Using incentives as a tool to get the results that you need – business-wise – is undoubtedly an intelligent move.
But how can you ensure that your incentive scheme works for both you and your sales reps? Christopher Cabrera, author of “Clean Water for a Billion People: The Transformative Power of Incentives” said:
“Incentives are an incredibly powerful lever that can transform the world at large and keep your sales peoples’ eyes on the prize by giving them a tangible goal to achieve.”
The keyword here is “tangible”.
Warren Dietel’s “Incentive Plans that Drive Accountability” also listed several tips to make sure your incentive plans are effective. Here are three out of the several that he listed:
- Clear expectations – upfront
- Make it measurable
- Begin with the end in mind – what is your desired result?
In my experience, when I started out in the corporate world a decade ago, I noticed that unreachable or unreasonable goals in incentive schemes tend to demotivate employees. Instead of employees performing better, it resulted in higher dissatisfaction and turnover rates.
On the opposite end of the spectrum, clear and tangible goals drive employees to keep delivering so that they’d be sure to get their incentives month after month. I know for a fact that was what I did to increase my monthly pay check when I was starting out. Aside from the monetary reward, tangible goals helped build my confidence and made me a better-equipped, well-rounded employee.
Now, isn’t that the kind of sales team that companies need?
Reasonable and attainable goals will drive consistency in performance among employees – sales people included.
But where do you begin when drafting incentive schemes? There are actually great resources available so you do not have to reinvent the wheel when creating a great sales incentive program for your team. QCommission has templates that you can use to make your life easier. Click here to view the many different templates that are available.
CellarStone also works with a number of sales comp plan professionals that can help customize a plan for your industry. If you already have an existing plan, we can help you run a stress test by using our partner Compensation Master.
If you don’t already have a written sales compensation plan for your agents, it would be a good idea to come up with one today. Not only will it help serve as additional motivation for your sales people by making them feel secure, but it will also protect you, the employer. In some states such as California, it is now a law that sales reps must have a signed sales agreement on file that specifies their plans. If it isn’t a law in your state yet, there’s no harm in staying ahead of the game.
After all, a well-written sales compensation plan is a win-win situation: It motivates your sales agents and keeps them on their toes, and you get your desired results.