Insight Enterprises has bitten the bullet and overhauled its commission structure to better reflect its cloud strategy, in a move which has prompted a number of sales staff to leave the reseller, according to sources.
Sources claim Insight has been torn for a long time between keeping its high-performing sales staff happy with big on-premise commission payouts and keeping up with its vendor partners' move to the cloud, but has finally decided it must change its structure in order to remain competitive.
"For years they have been trying to find a way to get the front-line sales account managers to engage with cloud and services so Insight can compete," said a source, who did not want to be named.
"The challenge has always been the commission payments. Do you really want to take the risk – as Insight would see it – of losing lots of people really quickly to competitors who are still happy to pay for on-premise, traditional licensing? They are already behind the curve and if they don't change, they will not be able to get the right behaviour going forward."
CRN understands a number of more experienced staff who have spent more than five years at the company have headed for the exit after the commission changes came in earlier this month.
A source suggested most of the departing staff are leaving Insight's Sheffield office, which acts as its UK headquarters. The company also has bases in London and Manchester.
Insight confirmed it is overhauling its commission structure in line with its wider strategy, which at the start of the year its UK boss Emma de Sousa said is more focused on services and cloud.
In a statement, Insight's EMEA president Wolfgang Ebermann told CRN: "As part of our strategic planning process across EMEA, we have initiated a review of our compensation plans to ensure we are focused on the appropriate priorities to deliver on our new strategy. This consultation process is under way and we are dedicated to ensuring all team members are offered the opportunity to grow within their current client base and with new clients in our core European markets."
CRN understands some experienced staff members' big accounts have been taken from them as part of the rejig and moved to the Enterprise division of the reseller, meaning their commission payments have effectively been cut.
"The people who have had books of business won't be able to earn the money they had before," another source, who spoke anonymously, said. "They are moving some of the accounts out [to the Enterprise division] which is not going to be good for their earning power, so some of the older [staff] are going to leave now, which is why they are ramping up more newbies coming in."
Insight's Ebermann did not directly comment on the rumours about employees leaving, but insisted that staff retention at the reseller is not a problem.
"Our growth so far in 2015 in EMEA is a reflection of the strength of our existing team and our high staff-retention rates," he said. "This continues to be an exciting period for Insight as we move into a new type of service delivery for our customers and we are confident we have the right team in place."
A source said the recent changes to commission payments suggest Insight is finally taking the bull by the horns on the move to the cloud, which has been a big challenge for them for a while.
"The commission structure has been under review for a very long time and there are a number of dynamics to it," the source said.
"In the software space, things are fundamentally different today than they were four years ago, or even two years ago. All the [software] publishers, in particular Microsoft, are moving away from paying big transact fees at the time the year closes and are much more interested in paying and rewarding partners on the deployment and adoption of the technology."
The source said cloud deals can be as much as £11,000 cheaper than similar on-premise contracts, which is often enough to mean commission targets are not met.
"That £11,000 probably makes a big difference to those guys making their target, which is effectively the hurdle for them to get paid their commission or not. The chances of you getting a salesperson to say 'you know what, I will do the right thing and talk to the customer about Office 365 or cloud' is very, very small.
"If you multiply that across the size of the sales force they have, it's like trying to turn a supertanker but without a rudder."
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