I was just promoted to sales manager.
One Friday, I was told the company was cutting the commission rate 5%. I had to announce it Monday morning.
I wanted them to accept the news and realize they didn’t have to lose money if they sold more.
But here was my challenge, I came from operations, and this was the first time I had to give bad news to salespeople.
My salespeople would always remind me that I didn’t know what it’s like to be on commission.
I was stressed because in the past, I had seen my customer service people, warehouse, and delivery people go nuts when their pay was messed with.
Monday at 9 am I used the company slides to tell them the “good news.”
That’s the way the company portrayed it.
In no time, they started getting vocal.
I got defensive, then mad, and everything I said made the situation worse.
After the meeting, I went to my boss.
He gave me his 5-step system that he used to give bad news.
I decided that I was going to sit down individually with each of my salespeople and explain the situation using these 5 points.
Two of my salespeople were so mad all they wanted to do was vent and wouldn’t even listen.
It got so bad that I had to call a “time out” during the meeting.
But here’s the thing. Using those 5 steps, the other eight salespeople took it surprisingly well.
A couple thanked me for being so open with them.
I don’t know if your company does this, but every year all our employees were surveyed.
I was worried before the numbers came out.
I didn’t do great on all the questions, but they gave me a 5 out of 5 to two questions.
“My boss communicates with me openly.”
“My boss and the company care about me.”
That was cool.
So, what are the 5 points?
#1. Explain the main point of your message.
In my case, it was “the company has decided to change the commission rates nationally.”
#2. State specifics to explain why this is happening.
This is where it gets tricky because not everyone will agree with your or the company’s logic.
In my case, “every sales team throughout the country is on a different plan.”
“Some salespeople are higher; some are lower, but with this change, we will have one plan throughout the entire country.”
Then I showed them a slide, “if you make these small changes, you could make more money.”
#3. Ask for questions about the main point.
“What specific questions do you have regarding the new plan.” Stick to the legitimate questions.
If you don’t have an answer say something like, “that’s a good question, let me check, and I’ll get back to you.”
#4. Facilitate reactions.
Of the 5 points, this is the most difficult by far.
Your main goal here is to make sure the conversation doesn’t get off point.
If it does go off track, say things like, “let’s stick to the issue here or “I understand but were talking about the new commission plan not …” Be empathetic but not sympathetic.
Empathetic: “I see your upset” or, “you think this is going to be hard.”
Sympathetic: “I agree this stinks or yea the company is trying to cut your pay.”
Don’t be afraid to take a break if it’s not productive. Sometimes forging on can do more harm than good.
#5. Summarize the main point of your message.
Don’t overdo it here.
“So, the new commission plan will go into effect on (date).”
“If you have any other questions or concerns just come and talk to me.”
It’s surprisingly simple but hard to do in the heat of battle.
I've used these 5 steps throughout my career and even in personal situations, like when I had to tell my four daughters, we were moving 300 miles away for my job.
That was fun!