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Cash Is Not King, Maslow Knew How To Motivate A Sales Team. By Mark Sullivan, Vice President, SalesDriver The first of 7 Secrets to sales incentive success. Wed Oct 20, 2004

After helping over 750 companies launch and manage over 2,500 incentive programs, I have learned why sales incentive programs succeed – and why they fail. Using this knowledge I have created “7 Secrets to Sales Incentive Success”.

Sixty years ago, psychologist Abraham Maslow created a hierarchy of needs, which concluded that once basic needs are satisfied, people want more.

Apply Maslow's pyramid to how to best motivate your employees, and you'll discover that the "more" people want goes beyond cash incentives. Certainly cash pays for your employees' "physical comfort" and ensures their "security" - the Monetary Needs. But cash cannot satisfy their social, self-esteem, and self-realization needs. These are the Psychic Income Needs that drive individual employees to succeed - to be part of a team, to earn honor and recognition from their peers, and to realize their greatest potential.

In a sales environment, cash compensation - base salary and commissions - satisfies Monetary Needs. But just as money can't buy happiness, money also can't buy the intangibles that drive your salespeople - self-worth, feeling valued in an organization, and approaching each new sales day with enthusiasm and positive energy.

Thus, cash is not king - at least not when it comes to jumping up the performance of your salespeople. Doubling commissions does not double sales! Non-cash sales incentives, however, generate a greater feeling of personal achievement and increase your sales force's overall performance. In fact, merchandise and travel incentive programs can provide a 200 percent greater return than cash.

Once a salesperson's Monetary Needs are met, you've got to offer something that meets their Psychic Income Needs. Non-cash incentives provide "trophy value," or bragging rights - things that aren't possible with incremental cash incentives.

Imagine a salesperson has earned a cash bonus. He walks around his neighborhood yelling, "Hey, check out my new $1,000 bill." Ridiculous? Yes. Yet bragging rights and celebrating success are a huge part of the sales motivation process. Now imagine that same salesperson won a 62" big screen TV in a non-cash incentive sales contest. A neighbor drops by for a visit and says, "Hey, cool new TV. When did you get it?" Time for bragging rights: the sales-person says he won the TV because he was the top sales performer in his office. But, even better than that, for the next 10 years every time the salesperson watches that TV, he'll remember what he did to earn it and which employer provided the reward.

If you want your sales team to be truly inspired and to maximize their motivation, you must create the environment that motivates them to achieve. Maslow knew how to motivate a sales team, and so can you by creating a compensation plan that includes a mix of base salary, commissions, and non-cash incentives.

Want to better understand "trophy value" and how it affects sales success? Here's what Todd Ridgeway, an Account Executive for AOL Time Warner who won a Harley Davidson Fat Boy motorcycle as a top sales performer, says about his involvement with a non-cash incentive program: "The feeling was, and continues to be one of tremendous accomplishment. Even today, when someone inquires about the bike, I tell them the story of how I won it in a sales contest. It not only makes me feel good, but it makes AOL Time Warner look like the greatest employer on earth. Everybody wants to know how to get a gig with AOL" (March/April 2002 Sales and Marketing Magazine). Non-cash incentive programs meet your employees' Physic Needs and add the necessary zing to your sales force's overall performance.