If you want to recruit the best of the best and then keep them around, your job as a business leader is to provide the incentives to stay. Recruiting, hiring, and retaining top sales talent requires a competitive compensation plan.
If you missed it, check out last week’s post on what NOT to do for your sales compensation packages.
When it comes to establishing a solid plan, it’s all about balance: pay too little and top salespeople won’t even look at your organization. But pay too much and salespeople could potentially become complacent. And as a result, you’ll have trouble scaling your sales organization as growth occurs.
So how do you successfully navigate your way around this delicate balancing act? Here are a few of our ideas.
Six Key Elements of Competitive Compensation Plans
Here are the guiding factors for a competitive compensation plan.
1. Empower Both Parties
A great compensation plan is a compromise; you want to design your plan in a way that links compensation to individual sales performance and to at least one of the following two elements:
- Departmental sales performance.
- Overall company sales performance.
We can help you decide how much compensation is tied to each component.
2. Develop Good Sales Habits
If there are certain sales habits you like and want to see your sales team repeat, reward them financially! There’s no better way to reinforce good habits and routines than with incentives.
3. Deliver Quickly
This is a crucial factor; if you want to incentivize good sales practices, you need to do your part and deliver those incentives in a timely manner.
Rewarded behaviors are more likely to be repeated if they are rewarded quickly and consistently.
4. Be Clear
Make sure everyone is on board by creating a plan that is not only easy to understand, but also to administer.
If salespeople understand their potential incentives and how to earn them, they’ll do all the work. A plan riddled with too much detail and conflicting points could do your organization harm. This could result in poor time management by sales leaders.
5. Align Metrics with Business Goals
Compensation plans are not a one-size-fits-all approach, and what works for one company may not be appropriate for another. Take time to analyze and define your business goals and then tailor a plan based on your company’s unique business model.
The 360 Consulting team can help guide you in creating a customized compensation plan that supports your company’s mission.
6. Transparency Is Key
Take the time to meet with your sales team and be open about the process to finding a plan that works for everyone. Go over some of the sales behaviors and habits that you are looking for and get their feedback on the plan by going through pros and cons together.
We Can Help
When it comes to developing a competitive compensation plan, it takes time and expertise to nail down the best route for your company and sales team. 360 Consulting is ready to help you tap into the strengths of your sales representatives and put your business on a long-term track of growth and success.
Take the first step towards breaking sales records and schedule your FREE consultation today!