Most Recent Sales Comp Answers
It may be possible to combine the two types of sales using margin value as the measure, or it may be necessary to create two separate incentive components…
Contests that create value are generally focused on behavior change, motivating because they’re fun and different…
Quotas are good if they motivate your sales team to achieve at top levels. Measures of quota quality include accuracy, the shape of the performance distribution, and the credibility of the quotas and quota setting process among the sales people.
California’s revised Labor Code §2751 sets forth the requirements that companies must follow in communicating commission plans to California employees.
Paying commissions only when the customer has paid – this may not work any more in some states. Illinois and Maryland have awarded commissions to terminated employees for sales that were booked before they left, but for which payment from the customer had not been received.
Most businesses change their sales compensation plan a bit on an annual basis, tuning rates, adjusting goals, possibly adding linkages or adjusting crediting rules. There is value in keeping the basic framework stable as long as it is serving the business well.
The variable pay plan should take care of minor fluctuations in sales volumes. For larger shifts, the staffing level and/or coverage model will have to be addressed.
There’s a direct chain that goes from the business strategy all the way to the measures and objectives in the sales comp plans. If you can’t demonstrate these linkages, your sales compensation plans may not be doing all they can to support your business’s success.