Case: Aligning Sales and Operations
A consulting company needs to expand, but has trouble aligning sales and operations. Operations claims they do all the work and sales gets all the money. Sales claim that they are undermined by operational staff.
- Sales commissions and operational base are reduced to create a shared bonus pool
- Vesting: 2 years
- Divesting: 4 years
- Goal Alignment: because sales and operations now have a shared pool, they feel a higher level of co-dependency.
- Improved Information Flow: sales began forwarding information from clients to operations. Operations became more proactive about conveying what can and cannot be sold.
- Long-term alignment: sales stopped chasing short-term commission and invested more time into long-term deals.
- Transience: the consulting worlds has a lot of talent that doesn’t stay for too long. Because of divesting, talent can come in, work for three years, and then profit for three more without being there. This creates an incentive to do as much as possible to grow the client base.