Mary Kay Cosmetics, Inc: Sales Force Incentives (A)

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Case

Reference no. 9-190-103

Subject category: Finance, Accounting and Control

Authors: Robert L Simons (Harvard Business School); Howard Weston (Leeds University Business School)

Published by: Harvard Business Publishing

Originally published in: 1990

Version: 15 October 1999

Length: 16 pages

Data source: Field research

Topics: Distribution channels; Control systems; Goal setting; Motivation; Sales; Sales compensation; Incentives

Share a link: https://casecent.re/p/46788

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Abstract

Describes the incentive system by which Mary Kay Cosmetics motivates the sales force of 200,000 independent agents who comprise the firm's only distribution channel. Illustrates the powerful effect on sales-force behavior that results when creative types of employee recognition are combined with financial incentives. Focuses on the challenges that managers face when they try to reduce program costs by modifying the VIP automobile program that awards the use of pink Cadillacs and other cars to successful sales agents. A detailed description of the parameters and formulas that drive the recognition and reward programs is provided.

Location:

Texas, United States

Industry:

Cosmetics

Size:

USD400 million sales

Other setting(s):

1989