As Summer wraps up and a successful third quarter draws towards a close, it’s time for sales leaders to start looking towards 2020 and beyond as part of the annual planning process. Amongst the plethora of reports and discussions to align strategies across the organization, your CEO and board will inevitably ask:
“Do we have the right talent?”
“Will our incentive plan help us meet our revenue goals?”
“Do our comp plans align with our strategy?”
To answer them confidently and ensure you are set up for success in 2020 and beyond, you will need a world-class comp plan that incentivizes your sales force, attracts A-Players, and leads your competitors. In order to do so, use compensation benchmarking to develop your market-leading plan.
What Is Compensation Benchmarking?
Compensation Benchmarking is the complete process of aligning your compensation plans to the industry and roles you’ve decided on in your Go-To-Market model. It allows us to query the industry and understand the different comp plans of our competitors and the implications of each. In so doing, we can build world-class comp plans which entice A-Player talent to our company, drive performance based on incentivized behavior, and alleviate compensation politics between finance and sales organizations by using third-party sources.
To understand the complete picture in competitive benchmarking, we use a variety of lenses. These lenses include competitive research, alignment of job titles to roles and responsibilities, industry research to understand the future direction of compensation, and individual interviews to understand the structure of competitor comp plans.
Why Is This Important?
When used correctly, competitive benchmarking will give you the tools to answer the board and your CEO’s most pressing questions on talent and comp.
#1: Do We Have the Right Talent?
Having an organization of A-Player sales talent increases your likelihood of making your number. To do so, an effective comp plan that attracts, rewards, and retains A-Player talent is critical. In today’s job markets, A-Player talent is more enabled than ever with the resources to find the best-paying jobs in the highest growing industries with the best benefits. To ensure those individuals are looking to your company as a first choice, you must rigorously research and compare your compensation plans with those of your competitors.
#2: Enable the Company to Achieve Its Revenue Targets and Optimize Incentive Compensation to Reps
When researching and benchmarking compensation plans, it’s essential to understand the minutiae which incentivize behavior for your competitors. Where your OTE might be on par with your competition, the factors which build into your plans could drive wildly different responses depending on your strategic growth goals.
By examining each aspect of your competitions’ plans, you can better develop a plan which pays top talent what they’re worth and drives behavior, which helps you reach your specific revenue goals.
#3: Do Our Comp Plans Align to Our Strategy?
To consistently make and beat your number, your entire selling organization needs to be aligned behind a singular strategy that best serves your customers. From the front-line reps to the customer success managers, each roles’ compensation needs to drive consistent behavior that helps your customers and aligns with your total Go-To-Market Function.
The key to a successful talent strategy in 2020 and beyond starts with world-class compensation plans. To build these, examine your competitors to align your sales comp to market trends, differentiate your business, and drive behavior that aligns with your revenue and strategic goals. By doing so, you will attract and retain the best talent that pushes your company to grow faster than your competitors.
To help you with competitive benchmarking, we have developed a tool to walk you through the process. Download it here and get started answering how you’ll attract and retain top talent in 2020 and beyond.
Need insights on how to build a world-class compensation plan? Schedule a working session at SBI’s Studio.
Located in Dallas, TX, our facility offers state-of-the-art meeting rooms, lounge, full-service bar, and a studio used to tape our TV shows. SBI provides the location and facilitators, all at a compelling price point.
As a guest of The Studio, you’ll get unlimited access to SBI’s CEO, Partners, and a handpicked team of experts.