6 Essentials to Have a Sales Comp Plan That Drives Behavior
The compensation plan is the most powerful tool that an organization can deliver to the sales team to establish alignment on sales and business priorities. It is the key driver of behavior, and if not considered in the broader context of the role and the sales strategy it will fail.
All too often organizations treat plan design as a financial exercise—reviewing results of the previous plan and making tweaks and adjustments to the plan mechanics or including a few “motivational drivers” like accelerators or spiffs with the hope of driving desired performance. When the expected results are not delivered, the plan designers often blame a complacent sales organization, while the frontline sales team complains that the plan is unfair.
Join us on a journey to explore six essential elements required for an effective sales compensation plan.
These six essentials make up the foundation for a sales comp plan that drives desired behavior among the sales team:
- Align – The plan must be aligned with the sales strategy and job roles.
- Differentiate – Using the “Reverse Robin Hood Principle,” make sure to reward excellence while not overpaying low performers.
- Simplify – Reduce complexity in the plan measures and mechanics.
- Motivate – Connect pay with performance, ensuring that the plan measures are aligned with the expected results.
- Connect – Avoid disconnects by making sure that other sales performance management elements — such as territories and quotas — are aligned with the sales comp plan strategy.
- Automate – Future proof the plan by having technology that is dynamic and flexible enough to not only support the plan needs, but also to handle changing strategic priorities.