I would agree with Steve Roth’s comment. I have declined commission structures in favor of a straight salary with a bonus option along with the other members of the leadership team, since the agency’s growth is a true, collaborative “all in” effort.

Too many variables are involved in executing a fair commission structure. Most are based on original sources of a lead, but in the best agencies, a lead can come from anywhere or anyone. And it can—and should—get the great follow up it deserves without prejudice to source. A great deal of effort goes into nurturing those leads and developing long-term relationships that can eventually turn into accounts.

And if you’re developing a new business program from scratch—customized research, thought leadership content, category insights, and a full marketing plan—the lag time to see any of those commissions can be a long one.

While many New Biz directors can and do play very vital strategic roles, it’s highly dependent on the size of your agency and how roles are defined within your organization. I’ve written the strategic positioning and had creative input at a small agency without a planning department, but had limited role at a big agency with a planning department of 10 and a strong, seasoned Director.

To draw an analogy with agency compensation plans: cover your “costs” with a flat salary, then use an incentive plan to deliver a bigger margin. In effect, cover your mortgage, but enjoy that nice pair of Jimmy Choos if you blow your agency’s revenue goals out of the water by X%. An incentive program for anyone in the agency who brings in a lead (X per lead that results in a meeting) would also acknowledge the reality of referral sources. Then everybody wins—except the other agencies you trounce in the finals.

At agencies, we're selling the cumulative intellectual capital of a whole team of people. No matter how hard and well a New Business/Business Development Director works, there are so many pieces of the puzzle that come together in the right way for a win, and any number of ways a pitch can be derailed. Despite the fact that I work in New Business, I’m just not that big a gambler, and I won’t risk a big chunk of my paycheck on a decision that could still pin on whether a client feels better chemistry with a competitor’s CEO sitting across the table.