Geography - How Much Does Location Matter?

The Xactly Insights (TM) study of geographies analyzed the 2013 sales and incentive compensation data. Here's just how important geography is for incentives.

Data analysis has an innocuous ring to it - you track down or gather up pertinent empirical information and you comb it for answers. But the process is more finesse than anything, like summoning works of art from fine materials.

Michelangelo used to say that when he carved a sculpture, he wasn't creating a new work of art, but rather seeing the art that existed within the marble and freeing it from within. This is the art of data analysis - taking mountains of verified empirical data and allowing analysis to show you answers that have been there all along. As you have seen with out gender study, the insights we gain from these investigations are invaluable.

By analyzing the raw information generated by companies across industries and disciplines, anyone can unlock the information that exists within. In the spirit of that discovery we have taken to the earth itself, unlocking the best-practices hidden in the geography of our country. Our study of geography has revealed some interesting insights about human behavior across territories and timezones. Looking closely, you can start to see the implications of these data-driven geography insights.

As you can see below, the most important information that comes from this study of geography is the fact that no compensation system is created equal that doesn't consider the effects of regional geography on its reps. From the impact of the pay mix on behavior to the wildly varied value of a hundred dollars across the nation, the important take away is to recognize the different personas you are dealing with when you deal with geography, and to plan your compensation plans accordingly.

Think about the different people represented by each segment of the country. East Coast, West Coast, Mountain, and Central; each area represents a different behavioral pattern, a different environment, and a different access to opportunity. If you are making decisions about the comp plans of a rep in Denver versus New York, you have to take into account the variable pay gap between the to locations, as it relates to the number of available opportunities in the area.

The insight you can gain from investigating this geography data is vital to creating desirable compensation plans, holding on to top performers with effective incentives, and ultimately inspiring growth and performance with simple locational tweaks.

We will feature a further breakdown of these personas next week, but for now, start to digest these important insights, and tweet us @Xactly if you notice anything interesting!