I'm sorry to say that this is wrong on so many levels. We engineers like to believe that the author is right and our guy gut tells us that "hey why do the sales people get commission and I don't??".
So why is the author wrong?
While there certainly ARE cases where commission is being used in the wrong way, there is nothing inherently wrong with it.
1) The author misinterprets the research and states that people perform worse when under an incentive. This is only true for INTELLECTUAL tasks. If you tell one group of people that they get $50 if they solve a math problem in five minutes then that group will perform worse than another group without an incentive.
But if you tell one group of people they'll get $20 for every brick they move from A to B in five minutes you can be sure they'll move the bricks much faster than a group with no incentive.
2) "The problems include infighting over who gets credit for accounts and sales."
Again, a problem with how you set up the system. This fighting can easily be avoided. Just make sure it is clear who is responsible for each customer.
3) The author also forgets one of the great features of a commission based system. If you are a small startup you may not be able to hire a large sales force. In that case, you can hire great sales people at a low base salary and make sure they only get paid when you get paid.
TL;DR: commissions are a tool among others. Use it well and it will help you. Use it in the wrong way and it won't. Use common sense.
If it were, there would be a small difference between the best salespeople and the worst. Everything I've seen suggest the variance is bigger in sales than it is in programming.
I think it's a stretch to say the author is wrong. He was very clear in stating that aren't necessarily bad, just that they come with costs. In his case it looks like the costs outweighed the benefits.
So why is the author wrong?
While there certainly ARE cases where commission is being used in the wrong way, there is nothing inherently wrong with it.
1) The author misinterprets the research and states that people perform worse when under an incentive. This is only true for INTELLECTUAL tasks. If you tell one group of people that they get $50 if they solve a math problem in five minutes then that group will perform worse than another group without an incentive.
But if you tell one group of people they'll get $20 for every brick they move from A to B in five minutes you can be sure they'll move the bricks much faster than a group with no incentive.
2) "The problems include infighting over who gets credit for accounts and sales." Again, a problem with how you set up the system. This fighting can easily be avoided. Just make sure it is clear who is responsible for each customer.
3) The author also forgets one of the great features of a commission based system. If you are a small startup you may not be able to hire a large sales force. In that case, you can hire great sales people at a low base salary and make sure they only get paid when you get paid.
TL;DR: commissions are a tool among others. Use it well and it will help you. Use it in the wrong way and it won't. Use common sense.