Restoring Sales Commissions

In 2013, Thoughtworks eliminated sales commissions. In 2018 we are re-introducing them. We had convincing reasons in 2013 to get rid of them, but we found that exerted too high a cost on the effectiveness of our sales operations, hence the decision to restore them.

Removing sales commissions was a response to several problems we saw with sales operations, both within Thoughtworks and the wider industry. There was a concern that salespeople sold services that were difficult to fulfill, that commissions discouraged collaboration and mentoring, and that managing commissions was a difficult and time consuming process.

In recent years, we have felt our sales operation isn’t as good as it should be. We have a software delivery capability that is both highly effective and known in the market to be effective. But our sales operation doesn’t reflect that. We’ve hired salespeople with a great track record that have under-performed. As we’ve grown, we’ve found it hard to orient sales people towards selling the kind of work we want to sell. We found it hard to recruit good salespeople. We’ve noticed a lack of determination to find and sell our services. All in all, the commissions model is deeply ingrained in the culture of sales professionals, and we are swimming against the tide in rejecting it.

The Thoughtworks leadership team first started considering restoring commissions late last year. During the sale of Thoughtworks, we put this on the back burner, but the feedback we got from potential buyers reinforced our view that our sales operation was not as effective as it should be. Our new owners, Apax, are big fans of using financial incentives, and are thus keen on restoring commissions. But we should note that we probably would have done so even if we’d remained under Roy’s ownership.

Personally I’m sad that we are restoring commissions. I was very happy that we took the chance to experiment with removing them, for the reason I detailed in my infodeck. But the point of an experiment is to pay attention to the results. While it’s impossible to isolate a single factor, such as commissions, for our disappointing sales function, I understand why we’ve decided to restore them and support the decision.