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Actionable Ideas for Long-Term Success with Your Comp Plan

Feb 06, 2019
2 min read
Sales compensation plans are a vital part of sales organizations. Here are some tips and best practices for long-term sales incentive compensation success.

Your compensation planning has the power to drive your business to the next level. It can increase quota attainment, sales team motivation, and ultimately, your company's success. Though many companies have already kicked off their 2019 comp plans, a "set it and forget it" mindset is no longer appropriate for continued growth and optimization.

As you review and improve your comp plans throughout the year, there are four actionable ideas to keep top-of-mind if you hope to achieve long-term success—these include identifying your goals, key stakeholders, metrics, and data insights.

There are several key questions you should answer when building out and adjusting your compensation plan, namely: How do you measure the performance of the plans themselves? Are you getting the results you intended? What do you do if you see something out of line with your intentions? 


You have specific business goals for your organization that are completely unique to you. That said, the way you define your goals will be ever-changing. We suggest several main types of business goals to keep in mind. Every business needs a motivated sales team to drive growth, so identifying how your reps are performing against peers is critical to outselling the competition.

Additionally, not every sales dollar is equally valuable to the business, so narrowing your team's focus on a specific or set of products may be a helpful strategy. Your business should also identify its desired level of collaboration among the sales reps—and commission structures should reinforce this.

Lastly, businesses should always aim to create value at every payout tier and every role of their organizations. All these components should be considered when a business is organizing their goals for the year.

Key Stakeholders

When designing a compensation plan that will last the long haul, it’s imperative that you keep in mind what each stakeholder will want to achieve from the comp plan. 

For example, those in Sales Management will be more interested in the alignment of sales results with market and business strategy, whereas your Finance department will be more focused on efficiencies and increasing overall revenue. Crafted carefully, you can actually bring these departments—and their goals—together by creating an effective comp plan.


Next, you’ll want to turn your goals into something measurable. Below are five metrics most sales organizations should be measuring:

  • Sales goal attainment
  • Compensation spend
  • Variable pay dispersion
  • Cost of compensation
  • New hire productivity

Data Insights

There are many different ways to represent the metrics you’re tracking. Use a variety of data views to help answer questions or concerns about your current compensation plan. Try looking at sales performance against quota by role, by territory, or even by quota size. What is the story the data is telling you? Consider looking at your compensation spend by sales team & role. Does the data insinuate that something isn’t working well?

What's Next?

Imagine it’s mid-year. You’re tracking appropriate metrics, you had a very specific intention for your sales compensation planand you’re noticing something problematic or unexpected is occurring. You have two choices. One avenue is to use the insights you’ve found to adjust your comp plan for next year. 

The second—and better—option is to start affecting a mid-year plan change. Taking immediate, deliberate action is often merited. Rely on the analyses and data that you’re pulling to guide sales leadership to resources for corrective support (coaching, training, mid-year SPIFF setting).

By keeping a close eye on you comp plan throughout the year and by focusing on these four actionable ideas, you will have the tools you need to build, adjust, and optimize your comp plan for long-term success.

  • Incentive Compensation
Lisette Walberer
Lisette Walberer
Content Marketing Manager

Lisette Walberer is a Content Marketing Manager at Xactly. She earned her BS from NAU and is pursuing an MA in English from ASU. She has experience in both content strategy and creation.