An Eclectic Paradigm of Salesperson Compensation: Toward a Comprehensive Framework of the Determinants of Sales Compensation Modes

The optimal mix of salary and commissions is an important consideration in salespersons’ compensation structures. A number of different approaches -- both analytical and behavioral -- shed light on different aspects of the related problems. However, these approaches often have disparate recommendations. This research introduces the eclectic paradigm of sales compensation (EPSC) as a potential decision framework for integrating elements of the analytical and behavioral approaches. Hypotheses extending from the framework are tested on a sample of real estate agents. The results suggest that the eclectic paradigm approach is more useful than single-theory approaches in predicting firms’ choice of sales compensation modes.