Pay for the old and you get the old.

Everyone nods, and everything stays as it was

The last part was about the target state. It is concrete, agreed with the management, tested in the team and backed by a roadmap. Everyone nods. And a few months later, sales is still working largely the way it did before.

Change management has a simple grid for this state. Successful change needs vision, skills, incentives, resources and an action plan. Without the vision you get confusion. Without skills, anxiety. Without resources, frustration. Without the action plan, a false start. And without incentives, you only get gradual change. (Doyé)

Gradual change is treacherous because it feels like progress. Something is happening, just slowly and at the edges. The core stays as it was, because the target system keeps paying for the old behaviour. Organisations do not get what they wish for, they get what they reward. (Kerr, cited in Kaehler 2025)

In sales the effect is particularly strong. Take a common split of eighty per cent fixed salary and twenty per cent variable. In practice, salespeople focus their full attention on how to earn those twenty per cent. Once variable pay is tied to specific targets, everything outside the target corridor gets low priority. (Sass 2019) Whatever is in the new target state but not in the target system hardly happens in day-to-day work.

Why the transformation otherwise stays reversible

Organisational research distinguishes between first-order and second-order change. First-order change alters processes and procedures within the existing system and can be rolled back. Second-order change is transformative and, besides new procedures and training, may also require new management and incentive structures. (Watzlawick et al. 1974, cited in Scherm 2024)

For a transformation in sales this means that new processes, a new coverage model and new KPIs are not enough on their own. As long as the money keeps flowing to the old behaviour, everything else is a change that can be revoked. Sales plays along politely, waits and goes back as soon as the pressure eases.

That is why the target system in a transformation is more than an administrative act at the turn of the year. It is the point where the change reaches people’s income. And therefore the point where it becomes binding.

First the target state, then the target system

I have often seen companies set big goals. A certain revenue in a few years, the largest provider in a segment. But nobody says what has to happen concretely this year to get there. The bigger and more distant the goal and the less transparent the path, the more frustration it creates.

In a transformation, the roadmap from the target state provides the milestones, and the targets for the year are derived from them, for the team and for each individual. Only then does everyone know what they personally contribute. That is why target agreements only begin once the target state has been communicated and the implementation has been planned. (Stolzenberg and Heberle 2021)

The sequence has a second reason. A new target system affects income more directly than any other change in a transformation. Whoever introduces it as the first step, before it is clear where things are heading, creates fear instead of orientation. The switch happens at the start of the target year and not in the middle of the fourth quarter, and the new targets are in place in time. If targets are culpably set so late that they can no longer serve as an incentive, the employer even owes damages. (BAG 2025)

Where it is decided, new business versus existing customers

Nowhere does this become as clear as in the balancing act between new business and existing customers. And nowhere is it as dangerous for a transformation.

The first change often starts precisely with existing customers, with earlier renewals and cross-selling. It brings in revenue quickly and shows the team that change pays off. If the target system then keeps paying only for new business, the existing customer base falls asleep again. That is gradual change in its purest form.

Yet as a rule, most of the business comes from existing customers, through renewals, extensions and cross-selling. Even so, very few companies tap this potential.

It is rarely a lack of will. A salesperson planning the week sees a renewal that will come anyway on one side, and on the other a new customer who counts directly towards target achievement. The decision is not made against the existing customer, but for the target. The current Kienbaum sales study with the German association of sales managers describes the same gap. Sales success is increasingly measured by profitability, customer development and long-term customer relationships, but what is rewarded is still mainly the short-term deal. And many systems measure new customer acquisition and account development with the same quotas. (Kienbaum 2026)

That does not mean existing customers always come first. Some companies have the opposite problem and sell almost only to existing customers. And sometimes the potential in the customer base is largely exhausted, so growth can only come from new customers. (Homburg 2020) It is about balance, and that balance has to be in the target system.

Separate where possible, otherwise the target has to carry the balancing act

My conviction is that sales should be clearly split into new business and existing customers, into hunters and farmers. Separate roles need separate targets. Hunters are mainly measured on individual deals, while farmers mostly have team-oriented models with a broader mix of financial, customer-related and qualitative targets. (Kienbaum 2026)

Not every organisation can afford separate teams. Then the same people do both, and existing customers have to become visible in the target, as a component of their own and not as a by-product of the new customer quota. A simplified example shows what that can look like.

Let us assume variable pay has so far depended entirely on order intake. A renewal does not count, and an extension with an existing customer only counts if it is booked as new business. Anyone who can do the maths only looks after existing customers once one of them is about to tip.

In the new model, for example, sixty per cent of the variable portion depends on new business and forty per cent on existing customers. The existing customer component measures two things, the renewal rate and growth with existing customers. Renewals are then no longer handled in the last few weeks but planned two quarters ahead, just as in the first change. And the new business component remains large enough that nobody stops prospecting.

Forty per cent sounds like little when you look at where the business comes from. Still, it is a big step, because before it was zero. And the weighting is not a law of nature, it follows from the roadmap. If the customer base is to grow significantly over the next two years, that is where the weight belongs. If the focus is on new markets, it shifts towards acquisition.

Pay for what is already moving

A transformation does not show up in revenue right away. A customer with whom the renewal is discussed two quarters earlier still renews only at the end of the contract. Whoever pays only for results in the first year pays for the new behaviour too late.

That is why leading indicators belong in the target during the transition, meaning what sales can influence itself. For example, renewal conversations held two quarters before expiry, or an account plan for every major existing customer. How leading and lagging measures are weighted in pay can be set together with the team and reviewed every quarter. (Scherm 2024)

This fits a target state that is allowed to change. If pay is tied too rigidly to one strategy, it channels behaviour so strongly that there is no room left for new ideas and critical feedback. (Schreyögg and Koch 2020) A target system in a transformation therefore has to be binding enough to change behaviour and open enough to allow course corrections.

What else gets left behind

New business versus existing customers is the biggest balancing act, but not the only one. Everything that costs sales time and is not in the target gets done less well, and in a transformation that hits precisely the tasks that are needed most urgently. Mentoring new colleagues during onboarding. Acting as a test user when new sales software is introduced. Speaking at an industry event. Posts on LinkedIn about the company and its products. Whoever acts as an ambassador of change in this way needs at least 10 to 20 per cent of their regular working time for it, without overtime. (Montua 2025)

That time has to come from somewhere. That is why the role description should state what is covered by the fixed salary and what counts extra, and the target system should include a team target for collaboration and quality. This also applies to inside sales, which otherwise becomes the dumping ground for unpopular tasks when only field sales earns commission. What is rewarded is a concrete contribution for others, not personal development as such.

Shaping the transition

As with the target state, one-to-ones come first, then the big round. A negotiated target agreement takes more time than a target that is simply set, but it creates commitment rather than mere acceptance. (Kuster et al. 2022) Where there is a works council, it belongs at the table early, because it has a say in introducing and changing remuneration methods. (Section 87(1) No. 10 BetrVG)

The biggest worry in the team is almost always the same. Will I lose money with the new system? In practice, a safeguard for one or two years has proven itself, during which nobody earns less than under the old system. (Kieser 2026) That way everyone can look at the new system calmly without first having to defend their income in every conversation.

A company in the dental industry shows how far this can go. It built a second field sales force for the same customers and resolved the conflict over variable pay with, among other things, a temporary double payment. The result was broad acceptance and strong support in the existing team. (Belz et al. 2018)

Even so, new targets rarely spark enthusiasm. Often the first reaction is that they are unrealistic. That has to be taken seriously, because anyone who believes a target cannot be reached rarely even starts working towards it. (Kaehler 2025) Still, as a manager you sometimes have to insist. At the same time, it is part of the job to help sales reach the numbers and to be lenient now and then. Whoever only insists loses the team. Whoever only gives in loses the target.

What remains

A target state changes no behaviour as long as the target system pays for the old one. Then something moves at the edges that feels like progress but is not, and the transformation stays reversible.

For me, that means switching the target system after the target state, at the start of the target year and with annual targets that come from the milestones of the roadmap. Securing the first change by giving existing customers their own weight in the target, ideally through separate roles and, where that is not possible, through a target that makes both visible. Paying during the transition for what is already moving before it shows up in revenue. And shaping the switch so that the team does not experience it as an attack on their own income.