Sales performance data can be frustratingly stubborn when it doesn’t show what you want to see. Maybe you ran monthly spiffs last quarter, and they pushed your deals into these weird, unnatural cycles. The frequency of your sales incentives changes just about everything from the health of your pipeline to how much you spend on commission processing and whether your best reps stay with your company or jump ship.
The challenge with spiff frequency is that you have to balance a few different pressures that all pull in opposite directions. Short cycles keep your teams focused and motivated, but they’ll completely drain your administrative resources, and your ops team will hate you. Longer periods are better for bigger deals and give everyone some room to breathe, but you could lose that momentum you worked so hard to build. Your CFO is always asking for predictable costs that don’t fluctuate wildly month to month, while your sales managers need to have the flexibility to adjust when the market suddenly changes. If you have different sales motions across multiple product lines, the mess multiplies fast. Whenever you change the rhythm that your team is used to, performance takes a nosedive for months as everyone adjusts.
The right answer depends on a few factors that are unique to your business. Deal velocity matters quite a bit – you need to know how long it actually takes for your deals to close in your pipeline. Deal size and structure are another big one, along with how much bandwidth your operations team realistically has and how volatile your market tends to be. A transactional SaaS company can run programs that would completely fail for a large-scale hardware sales team and vice versa.
We’ll help you find which spiff schedule actually drives better results for your sales team!
Match Your Spiff Timing to Sales Cycles
The best spiff program for your sales team has nothing to do with what your competitors are doing or what worked great at your last company.
The secret is all about how you match your spiff timeline to the length of your sales cycles.
A helpful rule of thumb is that your spiff period should cover roughly 25% to 50% of your average sales cycle. When it takes your team 4 months to close a typical deal, monthly spiffs probably won’t work. Your reps need a longer runway to see their hard work actually translate into results. For teams that sell something that closes in 2 weeks, quarterly spiffs are going to feel like they drag on forever.
I watched a SaaS company with an average sales cycle of 45 days completely turn around its results after it switched from quarterly to monthly spiffs. Their reps could finally connect their day-to-day activities to the reward that was waiting at the end of the month – it made all the difference. But an enterprise software company with 6-month sales cycles tried the same monthly strategy, and it completely backfired. Reps started to ignore their biggest opportunities just to chase smaller deals that would close faster.
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A mismatch like this causes all sorts of problems for your entire team. When your spiff period is way shorter than your sales cycle, reps are going to feel backed into a corner and start to ditch their best prospects. Why work on that big deal that could close next month when you can snag a quick win right now? Running the period too long causes everyone to lose steam. The finish line might as well be on another planet, and their day-to-day activities just don’t change much anymore.
Just pull your CRM data and analyze the average time to close over the last 6 months.
Monthly Spiffs Keep Your Sales Team Strong
Monthly spiffs create a natural rhythm that helps keep your sales team motivated and interested throughout the entire year. Most sales managers have experienced the frustration of quarterly goals that let reps coast for 2 months and then panic in the third. With monthly targets, your team can’t afford to take their foot off the gas since they get just 30 days to hit their numbers. Every week has weight to it, and every deal moves them toward a finish line that’s always right around the corner.
This shorter timeline actually taps into something pretty strong about how our brains work. We’re naturally wired to push harder when rewards feel close and achievable. The research here is pretty convincing. Multiple studies have found that salespeople stay at much higher levels of motivation when they’re working toward rewards that come frequently, as opposed to ones that feel far away or abstract.
The benefits usually show up in your sales metrics pretty fast once you make the switch. Reps build pipelines more steadily throughout each month instead of letting deals slide and then desperately trying to make up ground at the end of the quarter. The revenue flows in at a steadier and more predictable pace and helps you dodge those painful dry spells that usually happen in months 1 and 2 of a quarterly cycle. Your forecasts also become much more accurate because you’re pulling in fresh data every 30 days instead of every 90.
Monthly programs usually work especially well for newer sales reps. The steady wins give them a chance to build up their confidence as they experiment with different strategies and find what actually works for them. A bad quarter can crush their morale. But a rough month is a small setback that they can bounce back from pretty fast.
Plenty of managers have expressed concern that their teams might experience fatigue from non-stop spiffs. The answer here is actually pretty simple. You can switch up your exact targets each month to keep the program fresh and interesting. Maybe January focuses only on new customer acquisition, and then February moves the emphasis to upsells or renewals. Your reps will stay interested and motivated because they’re chasing completely different goals even though the 30-day timeline remains the same.
Complex Sales Work Better with Quarterly Programs
Quarterly spiffs can be the better choice for quite a few companies. Here’s why it works especially well when your business sells to other businesses, especially in industries where deals can drag on for months before anyone signs on the dotted line. Sales reps here need adequate time to build relationships with multiple decision makers, and monthly pressure just doesn’t allow for that.
Medical device sales and large-scale software deals are perfect examples. Buyers in these markets have zero tolerance for pushy sales techniques, and they’ll absolutely walk away from a deal if they sense even a whiff of desperation from your team. A quarterly timeline changes the entire situation because it lets your reps actually build these relationships over time. They can actually think about what the customer needs and wants instead of always racing against the arbitrary deadline that rolls around every 30 days.
Quarterly programs also make a lot more sense for team-based selling environments where they need adequate room to coordinate their work properly. A longer timeline gives everyone enough space to make contributions without accidentally undermining one another’s work or duplicating work. Senior reps usually gravitate toward this structure as well, and for solid reasons. They’ve developed advanced pipeline management skills over the years and don’t need anyone checking in on their progress every month.
A lot of organizations completely miss the one big benefit of quarterly spiffs – budget alignment. Most businesses already work on quarterly planning cycles for their finances anyway. When your spiff program runs on the same schedule, it gets much easier to get executive approval for the budget because everything lines up cleanly in the financial reports and projections.
The administrative parts of quarterly programs are pretty different from monthly ones as well. On one hand, you’ll deal with less regular paperwork and fewer calculation cycles, which can save hours for your operations team. But you need strong tracking systems in place because you can’t afford to lose visibility into performance metrics for 3 entire months at a time.
Match Your Spiff Programs with Market Conditions
Market conditions can change much faster than sales managers want to believe. January 2020 sales figures looked completely normal, and then 2 months later, in March, those same businesses were looking at numbers that made no sense at all. The businesses that already had monthly spiff programs in place ended up with a big edge during the chaos from 2020 to 2024. They’d reset their targets and adjust incentives every 30 days. But their competitors were stuck with quarterly goals that had nothing to do with what was actually happening anymore.
Customer behavior can change dramatically in a matter of days, and when it does, the ability to pivot is what matters most. Monthly programs give you the flexibility to experiment with different strategies without committing to a long-term strategy that might not work. When a new product line needs promotion, run a focused incentive program for 1 month and measure the results. If the campaign doesn’t deliver the expected results, the damage is limited to 30 days instead of an entire quarter of missed opportunities.
Quarterly spiffs do have actual value in some situations, especially if the market that you’re in stays fairly steady and you can predict what’s coming. Longer sales cycles and those well-established customer relationships you’ve been building for years actually do better with the reliability that comes from quarterly programs. Sales reps need enough time to get their momentum going, grow their pipeline properly and develop those client connections. Switching up the compensation structure every couple of weeks disrupts all that hard work, and everyone ends up confused about what they’re supposed to be doing.
Plenty of businesses try to switch back and forth between monthly and quarterly programs and base it on what the market’s doing at the time. The idea makes sense on paper. But it almost never works out. Sales teams have a really hard time when their comp plan changes every few months. Reps need consistency if they’re going to plan their strategy and manage their time throughout the year.
The tension between flexibility and consistency is a genuine headache for sales managers. Businesses have to be ready to pivot when markets change. But with too much change, your team never finds its rhythm. A lot of sales leaders are actually turning to hybrid models now because they want to get the benefits of both the monthly and quarterly structures without the downsides of either one.
Level Up Your Incentives and Rewards
The perfect spiff schedule doesn’t actually work as a one-size-fits-all answer that every company can just copy and paste into their operations. Businesses that really crush their sales goals are the ones that have figured out that generic formulas don’t work – they dig into their own sales patterns and watch closely how their teams actually work day to day. Your sales cycle length is by far the biggest factor you need to think about when you’re building your schedule. Of course, you’ll also want to think about how complicated your average deal is, the amount of administrative bandwidth your team has available, and what your particular market conditions look like at any given time.
A smart strategy is to pilot any new schedule with just a small segment of your team first – maybe pick one region or a single product line to test with before expanding it company-wide. You should also explain the reasoning behind the change and specifically how these adjustments are going to help them close more deals and make more money. Those millions of dollars that businesses lose every year because of poorly timed spiff programs show what’s at stake – and when businesses get their spiff timing dialed in just right, their sales teams start hitting those targets that once seemed completely out of reach.
Your spiff schedule needs regular attention and some adjustments from time to time because it’s not a set-it-and-forget-it system. The markets are always changing, and your products go through different life cycles, and your sales team develops new capabilities and strengths over time. A quarterly review of your deal data makes plenty of sense for most businesses – it gives you enough time to see real patterns without letting problems fester too long. Pull up your sales data from the most recent quarter and analyze it for patterns – how long are deals taking to close on average, and when during each period are the bulk of your sales actually happening?
At Level 6, we’ve built our entire business around helping businesses maximize their performance through carefully designed incentive programs. We work on everything from sales team acceleration programs to wider employee engagement and recognition initiatives, and we’ve developed a deep expertise across all types of incentive options. Our toolkit includes branded debit cards, full-service employee rewards systems and completely customized sales incentive programs – all designed specifically to meet your company’s particular challenges and opportunities.
We’d love to show you how our programs can help drive measurable improvements in ROI and sales performance. Contact us for a free demo, and we’ll show you some real examples from businesses in your industry.
Claudine is the Chief Relationship Officer at Level 6. She holds a master’s degree in industrial/organizational psychology. Her experience includes working as a certified conflict mediator for the United States Postal Service, a human performance analyst for Accenture, an Academic Dean, and a College Director. She is currently an adjunct Professor of Psychology at Southern New Hampshire University. With over 20 years of experience, she joined Level 6 to guide clients seeking effective ways to change behavior and, ultimately, their bottom line.
