MONEY AS A SALES BAIT
Marlon Brando in 1973 refused the movie fraternity’s heftiest honor ‘Academy award for Best Actor’ for the movie Godfather where he played the patriarch Vito Corleone. The reason for refusal to accept; Native Americans had no representation in film industry and were used as extras and he wanted this to change. An external honor i.e. fame and recognition of such magnitude was rejected to cater to an internal drive of seeking justice. Mark Zuckerberg of Facebook who is worth $ 74 billion (as on 2017) takes a salary of $1 since 2013. Sergey Brin and Larry Page of Google, both of who are worth over $ 35 billion each received $1 salary for over a decade. Steve Jobs also belonged to the $ 1 salary a year club from 1997 till his 2011 resignation. There are many others in history who have either refused honors, money or other forms of benefaction. $ 1 salary may not be such a consequential sacrifice; after all a few of them were endowed with prodigious stock options nevertheless $ 1 salary is indeed a statement of intent, commitment and expression of intrinsic motivation of these people. They had a conception of accomplishment beyond money.
For decades people have pursued professions based upon the lure of more money. At least at the start of one’s career, the kind of industries and functional roles that most people navigate themselves into has an unquestioning adherence to some aspect of monetary avarice. Selling is one such functional role to exemplify. People who join sales profession seem predisposed to the idea that it is lucrative due to incentives, bonus, variable pay etc.? For the accomplishment oriented sales persons this is true but upon deeper inquest into their motivational patterns reveal aspects beyond money.
HOW FUNDAMENTAL IS MONEY AS A DRIVER IN SALES?
It is indisputable that money is a strong motivating instrument to preserve one’s sense of financial and psychological well-being and why not, it represents freedom, choice, comfort, pleasure, power, independence, extravagance, security and the lack thereof represents anxiety, stress, austerity, scarcity and other disempowering feelings. Though a kind of inseparability exists between money and motivation, is it money that fires up one’s intrinsic motivation?
Thriving and successful people state that money is just a byproduct rather it is passion for specific pursuit, un-quenching aspiration, achievement craving, desire for distinction or perhaps insufferable pain in some which become the motive force for action. In spite of this a vast majority are content to embrace their inflexible stance, which is ‘money as the prime motive force.’ This belief impound them in their ability to look beyond the confines of their role, function, title and industry and they remain imprisoned for years doing spiritless and repetitious work to avert the fear of losing out on existing remuneration. Periodic growth and hierarchical climb inveigle them to further believe that they are exerting influence and making progress. Passage of time makes many of them wealthy joyless people. Money; How much of a sales bait is it? To derive an answer let us understand primary & secondary motivation as well as intrinsic and extrinsic motivators.
PRIMARY & SECONDARY MOTIVATORS
Primary motivators are the absolute essentials to preserve life for example thirst, hunger, temperature regulation, security from predators, sleep, elimination, avoidance of pain and sex. Once most of the primary motivation aspects are taken care of human mind transitions into secondary motivators such as creativity, curiosity, sociability, love & intimacy, ambition, winning, recognition, entertainment, competing with others to have a sense of victory and challenge (as in sports), power, politics, philanthropy & fulfillment, and a few others. Selling as a function provides a few secondary motivations. There is sociability as performing sales people have immense respect and acceptability, there is recognition, competition with peers and competing firms, victory, ambition etc.
The secondary motivators are very powerful and can become intrinsic motivators. Why then is money such a powerful motivator because its possession in more than adequate proportions takes care of both the primary and secondary motivators hence the gold rush for it. In the acquisition of this money, one abandons one’s passion, desires, excitement, skills, dreams, work-life balance etc. and pursue an unrelenting monotonous path and perhaps even navigate through many such paths to get there. It would be a cliché to highlight here that the very journey itself has to be eventful, adventurous and satisfying, as all of us know it yet when it comes to money there seems such a pining for it.
INTRINSIC & EXTRINSIC MOTIVATORS
Intrinsic motivation is internal, a kind of self-desire and determination to crank oneself to attain or accomplish desired goals. It is the capacity to tap one’s inner potentiality. It doesn’t mean external triggers such as money, title, appreciation etc. become inconsequential but the person doesn’t hanker for these as much as an extrinsically motivated person may seek. The task at hand itself is the motivation rather than the reward upon completion of the task.
Extrinsic motivation is the motive force invoked through external means such as money, perks, grades, titles, rewards, fame or even threat of punishment. External encouragement is important and works wonders in many fields. Why do football teams in Europe play and behave differently when they play in their home ground as against an ‘away match’ in the opponent’s home ground (say Champions League)? Cheering, terrace chanting, songs, clapping from a highly appreciative and supportive audience all these make a significant difference in the player’s psyche. Andy Murray’s Wimbledon victory in 2013 against Djokovic is an amalgamation of internal grit of Andy and the colossal impact rendered by British crowd support. External accolades and validation as against merely relying on internal resource is a successful strategy but nothing can be more imperious than a vast majority of intrinsic motivation in one’s approach. Sales people must adopt such a stance.
CUES FOR SALES MANAGERS:
Acquire talent and offer a very decent salary up front. This should be the tie in factor and not sheer reliance upon periodic incentives as a top up strategy akin to fuel additives to improve power and performance.
A sales quota has been allocated for the year. This in itself is the key performance indicator. How many times has your sales persons gone through the complex calculations and clever algorithms to see their incentive eligibility at the end of the year and upon missing it by a whisker lost out their motivation and looked upon the subsequent quarter with derision and frown. This could eventuate in overheating.
Every firm offers bonus to their employees and incentives to their sales people and the idea is not to discontinue these but to emphasise the primary responsibility of the employee towards organizational sales vision and mission.
Coach the sales team to invoke their intrinsic motivation to achieve their quotas. It is easier to do this with sales people who have come into the profession for the love of the sales function as against allurement for money.
If variable pay component is more prudent and exposes people to abundant possibilities to earn more then it is fine to structure a great incentive scheme. This seems to be the prevailing philosophy of firms in a few countries.
Sure, sales is indeed an important function for the organization as it is a revenue producing task and organizational health hinges upon it but so is marketing, delivery, quality, manufacturing speed, logistics, customer service, and every other aspect that provide a great experience to the consumer. Yes the rainmaker’s skills cannot be equated to the skills needed in logistics but the salary differential at inception has covered it, hasn’t it?
If incentivising is an inevitable way of sales life then monthly or quarterly incentives work better than a year-end lump sum. An anticipatory monthly incentive scheme can be worked at based on performance indices. Temporal discounting ( also known as delay discounting) is the tendency of people to discount rewards, which are too distant in time. Immediate gains and the thought of instant gratification provide more motivation. The link below exemplifies this, the famous Marshmallow experiment.
Overjustification effect is a theory that when an expected external incentive such as money doesn’t come it in fact decreases a person’s intrinsic drive to perform. A sales person could be intrinsically motivated but in a hard-driven incentive culture his/her natural love for sales could get contaminated with desire for this reward. At this stage the intrinsic love that one had for he job becomes ‘work’ and upon deprived from this reward he/she experiences a subsidence in motive force.
Like antidepressants that endure for life, the sales person’s interest sadly has to be sustained with reward mechanism only. One amongst significant roles of a sales manager is to ensure that sales people do not see selling function as a means to an end i.e. paycheck/ incentives rather encouragement and love for the whole selling process as a journey satisfaction must be invoked.
Sales incentives do have merits. It provides the flexibility to the sales person to influence his earnings, which is kind of entrepreneurial in its format but singularly sighting money at the end of the task as an objective, over time, dilutes the interim journey. One amongst organising principle of sales is to have a system of capturing the firm’s intrinsically motivated sales people, keep their flame ablaze and retrain the extrinsically motivated sales people to redirect their motivational quotient from within. Steve Jobs had stated, “Bottom line is, I didn’t return to Apple to make a fortune. I’ve been very lucky in my life and already have one. When I was 25, my net worth was $100 million or so. I decided then that I wasn’t going to let it ruin my life. There’s no way you could ever spend it all, and I don’t view wealth as something that validates my intelligence.”
Money is important, whom are we kidding, but its inexorable pursuit is what makes it a ‘means-driven strategy’ as against a ‘pursue your passion and money will accrue strategy.’ Both models are available today for one to pursue. We have experienced one, do we have courage to go after the other, an inclination for risk.