What Installing a Canopy Has in Common with Designing Compensation Plans

Last month my husband Danny and I purchased a canopy for our back deck and made the decision to install it ourselves. Before starting, we did what most people would do and skimmed the instructions and took inventory of the tools needed for the project:

Hard hat — check
Electric screwdriver — check
Hammer — wait… why do we need a hammer?

When we looked at the parts and fasteners, it didn’t seem like a hammer would be necessary, so we ignored that one. In addition, we also ignored the fact that the instructions recommended three to six people for the installation. If that wasn’t bad enough, we also skipped the part where it suggested counting all the pieces before starting.

After unboxing and laying everything out, I proudly put on my purple hard hat. Danny grabbed the tools, and we started assembling the canopy.

A few trips to Lowe’s and Home Depot (I shop at Lowe’s, Danny shops at Home Depot), a couple Amazon orders, realizing that a hammer really was needed, and a few moments where we had to take things apart and start over, the canopy got installed.

Side note: we didn’t need therapy, but we probably could have used a third person.

By now you may be wondering what installing a canopy has to do with sales compensation design. In my experience, quite a bit.

Over the years I’ve worked with many organizations designing sales compensation plans, and I’ve noticed that the same kinds of mistakes we made installing that canopy show up in compensation design projects time and again.

You Can’t Build This Alone and You Shouldn’t Try

One of our first mistakes was ignoring the fact that the installation called for three to six people. We eventually got it done with just the two of us, but the project took far longer and cost far more frustration than it needed to. Sales compensation design works the same way.

Designing an effective plan isn’t something that should happen with just one or two people in a room. Several groups across the organization play a critical role in making sure the plan is sound and works once it’s implemented. For example, executive leadership provides strategic direction and growth priorities. Also, sales leadership and operations translate those goals into quotas and incentive structures. Finance ensures the plan aligns with the company’s financial goals and budget. Legal reviews plan language to reduce ambiguity and protect both the company and employees. HR aligns the plan with company policies and practices. IT and systems support the technology used to track performance and calculate payouts. Finally, payroll ensures payments can be processed accurately and on time.

When one of these groups is left out of the process, issues tend to surface later. The plan may still get built. However, like our canopy project, it usually takes more time and rework than it should have.

The Cost Model Is the Hammer

Another mistake we made was starting without all the tools we needed. We assumed the hammer wasn’t necessary. However, halfway through the installation, we realized it absolutely was and we had to stop everything to go find one.

In sales compensation design, the tool that can’t wait is the cost model. While most organizations do build one, I’ve seen situations where it enters the conversation later than it should or isn’t fully pressure-tested across different attainment scenarios. And when that happens, the problems that surface aren’t small ones.

In one engagement, a team had invested months designing a plan that was thoughtfully structured and well-aligned to strategy. The cost model existed but it had only been tested under expected attainment. When they ran scenarios for significant overperformance, leadership realized the plan would produce payout levels the business couldn’t sustain. Subsequently, reworking the mechanics at that stage wasn’t impossible, but it cost time and created frustration that could have been avoided if the modeling had happened earlier.

The cost model helps teams understand how the plan will behave at various performance levels and ensures the incentives align with the organization’s financial expectations. Approaches like sensitivity analysis or Monte Carlo simulations which model thousands of possible performance outcomes can help teams understand the full range of variability in payouts, not just the expected case. Without that level of modeling, critical questions go unanswered: Will the plan self-fund at expected attainment? What happens if the sales team significantly over-performs? Does the plan align with the company’s financial goals?

The cost model is the hammer. You need it before you start.

Missing Parts Always Show Up at the Wrong Time

Another oversight on our part was not counting all the pieces before starting. At one point we ran out of screws, which sent Danny to Home Depot. Later we discovered we were missing grommets entirely. That led to a trip to Lowe’s, a few failed Amazon orders and eventually contacting the manufacturer to get the missing parts.

Sales compensation design doesn’t require physical parts, but it does require making sure all the key components of the plan are clearly defined before launch. That means performance measures, quotas and quota allocation methodology, pay curves and accelerators, crediting rules, governance and exception processes, and communication materials including frequently asked questions for both individual contributors and sales leaders.

When one of these elements is missing or unclear, it creates confusion for sellers and administrative challenges for the teams responsible for managing the plan. And much like discovering you’re out of screws halfway through assembly, the timing is never convenient.

The Step You Skip Will Find You

Our final mistake? We skipped a step.

We hit a point in the instructions where the installation of the curtain rails wasn’t clear, so we decided to come back to it later and proceeded with the rest of the instructions. It turns out, that step needed to happen much earlier in the process. As a result, we ended up having to partially take everything apart to fix it.

I see this all the time in sales compensation design. Teams focus on getting the plan right, the metrics, the mechanics, the modeling but often skip steps like governance or change management. Everything looks good on paper. Then the plan goes live.

In one situation I’ve seen more than once, organizations launch a well-designed plan with no formal governance structure in place. Within a few months, exceptions start piling up. For instance, a verbal commitment here, a one-time SPIFF that never goes away. Before long, what started as a clean plan has become something no one fully recognizes. Fixing it requires the same kind of painful reassembly we had with the canopy frame.

Skipping a step rarely stops a project entirely. But it almost always leads to rework.

Looking back, installing the canopy and designing sales compensation plans have more in common than I expected. Both require the right people, the right tools, and all the pieces in place before you begin. And both have that one step you’re tempted to skip the one that turns out to matter most.

The good news is that after two days of installation and waiting a week for the remaining grommets to arrive, the canopy looks great. But if we had followed the instructions from the beginning, we probably would have finished a lot faster.

And yes… the hammer really was needed. Just as governance is always needed.

SalesGlobe is a leading sales effectiveness and data-driven creative problem-solving firm. We specialize in helping Global 1000 companies solve their toughest growth challenges and helping them think in new ways to develop more effective solutions in the areas of sales strategy, sales organization, sales process, sales compensation, and quotas. We wrote the books on sales innovation with The Innovative Sale, What Your CEO Needs to Know About Sales Compensation, and Quotas! Design Thinking to Solve Your Biggest Sales Challenge.