| Many companies struggle to put together incentive | | | | with your people. |
| programs that truly focus their sales team on | | | | Sales commissions are probably the most popular and |
| producing superior results without getting them into | | | | typically they revolve around the idea of paying your |
| financial difficulties. Sales commission programs, | | | | sales representative a percentage of the revenue or |
| bonuses and other recognition programs are a very | | | | gross margin that comes from each sale. Sales |
| difficult topic because oftentimes, the conditions | | | | commission programs are different from sales bonus |
| under which incentives were originally set change | | | | programs which revolve around receiving a certain |
| over time. It's very important that if you're going to | | | | revenue target or other milestones. The difference |
| develop an incentive program for your sales people | | | | between a percentage and an absolute amount is an |
| that you make it subject to change on a regular | | | | important distinction, because a sales commission has |
| basis. Why? Because your business conditions change | | | | the potential danger of allowing your sales people to |
| and the parameters around which you want to | | | | make a lot more money then you originally had ever |
| incentivize your people will change as a result. | | | | intended. |
| Sales commissions, bonuses and other forms of | | | | We've seen lots of companies who have reps that |
| incentive compensation are programs that should | | | | are making too much money in relationship to the |
| never be viewed as entitlements by your sales | | | | amount of actual value they are bringing to their firm. |
| people. If they become entitlements, you haven't | | | | This breeds complacency and an entitlement mindset. |
| kept the program fresh and aligned with the | | | | It's important for sales incentive programs to be |
| requirements of your sales territory goals and plans. | | | | reset on a regular basis, in conjunction with fiscal |
| It's very important for that reason that they be | | | | year planning. |
| reviewed and renewed or changed on an annual basis | | | | |