Group Forums >> San Francisco Sales Group >> CEO++ pay?
CEO++ pay?
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Posted 5 months ago Do you think the top Sales Rep should make more than the CEO? |
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| Posted 5 months ago Kabaim, As the former owner of several companies, I encouraged my sales people to make as much as they could. Their commissions were not capped and they could make more than me and several did. If your questions pertains to a smaller company, then I believe the top sales reps should be able to make more than the CEO provided that the CEO's pay isn't associated with other parameters that the sales rep just doesn't have access to such as large blocks of stock and bonuses. At large pharma companies that I onced worked for, none of the top sales reps came close to the CEO's pay. Capped commissions, bonuses, much smaller base salaries, performance review calculations in the mix ensured the top sales reps couldn't make unlimited commissions or bonuses to exceed the CEO's pay.
Slbenz |
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| Posted 5 months ago I worked for a company where our top sales person made more money than the VP of the division. Guesss what?? The next year the commission scale was changed. He didn't like that at all! I think a good sales person should be able to earn whatever, but it doesn't matter what I think. Top executives don't like to be outearned by the sales department. Our commissions were lowered every year for the last three years. Humm, and this company is ranked as one of the best sales companies to work for. Getting a sale is more difficult this year than it was three years ago yet our earnings are now a good 25% less. In the particular instance of this sales person, the commission situation was definitely lopsided and the commission scale was pretty high due to it's infancy of the department. The commissions have been cut so much now though that it is very difficult to even make in the $200's. When commission schedules are developed the managers should know what a company can afford to pay to be profitable. If a sales person then earns a ton they are bringing in a ton of revenue to the company. How often does it happen that a sales person makes more than the CEO? and how many sales people in the company are doing it? It is pretty rare, and doesn't usually last that long, if it does maybe the CEO needs a raise! After all, weren't they responsible for ultimately bringing in the talent? As a salesperson I am very money motivated. Seeing high earnings possible make me work harder - it is the carrot! Don't take away my carrot! |
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| Posted 5 months ago Thanks slbenz and MissSally - very valuable insight. At my previous company, something similar to what MissSally describes happened - around mid-year, it was clear that the top rep was going to be going way over the top, and the trajectory would have put him clearly above the CEO pay (this was a mid-stage start-up). The comp plan was changed mid-year... however, the rep was compensated with another block of stock options to compensate (it worked out for all parties in this case). A few years later, it happened again with another rep, and the stock option block was much smaller... Repeating the pattern of changing comp plans mid-year when reps are too (!!!) successful really damages a company's ability to retain top sales talent. |