Behavior Modification Therapy - Stair Step Breakaway Compensation



Read More: Leadership  |  Personal Development

As compensation plans go the stair step breakaway is there to serve one and only one party - the company. This system does nothing to benefit the distributor. In fact, it's down right discouraging to work hard at your business only to have your downline break out of your group at some point.

What mostly happens when one of your downline breaks away is that you lose either volume points or dollars or both. The big money is just around the bend, over the bridge and across the tar pit. It's pretty unattainable unless you are at the top of the pay plan.

The breakaway part of a compensation plan is usually pretty difficult to spot as it is hidden in a tedious explanation. Until you actually see it in action and watch what happens to your points in your back office it can go on unrecognized. It can be a shocking and discouraging revelation. And, at that point it's much too late for you.

Is it your fault that you missed the explanation? Who am I to say? I missed mine.

Let me offer you my experience so that you might not stumble upon the unexpected after the fact.

I was totally unaware of the fact that I had been with a company that had a stair step breakaway point system. Although my upline described a stair step plan as bad and something to be avoided at all costs, it was never pointed out that we were actually in one! I never picked up on it. (Guru integrity is a subject for another day.)

I discovered it worked like this. In order to reach a strategic bonus level, call it emerald, you needed 2500 points and 4 people under you at 300+ points each, call them the “300+ pointers”. Since it's a weekly plan points are tallied at midnight Saturday night. By the way, the emerald bonus, although difficult to attain, is significant enough to make it VERY desirable.

So, say you have 2750 points and your 4 people at and over the 300 point level. You are tickled because you're going to be emerald this week. But at 11:35 PM Saturday night one of your west coast 300+ pointers makes 2500 points themselves and breaks the emerald barrier.

Poof, by the click of a mouse and a 16 digit piece of plastic you lose those 2500 points and are now merely a 300+ pointer yourself this week. That is a painful breakaway costing you anywhere from $800 to $1500 for the week!

The real question then becomes why would I ever want to help my people advance if it means they will breakaway from me and cost me money? That is the kind of behavior this company's compensation plan drives. Just ask my friend who was a mere 70 points away from making emerald one week and never heard a word of encouragement from her upline. Why would they want to encourage losing points? That is behavior modification at its most obvious.

Knowing what a pay plan is capable of doing to your paycheck is an essential piece of the network marketing puzzle. Diligence and Vigilance! Make sure you know what behavior your compensation plan drives!

 

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About the Author: Rick Lelchuk

Member Since: 11/26/2008

Company: Inspiring Transitions

Industry: Coach

Primary Web Site: http://inspiredandinbusiness.com

Comments



Great article Rick

Most people don't have a clue how their compensation plan works. 

Very valuable info.

Joyce Penner

www.joycepenner.com

Joyce Penner — Tue, 03/03/2009 - 11:34am

Boy, This is Eye Opening

Rick,

I made a huge and costly mistake by not completely understanding my previous company's compensation plan.  It was a weekly comp plan and I was actually setting myself up to compete with my own downline.  Won't make that mistake again!

Breakage?  OUCH.

You're 100% right ... Knowing what a comp plan can do to your paycheck is, without question, absolutely, positively essential.

Fantastic Article!

Melanie Kissell

http://melaniekissell.com

Melanie Kissell — Tue, 03/03/2009 - 11:52am

Perfect

Rick,

You did an excellent job on this article. If you are not a hard core recruiting monster the stair step breakaway plan is not for you. Everyone should do there due diligence and completely understand a companies pay plan AND there policies and procedures.

If they have not, everyone should read and understand these these 2 extremely important parts of there contract before they waste 10 or 20 years and end up with little or nothing for there efforts.

Ivan

Ivan Sams — Thu, 03/05/2009 - 11:29pm

Thanks, Ivan

As long as you know what it says in your contract and pay plan you can deal with it accordingly. We are a marketing arm of our companies, not a part of the company, they have control.

Ivan, I have seen companies with short 3 and 4 page contracts get rid of people they wanted out. So the length matters not. I have also seen companies write less than up front compensation plan explanation. You only learn what happens in the pay plan once you get into the system and have invested time and effort.

RICK

Rick Lelchuk — Fri, 03/06/2009 - 4:36pm