I say hold something back from the initial sale. Your reps hear "make less money." So do you, dressed up as "that lowers our ASP."
That's what everybody's been trained to hear, and it's costing you. Not in some patient long-term way that asks anyone to trust a process they don't control. This quarter.
Same customer, two paths, 10 percent commission on new ARR, round numbers.
Path one, the way it's done now
Your rep builds a $60k package. Nine things in it. The customer needs three and can't use two of them for at least four months, so they negotiate, because that's what a rational person does when asked to pay for things they can't use. Weeks go by while they do. 10 percent off to close. $54k.
Rep's commission: $5,400.
Renewal price: $54k, because nobody renews above what they paid.
Expansion: none. The two items the customer couldn't use were sold at zero, and they stay at zero, because you can't sell somebody something they already have.
The rep gets $5,400, once, and is done with this account. You get $54k, on a long cycle, that shrinks at renewal.
Path two, unbundled
Your rep sells $48k. The three things the customer needs, the things they can use now. The two items they can't use yet get named on the call, held back, and tied to the milestone that will make them relevant.
Three things happen, and two of them happen now.
It closes faster. Three things to evaluate instead of nine. A buyer deciding on things they need decides faster than one deciding on things they can't use, and the discount conversation never starts because there's nothing in the deal to discount against. The weeks come back on this deal, not in month five.
The weeks go to the next deal. Quota is a number per period and the period doesn't get longer. A few weeks back per cycle is another deal or two a year, at full price, with no discount conversation on any of them. The path-one rep is still on the phone haggling over a bundle while yours is already in the next room.
The held-back item lands at a premium. Four months later the customer hits the milestone. Now the item solves a problem they have today instead of sitting on a bundle they couldn't use, and that prices higher. Call it $15k, not $12k. On a plan that pays the rep on expansion they set up, that's $1,500.
The rep gets $6,300 and the time to do it again. You get $63k, undiscounted, and a renewal that holds instead of contracting.
More now. More later. For both of you. The reflex assumed the current approach was maximizing everybody's number. It was maximizing the size of one deal on one day, at the cost of the cycle, the premium, and everything after it.
What this actually requires
One thing, and it's yours to decide, not theirs. The plan has to pay the rep on the expansion they set up. If it doesn't, path two genuinely does cost them $600 and they're right to refuse it, and they will.
Which also answers the other objection, the one about reps trusting post-sale to close what they set up. They don't have to trust anybody. They have to read the plan. If it pays them on what they set up, the trust is in writing, and you're the one who wrote it.
The plan is the problem
A comp plan that only factors in initial deal value is optimizing for the wrong thing, and it's doing it precisely. You get what you incentivize. Pay a rep on the size of the first deal and they will maximize the size of the first deal, with the two tools that reliably do it: stuff it, then discount it to close.
That isn't a character flaw. It's the plan working.
What it costs you doesn't show up the day it happens. The discount becomes the renewal price, which is contraction that arrives at renewal with the rep's fingerprints nowhere near it. The stuffed items were sold at zero, which is expansion potential with nothing left in it. Both of those are LTV, and neither one appears in the metric the plan was built around.
The fix isn't asking reps to be patient. It's paying for the things that produce the second path. Deal speed. A milestone named on the call. Expansion in an account they set up. Every one of those can be comped, with a bonus, a spiff, or a commission accelerator, and every one of them is cheaper than the discount the plan is paying for right now.
You get what you pay for. A plan that pays on deal size gets stuffed, discounted deals on long cycles. A plan that pays on what a rep sets up gets shorter cycles, cleaner deals, a premium at the milestone, and an account that's still worth selling into in month five.
The rep was never the problem. The rep was doing the math correctly against the plan you handed them.
Lincoln Murphy formally named and popularized Customer Success starting in 2010 and has spent 15 years connecting it to expansion revenue and commercial outcomes. Read The Premise.