Incentives Are Not the Solution – Not This Time…

Ever watch the movie “The Replacements”?  It’s a little known, but pretty darn funny movie about a rag-tag group of football replacements signed on to play during a professional football players’ strike.  As you would expect when pulling players from prison, soccer, personal security and other places, there isn’t a lot of “team” on the team.

That movie came to mind the other day when I was on the phone with a friend and colleague from my checkered past.  He was tasked with putting together an incentive and reward program for his company and he called for some advice.  His company was recently acquired, along with another company and was in the early, early stages of being assimilated (resistance is futile ya know.) 

Over time the three companies will become one.  The CEO wants sales – and he wants gross margin.  And he wants it now.

As he discussed the plan I stopped him and said something along the lines of…

“Why are you running an incentive program to drive sales/gross margin immediately after a merger/acquisition?  Sales are the least of your worries now.” 

His answer – “That’s what the CEO wants.”

What You Want May Not be What You Need

I’ve been part of an organization that has been through mergers and acquisitions.  I can tell you for a fact – sales should be the last thing on your mind at the time of the “great coalescing.”  While the concept of the merger made a lot of sense in the spreadsheet and on the power point slide – it probably doesn’t make sense to the sales and support teams from the various companies involved.  

For example: 

As a salesperson with accounts that pay your mortgage, you’re pretty protective of them.  You want to make sure you’re providing top-notch service, appropriate solutions and keeping mistakes from creeping into the relationship.  You’ve worked hard at managing your relationships and are a trusted advisor to your clients.

But now you are informed you are part of a new incentive program from corporate that rewards all sorts of new people in new companies (some you’ve never heard of) with unproven track records for selling stuff you’re not familiar with to YOUR clients.  Sure it rewards you as well for cross-selling and presenting the new company’s services.  But in your mind the reward isn’t worth the risk.  The marginal value of greater income is much lower than the downside risk of NO income.

Here’s what will happen if they run this program…

• Sales person will get numerous calls from people he/she doesn’t know requesting audiences with “their” clients.
• Sales person will get pressure from management to allow these folks access.
• Sales person will create roadblocks for these folks so they don’t get access to “his/her” client.
• Program will create animosity between all parties.
• Sales will slow down in all areas.
• Clients who could benefit (and are probably looking) for the services the combined company offers will find them somewhere else.
• All business in the new corporate entity will drop.
• Incentive program fails, friend gets fired, CEO will launch newly designed incentive program.

Sorry – but that is what will happen.

Incentives Weren’t the Solution

The solution in this case is to “create a company” first then drive sales.  Just because the financials are now combined and connected doesn’t mean the people are.

My recommendation to my friend…

Don’t run an incentive program for sales.

1. Work with the new management teams to create the vision/mission/proposition for the combined client base.
    
2. Create reward and recognition programs that reinforce meeting and learning about the new company position, values, offerings, etc.  Reward behaviors like visiting the offices of the new company, or designing new presentation materials through bi-partisan teams.  Work on anything and everything that helps bring together the groups to talk/meet/explore/create.  But don’t run an incentive to drive sales.

As you’ll see if you ever watch “The Replacements” – they didn’t start winning until they could trust each other and come together as a team. 

Same goes for your company.  Whenever you’re pulling disparate groups together remember that creating incentives for outcomes comes AFTER you’ve found a way to reinforce behaviors that bring the group together.  Focusing on the “sales” or other outcomes will simply pit each of the team members against each other immediately.

Work on building the team before you work on scoring the points.

Watch the video below and see the point at which the team, became a team (email subscribers click through to the post to see embedded video.  Very minor NSFW language at beginning.)