If you determined your compensation plan is a problem, the questions you are probably asking yourself are:


  • How can I fix this quickly?
  • Can I fix it myself?
  • What are my options if I do try to fix it?




How Can I Fix This Quickly?

This depends on 2 key factors:


  1. What’s broken with the current plan?
  2. How much time does the team have to work on this?


For example, if your current plan has variable components that are less than 15% of total targeted earnings, you might decide to adjust these as a way to level-set your variable components. This is something you can fix quickly with minimal time investment. On the other hand, determining if you are paying at the 60th percentile of your peer group entails compiling research data and analysis. This may take some time to complete if you don’t have the information readily available.


Can I Fix It Myself?

To answer this question, use the best practice assessment to determine your knowledge and capability gaps. Does the knowledge to address the issues exist inside your organization? Are those resources available to address the issue now? The matrix example provided below can help you begin to understand your internal capabilities and the time commitment necessary to address each item.


Sales Compensation Option Matrix resized 600


What Are My Options If I Do Try To Fix It?

Every buying decision typically has 3 options:


  1. Do Nothing
  2. Fix it yourself
  3. Hire outside help


If you’ve decided ‘doing nothing’ is not an option, determining whether or not you can fix the issue yourself is the next step. Use the last column of the matrix to bring clarity to your decision making process. In the example, there are three items designated as “3rd Party.”


You’ve now determined there are several components of your sales incentive plan that require the assistance of someone outside your organization to fix. My next post will discuss how to ensure you select the right 3rd party to assist you with making improvements to your sales compensation plan.


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