A key challenge when designing effective sales incentive plans is determining how to pay for the value each individual brings to the sale.

 

The below example highlights five steps of a typical selling process, followed by role types that generally “own” each phase of the sale. While you can argue it’s the account executive’s (AE) job to facilitate each of these steps in a selling campaign, they often cannot accomplish the objectives of each phase on their own. For instance, when conducting a technical product demonstration, is the AE better suited to speak with the customer’s technical buyer or is it your solutions engineering (SE) team? You don’t want the AE to get in over his or her head and lose credibility in the sale. The SE brings technical “value” in moving the sale forward.

 

sales incentive plans

 

The call to action is to conduct the following exercise:

 

  • Get your leadership team in a room together
  • Draw a matrix similar to the one below on a white board
  • Across the top of the matrix, list out the steps of your sales process

 

Note: If you don’t have a defined sales process, stop here: You’ve potentially uncovered a larger issue that sales compensation won’t fix. Get your selling methodology formalized before worrying about sales incentive compensation.

 

  • List out the various roles involved in your typical sales campaigns down the left hand side
  • Populate the matrix with a “P” for the primary owner of this phase in the sales process, and an “A” for those who assist in the phase of the process.

     

    compenation sales incentive plans

 

When complete, you should have clarity around the sales role each individual plays in the process. 50% of solving a problem is defining it correctly. You’ve just completed step 1 and brought clarity to the issue.

 

In my next post, we will visit step 2, which is defining the type of sales role you have and how to develop sales compensation plans that align with each role.

 

Need help defining your sales process? Check out my colleague John Kenney’s blog posts to learn how to better define yours.

 

Ryan Tognazzini

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