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How can I maximize the impact of the communication of the new sales compensation plan?
One rule of thumb for plan communication is to double the amount of time you used for designing the plan to the plan implementation effort. Ideally the communication begins by letting the sales force know that the plan is being reviewed to align it with the company’s changing go-to-market strategy. Examples include: More emphasis on …
We’re launching a new product – what’s the right compensation arrangement for the first year?
While putting incentives in place to reward sales people for their important contribution to the successful launch of a new product is smart, there are a lot of ways to get it wrong.
How should we build a payout table for very small goals, or goals that could go negative?
If a small business had a business plan that included an operating loss of $200,000 for the year, putting together a payout table to reward for this “success” would not work if the mechanics were communicated as a percent of the goal…
What are the key components of a sales compensation plan document?
The sales compensation plan document serves as a standard reference for sales reps, sales managers, and those who calculate the incentive payouts. Typically, the plan document includes an overview of the plan structure often with a statement of the company’s pay philosophy, a detailed description of the plan’s components with brief payout examples, the terms …
How do we move our pay mix so that there’s more in the incentive and less in the base?
We need to offer a more meaningful incentive, but our base pay levels are too high. How do we make the transition?
If a Territory Manager is a “Hunting Farmer,” How Should Their Comp Work?
While many established sales organizations use the hunter-farmer model as their sales force organization model, there are inevitably geographic territories or customer segments that do not justify both “hunters” and “farmers’…
Checklist for assessing the effectiveness of your plans
To prepare for your annual plan review, check with your sales and business leaders about how they think the current plans are doing using this checklist.
Are SPIFFs a good idea?
SPIFFs are a valuable tool in the sales compensation toolkit, but can be mis-used to the point that the SPIFFs seem to be in charge rather than sales management. Excessive SPIFF use is a clear sign that the core comp plan is not working as it should.
Hiring your first sales person
For early stage businesses, your first sales hire is hard to do well. You don’t have a sales leader to help you confirm you have the right skills and temperament for the job. You’re not sure what to expect in terms of productivity…
How to pay for “sales” in a freemium model?
We have a sales role with the job of helping existing customers get better value from our service – but “success” will not result in a contract or a specific sales event. How do we comp for that?