11/18/2025

Compensation Is a Poor Substitute for Leadership

Leaning too heavily on compensation can force leaders to miss the bigger picture

When CEOs discuss sales performance, the focus almost always turns to compensation—how much, in what form and for what behaviors. This happens for two reasons: one practical, and one that is quietly counterproductive.

The practical reason is straightforward. In most B2B companies, compensation is the largest line item in the sales budget. It's a significant cost that must be effectively managed. But the second reason is more problematic: There is a widespread and often unexamined belief that salespeople are "coin operated" or primarily motivated by money. At best, this belief is outdated and simplistic. At worst, it leads executives to overuse or misuse compensation as the primary driver of performance for their salespeople.

The best sales teams I've seen—and research backs this up—are not activated mainly by bonuses or commissions. They are motivated by purpose, making a difference for customers, and creating value in the market.

Please select this link to read the complete article from Chief Executive.