We often hear The Marketing Manager bemoan ….. “ I know that of all I invest in advertising and promotion, only half works…………..wish I could say with confidence which half”. Whilst we don’t seem to hear or read about it as much, I think it fair to say that the Sales Manager’s counterpart lament would go something like………. “I know that of all the money I put aside for the sales team incentive pool, it seems to motivate half of them……. wish I could motivate most of the other half”.

So, how does yours compare?

There appear to be seven key principles that need to be observed in the formulation of your program.

  • Transparency, objectivity, understandability, scrutability.

o   This should be a two-way street……the Sales execs should be given a shared accountability, with Senior Management, for setting territory/portfolio revenue budgets that feed company/division revenue budget setting

  • Honours whole-of-company profit share rules

o   a pre-agreed revenue or margin threshold needs to be surpassed for the whole division or company Sales team to be able to create an incentive pool

  • the payout amount is flat and fixed…..for every x% the company/division surpasses the threshold, y% goes into the incentive pool.
    • This principle cascades down ….. national pool to state pool to individual pool.
  • Features tailored behavioural and compliance “gates” for eligibility.
  • Balances sales activity inputs, process outputs, as well as financial outcomes.
  • Balances national team with state team with individual rewards.
  • Balances short term (quarterly) with longer term (annual) redemptions.
  • Balances maintenance of existing revenue streams from existing customers with new revenue from existing customers with new from new.

Like many endeavours in Sales team optimisation (as in life!), there is no right / wrong program for any sales organisation. Defensible detail in tailoring that honours these principles for your team will be a great start!

Visiting The Next Level’s website can help put this discussion in perspective or simply send us an email – info@nextlevelenterprises.biz and we will gladly answer any questions you may have or organise to come out and have a discussion as to what The Next Level Sales System can do for you and your business.