If there was an expense that accounted for 5% of your company’s total revenue, you’d want to be sure it was being managed properly, right?
You may want to take a closer look at one major expense: salesforce compensation.
A survey of smaller firms by Makana Solutions shows a mere 13% of your peers classify their sales comp plans as “very effective” – even though over 75% of companies are spending 5% or more of their revenue on it.
To make sure you’re maximizing your plan, embrace these strategies:
1. Align behaviors with strategy
The whole point of a sales comp plan is to get people’s behaviors to advance your company’s bigger picture goals.
But are salespeople given too much to aim for? A good rule: Sales plans should have no more than three measures to keep people focused.
Note: Your company’s strategy may have shifted a bit in the face of the current economic situation.
Does your comp plan reflect that?
2. Use the right tools
It’s also tough to keep people’s eyes on the prize to get the results you’re after when they don’t have a clear picture of their progress.
The culprit? Spreadsheets. Most small to mid-sized businesses still resort to cutting and pasting in Microsoft Excel to monitor their programs.
That can introduce errors or even simple delays that derail your process. With so much on the line, it may be time to seek out a more sophisticated system.