Is your Sales Incentive Compensation Strategy Doing What it Should?
Several weeks ago, we published a Sales Compensation Calendar for 2012 that recommends assessing your incentive compensation plans on a monthly or quarterly basis. Now that we’re well into the second month of the year, let’s get started.
Is your sales compensation strategy doing what it should?
Ask these 4 questions to find out:
1) Do your incentive compensation plans establish clear goals?
Where do you want to be in 12 months? Work backwards. Set specific objectives. Then, figure out how to get there. Set clear timelines around your goals. If you use more than three or four metrics, you’re probably confusing your sales team. And don’t forget to create the best compensation design team possible. They’ll help you set the best goals.
2) Do your reps have visibility into their sales commissions in real-time?
We all know it’s useless to pay sales teams for something they don’t feel they can control. Sales reps won’t step up extra effort if they don’t see quick results. In the case of sales commissions, the longer you delay paying your reps, the less impact the sales compensation plan has. But when you automate your sales compensation, sale reps instantly see potential pay. “Oh, I just did this, and it’s worth this much to me. Wow, I am going to do that again.”
Instant recognition =
Instant gratification =
Better sales performance
3) Can you use your tools to plan for the future?
Sometimes, you absolutely need help from sales compensation experts. But there’s no need to pay for insight you can get yourself. Can you use your tools to run what-if scenarios? What about reports—can you get the information you need with the click of a mouse?
4) Can you easily extract information to improve your plans?
Don’t let perfect hold good hostage. Fine-tuning your sales compensation plans can’t be avoided. In fact, you should be doing this every quarter. This is why analytics and reports are so critical. Make sure you can instantly access insight whenever you need it—so you get maximum return on compensation dollars.
We’ve all heard that asking the right questions leads to finding the right answers. This is just a start. For more, check out Xactly’s Guide: Pick the Right Sales Performance Tools.
So, ARE your incentive plans doing what you want them to do? Let us know.
Designing Sales Compensation Plans
With careful consideration and strategic design, you can use incentive compensation to inspire your teams and empower them to perform above and beyond the competition.