Top 5 Measures of Sales Compensation Plan Effectiveness
Measure #1: COMPARE PLAN STRUCTURE WITH MARKET PRICES
Act: Review the plan using the data published from survey sources. Be sure to use competitive intelligence and confirm that you are positioned where you desire to be with regards to the market.
Measure #2: USE ANALYTICS TO BETTER UNDERSTAND PROGRAM RESULTS
Act: Analyze outcomes based on payout curves, quotas, employee performance, etc. Are things aligned where they should be? (i.e., are your top earners your top performers?) Be sure to adjust quotas to account for sales territories.
Measure #3: GATHER BOTH FIELD AND MANAGEMENT PERSPECTIVES
Act: Talk to a variety of individuals involved. Executives, sales managers, individuals in finance and human resources, and those in the field have different perspectives on the effectiveness of programs.
Measure #4: AUDIT PROGRAM ADMINISTRATION
Act: Monitoring the program after implementation is key in the path to successful sales compensation program administration. Audit practices such as the timing of the sales completion, goal tracking, crediting, and payout timing.
Measure #5: CONTINUE TO EVALUATE STRATEGY AND PHILOSOPHY
Act: Keep the culture, goals, and mission of your company at top of mind. If the sales plan objectives do not match the company’s goals and growth strategies, you may need to make some adjustments.
After understanding these five actionable measures, a natural next step for many organizations is to partner with a Compensation Consultant. QTI’s team of experienced Compensation Consultants is ready to guide you through your compensation study and help develop a sales compensation program that will drive results. Contact us to learn more.