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Create Sales Comp Success with a Four-Step Approach

Communicating a new compensation plan to the salesforce is important. It is key to translating a well-designed plan into a results-enabling program while limiting disruption. Without effective messaging and training, well-designed sales compensation plans can demotivate sales representatives or distract them from normal selling efforts.

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Organizations typically make considerable investments of time and money into plan communication. They develop communication materials and tools and make system upgrades to accommodate changes in the plan mechanics. Sales leaders host in-person and online sales training events to ensure salespeople understand how the plan works. First-line sales managers (FLSM) are a critical factor to bringing it all together. Successful rollout requires the FLSM’s engagement, support and courage. 

Why the FLSM Is Important
FLSMs act as a filter to the senior leadership team’s communications. They can decide which messages to emphasize or deemphasize to their teams. They are also typically one of the highest leveraged positions within an organization. With common spans of control between 8:1 and 10:1, a single FLSM can influence a substantial percentage of the organization’s salespeople. Further, their teams have direct responsibility for the organization’s most important assets: its customers. The reach and responsibility of the FLSM position make it vital to the success of rolling out a new sales comp plan.

LEAD: Listen, Educate, Advise, Deploy
Listen
to FLSM’s input on how to roll out the plan. Involve them early in the implementation process. Hear their concerns and work with them to address potential issues. They typically have the best sense of anyone in the organization about how the individuals on their team will respond to the change. They know that one individual will like the upside potential of a higher-risk plan while another individual will be frustrated by the new growth expectations. While you shouldn’t make adjustments for individual cases, hearing their concerns early in the process will help you take a better approach to salesforce-wide communication. 

Educate FLSMs on the details of the new plan. Education is more than emailing a plan document and asking the managers to respond with any questions. Education includes manager-focused communication materials that describe why the company is making the change, how the plan works, including payout examples, and more. Education sessions are preferably held in person when feasible (and depending on the magnitude of change). FLSMs must know the plan details and rationale for change well enough to explain it on their own to their team. 

Advise FLSMs on how to handle questions and objections from their team. They will have many conversations with their team, formal and informal, about the new plans. Sales representatives will press them about why the change is being made and about components of the plan that seem unfair. Help the manager address these questions by reviewing FAQs and responses. Discuss the plan components with any unhappy sales representatives. It will help the manager feel more comfortable during team conversations and increase consistency in communication throughout the field. 

Deploy tools and communication materials for FLSMs to use with their team. Plan documents, earning estimators and training presentations are commonly used. These items are critical to successfully educating a salesperson on the new plan. A central function/person within the organization should create these tools to ensure consistency. Managers should not be expected to create any communication rollout tools on their own.

Communicating a new plan is imperative to the plan’s success. Effective communication requires full engagement from the FLSM. However, they must be equipped to navigate the rollout process. Lead the FLSM to increase engagement and ensure successful communication. Listen to their input on the rollout process. Educate them on the details of the plan and rationale for change. Advise them on how to address questions and objections from sales representatives. Deploy communication tools to help them teach the plan to their team. Engaged FLSMs will drive better adoption of your new compensation plan.

About the Author

Mike White is a director in the Alexander Group’s Chicago office. Connect with him on LinkedIn.


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