Sales managers are always looking for enterprising ways to motivate their teams, inspire the troops, retain their best sales people, and increase company profitability. You can achieve all this and hit your growth targets faster with a smarter sales incentive program.
Inadequate compensation plans are the leading cause of job dissatisfaction
Studies reveal that managers and employees alike are dissatisfied with their compensation plans. A majority of the employees are unable to find a connection between their performance and their pay. Furthermore, many sales managers feel that their incentive plans fail to motivate their teams. In fact, they claim that these plans end up overpaying poor performers.
Paying according to performance is getting trickier by the day especially when it comes to rewarding individual successes. The reason for this is simple—integrated team efforts have become more important than ever in meeting customers’ needs. A vendor’s overall capabilities rather than a key individual’s efforts are what many customers base their buying decisions on.
Organizations that pay by the sale neglect customers’ expectations regarding variety, quality, and unusual requests. Furthermore, traditional incentive plans try to do something for everyone, and as a result, hinder pay-for-performance rewards. Such practices discourage performance. The only solution here is developing a smarter sales incentive program. How can you do that? Let’s take a look.
Incentives for improvement
It is impossible for everyone to be at the top of the leaderboard when appraisal time comes around. In fact, some of your most dedicated and hardworking salespeople will be somewhere around the middle. Often, managers end up ignoring the bunch that’s around the middle. This is something you shouldn’t do. Instead, you should set this group a goal for achievement of a certain sales growth percentage over the next quarter or year. This will keep your sales reps motivated to achieve results when there isn’t any short-term objective in sight.
Incentives for quality sales
In order to achieve their sales target before the end of a year or quarter, many sales reps make sales that don’t actually benefit the customer or the company in the long run. In fact, such sales bring in complaints and negative reviews for your company. This is the reason you should refrain from blindly rewarding higher sales. Instead, you should structure your incentive plans in a way that they reward quality and not quantity.
Incentives for knowledge and skills acquired
Your sales incentive programs should compensate sales reps based on the knowledge and skills that they‘ve acquired related to their job. This means that you should determine pay on the basis of the number of jobs a sales rep can do and the level of skill he or she can use to close a sale. Also, you should offer incentive to your employees for obtaining sales training or certification.
With a smarter sales incentive program, organizations and sales managers can motivate sales teams better. You can use commissions to motivate employees and hit your growth targets faster. To learn more about CallidusCloud Commissions, visit our commissions page.
Suggested Reading: When it Comes to Commissions, Excel is Not Free.