Totally Rewarding Chats | Ep. 25: Sales Compensation Best Practices

Mastering Sales Compensation: Best Practices for Driving Revenue and Engagement

Sales compensation is one of the most dynamic and impactful aspects of organizational strategy, yet it often resides in its own silo, misunderstood or overlooked by those outside its orbit. In a compelling conversation with sales compensation expert Christopher Goff, we explored the intricacies of designing fair, effective, and business-aligned sales compensation strategies. From aligning incentives with organizational goals to addressing common misconceptions, Chris brought valuable insights into a field that directly influences revenue generation and team engagement.

Chris shared key principles for structuring sales compensation programs, including the importance of aligning incentives to business strategy, maintaining affordability, and ensuring cultural congruence. He emphasized rewarding sales activities as close to the desired outcomes as possible to reinforce positive behaviors and sustain motivation. Additionally, he addressed common challenges, such as managing compensation for long sales cycles, balancing individual contributions with team dynamics, and preventing unintended consequences like stagnation among high-performing sales reps.

Whether you're a compensation professional, HR leader, or sales executive, Chris’s insights are a valuable guide for navigating the complexities of sales comp and creating programs that truly work. Watch the full episode now.

In this episode

• Host, Sean Luitjens, General Manager of Compensation Benchmarks, Visier

• Christopher Goff, Senior Director of Sales Compensation, Labcorp

Episode transcript

Sean Luitjens (00:00)

All right, everyone, we have another rewarding chat lined up. I’m here with Chris Goff, who I’m excited to talk about sales compensation with. Mostly because I know almost nothing about it—other than the fact that it’s different and hasn’t typically been part of traditional comp planning or incentives. It’s its own world. So, I’m thrilled to have Chris here. How are you doing?

Christopher Goff (00:24)

Excellent. How are you?

Sean Luitjens (00:26)

I’m good. Where are you dialing in from?

Christopher Goff (00:28)

Orlando, Florida.

Sean Luitjens (00:31)

But that’s not where you live, right? You’re just smarter than those of us in New England, where the foliage is fading.

Christopher Goff (00:33)

That’s correct. If you prefer the cold, so be it, but I’ll take a little sun.

Sean Luitjens (00:44)

I like the cold and the summer, but the time between fall leaves and snow in New England is my least favorite season. It’s cold and miserable, but not snowy enough to enjoy. That’s when I usually try to escape. Spring’s mushy mud season isn’t great either.

Christopher Goff (00:59)

Fair enough.

Sean Luitjens (01:13)

For those who don’t know you, can you give us a little background? Where are you now, and what brought you here?

Christopher Goff (01:21)

Sure. I started in sales operations over a decade ago, focusing on quota allocation and territory management. That’s where I first picked up sales incentive work. It was one of those situations where I had to become an expert in three months—sink or swim. I spent about 10 years in that space, handling many components of sales operations.

From there, I moved to broad-based compensation, managing all comp programs for a healthcare IT company. That’s where I learned about the regulatory environment, benchmarking, surveys, and the broader aspects of compensation beyond just variable design.

For the past five years, I’ve been a compensation partner for the commercial division of my current organization. It’s a little different because it sits within Total Rewards. Over my career, I’ve lived in sales, sales ops, finance, and HR, all while focusing on sales comp. It’s a unique niche, and since COVID, I’ve taken to speaking and writing about it as a passion project. Sales compensation is often fragmented, and most people only see a small piece of the puzzle. I’m passionate about promoting a more holistic understanding of it.

Sean Luitjens (03:42)

That’s great. Let’s dive into sales comp in a bit, but first—what do you do for fun when you’re not working on compensation?

Christopher Goff (03:56)

I enjoy writing, photography, and travel. I’m always looking for new experiences, whether that’s personal development or challenging myself in different ways. Photography is an interesting hobby, especially with the balance of capturing the shot and editing. It’s an evolving skill.

Sean Luitjens (05:00)

I love photography too, though I’m terrible at it. I spend a lot of time outdoors, but I somehow make beautiful scenery look awful. That’s my superpower.

Christopher Goff (05:22)

Digital photography is a whole different world. It’s not just about having an eye for the shot; there’s also the editing process, which can take things to the next level.

Sean Luitjens (05:37)

Yeah, I’m bad at the first part and gave up on the second. Let’s shift gears. Quick speed round: tea or coffee?

Christopher Goff (05:43)

Coffee.

Sean Luitjens (05:49)

High-leverage or low-leverage salespeople?

Christopher Goff (05:53)

High-leverage.

Sean Luitjens (06:12)

Camping or glamping?

Christopher Goff (06:15)

Somewhere in the middle. I’ve done Boy Scout-style camping—on rocks with no padding—but these days, I prefer something a bit more comfortable. We recently got an RV, so that’s been a nice middle ground.

Sean Luitjens (06:33)

Nice. Now onto the main event. Sales comp is something I know very little about, other than it’s difficult. Can you walk us through the best practices and what you consider when evaluating or implementing sales comp programs?

Christopher Goff (08:09)

Sure. Sales comp has basic principles, but there are always nuances to consider. First, affordability. Organizations often overhire in sales, assuming it will “just work out,” but affordability needs to be realistic.

Second, strategy. Sometimes we hire people first and figure out the job later, but that’s backward. The strategy should come first, and hiring should align with how someone contributes to it.

Third, culture. A salesperson might have been successful 15 years ago in a different organization, but are their values and approach aligned with your current company culture? Sales is often the first point of contact with customers, so it’s crucial to be in sync.

Additionally, sales comp should reward behavior as close to the desired outcome as possible. Whether it’s lead generation, technical support, or closing deals, the timing of rewards impacts motivation. Clear eligibility criteria for incentives are also essential—who gets paid, and for what? Overlapping responsibilities can create confusion and inefficiencies.

Sean Luitjens (12:42)

That makes sense. How do you approach long sales cycles, like in SaaS, where deals can take 18-24 months? How do you structure compensation for the early stages?

Christopher Goff (13:06)

There are a few approaches. Some companies offer sign-on bonuses or guarantees to cover commissions from a previous role. If someone’s taking an active deal with them, it can accelerate the sales cycle, and that needs to be accounted for. Another option is phased pay. For instance, year one might have a higher base pay with a shift to more variable pay in year two.

If someone is stepping into an existing territory, you need to assess whether it’s been worked and what’s realistic for them to achieve in the short term. It’s all about balancing fairness with practical affordability.

Sean Luitjens (17:11)

Let’s break down the structure. How do you approach the different levels of sales comp?

Christopher Goff (17:16)

I start with job content. Are they new business-focused, generalists, client sales, or specialists? Each type ties to different pay mixes and risk/reward structures. For instance, new business roles often have higher at-risk components and accelerators for upside potential.

From there, you decide between a commission rate plan or a quota-based plan. Each has a pay curve, with thresholds and accelerators. Payout timing—monthly, quarterly, annual—depends on the business model and sales cycle. Ideally, payouts align with when the company gets paid, but there’s always a balance between cash flow and timely rewards.

Sean Luitjens (21:51)

That’s fascinating. What’s the biggest misconception about sales comp?

Christopher Goff (35:26)

The biggest misconception is that most people don’t understand it. Many don’t even realize sales compensation is a job! Broad-based comp professionals often avoid it because it’s complex. But that’s what makes it interesting—it’s dynamic, constantly evolving, and directly impacts behavior and outcomes.

Sean Luitjens (40:02)

One last question: If you could fix one thing in all of HR, what would it be?

Christopher Goff (40:09)

I wish people were more comfortable talking about compensation. Transparency is coming, whether we like it or not, and we need to normalize conversations about pay. It’s just part of the exchange when you work for an organization.

Sean Luitjens (41:09)

This has been fantastic. Thanks so much, Chris. For those listening, we’ll tag Chris on LinkedIn, so feel free to connect and learn more. Thanks again!