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The Top 10 Articles of 2020: #1

Sales vs Back Office = Envy

Managing the tension between front office and back office colleagues has always been a challenge for companies. And the smaller the company, the bigger the challenge. If a business owner or manager belongs to a younger generation, then the complications are fewer and much less intense. This is because they believe that those who generate revenue should earn the lion’s share, while the back office workers are there to assist these revenue generators.

Not so nice

My first experience on this topic was when a multinational firm hired me as sales director, and my task was to shake up a sales team that had completely lost their motivation. The monthly revenue expectation was around EUR 1 million, much higher than their current EUR 500,000, meaning that the entire enterprise was underperforming. After reflecting on the situation, we came up with extra motivation for the team: we implemented a very generous commission for all sales above EUR 1 million. This was not in line with company guidelines, but few expected problems because it was so far out of reach. But as usual, life is funny, and fuelled by new motivation and limitless opportunities, the team generated EUR 1.4 million in revenue, allowing some members of the team to take home more income than the Country Manager himself. Of course, this also solved the corporate backlog, killing two birds with one stone, so everyone was happy, and I became a celebrated “star” within the company. Well, almost everyone was happy. The Country Manager called me in, and the Financial Director was waiting for me in his office. The topic: how dare I allow “simple salespeople” to earn a higher income than a country manager or Financial Director? I didn’t understand the question, because, at the time, members of my team were taking home roughly three times my income, and I was very happy about that fact. Of course, they rescinded my new motivational system, and as a result, my team’s performance in the following months did not even come close to the previous levels. With this, both the Country Manager and the Financial Director lost their bonuses, as well as some considerable money for the company, a process that continued for months after.

By then, HQ was curious about the situation and organised an international “interrogation” on the matter. In short, they replaced both the Financial Director and took control of sales form the Country Manager, and I became the sole person responsible for developing the motivation system not only for my own country but for the entire international network. I couldn’t decipher the true meaning of this whole situation for a very long time, but today, I see that it wasn’t simple envy that caused the quarrel. These “simple salespeople”, some of whom did not even have university diplomas, accomplished something that the two top leaders could not. For them, the income disparity reflected that their studies were useless, as with “zero knowledge” — their exact words — anyone could earn more than them. Needless to say, if this sentiment existed at the upper echelon of the company, it was even more prevalent in the rungs below. There were constant battles between salespeople and the back office. I was always on the side of the salespeople. The sales strategy was in my hands, so I had a direct impact on what they could sell and whether they could sell. This made me the top decision-maker in the sales department, but I was not the department’s top earner. Was I jealous? Did I want to trade positions with the salespeople? No! Because I saw their work! I mean, I saw it up close and personal. But within a very short time, I was deemed to be a “sales advocate” within the company, and this moniker was not a positive one.

Owners have no choice

My perception has not changed one bit since becoming a business owner. The company owes its existence to salespeople because they generate revenue. Indirectly or even directly, they are responsible for raising the wages of back office workers. They take a beating out there on the market, while the rest of the organisation sits inside the comfortable office. Of course they have a different income structure. But what if salespeople have fixed incomes? Where is the fairness, then? The owner or manager must take care of it! Yes, the salesperson has to take a risk. Otherwise, they are not a real salesperson. Sure, they’re used to being pampered, but based on more than twenty years of experience in sales management, I can safely say: a real salesperson isn’t afraid of a challenge! They are not afraid of a low fixed income if the commission provides unlimited opportunities. And just because a lot of people say the opposite does not mean it is not true. It just shows that a lot of people want to justify their income even though they cannot bring business. But this is no longer the case. The situation has changed since the Great Recession, and now, with the onset of the COVID Crisis, things have only accelerated. And if the salesperson has to take the risk, there will be immediate internal equilibrium, as a back office colleague would never take a job for a low fixed income in hopes of a commission, because they are simply not coded that way. Income issues became critical in 2020. More and more business owners and managers are discovering the great potential of significantly different incomes. I’m not just speaking from a sales/back office perspective. The back office vs back office issue is also becoming more interesting and has great motivational potential. Why not make a significant distinction between a mediocre employee and a standout employee? If the rules are clear, no one should have a problem. Sure, there will be issues, but if an employee cannot accept such a system, then their long-term worth is in doubt.

I see the contradictions in my company every day. My guiding principle is that a salesperson who can produce large sums should be freer than a consultant who administers the projects brought by the salesman. Moreover, the administrator has no margin for error, or at least not much. After all, destroying a business that someone else has brought in with hard work is not a nice thing. And causing defined harm to the employer is also not very noble. What if 85% of workers do not like this simple fact? It can happen! That just means that the other 15% has real development potential, so owners and managers need to concentrate on that group and that group only!