Many companies mistakenly hire salespeople and then define their job and compensation. The correct sequence is to first determine the business need, then construct the specific job role to address it, and finally design a compensation plan that incentivizes the required activities before ever posting the job.

To powerfully reinforce desired behaviors, compensation plans must connect the reward as closely in time as possible to the sales activity. This "proximity principle" is more effective than distant, larger payouts because it creates a clear and immediate link between action and incentive, even if the initial payout is smaller.

A one-size-fits-all sales role fails in consumption models. Success requires segmenting the team into specialized roles—new business acquisition, customer onboarding, and account management—each with distinct incentives aligned to their specific function, from initial sign-up to value realization and expansion.

Don't finalize a comp plan in an executive silo. Share the draft with trusted, top-performing reps and ask them to break it. They will immediately spot loopholes and unintended incentives, allowing you to create a more robust plan that drives the right behaviors from day one.

Salespeople's biggest frustration with comp plans is being held accountable for outcomes they can't directly influence. This perceived unfairness is a primary driver of attrition, making it critical to align incentives strictly with a seller's direct responsibilities and control.

Annual plans can't predict every business need, like a new product launch or acquisition. A pre-approved budget for discretionary incentives (SPIFs) allows sales leaders to quickly motivate reps toward new, unforeseen priorities without having to disrupt the core compensation plan mid-year.

Sales compensation is the most powerful lever for changing a sales team's behavior quickly. More than training or directives, incentives tell reps what they are supposed to do and why, directly shaping their daily actions and strategic focus.

Salespeople are trained to find leverage and improve outcomes. Their tendency to critique compensation plans stems from the same skill set that makes them effective sellers. Leaders should view this behavior as a sign of a good salesperson, not just negativity, and address it with transparency.

Employee retention now requires a customized approach beyond generic financial incentives. Effective managers must identify whether an individual is driven by work-life balance, ego-gratifying titles, or money, and then transparently tailor their role and its associated trade-offs to that primary motivator.