Cross-selling performance in complex selling contexts: An examination of supervisory- and compensation-based controls

Although cross-selling offers significant benefits for both vendors and customers, three-quarters of all cross-selling initiatives fail, typically for sales force - related reasons. Prior research examining the antecedents of salespeople's product adoption has not yet shown whether or under which conditions such adoption behavior leads to better salesperson cross-selling performance. The authors develop a model of the role of supervisory behavior, compensation-based controls, and their interactions in enhancing the effect of salespeople's adoption behavior on cross-selling performance in a complex selling context. To test the model, the authors use a matched, multilevel data set from company records and surveys of salespeople and sales managers working in a biotech firm. The analysis shows that transformational leadership enhances the effect of salespeople's product portfolio adoption on cross-selling performance, whereas transactional leadership diminishes the effect. Furthermore, the effect of leadership type depends on whether cross-selling incentives are provided: the positive performance effect of transformational leadership is crowded out when monetary incentives are provided, and the negative effect of transactional leadership becomes even more negative. These results have significant theoretical and managerial implications.