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My company is split into two teams: sales and products. Sales has the responsibility for creating leads, follow ups, and closing a sale. Product is responsible for learning and teaching everything about the product and using that knowledge to support Sales in making a sale.

Previously when the company was still small we gave commission to both Sales and Product to fill in gaps that Sales can not yet fill because of a lack in numbers. Now we have enough Sales people and I want Product team to focus 100% on mastering our products and not spend half their time chasing leads. Because both teams currently get commission they do not cooperate optimally. There's a lot of strife between the two teams, such as racing to close a sale individually so they don't have to share the commission, and so on.

How can I create the most optimal incentive schemes, one for each team, that don't reduce their current earnings, promote individual and team achievement, and best cooperation? Examples would be appreciated. Thank you very much.

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'i want product to really focus on products' what do you mean by this? im unsure and the clarification could help with my answer – RhysW Feb 6 at 12:08
Thanks for your reply. I mean that I want the Product team to focus 100% on becoming experts on the products that they are responsible for. With the current scheme the Product team is spending half their time chasing leads, which is what the Sales team is for. I hope that clarifies it. – rabbid Feb 6 at 13:37
So let me just check i understand this, Sales team get paid commission based on each sale, and the product team are supposed to be experts who help provide information to the sales team. But due to a lack of sales team the product team was also paid for each sale? in which case ofc they are going to go out of their way to conflict, its the only way they get paid... – RhysW Feb 6 at 13:42
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To be honest i dont see why there are two groups in the first place, sales /should/ be experts in what they sell, if they dont know what they are selling then they have to rely on product, but then product are basically doing it all and sales is then pointless as they dont know much about the products. why do you need two seperate teams? why isnt it one team where each person is knowledgeable about the products? – RhysW Feb 6 at 13:44
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If you don't have a completely transparent policy of who is responsible for what, how can you expect to be fair with performance-related bonuses? – Dibstar Feb 6 at 16:05
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closed as not a real question by Rarity, DJClayworth, squeemish, bethlakshmi, jcmeloni Feb 7 at 1:38

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1 Answer

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The first thing you need to do is up the salaries of the product team to make up for the commissions they will lose if they no longer get commissions. Now you have removed their reason to compete with the sales team. The sales team will continue to get commisions.

Annual bonuses for both groups will be dependant in part not only on sales but on cooperation. This is because the guy who sold $1,000,000 worth of product might have sold $2,000,000 if he had used the product team wisely. This now removes sales' incentive toe xclude teh product team.

A small commision could also be given to the product team for recognizing a potential lead and passing it on to sales if sales wins the sale. This commission should not be taken out of the sales guys commision or he will not want to make those additonial sales.

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I agree with paragraph one. Thought of that as well. Paragraph two is interesting. How would you properly quantify cooperation? Paragraph three is interestin, a referral system. – rabbid Feb 6 at 22:52

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