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Additional Comments:
Our experience with clients across a wide range of industries
indicates that these design techniques ...
Additional Comments: A key to retention is ensuring that
performance expectations are realistic, and the sales person sees...
Additional Comments: While the annual incentive
pay is important to a sales person for many important
reasons, long term i...
rewards have both been identified as key retention programs for
high performers.
4
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Best practices notes comp design techniques that foster retention of sales reps july 2015 cf blog [compatibility mode]

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Best practices notes comp design techniques that foster retention of sales reps july 2015 cf blog [compatibility mode]

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  2. 2. Additional Comments: Our experience with clients across a wide range of industries indicates that these design techniques are the ones most commonly reflected in either implicit or explicit retention strategies that focus on aligning compensation with career progression/advancement. 2 Topic Additional comments Job level  Reasonable #, e.g., 3-5  Competitive “step-ups” in pay, e.g., 12-20% Salary as multiplier  Requires an analytical understanding of % difference in salary as function of tenure; performance Merit pay treatment  Even when merit pay grid is same for all sales employees, those with higher bases will benefit from larger percentage increase if a high performer
  3. 3. Additional Comments: A key to retention is ensuring that performance expectations are realistic, and the sales person sees that achievement is explicitly recognized. These techniques help to ensure that those are reflected in the pay plan. 3 Topic Additional comments Performance threshold  Good news/bad news about this technique;  Good news – creates significant incentive and reward for holding on to all business  Bad news – runs risk of creating annuity pay – potential to lessen motivation to grow Quota tiers  Larger quotas – higher rates; motivates reaching up in territory size; motivates business growth OA+ rates  Typically, an additive incentive rate to the target or base rate – makes it financially worthwhile to overachieve
  4. 4. Additional Comments: While the annual incentive pay is important to a sales person for many important reasons, long term incentives and non monetary 4 Topic Additional Comments Consistency performance bonus  May be part of the “target” or an additional upside  Clearly reinforces period over period achievement Special recognition designations  Publically visible high achievement award designations are aligned with the requirement to recognize top talent –  This could include both rotations through, for example, marketing – and/or titling for careered sales people (e.g., “senior professional account executive”)
  5. 5. rewards have both been identified as key retention programs for high performers. 4

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