficient but usually don’t bring about the kind of clear and impressive result for most people to want to continue in the change process. Ask yourself ‘WHY’ am I doing this, saying that, or believing in this way and honestly consider the answer. If the answer is inappropriate, consider the alternatives and make the needed change.

Individuals as well as companies who have the habit of asking ‘WHY’ promote change on an ongoing basis. They don’t just do, say or believe certain things because that’s the “only way” of doing, saying or believing. And they don’t automatically change just for the sake of changing.

They ask ‘WHY’ and then examine the answers, thoroughly, thoughtfully and consistently. When change is warranted, they act. If not, they know why.

Have you asked yourself, “What am I doing?” WHY NOT?!

Slowing down to be productive

Storytellers make me laugh. I am a person who would not pass up hearing a good story instead of going about my assigned task. Does this affect my productivity? Yes. Yet, does my practice have any positive impact on my workplace? You bet. As my daughter told me years ago as she pushed me into professional speaking, “Daddy, be a story teller like Garrison Keillor”. And so I am.

I think it’s time to relook at the concept of “productivity” anyway. We live in a world of constant measurement. At the airport, did the airplane push away from the gate in less than 15 minutes of measured time? If your lunch is not delivered to you in 10 minutes, it’s free!

What began with one-hour dry-cleaning “while you wait” has degenerated into a world of FedEx, fast food and workplace expectations of working faster and faster. I was talking with a FedEx courier recently about the stress on him to increase his deliveries. As he told it, they dropped giving Rolex’s for package delivery and have traded down in watches while pushing delivery expectations up.

One downside to productivity measurement is the oft-overlooked issue of simply measuring the wrong thing. Or what we have measured does not get to the heart of the problem. For instance, most of us would think that technology and productivity would go hand in hand. Yet, consider the simple fact that an increase in technology does not necessarily translate to an increase in productivity.

Matt Richel, writing in the New York Times, NYT, 14 June 2008 concluded “statistical and anecdotal evidence mounts that the same technology tools that have led to improvements in productivity can be counterproductive if overused”.

While computers are the driving force behind every business operation today, who suspected that Facebook would be the favorite time waster at almost every level of the spectrum?

I ran across this story, which I think illustrates the quandary of productivity.

“One of the best marksmen in the FBI was passing through a small town. Everywhere he saw evidences of the most amazing shooting. On trees, on walls, and on fences there were numerous bull's-eyes with the bullet hole in dead center.

The FBI man asked one of the townsmen if he could meet the person responsible for this wonderful marksmanship. The man turned out to be the town deadbeat.

"This is the best marksmanship I have ever seen," said the FBI man. "How in the world do you do it?"

"Nothing to it," said the deadbeat. "I shoot first and draw the circles afterward."

Having managed many teams over the years, I have been subjected to some of the deadbeat’s crafty solutions of drawing the targets over scatter shots and being told how good their work was.

It finally comes down to not being the fastest worker or the shrewdest teller of how good their work was, but who does the RIGHT work. How the customer was delighted. How packages were ALL delivered to the RIGHT person.

And as a veteran of retail, how an item will STAY sold. Now, that’s productive.

Travel Tricks 7: A Game Airlines Play

My prior travel post was on luggage woes at airports or with airlines. This time I will let you in on a few things that I have seen airlines do to keep customers hoping and hopping, but definitely not satisfied.

Starting with a game I think they like to play that I call Terminal Turnover. Fore those of you that played the child’s games Fruit-basket Turnover or Musical Chairs you will quickly get the idea. Your flight is late or delayed, however the airline will not tell you this, instead they send you to another gate to await the plane or even worse another terminal within the airport. Gate changes are not so bad especially if they are close. However terminal changes can give the flyer undue stress and concern about getting to the new location before their plane does. Of course this never happens but traveler stress over it none the less.

If airlines would just be honest with their customers about what is going on, it is easier for us to be understanding and less stressed. Stress can lead to exhaustion or anger. This is not good for customer or employee satisfaction. Communication is one key to keeping customers content and employees happy.

Once when I was traveling just for my own curiosity, I thought I would count how many times the airline had me switch gates for a “delayed for weather” flight. I stopped counting after I changed gates 8 times because I was beginning to get a little miffed. During those changes they had me go to another terminal one time and then the next time they had us move we came back to my original terminal and gate for the flight. After that long trip dragging my luggage, I laughingly told the lady making the trips to/from gates with me that I would not have to go to the exercise room when I finally got to my hotel since the airline provided me with a great workout thus far. She thought it was funny then, but 2 changes later she was starting to get angry and anxious due to the lack of information we were being provided. Around change #7 many people gave up on the airline and arranged rental cars instead. Around midnight, the airline told those of us that stuck it out with what proved to be false hope that the flight was actually cancelled and there would be no other flights that night for us to get on.

What happened next? Well all the rental cars were gone, all the hotels were booked, it was pouring outside, and the airline began to give out tiny blankets to those left stranded at the airport. Many travelers ended up having to spend the night at the airport gate on a cold night where the blankets went so fast that not many people even got one. Ever try to sleep in those airport chairs with your feet propped up on your carry-on using your suit jacket as a blanket? Not pleasant. I’ve only had to spend the night in an airport twice. Both times it got cold; the place to eat, drink, or buy reading materials were closed; and very little sleep was achieved. Believe me, sitting for hours waiting for a delayed flight beats a night at the airport due to a cancelled one any day!

Tell me what you think and how you survive the games airlines play. Visit the blog soon for what may be my final post on this subject.