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Breaking the Sales Force Incentive Addiction: A Balanced Approach to Sales Force Effectiveness
Abstract
Dating back more than a century, companies have used incentives such as commissions and bonuses to motivate and direct the activities of salespeople. Today, sales force incentives comprise a large portion of sales force pay (approximately 40 percent on average for U.S. companies), almost all of which is linked to each individual salesperson's short-term performance using metrics such as quarterly sales. Yet as selling becomes increasingly complex, motivating the right sales force behaviors using these traditional large short-term individual (LSTI) incentives becomes more challenging. Based on observation of various sales organizations, we suggest two propositions about the use of LSTI incentives in sales forces today. First, these incentives can create undesired consequences, including organizationally unproductive short-term focus among salespeople that leads to a counterproductive culture and hurts company performance. Second, other sales force effectiveness (SFE) drivers are frequently more powerful than incentives for setting the right tone for the sales force, affecting sales force behaviors, and enhancing performance—especially when products and markets are complex. These propositions suggest that sales leaders should break their addiction to sales force incentives and develop a more balanced approach to motivating and controlling sales force effort using other SFE drivers in addition to LSTI incentives. By organizing a research agenda around a holistic Sales Force System framework, researchers can provide insights on the appropriate role for incentives, thereby helping sales leaders create and maintain more effective sales organizations.
... that monetary sales incentives increase performance through their beneficial effects on salespeople's motivation and effort (e.g., Cameron et al., 2001;Chung et al., 2013;Lazear, 2000), a nascent stream of research indicates that the increased complexity of service innovations renders monetary sales incentives ineffective or even counterproductive (e.g., Rouziès et al., 2009;Zoltners et al., 2013). In view of the growing practical relevance of this topic and the salient lack of theoretical clarity, the present study aims to empirically examine the effects of monetary sales incentives when firms aim to provide complex service innovations to customers. ...
... Second, some studies suggest an opposing view and conceptually propose that monetary incentives can impede sales performance (e.g., Ariely, Bracha, et al., 2009;Ariely, Gneezy, et al., 2009;Condry, 1977;Habel et al., 2021;Kohn, 1993;Rouziès et al., 2009;Zoltners et al., 2013). One stream of research has unveiled that monetary incentives distract salespeople from being creative, innovative, and explorative and diminish their analytical skills (e.g., Ariely, Bracha, et al., 2009;Condry, 1977;Kohn, 1993). ...
... One stream of research has unveiled that monetary incentives distract salespeople from being creative, innovative, and explorative and diminish their analytical skills (e.g., Ariely, Bracha, et al., 2009;Condry, 1977;Kohn, 1993). These deficiencies result from the short-term focus that traditional sales incentive schemes entail (Zoltners et al., 2013). Slater (1980, p. 127) summarizes that "getting people to chase money produces nothing but people chasing money." ...
Complex service innovations constitute a cornerstone in the strategy of numerous industrial companies. The industrial sales force assumes an important role in the selling of these complex service innovations. For firms a key challenge in this respect resides in ensuring the sales force’s motivation for the selling of such innovations and effectively solving customers’ business problems. Past research frequently discussed monetary sales incentives as an effective tool to reinforce desired employee behaviors, but, to date, the discussion has failed to produce conclusive guidance for practitioners as to whether monetary sales incentives in fact can facilitate selling of complex service innovations. To clarify the effects of monetary sales incentives in this respect, we draw on self‐focus theory to disentangle how complex service innovation selling is shaped by the interplay of salesperson service incentives (i.e., the extent to which variable compensation depends on service turnover) and salesperson share of variable compensation (i.e., the percentage of compensation that depends on performance). To test these interactive effects, we use a multiple‐source data set including 294 salespeople, and matched objective firm data. The results reveal that when service incentives are high, the share of variable compensation exhibits an inverse u‐shaped effect on a salesperson’s problem‐solving behavior, which is an important predictor of innovative service selling success. In addition, the share of variable compensation increases work effort, which in turn drives innovative service selling success. These findings shed light on the intricate “human”, employee‐related side of service innovation management and provide actionable implications for managers how to increase their firms’ innovative service selling success. This article is part of the Special Issue on ˝The Human Side of Innovation Management.ʺ
... Despite the impressive body of literature on negotiation and salesforce control, the academic discussion too often focuses on the perspective of participants in negotiations and neglects to acknowledge that the company that mandates a salesperson to negotiate on its behalf is economically responsible for the deal (Dubinsky and Ingram 1984;Anderson and Huang 2006). Analyses that do go beyond the perspective of negotiators tend to investigate single issues, such as monetary incentives (Zoltners et al. 2012), overlooking the fact that companies have many more powerful levers to influence salespeople (Mahaney and Lederer 2011). ...
... In addition, negotiation management research focuses on different topics than salesforce control literature does. The latter mostly covers indirect management systems, such as monetary incentives (Eisenhardt 1985;Zoltners et al. 2012), and seldom discusses levers of direct influence. Interestingly, both streams of literature focus their argumentation on one end of the continuum between outcome-control and behavior control strategies (Anderson and Oliver 1987). ...
... This is a parallelism to sales force control theory, where Anderson and Oliver (1987) introduced the idea of a continuum of control strategies for salespeople, with the antipodes being behavior and outcome control. Most researchers, however, agree that the extremes do not exist in reality; rather, companies use a combination of control strategies (Anderson and Oliver 1987;Cravens et al. 1993;Zoltners et al. 2012). ...
Researchers and practitioners alike recognize the necessity to manage salespeople before, during, and after negotiations. Literature identifies four approaches that companies use to manage salespeople in and around negotiations. However, it has never been researched which of these approaches help companies implement negotiation management successfully. The present study examines which management approach or combination of approaches lead to a consistently high level of negotiation success. The authors use a fuzzy-set qualitative comparative analysis to identify the conditions explaining negotiation success. The findings indicate that any effort to actively manage negotiations as a corporate capability supports sales in achieving a higher level of negotiation success. While the study was not able to identify any necessary conditions, the sufficient solution formula to reach a high level of negotiation success comprises two paths in its most parsimonious form. Following this solution formula, companies should either enable salespeople to solve complex situations autonomously and provide guidance along the negotiation process or define clear objectives, manage salespeople against deviations from the objectives, and monitor them closely throughout the negotiation process. This suggests, that successful negotiation management either empowers salespeople to act autonomously or focuses on a control management style. The latter should comprise both aspects of outcome and behavior control.
... Thus, they are particularly important when examining organizational crossselling antecedents. Third, the three steering instruments in this framework are highly actionable, as firms may apply steering instruments in the short run to support existing organizational structures (Zoltners, Sinha, & Lorimer, 2012). ...
... With regard to the direct relationships of organizational cross-selling structures and steering instruments with cross-selling performance, we build on prior research providing rich evidence that these organizational determinants are important drivers of various facets of performance (Ambrose & Schminke, 2003;Burns & Stalker, 1961;Campion, Cheraskin, & Stevens, 1994;Lassk, Ingram, Kraus, & Mascio, 2012;Zoltners, Sinha, & Lorimer, 2012). Specifically, for organizational cross-selling structures, we expect that the guidelines entailed in mechanistic cross-selling structures result in higher cross-selling performance, because they precisely define the cross-selling activities, thus guiding the sales force to higher cross-selling performance. ...
... Second, we recommend that managers make small adjustments to their steering instruments to realize quick gains in their organizations' cross-selling performance. Training, job rotation, and cross-selling incentives are steering instruments that support existing organizational structures (Lassk, Ingram, Kraus, & Mascio, 2012;Ortega, 2001;Zoltners, Sinha, & Lorimer, 2012). For example, cross-selling training can be implemented relatively quickly to support the realization of established cross-selling guidelines (i.e., mechanistic cross-selling structures). ...
This study draws on the structural perspective of organization theory to investigate how firms can organize for cross-selling. Specifically, it analyzes how configurations of organizational structures and steering instruments are associated with cross-selling performance. Results show that mechanistic and organic organizational cross-selling structures should be closely aligned with financial and nonfinancial steering instruments: while the interactions between mechanistic cross-selling structures and non-financial steering instruments are likely to result in high levels of cross-selling performance, organic cross-selling structures should be combined with financial steering via cross-selling incentives. Findings also reveal a U-shaped relationship between cross-selling performance and firm EBITDA. These results suggest that to enhance profits, firms should either organize for very high levels of cross-selling performance or refrain entirely from investing in cross-selling structures or steering instruments.
... Jones et al. (2005); Rom an and Rodríguez(2015);Zoltners et al. (2012) 3Consultative sales skills The salesperson must operate more as a consultant and use skills associated with problem identification and recommendation generationRotta (2018); Goodwin-Kucinsky et al.(2017),Pierce and Irwin (2016) 4Funnel management Refers to the process to manage suspects and prospects to ensure revenue targets are attained.Armstrong et al. (2008); Grublješič and Nejc Campa (2016); Patterson (2007) 5 Industry research and value development Salespersons need to have industry knowledge, specific account knowledge and knowledge of the person they are dealing with Loe and Inks (2014), Gregory (2009); Robertson et al. (2006) 6 Objection handling Objection handling is a process and a set of techniques to mitigate the impact of customer objections Campbell et al. (2006), Inks et al. (2011); Punwatkar and Varghese (2014), Rackham (1988) 7 Solution selling Solution selling is a group of techniques and a methodology to effectively sell solution Adamson et al. (2012), Eades (2003); Rapp et al. (2014), Sharma et al. (2008) 8 Business and financial acumen Key to credibility and to truly understanding the impact of a decision by the customer to go with the solution Kaski et al. (2017), Marcos-Cuevas and Ryals (2015); Peacock (2017), Volbeda and Blanch (2016) 9 Business ethics Relates to the internal and external ethical principles to which the organization adheres Agnihotri and Krush (2015), Hansen and Riggle (2009); Ingram et al. (2007), Munoz and Mallin (2019) 10 Product knowledge training Involves understanding what the organization sells, how it pertains to customers' needs and positioning the product effectively to a customer Ogilvie et al. (2018), Ingram et al. (1989); Shoemaker and Johlke(2002) ...
Purpose
Determining the skills required for salespersons to maximize their effectiveness was the main driver for conducting the present study. In order to identify those necessary skills, this study aims to review various research techniques drawn from multiple disciplines and applied that knowledge to salespersons.
Design/methodology/approach
This study used a mixed-method methodology. This study began by conducting a literature review and then interviewed experienced salespersons with varied backgrounds to develop a comprehensive list of sales skills and themes and categorize them into competency categories. This study then conducted a quantitative analysis to determine the respective importance of the skills and themes by surveying a sample of internal stakeholders of a multinational company. Finally, this study calculated the reliability and validity of the themes.
Findings
A total of 206 relevant skills (later reduced to 110) and 28 themes were identified and grouped into three competency categories: conceptual, human/interpersonal and technical. Survey respondents rated the skills and themes higher than the “somewhat important” score of 3 out of 5, with the overall mean importance for skills being in the “important” range (score of 4.27 out of 5). All identified skills were believed to be important to a salesperson’s success.
Originality/value
This study’s expanded list of sales skills will improve employability, reduce turnover among employees and build better groundwork for fostering learning through work, resulting in better performance. These skills represent a 2020 updated list that could be used for future academic research and training and research in the business world.
... This recommendation may be particularly relevant, seeing that to date sales organizations rarely use profit-related measures to evaluate salesperson performance (CSO Insights 2019) and salespeople are merely incentivized based on revenue (Alexander Group 2018). Given that companies frequently adjust the sales force compensation system, implementing profit-related sales incentives seems to be a highly actionable and promising initiative (Zoltners et al. 2012). Profit-related incentives should be especially useful to manage customer-oriented salespeople in two conditions: ...
Although customer orientation is widely endorsed as a crucial salesperson characteristic, little is known about its effect in price negotiations with customers. This study rectifies this omission and argues for its ambiguous effects. While customer-oriented salespeople create value for customers that enables them to reduce price concessions, they may overly focus on customers’ needs and, in doing so, hesitate to defend against such requests. Results of two quantitative studies and one preliminary qualitative study reveal that customer-oriented salespeople do not unconditionally benefit from their created value in price negotiations with customers. That is, salespeople effectively leverage their created value to negotiate prices with customers only if their sales managers instill confidence that high prices are justified. Furthermore, we find that profit-related incentives reduce undesired consequences of salespeople’s customer orientation in price negotiations.
... By the beginning of the 20 th century, a variety of sales force compensation and incentive elements such as salaries, commissions, quotas, bonuses, and contests had become prevalent. Despite periodic questions and concerns about their efficacy and deleterious consequences (e.g., Kohn 1993, Zoltners et al 2012, the use of sales incentives remains popular, e.g., it is estimated that U.S. spending on sales force financial incentives totaled more than $200 billion in 2006 (Zoltners, Sinha, and Lorimer 2006). Not surprisingly, therefore, there has been continuing interest in the optimal design of sales force compensation plans over the last halfcentury. ...
... Alternative marketing metrics include customeroriented measures such as satisfaction, preference, consideration sets, share of customer wallets, and eleven other items (Mintz & Currim, 2013, p. 20). Sales studies, on the contrary, tend to emphasize the incentives to achieve sales turnover (Zoltners, Sinha, & Lorimer, 2012). Other sales researchers have been taking note of the studies on empathy of the sales force toward customers (Pryor, Malshe, & Paradise, 2013), or their identification with the organization (Homburg, Wieseke, & Hoyer, 2009), managerial emphasis on emotional intelligence (Lassk & Shepherd, 2013), and psychological climate (Erevelles & Fukawa, 2013). ...
In this study, we examined marketing accountability by assessing the significance of the use of marketing and financial metrics in Japanese firms. Data related to both metrics was provided by 667 managers. The individual decision of marketing-mix activity served as our unit of analysis. We asked managers how many of the 15 marketing and 15 financial metrics proposed by Mintz and Currim (2013) they used. We concluded that the use of metrics contributes to improving performance; however, the relationship is not simple. Although managers using few metrics are likely to fail, the success of those that use many is not guaranteed either. We developed and examined an advanced model after reexamining Mintz and Currim’s study and determined that the control of reporting duty between vertical management layers was effective for using financial metrics. Top management control seems to increase effectiveness when using marketing metrics, but this effect diminishes when considering several control variables. Our additional cluster analysis identifies that the majority of our samples depend on fewer metrics with worse performance. The existence of this majority named “no metrics” implies that the relationship between metric use and performance can be linear or non-linear depending on the size of this cluster.
... Similar to prior SDT studies, the current study showed that sales activities and performance are not sufficient to retain inside sales agents. Even though the literature expounds that autonomous motivation, not sales incentives (Gagné and Forest, 2008) increases agent retention, sales departments continue to be obsessed with developing incentive plans to maximize sales performance rewards (Zoltners et al., 2012). The results of this study enable sales researchers to examine the manner in which a sales manager creates a sales environment and culture centered on people. ...
Purpose
Previous sales research remains limited to analyzing the influence of sales activities with sales agent tenure. To date, research on this subject has focused on the downstream direct or indirect impact of sales activities to sales performance, failing to consider whether sales activities impact a sales agent’s tenure. This paper aims to assess the effect of sales activities on sales performance and sales agent engagement on sales agent tenure through the lens of autonomous motivation to better understand sales activities as an overall sales process antecedent
Design/methodology/approach
Through the utilization of secondary sales operational data, this research demonstrates the influence of sales activities on multiple sales agent outcomes, while depicting the importance of sales managers creating an autonomous motivational climate.
Findings
This research demonstrates the direct relationship between sales activities to job engagement and sales performance. However, sales activities have a negative relationship to sales agent tenure, which require a sales manager to create an autonomous motivation to mediate the relationship between sales activities and sales agent tenure.
Practical implications
Organizations are provided with sample methodology and analysis to better determine how a culture grounded in autonomous motivation mediates sales activities and can be a catalyst for improving sales agent tenure. Then, provide a better understanding of the effect of actual sales activities on important sales department work outcomes.
Originality/value
The model is the first to test holistically the influence of sales activities on sales performance, sales agent engagement and tenure jointly by using actual secondary operational data. This study provides a glimpse of the real world balance a sales manager must consider between climate and activities. Plus, this study takes initial steps to study sales agent engagement, an under-researched construct in sales research.
... Today's salesforce no longer needs a manager who only looks after the numbers and ratios behind his screen in his office. It is no longer a question of putting pressure on the team but rather becoming an essential part of its success (Zoltners et al. 2012). The manager observes and reorients his team in real time by playing the role of coach in the field (Barker 1999). ...
Sales management has undergone a transformation in recent decades. This last is characterized by sales managers’ adaptation of coaching in their managerial process. This gave rise to a new hybrid form of the sales manager: the sales coach-manager. Several studies conducted, mainly in the United States, accentuate the importance of sales coaching in maximizing business performance. This article is based on a literature review on how and why this change occurs.
-Keywords:
Coaching, Sales coaching, Managerial coaching, Sales performance, Salesforce management
Sales person is a major thing in sales, Work procrastination is something that companies really avoid, mainly doing by sales people. Work procrastination done by sales person is influenced by several factors, one of the factors within the individual is self-control. External factors are the psychosocial work environment. This study aims to examine the effect of the psychosocial work environment and self-control on work procrastination in sales persons at PT.X. The sampling technique used simple random sampling technique with a total sample of 77 sales persons. Data analysis used multiple regression techniques. The results showed that there was an influence of the psychosocial work environment and self-control separately or together on work procrastination in sales persons at PT.X. The joint analysis shows a coefficient of F value of 14,784 and a significance coefficient of 0.000 (p ≤ 0.05) and an R square of 0.285 is obtained. This means that there is a very significant influence between the psychosocial work environment and self-control together on work procrastination in sales persons at PT.X with a relative contribution of 28.5% while the remaining 71.5% is influenced by other factors. not included in this study. Abstrak: Sales person merupakan suatu hal utama dalam penjualan, Prokrastinasi kerja merupakan hal yang sangat dihindari oleh perusahaan terutapa terhadap sales person. Prokrastinasi kerja yang dilakukan sales person dipengaruhi beberapa faktor, salah satu faktor dari dalam diri individu adalah kontrol diri. Sedangkan faktor dari luar individu adalah lingkungan kerja psikososial. Penelitian ini bertujuan untuk menguji pengaruh lingkungan kerja psikososial dan control diri Terhadap Prokrastinasi kerja pada sales person di PT.X. teknik pengambilan sampel menggunakan teknik simple random sampling dengan jumlah sampel 77 orang sales person. Analisis data menggunakan teknik multiple regression. Hasil penelitian menunjukan bahwa terdapat pengaruh lingkungan kerja psikososial dan kontrol diri secara berpisah maupun bersama-sama terhadap prokrastinasi kerja pada sales person di PT.X. Analisis bersama-sama menunjukan koefisien nilai F sebesar 14.784 dan koefesien signifikansi sebesar 0,000 (p ≤ 0,05) dan diperoleh R square 0,285. Hal ini berarti bahwa ada pengaruh sangat signifikan antara lingkungan kerja psikososial dan kontrol diri secara bersama-sama terhadap prokrastinasi kerja pada sales person di PT.X dengan sumbangan relative 28,5% sedangkan sisanya sebesar 71,5% dipengaruhi oleh faktor-faktor lain yang tidak termasuk dalam penelitian ini. Sales person memiliki peran penting bagi perusahaan untuk mencapai tujuan perusahaan dengan menjadi penghubung antara perusahaan (produk) kepada konsumen (pembeli) serta menjadi pekerja yang memberikan informasi mengenai keunggulan sebuah produk, maupun masukan-masukan yang diberikan oleh konsumen tentang sebuah produk untuk perusahaan. Disamping itu sales person juga merupakan image sebuah perusahaan atau produk, yang menjaga nama baik juga citra perusahaan (Swastha, 2002), pekerjaan yang dilakukan sales person membuat mereka rentan melakukan prokrastinasi kerja. Prokrastinasi menjadi penting untuk diteliti karena Studi menunjukkan bahwa penundaan kronis mempengaruhi 15%-20% orang dewasa, dan bahwa sekitar 25% orang
This study examines the infl uence of sales management control (outcome based, behavior based, and knowledge based) on the innovativeness of sales departments. Using data from Japanese sales departments, the results indicate that sales departments tend to be innovative when salespeople are evaluated based on their behavior and knowledge rather than on outcome. Theoretical and managerial implications are discussed.
Purpose
The main purpose of this research is to gain a clearer understanding of several key determinants and consequences of the ethical behaviour of salespeople.
Design/methodology/approach
Questionnaires were administered during regularly scheduled meetings to a total of 280 financial services salespeople. The salespeople questioned were mainly specializing in selling high‐involvement financial products (e.g. mortgages, life insurance) to final consumers.
Findings
Results suggest that method of compensation and control system (CS) are important determinants of ethical behaviour. Age (AGE) also proves to be a significant antecedent of ethical behaviour. However, education (EDU) is not significantly related to ethical behaviour. Additionally, a salesperson's ethical behaviour leads to lower levels of role conflict‐intersender and higher levels of job satisfaction, but not higher performance.
Research limitations/implications
To improve generalization of the findings, future research should broaden the sample by including a variety of industries. Likewise, the use of longitudinal data could provide new insights into the antecedents and consequences of ethical behaviour of salespeople and in particular the relationship with performance. Continuing research is needed to further analyse the relationship between ethical behaviour and other relevant behaviours that may take place during the interaction with the customer (e.g. organisational citizenship behaviours and customer orientation).
Practical implications
This research is, to our knowledge, the first study that simultaneously identifies and analyses several key antecedents and consequences of the ethical behaviour of salespeople.
Originality/value
This study adds to the literature by reducing the existing gap and showing companies insights into how to foster ethical sales behaviour and the positive consequences that this behaviour has on their salespeople.
This paper studies how salespeople make ethical decisions. For this purpose a structural model has been developed which configures how the organization's environment, the organizations's climate, and personality traits affect ethical decision making. Internal communication and the choice of a control system especially affect ethical decision making. Internal communication also affects the attraction of salespeople with unethical personality traits (Machiavellism), while the control system affects the ethical climate. Ethical climate and salespeople's personality traits also affect the ethical decision making. In fact the study shows that ethical decision making can be influenced by management.
This study proposes a model that explains the ethical behavior of automobile salespeople in terms of their ethical perception, legal perception, method of compensation (commission-based or salary-based), age, and education. The model is estimated by using five scenarios that involve ethical issues commonly found in the automobile industry and responses from 184 automobile salespeople in a mid-Atlantic metropolitan area. The findings suggest that ethical perception is the most important determinant of ethical behavior. Also, method of compensation is a major determinant in four of five scenarios, and legal perception in two out of five scenarios. However, age and education are not significantly related to ethical behavior. A discussion of the results, limitations, and implications is presented for managers.
The world of selling and sales management has changed dramatically in the past decade. Sales organizations face amore complex work environment marked by increasing customer expectations, frequent significant change, increasingly complex buying situations, and more diversity in their customer bases. Collaboration, both internal and external, is crucial in today’s sales environment More than ever, sales organizations, sales managers, and salespeople are accountable for their behavior and performance outcomes. Using the three themes of complexity, collaboration, and accountability, this paper discusses related managerial responses and future research opportunities.
The objective of this research was to determine the effects of a firm's control system and dimensions of the work task environment upon ethical judgments made by salespeople. Industrial field salespeople are likely to encounter ethical conflicts on a daily basis in their dealings with customers, competitors, and their own management. How they resolve such conflicts is believed to be a function of both individual characteristics and factors in the situation. This study focuses on situational factors in the form of organization design variables, particularly control system and task environment. The firm's control system includes its method of monitoring, supervising and compensating salespeople. The study develops fourteen ethics-related selling scenarios and assesses, via projective questioning, how 446 salespeople would react to them. Findings indicate that organization design does influence the behavior a salesperson considers appropriate to cope with ethical conflicts. In particular, salespeople operating under a more bureaucratic, input-based control system advocate more ethical behavior than do salespeople operating under a more output-based, laissez-faire control system. Also, salespeople who perceive the market to be competitive recommend less ethical behavior. However, the proportion of salary versus commission in the salesperson's compensation system does not have an effect on response. Differences are also discovered with respect to the salesperson's seniority, rank, and certain features of the task environment.
Reviews recent evidence on the effect of task-extrinsic incentives on motivated activity, first from a historical perspective and then from the standpoint of recent research on the topic. Three early studies are reviewed in detail to establish the paradigm case, and then additional studies are categorized by content. The purpose of this article is to outline the entire range of the effect under investigation. The evidence from these studies suggests that
in certain contexts the effect of task-extrinsic incentives is to undermine performance of and subsequent interest in the rewarded activity. The research is discussed in terms of what it suggests about the contrast between self-initiated and other-initiated learning. (88 ref) (PsycINFO Database Record (c) 2012 APA, all rights reserved)
Numerous strategies for increasing customer orientation of salespeople, including customer satisfaction-based incentives and selective recruiting, have been suggested; however, little is known about their effectiveness. This study replicates and extends findings from two previous studies by testing the effects of customer and sales volume-based compensation and personality characteristics on the customer orientation of salespeople. Customer satisfaction incentives and salespeople's level of empathy were positively related to customer orientation. Sales volume incentives and job tenure were negatively related to customer orientation. Empathy moderated the effect of customer satisfaction and sales volume incentives on customer orientation. A discussion of the findings, managerial implications, and suggestions for future research are all presented.