The design of the commercial incentive system determines, with greater force than any other variable, the actual behaviour of the team. Most mid-sized industrial companies maintain inherited schemes that reward volume closed, implicitly assuming that margin is governed by other mechanisms. The assumption is mistaken, and the data make it clear.
Bain documented in its 2025 commercial excellence study an observation that warrants analysis. 82 per cent of companies declare executing formal sales plays, but only 21 per cent extract their full potential value from execution. Those that do extract it grow 2.2 times more than the median of the sector. The difference is not explained by the content of the sales plays, but by the coherence between what the system says it values and what the system actually pays the sales rep.
A complementary figure from the same report identifies a systemic bottleneck. 70 per cent of companies fail to integrate their sales plays with their CRM or with their revenue technology. The consequence is that the sales rep receives formal instructions on desired behaviour and, simultaneously, has their pay measured by a system that records only closure and volume. Faced with the contradiction, individually rational behaviour is to ignore the formal instruction and maximise what is paid.
The pattern is structural in industrial B2B. The sales rep with a volume-based incentive scheme prioritises, in order: closing in time for quarterly accrual, conceding defensive discounts when urgency demands, expanding scope without raising price to keep the closure alive, avoiding accounts with long cycles even if they are strategically more valuable. The aggregate result is rising revenue and falling margin, a dynamic the standard commercial dashboard does not capture clearly.
The reverse of the pattern is feasible and documented. Industrial companies that redesign the incentive system to incorporate three simultaneous dimensions — volume, margin captured and account-mix composition — observe measurable behavioural adjustments in six to nine months. The sales team reallocates time towards higher-margin, lower-velocity opportunities, and reduces defensive discount where it is not necessary.
For general management, the redesign requires three unpopular decisions. Accept transitionally a fall in reported volume while the team adjusts to the new system. Bear the internal cost of the negotiation with the sales team, which perceives the change as a remuneration threat. Build the analytics that allow margin captured per transaction to be measured with sufficient precision to remunerate on that basis.
The standard objection is that measuring margin per transaction is operationally complex and opens accounting debates on cost allocation. The objection is accurate and resolvable. The useful practice is to start with a reasonable approximation, distinguishing at least three levels of margin quality per transaction, and refine it over time. Perfect precision is the enemy of measurable improvement.
An additional implication concerns team composition. Sales reps adapted to the volume scheme do not necessarily adapt to the margin and mix scheme. The transition requires accepting selective rotation, specific training and, in some cases, the incorporation of profiles different from the historical ones. Without that rotation, the new system operates on old behaviours and the results are tepid.
Recognising that the incentive system defines actual behaviour forces management to assume its responsibility as the designer of that system. Complaining about the sales team's behaviour without modifying the system that pays them is, in practical terms, complaining about the results the company itself is paying to obtain.