Wait. Did you say no commission?<\/p>\n\n\n\n
It was mid-2019 and I was considering my next move. I\u2019ve been in the tech startup space for a while \u2014 building out businesses, teams, and individuals. I (thought I) knew what I was looking for: a strong commission plan or at least one that had the flexibility to modify.<\/p>\n\n\n\n
Accelerators. Sales performance incentive funds (SPIFs). President\u2019s Clubs. You get the picture.<\/p>\n\n\n\n
So when the recruiter mentioned monday.com\u2019s no commission sales structure, I didn\u2019t know what to think. <\/p>\n\n\n\n
I paused in disbelief … scratched my head and thought, how would that work? No commission? For Sales? Huh? Sales compensation = commission. How was this even possible? <\/p>\n\n\n\n
I was curious \u2014 and doubtful \u2014 but open to learning more. And I\u2019m glad I did.<\/p>\n\n\n\n
Fast forward 18 months later and I\u2019m still here at monday.com. While a no commission structure isn’t simple (and maybe not for every company) it’s an entirely new dimension of sales that shines a light on aspects of the sales organization that could use reconsidering.<\/p>\n\n\n\n
Here are 4 reasons why monday.com\u2019s no commission structure works for our team (and maybe you too).<\/p>\n\n\n\n
Disclaimer: a no-commission sales structure is not for everyone. And that\u2019s okay. I\u2019m here to share why it works for me, my team, and monday.com.<\/p>\n\n\n\n
In many organizations, sales \u2014 and salespeople \u2014 are held to a higher standard.<\/p>\n\n\n\n
Sales are the team that closes deals, brings in new customers, generates revenue, and ultimately \u201csells\u201d the virtues and value of your amazing product or service.<\/p>\n\n\n\n
In many cases – without sales, there would be no company.*<\/p>\n\n\n\n
*Technically, other teams in an organization could make the same argument: With no product, there are no sales. With no marketing, nobody knows about the product. And so on. In fact, monday.com started without a sales team and operated that way for several years in a no-touch model.<\/p>\n\n\n\n
But in a no commission sales structure, sales are not better (or worse, for that matter) than any other team in the organization. We are all one, totally aligned but executing our respective discipline\/profession.<\/p>\n\n\n\n
A no commission sales structure levels the playing field and ensures total business alignment across the company. <\/p>\n\n\n\n
Paloma Kim<\/a>, Sr. Account Executive (and recently promoted to Team Leader) at monday.com, says it best:<\/p>\n\n\n\n \u201cThis model aligns motivation between consultant, client, and company. It opens the door to a consultative sales approach focused on our clients\u2019 challenges and harvests excellent customer experience. This, ultimately, translates to bigger wins together as a whole.\u201d<\/p>\n\n\n\n The goal is centered around scaling our company, NOT our individual wealth. The latter will come with success. So everyone here is \u201clooking at the same dot on the wall\u201d \u2014 working together to grow the business.<\/p>\n\n\n\n Without customers, there would be no company.<\/p>\n\n\n\n Customers are the reason companies exist. They are the lifeblood of any organization. They are the primary revenue driver. They also help drive the company\u2019s innovation and progress and its product and services. <\/p>\n\n\n\n A no commission sales structure helps to put the customer where they belong: FIRST.<\/p>\n\n\n\n Sales reps think about how to add value to the customer. They take as much time as necessary to ensure a good fit, and a solid transition from sales to customer success occurs. Sure, sales reps want to close the deal, hit their targets, and secure new customers.<\/p>\n\n\n\n However, they also want to do what is best for the customer.<\/p>\n\n\n\n This customer-first mentality leads to customers who stay longer, pay more, and become raving fans and advocates for your business.<\/p>\n\n\n\n Chris Moore<\/a>, a monday.com Sr. Account Executive since February 2020, feels \u201cempowered to work on strategies that have the greatest impact for clients,\u201d not those who impact his personal take-home. <\/p>\n\n\n\n \u201cOver the course of the last year, I’ve realized that working in a no-commission model means I consistently give more thought and attention to my client’s needs, knowing their success is aligned with both the company’s and my own. This means higher-impact solutions for clients, stronger relationships for monday.com, and more motivation for me to stay focused on what matters.”<\/p>\n\n\n\n The challenge: sales reps aren’t incentivized to ensure a customer is the \u201cbest fit\u201d for the organization. Instead, in a commission-based system, reps are compensated to close more (and higher value) deals.<\/p>\n\n\n\n A no commission sales structure enhances teamwork – tenfold <\/p>\n\n\n\n There is no \u201cI\u201d in \u201cteam,\u201d and that\u2019s a good thing because we are BETTER TOGETHER.<\/p>\n\n\n\n I don\u2019t miss the days of seeing resentment, bitterness, or envy over a teammate getting a bluebird. Nor do I crave the shifts in positioning credit and blame, distracting from the lessons. Those days are gone, along with the Lone Ranger. In fact, we have a \u201cNever Lose Alone\u201d mentality across everything we do.<\/p>\n\n\n\n In a no commission model, everyone wants to help their teammate.<\/p>\n\n\n\n \u201cTeamwork is engraved in our day-to-day operations from the very beginning,\u201d says Paloma Kim.<\/p>\n\n\n\n Before I go too far down this road, let me be clear:<\/p>\n\n\n\n Yes, we still have sales goals: Aggressive ones!<\/p>\n\n\n\n Yes, we still track sales progress-to-goal: Both qualitative and quantitative measures.<\/p>\n\n\n\n Yes, we still have incentives to meet\/exceed those goals: Recognition, career pathing, and bonuses.<\/p>\n\n\n\n And YES we\u2019re fully transparent (something we pride ourselves on at monday.com<\/a>) about where every sales rep stands as it pertains to individual goals as well as team\/company-wide targets.<\/p>\n\n\n\n A ton has been written \u2014 and spoken \u2014 about the importance of teamwork and collaboration regarding employee morale, engagement, and success. As the author in this Forbes article<\/a> points out from a Stanford study (and I\u2019m paraphrasing):<\/p>\n\n\n\n Those who collaborated stuck with tasks 64% longer than those who went at it alone. The collaborators also reported higher engagement levels, lower fatigue levels, and a higher success rate. <\/p>\n\n\n\n I find that everyone on the team truly, genuinely wants to help the person sitting (virtually, now) next to them. The saying is true: A rising tide does lift all boats.<\/p>\n\n\n\n It\u2019s hard for me to overstate this:<\/p>\n\n\n\n My ability to make decisions that are best for my team \u2014 to test, tweak, to move people around, to create new groups, and so on \u2014 becomes significantly easier when compensation is taken out of the equation.<\/p>\n\n\n\n It\u2019s not even close.<\/p>\n\n\n\n In my pre-monday.com days, many decisions carried a financial impact on someone. And, because the structure was (being) established, there were limitations to how creative you could be to overcome a challenge, solve an issue, or design and execute for scale. This is especially true with timing.<\/p>\n\n\n\n Those days are gone. And our limitations are only those we put on ourselves.<\/p>\n\n\n\n In my monday.com no commission world, I can:<\/p>\n\n\n\n None of this impacts their compensation. And none of these decisions need to wait.<\/p>\n\n\n\n Example #1: We lifted our mid-market segment from a cap of 1,500 employees to 4,000 employees for 6-7 weeks to balance the lead flow, pipeline and workload, and ensure our customers got the attention and experience they deserved.<\/p>\n\n\n\n Example #2: We piloted a new segment with our top rep as a pace setter, then added one rep to the pilot every month to see if they could deliver the same results. After 4 months and 4 piloted members, we\u2019ve modified our hiring plans to dedicate another 16 new reps to this effort.<\/p>\n\n\n\n Example #3: With our aggressive hiring plans and thorough interview process, it became difficult to have competing priorities across all the sales managers, especially for HR\/recruitment when coordinating processes and schedules. We took a manager who had just built a complete team quickly (and very effectively for that matter) and asked him to do it again while realigning their current team members to other teams. That manager is currently on his 4th team build-out over the last 9 months. This means HR has a single point of contact and a dedicated team to focus on as a priority, this manager executes hiring and foundational aspects to lay the groundwork, and we promote internally to take over a complete team where execution is the focus instead of interviews and hiring.<\/p>\n\n\n\n Win. Win. Win.<\/p>\n\n\n\n Commission plans are meant to drive a specific behavior \u2014 sales in exchange for money.<\/p>\n\n\n\n Unfortunately, these behaviors do not always foster teamwork and collaboration. They may boost individual, short-term positive action, but they can create tension and division in the long run. <\/p>\n\n\n\n Federico Maiola<\/a>, monday.com Account Executive since January 2021, agrees:<\/p>\n\n\n\n \u201cAs a Sales Professional, earning commission has always been a source of motivation to work hard and excel at my job. When I first heard about monday.com\u2019s no commission model I wasn\u2019t sure it would work for me. In a few short months, I\u2019ve done a complete 180. The level of selflessness and team camaraderie that this model creates is incredible. Add the top-down transparency from management on company goals\/objectives, and I feel truly honored to be given the opportunity to be part of something special \u2014 and that\u2019s the only motivation I need to crush my number.\u201d<\/p>\n\n\n\n This \u201ceveryone out for themselves\u201d attitude does not always bode well for customers either and can lead to less-than-ideal fits and, ultimately, churn.<\/p>\n\n\n\n As we all know from annual sales kickoffs, there seems to be a new commission plan every year. Sales reps spend time figuring out how to make the most of the commission plan in order to make the most money, and when they break it the plan adjusts accordingly. Accelerators now start at 110%, hurdle rates instituted, penalties applied, Professional Services no longer counts for quota relief, etc. <\/p>\n\n\n\n And regardless of the reasoning for the annual changes, a significant amount of time, effort, energy (and $$) is spent constantly tweaking \u2014 or revamping \u2014 the commission model. But worse, reps spend too much time determining if they were paid out correctly … and devising plans to \u201cbeat\u201d the model.<\/p>\n\n\n\n I\u2019d rather have my sales reps spending more time learning and growing and closing more (good) business.<\/p>\n\n\n\n No model is perfect. No sales commission structure is ideal. While I\u2019m in full support of the monday.com no-commission system, I\u2019d be naive to think it comes drawback-free.<\/p>\n\n\n\n A no commission sales structure is not for everyone. <\/p>\n\n\n\n We sometimes lose out on salespeople who are driven by extrinsic (often, financial) rewards. And we occasionally miss landing a \u201ctop sales rep\u201d who may have a proven track record of exceeding their goals (and their On Target Earnings). <\/p>\n\n\n\nReason #2: Customer First<\/strong><\/h3>\n\n\n\n
Reason #3: Teamwork and Collaboration<\/strong><\/h3>\n\n\n\n
Reason #4: Agility<\/strong><\/h3>\n\n\n\n
Traditional, commission-based sales models are great (when they work)<\/strong><\/h3>\n\n\n\n
It\u2019s not always unicorns and rainbows.<\/strong><\/h3>\n\n\n\n