When Sales Incentives Backfire

This HBR IdeaCast episode discusses how salespeople game sales incentive systems, exploring eight common schemes like "partnering with customers" to maximize personal gain at company expense. The hosts interview a professor and a consultant who detail these tactics and suggest that company leaders adopt an "immoral imagination" to anticipate and prevent such behavior. They recommend using data analysis to identify patterns of gaming and suggest that while minor sandbagging might be tolerated, more serious issues require intervention, potentially involving plan redesign and performance management. The discussion emphasizes the importance of collaboration between sales leaders and operations teams to design effective and less-gameable incentive structures. Ignoring the problem can lead to significant financial losses for the company.