Comp plans that drive the right behavior
You can write any strategy you like into a deck, but your comp plan is the strategy your reps actually follow. People do what they're paid to do, not what the kickoff slides asked them to do. When behavior on the floor doesn't match the plan on the wall, the comp plan almost always wins. Which means if reps are doing the wrong things, the first place to look isn't the people. It's how you pay them.
I've seen companies beg reps to sell multi-year deals while paying the same on a one-year contract, then wonder why nobody does it. I've seen teams preach new logos while the plan rewards easy renewals. The reps weren't being difficult. They were being rational. They read the plan correctly and you didn't.
Start from the behavior, not the number
Most comp design starts with a target payout and works backward. Flip it. Begin with the specific behaviors you need: the deal sizes, the products, the customer segments, the retention outcomes that matter for the business this year. Then build a plan that makes those behaviors the most profitable thing a rep can personally do. The plan should make the right behavior and the self-interested behavior the same behavior.
Your comp plan is your real strategy. Reps do what it pays, not what the kickoff asked.
Principles that hold up
- Keep it simple enough to sell to. If a rep can't calculate in their head what a deal earns them, the plan won't change behavior at the moment of decision.
- Reward outcomes, not activity. Pay for closed revenue and the right kind of revenue, not for dials or demos that may lead nowhere.
- Pay more for what's hard and strategic. Accelerators and higher rates on the behaviors you most want make the priority unmistakable.
- Avoid rewarding the wrong win. If the plan pays equally for a discounted scramble and a healthy full-price deal, you'll get more scrambles.
Watch for what you didn't intend
Every comp plan has side effects, and the good ones are designed with those in mind. Pay purely on new revenue and renewals may suffer. Cap earnings and your best reps coast once they hit the ceiling. Change the plan too often and you teach reps to distrust it and game the timing. Before you roll anything out, war-game how a smart, self-interested rep would exploit it, because one of them certainly will.
The test of a comp plan isn't whether finance finds it affordable or whether it looks balanced on paper. It's whether, when a rep faces a real choice on a real deal, the money pulls them toward what's good for the business. Get that alignment right and the plan does your managing for you. Get it wrong and no amount of coaching will out-argue a paycheck.