Closing the Gender Pay Gap: Women in Sales Outperform, Loyalty Undervalued

In the Sales world, performance is a key measure of success. However, recent data findings reveal intriguing insights: despite female salespeople outperforming their male counterparts and being more loyal to organizations, they tend to receive lower compensation. This contradiction is especially evident in sales quotas, where women are assigned lower quotas, which can negatively impact their career trajectory and overall compensation. Read on to learn more.

Pay Does Not Reflect Performance

One of the most striking revelations from the data is that although facing disparities in representation and pay, female sales professionals consistently outperformed their male counterparts. The findings show that female salespeople outperformed men by 1.5%, and female sales managers outperformed by 3%.

These figures challenge the long-held assumption that gender is a determining factor in sales success. Instead, they underscore the fact that talent, skills, and dedication are the true drivers of performance in the sales field.

Loyalty Takes a Backseat

Another noteworthy finding from the data is that loyalty is not a factor when it comes to pay in Sales: although women tend to exhibit greater loyalty to their Sales team - with the data revealing that female sales professionals stayed with the same organization on average four months longer than their male counterparts - without adjustment of outside factors, men earn 9% more than women as salespeople, and 13% more as sales managers.

The Quota Riddle

Despite the evidence of superior performance and stronger devotion to organizations by women in sales roles, it is disheartening to find that many organizations do not seem to recognize or leverage this fully. The data exposes a concerning trend where male salespeople are assigned quotas that are, on average, 3% higher than those assigned to their female counterparts. The disparity is even more glaring for male sales managers, with quotas that are 5% higher than their female counterparts.

This unfair impact on quota assignments sheds light on the need for a more data-driven and equitable approach to assigning quotas that leverages the proven track record of female sales professionals. Mike Ahearne, Professor and C.T. Bauer Chair in Marketing at the C.T. Bauer College of Business, University of Houston, challenges the common arguments against the existence of the pay gap. He points out: "There are a couple of reasons why people argue the pay gap doesn't exist - for example, women not performing well or women more likely to leave jobs for things such as family or child care obligations. However, the data tells us otherwise: women not only outperform men but are more loyal. If firms looked at pay based on performance, women would be paid more."

Addressing Pay Gap Disparities

To address the gender discrepancies highlighted in the data findings, organizations can implement the following initiatives:

• Gender Pay Equity Analysis: Conduct a thorough review of your compensation practices to ensure that female sales professionals are compensated fairly for their contributions. Any discrepancies found should be rectified to ensure equal pay for equal work.
• Quota Assignment Review: Reevaluate your quota assignment process to ensure that quotas are set based on performance metrics and individual capabilities rather than gender. This creates a more level playing field for all sales professionals.
• Training and Development Programs: Investing in training and development programs that provide equal opportunities for all employees to enhance their skills and advance in their careers. These programs aim to bridge any existing skill gaps and support career progression for female sales professionals. At Xactly, we utilize Hone Health and MasterClass.
• Bias Awareness Training: Conduct bias awareness training for all employees, especially those involved in decision-making within Sales teams. By raising awareness about unconscious biases and assumptions, we aim to create a more inclusive and equitable work environment. Xactly uses KnowBe4 for this effort.

By implementing measures such as equal pay for equal work, fair quota assignments based on performance rather than gender, and providing opportunities for career advancement and professional development for all sales professionals regardless of gender, organizations can move towards a more equitable, fair working environment.

The report is a comprehensive analysis of data from Xactly's extensive database, covering 89 companies and 37,198 salespeople across eight industries from 2020 to 2023, highlighting both pay and representation disparities that persist in the field. To compute adjusted pay gaps, the analysis compares male and female salespeople in the same time period, living in the same state, holding equal job titles, with equal experience, and working in the same industry.

• Compensation
• Incentive Compensation