Any tips for putting together an incentive plan for “inside sales” employees? We are trying to get our employees into a “value-added selling” frame of mind (instead of price-point) and want to provide an incentive.
The difference is that the “commission” is communicated as a “piece of the action,” whereas a “bonus” is a fixed incentive amount offered for achieving a specific objective. Commissions and bonuses both have their place in sales compensation plans – but knowing when to use which one can be a bit tricky.
The best way to make sure you include the right people is to start with your goals. Why do you have a President’s Club?
(52 mins) Predict the cost of your proposed new plans using the right aggregate cost modeling technique. View this webinar to understand three good bases for modeling the cost of the new plans based on either a synthetic distribution, your historical performance distribution, or a simulation. Example of all three are provided in a downloadable Excel file.
A sales compensation design effort yields results in three areas: revenue increase, margin improvement, cost of compensation in relation to sales productivity. Be sure you know why you are changing your plans and what you hope to accomplish, and your plan design will be much more likely to yield improved results.
Should the VP of Sales be on a sales compensation plan, or an executive compensation plan? Use the right plan design to focus your head of sales.