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September 30, 2025 • 10 mins

Compensation Strategy

  1. 💰 Compensation plans directly influence salesperson behavior, with effective plans tying quotas to pocketbook to motivate salespeople to hit numbers and grow the company.

  2. 📊 Quota-based commission plans can be designed to provide a bonus for exceeding quota, motivating salespeople to push beyond their targets.

Psychological Factors

  1. 🧠 Commission plans should be designed with psychological considerations in mind, as they significantly impact salesperson behavior and motivation.

Performance Drivers

  1. 📈 Commission tied to quota motivates salespeople to hit their numbers, offering a higher percentage of sales revenue when meeting or exceeding quota.

  2. 🎯 When salespeople aren't meeting quotas, the primary issue is often the compensation plan, not sales training, as it fails to provide adequate motivation.
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