Over time, even the best sales compensation plan will go stale. It might not represent the industry as it now stands, or product changes within the company might have made it obsolete. But even salespeople who really need a new compensation plan will resist the idea. After all, change is frightening, and when the change will affect your livelihood in a big way it's even more frightening. So when you begin working on your new plan, you'll need to keep that attitude in mind and prepare for it.
In many cases you'll be able to use your old compensation plan as a template and just apply some significant tweaks. In other situations, though, you might have to start from scratch. If you're creating an entirely new plan, it's even more important to consider the sales team's feelings. Let them know about the new plan as soon as you decide to start working on it, long before you set anything in stone. Then ask them for feedback, both in a group and one-on-one. Even if you don't use a suggestion, the salesperson will feel better about having had some input into the process.
As a general rule, the simpler a plan is, the better it will work. If you have two or more options as to how to set something up – for example, how you will assign leads – it's almost always best to choose the less complicated method. Your plan will inevitably get more complex over time as you address corner cases and fix loopholes. If the plan is complicated to start with, it will be a nightmare of red tape before long. And simple plans are far easier to understand and to put into effect.
It's possible you won't be the one designing the new plan; the executives above you may simply hand you a finished product. If that's the case, make absolutely sure that you understand the sales plan in every detail before you try to pass it along to the sales team. As you read the plan over for the first time, make a list of everything that seems unclear or that you don't understand and get those questions answered. If something seems murky to you, it will probably seem murky to your salespeople, too.
Once you fully understand the new sales plan, introduce it to your sales team well before it's implemented. The more time you can give them to get used to the compensation system, the better. Call a sales meeting to roll out the details to your team, and allow plenty of time for questions and comments. Take notes on any feedback your team hands out. You may or may not be able to implement it, but at least make it clear you're listening. After the meeting, schedule brief individual meetings with each salesperson to give them time to air any concerns that didn't come up in the general meeting. If one of your salespeople doesn't seem to have anything to say, probe with some questions of your own to confirm that he understands the new plan.
When the new compensation plan actually does go into effect, continue checking with your team to be sure that they fully understand it and understand how their new sales fit into it. During the first few weeks or months you'll almost certainly run into situations that aren't covered by the new plan. Jump on those situations immediately and get the rules set up ASAP to cover them. Don't forget to get feedback first from the interested parties – in fact, if it's a situation that's likely to occur in the future, you might want to get the whole team involved.
By Wendy Connick
http://sales.about.com/
In many cases you'll be able to use your old compensation plan as a template and just apply some significant tweaks. In other situations, though, you might have to start from scratch. If you're creating an entirely new plan, it's even more important to consider the sales team's feelings. Let them know about the new plan as soon as you decide to start working on it, long before you set anything in stone. Then ask them for feedback, both in a group and one-on-one. Even if you don't use a suggestion, the salesperson will feel better about having had some input into the process.
As a general rule, the simpler a plan is, the better it will work. If you have two or more options as to how to set something up – for example, how you will assign leads – it's almost always best to choose the less complicated method. Your plan will inevitably get more complex over time as you address corner cases and fix loopholes. If the plan is complicated to start with, it will be a nightmare of red tape before long. And simple plans are far easier to understand and to put into effect.
It's possible you won't be the one designing the new plan; the executives above you may simply hand you a finished product. If that's the case, make absolutely sure that you understand the sales plan in every detail before you try to pass it along to the sales team. As you read the plan over for the first time, make a list of everything that seems unclear or that you don't understand and get those questions answered. If something seems murky to you, it will probably seem murky to your salespeople, too.
Once you fully understand the new sales plan, introduce it to your sales team well before it's implemented. The more time you can give them to get used to the compensation system, the better. Call a sales meeting to roll out the details to your team, and allow plenty of time for questions and comments. Take notes on any feedback your team hands out. You may or may not be able to implement it, but at least make it clear you're listening. After the meeting, schedule brief individual meetings with each salesperson to give them time to air any concerns that didn't come up in the general meeting. If one of your salespeople doesn't seem to have anything to say, probe with some questions of your own to confirm that he understands the new plan.
When the new compensation plan actually does go into effect, continue checking with your team to be sure that they fully understand it and understand how their new sales fit into it. During the first few weeks or months you'll almost certainly run into situations that aren't covered by the new plan. Jump on those situations immediately and get the rules set up ASAP to cover them. Don't forget to get feedback first from the interested parties – in fact, if it's a situation that's likely to occur in the future, you might want to get the whole team involved.
By Wendy Connick
http://sales.about.com/
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