article | February 19, 2011
Incentive Compenstation: Getting it Right (Part 1 of 3)
In designing comp plans, there are many factors to consider. Over the next three editions of this blog, we will take a closer look at three key factors:
Part 1: Target Compensation
How much should your sales reps be paid in total target compensation (base+variable)? To start, think about what the role requires, what you can afford, what the customer expects and how your peers pay their reps.
Still unsure about how to combine these ingredients into a comprehensive solution? Try using a Venn Diagram to list all of the attributes you want for each category. It’s a great visual tool to help sort out your thoughts and bring clarity to the problem. Look at the commonalities from each circle and begin to craft your solution accordingly.
Stay tuned for part two where we take a closer look at base-variable mix and how to determine if you’re on the right path.