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ThoughtWorks kills sales commissions

This is a post from The Pursuit of Happiness, a blog on happy workplaces and work culture at my company, GasPedal. Check it out for more posts like this every week.

In 2012, Chicago-based software company ThoughtWorks ended sales commissions and paid their entire sales team on straight salary.

The result? More collaboration, more integration of the sales team and the rest of the company, and higher morale overall.

Here’s how they explain it:

While sales incentives are an almost universal motivation for sales forces across many sectors, ThoughtWorks has long felt that it can cause departmental divides. Most importantly, the company believes it leverages how sales teams can interact with existing or potential clients by focusing on actual customer success.

Since abandoning sales commissions across the entire business this year, ThoughtWorks has found an even greater degree of collaboration between its sales team, developers and consultants, and staff quickly adjusted to the change.

Managing Director Luke Barrett comments: “At ThoughtWorks our sense of ethics has always been the core of the business, and we have long felt that sales commissions are at odds with this. Simply put, it didn’t feel fair when everyone is working hard to promote the business that only a select few were rewarded. There is a traditional degree of separation between sales and developers, and it can lead to an ‘us and them’ attitude which is not constructive.”

More on their website and also at The New York Times.

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  1. Vincent December 10, 2014 at 9:03 am #

    I definitely think that was a great idea. Although the “commission” as an incentive sounds good, the repercussions, especially in the sales team are not always conducive to a working environment. It creates some form of separation at work. Obviously that is not the idea or the intention, but certain undesired attitudes brood from this type of remunerate system.

    Good Job.

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