I was chatting with a national sales manager for a growing company who expressed interest in attracting top sales and management talent.

When I asked him about the compensation he offers, he detailed a plan that consists of a super-low, guaranteed salary plus reasonable commissions, based on performance.

Then, I probed to determine what alterative pay plans he had in place, and he seemed shocked at the question.

This is our plan, he emphasized.

I went on to tell him that what he outlined is incredibly unattractive to someone of high caliber, and he should come up with more exciting alternatives, if he is sincere about attracting top talent.

It amazes me how inflexible managers become once they have formed a pay plan that at least a few people will work under, without complaint. They adopt an If it aint broke, dont fix it mentality.

Which is very, very shortsighted for one simple reason: people in sales, particularly, are motivated differently. For instance, some folks thrive in a commission-only environment, while others need a hefty, set salary before they feel they can relax and give their best.

You have to allocate your incentives to fit the beings youre working with. If they need security, but theyre good, adjust the mix so theres a healthy guarantee. If theyre daredevils or folks who are used to being on the high wire, working without a safety net, then back-load the incentives so theyre paid nicely based on results.

But also appreciate that theyre judging you, and your company. Salespeople and managers with excellent track records will see everything about you, from the quality of the shoe leather on your feet to the permanent or temporary feeling of the furniture in your office.

If anything about you says, Fly by night, theyll insist on up-front pay, and theyll doubt strongly if youll be around to remember your promise of lofty commissions in the hereafter.

In other words, if company like IBM or Exxon says it will honor your future achievement with big bonuses, you have a right to believe them, and you know theyll be around to collect from, if you have to hold their feet to the fire.

When it comes to health benefits, more and more companies are going to a cafeteria format, enabling people to pick and choose, and to trade off one good thing for another.

Try applying this modern sensibility to compensation and you and your company will be handsomely rewarded--with performance.

Dr. Gary S. Goodman 2006