I've been chatting with a few people from different companies that are at the front line ie. they're the salespeople bringing in the cash.
It's interesting how companies motivate their staff. One case I came across that was inspirational for me was my friend that works for a large printing/document management company. Over 80% of my friend's pay is in commission payments.
It makes me wonder why it's been so hard for us to find salespeople that can be motivated by commissions. I've been told that great salespeople are motivated by the challenge of performance-based pay and understand the concept that they will earn more when they deliver more for their employers.
My friend is obviously a great salesperson and is able to deliver month after month of increasing sales. I guess only a salesperson that is awesome at their job is motivated by performance-based pay - since they know they can earn a lot of money. For those that whine and complain about being on commission, those are the ones that can't sell and eventually get fired.
As my friend very bluntly put it:
"If I'm on salary, then a bad month for sales is a bad month for sales; if I'm on commission, a bad month for sales means I don't have enough to pay my mortgage."
You always need to see the needs and psychology of both parties to the deal - in this case it is our company and potential salespeople. We want sales, dedicated effort and minimal up front cost. They want more initial up front security (base salary, contract, etc.) and a floor to their downside (so that even if they don't perform for sales it can't be so bad).
In a start up company you have no room for dead weight, if you have salespeople that have the above characteristics: can't perform, are taking your base salary for granted, and whine and complain about being on commission - get rid of them.
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