In July, Google Cloud changed how it compensates its sales employees by decreasing the base salary and increasing the bonus.
This bonus-driven compensation method is similar to legacy software companies like SAP and Oracle. It’s a sign of the changing culture under Google Cloud CEO Thomas Kurian and global customer operations president Robert Enslin, who worked at Oracle and SAP, respectively.
The reaction to this change was mixed because while the compensation is greater overall if employees receive their entire bonus, the regular paycheck is less.
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Google’s Cloud business revamped its sales team’s compensation, ratcheting up the incentives — and the pressure — to maximize sales, as CEO Thomas Kurian rips a page out of a playbook long favored at sales-driven software companies like Oracle and SAP.
The new compensation structure for employees in Google’s sales organization looks a lot like the way legacy enterprise companies like SAP and Oracle pay their sales folks, with incentives designed to reward rainmakers and weed out underperformers. Employees received a letter to sign about the new compensation plan in June, and the change took effect on July 1, sources familiar with the matter told Business Insider.
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Source:: Businessinsider – Strategy