Anyone who has been through a significant sales compensation design project can attest to how much effort it takes to do it well. It’s not just about following leading practices in design, like having three performance measures or less, or making sure the sales role in question has some control over a particular measure. There are so many other factors to consider and manage throughout the process, from selecting the right design team, to securing the necessary approvals. Perhaps the most critical part is effectively “selling” to the sales people you are trying to motivate. In addition, you may need to navigate around distractions and issues that often come up along the way — big ones, like a re-structuring, or smaller ones like revised forecasts from finance or new product launch dates from marketing. Maintaining awareness and staying focused is imperative to ensure everything stays on track. Indeed, you can argue that the process never stops; even after new plans are in place there is a need to monitor how well they are working while also preparing for any changes to incorporate in the following year’s plans (hopefully, however, the level of activity is significantly less intense!).
A great amount has been written about the technical aspects of sales incentive compensation. Although technical aspects of incentive design are absolutely important and must be heeded, this series is not about those specifics.
Instead, the spotlight will be on the process itself and some of the lesser known success factors – from how to get started, the “sausage making”, and finally wrapping it all up. As noted in the title, the emphasis in this series will be on the practical activities that need to take place, how to avoid the many pitfalls along the way, and ensure a motivational, fair incentive program that limits leadership and sales force distractions from selling (which is, after all, the name of the game).
A quick preview on what’s to come:
1. Getting Started – Securing Executive Sponsorship, Creating the Right Design Team, Inclusiveness, Communication, and Educating Team Members
2. The “Sausage Making” – Establishing Core Decision Guidelines, Starting the “Selling” Process, Check Lists, and Design Team Socialization
3. Wrapping it All Up – Modeling, (Even More) Communication, Systems and Reports, Plan Launch, and more!