[tptacek]

Especially if you're doing account manager-type high-touch sales, which I assume Oxide is given its product, it would be difficult to hire strong sales people at all without variable compensation. It's best to think of sales as an entirely different kind of animal as the rest of the company. Like the post says, when they're making lots of money, everybody else is making even more money.

One thing people who have never managed direct sales teams might not immediately grok is: good sales people are experts at gaming incentive schemes. Their work and output adapts to their comp schemes in ways nobody else's does. If you cap a salesperson's comp in a quarter, they will work to move sales out of that quarter; exactly what you don't want.

[hinkley]

> Like the post says, when they're making lots of money, everybody else is making even more money.

I’ve worked with sales people whose compensation had loopholes you could drive a truck through, make sales that cost us more money than we made on the contract. Now a few of those are good for attracting VC money, but you have to be strategic and I’ve seen too much evidence of them not being so.

If you lock up your biggest potential customers with bad contracts that makes you default dead and no good way to weasel out.

[tptacek]

A compensation plan that aligns incentives to address the principal-agent problem of sales representatives is probably necessary, but definitely not sufficient, to manage an effective sales program.

[OJFord]

> One thing people who have never managed direct sales teams might not immediately grok is: good sales people are experts at gaming incentive schemes.

Is that just circular though? i.e. I think everyone's like that, it's just unusual that it's tied directly to compensation. e.g. if I feel that my Jira output is being critically monitored, I might push something (or the reporting of something) into the next sprint if it's close and I've already done a lot in this one; I might more diligently create tickets for every little incidental thing that popped up (rather than just quietly getting it done).

I'm not comp'd according to that, but it's the same behaviour, it's just 'a measure becoming a target' really isn't it?

[tptacek]

I don't have a more precise way to articulate this other than that adapting your behavior to your compensation is a skill, most of us are not expert in that skill even if we think we are, but even bad salespeople are like ninja masters at it.