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Ask yourself, how many times have you changed your sales incentive plan in the last few years? Once, twice, or even 3 times a year? Well, if you responded yes, then you are not alone.
It is said that when it comes to calculating their incentive payments the mind of the sales person works faster and more accurately than a super-computer. By taking the most efficient of all actions, they know how to reach their targets and optimize their pay.
What is this Missing Link?
Changing your plan every year might not work as many businesses lack some critical aspects when designing their sales incentive plan. Deloitte calls that the missing link. It seems that many companies remain focused on basics such as quotas, cost savings, committee systems and staff plans. Sometimes they fail to see the bigger picture in doing this with the result being little improvement in sales performance. To put it another way, simply changing your plan every year will not guarantee success.
What’s the missing link, then? Is there a magic formula that will suddenly alter your world when applied to your sales incentive plan? Regrettably not. However, both Deloitte and a number of industry experts offer some valuable advice to sales managers struggling to provide their organizations with the right sales incentive plan.
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Setting a goal for your sales incentive plan
Above all, sales managers need to take a more holistic view of their mission of driving sales. In order to develop a comprehensive company strategy for sales, this means taking into account all the interrelated components of their business.
This strategy should be based on the mission of the company, its goals, its target markets, its customer value proposition, and its structure and culture of the organization. Then managers should be able to align sales goals and goals with that strategy seamlessly.
Once the strategy and targets in your sales incentive plan are aligned, the focus should be on how best to guide and motivate the sales team to implement the strategy. This is where managers will need to consider the salesperson’s role carefully in order to devise sales incentives that will actually drive sales. Managers will once again need to take a holistic view of the organizational makeup of the company.
The important factors to be included are the type of sales you need to sell your product or service, the attributes and behaviors your salespeople require, the metrics you set to measure performance, and the kinds of incentive plans and ideas that will work best for your business. This means sales managers will need to take full employee life cycle into account including recruitment, training , career development, retention and incentive programs.
Finally, and most importantly, sales managers need to keep the communication lines between them and their sales staff completely open. Selling people need to understand the company’s sales plan and recognize the behaviors needed for successful sales.
The best way to do this is to include the sales team in the planning process, request their input and feedback, and keep them constantly updated with strategies and plans changes. And another thing-do not make changes so quick. Give the time to work for the sales incentive plan. The findings will happily surprise you.
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