Incentives, rewards, and compensation play a central role in the relationship between employer and employee, hence it is critical for organisations to understand the views of the latter towards these, as according to Maslow, they are key factors to the fulfillment of individual needs.

Extrinsic factors are the returns from the organization to the employee for his/her services and efforts and can be financial (e.g., monthly pay, increases, bonuses) or non-financial (e.g., employment security, mobile work, flexible hours).  On the other hand, the intrinsic factors are linked to the things that the employee wants to achieve through his/her work, and they are either associated with the work itself (variety, responsibility) or with the work process (use of abilities and skills, accomplishment).

The satisfaction of the so called “hygiene” factors (total earnings, working conditions etc.), from the theory of Herzberg that we discussed last week, although according to relevant research throughout the years is considered to have low-to medium motivational value, must be fulfilled mainly for the avoidance of dissatisfaction.  Having said that, organisations should avoid trying to motivate employees solely through these factors and focus more on intrinsic drivers such as personal development, interesting work and recognition which are less costly, but far more complex and with longer-term benefits.  Despite the above, the paradox of modern workplace is that more time and effort is spend by organisations to satisfy the former than the latter.

If salespeople show extrinsically motivated behaviours, namely those where the controlling mechanism is easily identified, will focus on financial incentives and advancement.  On the contrary, if intrinsically motivated behaviours are observed, where there is no other obvious reward than the activity itself, they will emphasise on how interesting the context of the job is and how much they can learn, so as to develop as professionals.   

With regards to the need for achievement (NFA), based on McClelland’s theory, which is one of the main characteristics of sales professionals, driven by the objective to accomplish the task at hand, the work should be organized in such a way that it will serve this cause.  Moreover, salespeople with high NFA should be given the opportunity to learn and acquire skills, which will help them with their further development as professionals, while McClelland himself concludes that this type of people look for business environments, where they can claim ownership of their job.  Regarding payment, according to a relevant article from Arnolds and Boshoff (2003), individuals with high NFA value money as a sign of their accomplishment and they feel dissatisfied, when the rewards from their organisation do not reflect their contribution.

According to the above, a balanced program that combines an effective compensation plan with incentives that will motivate sales professionals and help them to achieve their business and personal goals, since achievement is the dominant individual need for salespeople, should be seriously considered from people involved in the design and implementation of such policies.

Moreover, feedback from the employees regarding this issue is considered valuable, therefore attitude surveys are surely good practice and a useful tool that can be used periodically, to detect the work variables, which affect the motivation and dissatisfaction of a salesforce.  Because, as we said in the previous post, we always need to remind ourselves of the fact that the employees are holding the “keys” to motivation and the “door” is locked from the inside!