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Sales Forces Unite

By Jun 01, 2010

Last year, many businesses tightened budgets by reducing staff and people-related expenses like benefits, incentives and training. But now it’s time to move from short-term survival mode to long-term success. One way to do that is to build a case to justify your sales force incentive program. Here’s what you need to know.

  • Forecast: Conduct a future environment scan. Assess your competition, the economy and sector-specific trends based on market indicators, legislation and regulations. What external factors affect your business and people?

  • Look Around: Conduct an engagement analysis with your sales force. Review the current financial situation. Outline the organization’s current strengths and weaknesses. Identify who and what can influence and affect the program — positively AND negatively.

  • Set Your Sights: Identify where your company wants to be in the short and long term. Align the program with the company’s desires. Connect how improving sales performances — with set, measurable goals — will help the company achieve its overall vision.

  • Track Success: Determine what success looks like, and set measurable benchmarks that lead the program to that success. Show how each benchmark builds up to the overall goals. One good, high-level measurement of success is to work to achieve 10% year-over-year growth — but remember to check that against what’s achievable in your industry and situation.

  • Plan a Path: Create an action plan to fill in the gap between the company’s current position and where it wants to go. Outline the steps to ensure future success. Build a plan that connects the goals and measurement targets with tactics.

  • Crunch Numbers: Evaluate the financial impact of the program. Develop a basic financial model with simple calculations and inputs to show where and how the program added to corporate success. A basic formula for determining return on investment combines the joint product of incremental revenue, profit margin and percent attributed to the program. Deduct program costs from this multiplied number and divide the overall sum by the program costs.

— JENNIFER KALLERY, division vice president of marketing, Maritz