Let’s set the stage. It’s a cold December day and one of the top sales reps at your company has just closed a big deal. In the afterglow of congratulations and bell-ringing, his attention is quickly grabbed by the next shiny object—and by this, I mean no offense. I love salespeople and I have been one. They are the lifeblood of any company. It’s not their fault that many sales compensation plans are built in a way that encourages them to forget about a client the second they sign on the dotted line. Sure, there are salespeople who do their due diligence to keep in touch, communicate, and upsell, but this often takes an experience level that not all reps have.
In addition, not every salesperson operates at the same level of productivity, with the same enthusiasm, or the same drive to consistently improve. Motivating and engaging reps is one of the most important steps in achieving your company goals and incentivizing your team to perform the behaviors that you’re looking for. Want them to focus on upselling current clients? It better be in the incentive plan, or you can bet it’s not going to be their priority.
To achieve success, and motivate people across the performance spectrum, you have to have the right strategic plan, measures, people, and technologies in place. The first step is to deploy a well-thought-out incentive structure for your internal teams.
“Incentives can drive a 30% increase in productivity” - LOCKE ET AL
Research shows that it takes very little pay at risk to drive a performance improvement—in some cases as little as 5% is enough to focus employee attention. This makes incentives a powerful tool in getting your teams to perform at optimal levels.
So how can you encourage your team to go beyond just ‘closing the deal’ and instead, build a salesforce that attentively follows through with each client to ensure maximum productivity and profitability for everyone involved?
Take Success One Step Further:
Let me know if this sounds familiar. Your team is filled with high performers who have tunnel vision on making the sale. However, the mentality seems to be that their contribution ends when the DocuSign reaches their inbox. When in fact, they should be on the lookout during and after the sales process for ways to ensure a customer is successfully on-boarded and set up for the best chance of success in the years to come.
So, let’s talk about structuring incentive plans so your reps feel vested in a customer’s success beyond closed/won and are rewarded for not abandoning the customer as soon as the deal is done. First and foremost, financial incentives (on top of their regular compensation) must tie their variable compensation to targets outside of the initial sale.
For reps, providing incentives to hit key milestones, such as onboarding completion, allows them to cash in on the extra effort and work that they most likely wouldn’t have received without the reward aspect being put in place. This type of add-on reward results in quantifiable success for all parties involved—the rep, your customer, and your company.
Here are some additional measures to consider for your Sales team:
- Capturing the key pieces of data required for successful customer onboarding and success
- On-time or ahead-of-schedule onboarding completion (the faster the customer is on-boarded, the greater the incentive payout)
- Final Customer Onboarding score above a certain number
- Customer Health score above a certain number for a certain period of time
- Customer Lifetime Value (CLTV). For example, set a projected CLTV one year from the initial sale and reward accordingly.
When employees see their value and the role they play in the company, everyone benefits. As a result, you can expect not only to see a spike in normal sales performance but also the life-cycle and retention rate of your current/future customers.
A properly built incentive plan helps focus your team’s attention and drives performance. These programs, when done properly, have a direct impact on employee engagement, which in turn, directly impacts your bottom line. This is a big deal because companies with highly engaged employees have twice the net income of companies who lag behind in engagement and when your sales team is engaged and motivated, the sky's the limit!
To learn more about how incentives can help your overall business strategy, especially with the New Year right around the corner, check out my new partner guide with TaskRay, “Structuring Incentives for Customer Success” and save your spot in our upcoming webinar, where I’ll dive into incentives with TaskRay.