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sales commissions will forever drive a wedge between sales and engineering. I have a few gripes about it 1) engineers should get a similar form of compensation

by K2h 14y ago

sales commissions will forever drive a wedge between sales and engineering. I have a few gripes about it 1) engineers should get a similar form of compensation, in my experiences 'bonuses' don't come anywhere close to what commissions do. 2) how can sales get commissions AND a salary. should be one or the other 3) commissions incentivise sales to sell ANYTHING they can get a commission on, not necessarly the things you want to sell or are good at making. one needs to be very careful in what sales is allowed to sell. 4) how can a product or service be returned or canceled and the commission still paid! insanity! no clean sale and the corrections fall through the cracks... yeah... I'm a little bitter.

ian 14y ago
I'm with you on this. I'm not a fan of any sort of salary bonus scheme. I hope if we ever hire a sales team we can avoid doing that. We have so far. I'd prefer to make your nX factor something that you prove to the rest of the team and that is rewarded by increased equity. Doesn't matter whether you're an amazing developer, member of our customer support team, doing hiring, or working on partnerships. What matters is that you're hacking the status quo for your role in a big company and helping us be more exceptional.
mindcrime 14y ago
3) commissions incentivise sales to sell ANYTHING they can get a commission on, not necessarly the things you want to sell or are good at making. one needs to be very careful in what sales is allowed to sell. Yeah, incentives for sales people can be a bit whacky. For one, they're rarely encouraged to do what's best for the company (and therefore their colleagues) in the long-run, but rather wind up taking a very self-centered, short-term view. There was an interesting article I saw a while back (can't remember if it was here on HN or not), about paying sales people salary only, no commission. From what I remember, at least one company tried it and found that it worked really well.
- dirtyaura 14y ago
  I'm wondering why commissions are structured the way they are. For example, in a SaaS company with a subscription model, I'd imagine that it would align motives of sales people better if the commission would be paid from each monthly payment instead of as a lump sum when the deal is closed.
- peets 14y ago
  Hello, world. Fog creek blogged about not paying sales commissions: https://news.ycombinator.com/item?id=3425331 https://news.ycombinator.com/item?id=3425331
  - mindcrime 14y ago
    That's probably the article I was thinking about. Thanks for digging that up.

by K2h 14y ago

ian 14y ago

I'm with you on this. I'm not a fan of any sort of salary bonus scheme. I hope if we ever hire a sales team we can avoid doing that. We have so far. I'd prefer to make your nX factor something that you prove to the rest of the team and that is rewarded by increased equity. Doesn't matter whether you're an amazing developer, member of our customer support team, doing hiring, or working on partnerships. What matters is that you're hacking the status quo for your role in a big company and helping us be more exceptional.

mindcrime 14y ago

3) commissions incentivise sales to sell ANYTHING they can get a commission on, not necessarly the things you want to sell or are good at making. one needs to be very careful in what sales is allowed to sell. Yeah, incentives for sales people can be a bit whacky. For one, they're rarely encouraged to do what's best for the company (and therefore their colleagues) in the long-run, but rather wind up taking a very self-centered, short-term view. There was an interesting article I saw a while back (can't remember if it was here on HN or not), about paying sales people salary only, no commission. From what I remember, at least one company tried it and found that it worked really well.

dirtyaura 14y ago
I'm wondering why commissions are structured the way they are. For example, in a SaaS company with a subscription model, I'd imagine that it would align motives of sales people better if the commission would be paid from each monthly payment instead of as a lump sum when the deal is closed.
peets 14y ago
Hello, world. Fog creek blogged about not paying sales commissions: https://news.ycombinator.com/item?id=3425331 https://news.ycombinator.com/item?id=3425331
- mindcrime 14y ago
  That's probably the article I was thinking about. Thanks for digging that up.