It’s time to talk compensation statements. We’re assuming, dear reader, that you’re in sales. If we’ve got that basic right, then please think about this simple two-part question.
What was your motivation for following this career path, and what makes you good at your job?
Let’s put author and motivational speaker Brian Tracey’s stance that sales is “the ultimate default career” to one side. Or possibly tackle that one on another day. In answer to our question, if we could take a straw poll of common and honest answers, we’d say that many of you were swayed by the prospect of earning a decent commission based on your ability to persuade, sell and close a deal. It really is that simple.
What you weren’t looking for were inaccurate compensation statements, where on paper at least, you’ve mistakenly missed out on a payment or hard-won bonus. After all those long days, after all the weeks finding that client’s sweet spot, you open the envelope or online statement and there’s at least one zero missing. Whether this is down to ambiguity over the rules of qualification or human inputting error into that master spreadsheet, it sucks, right?
On an individual level you’d have every right to be in a bad mood, possibly considering whether this company is the best place for your talents, and on a team level, such carelessness over compensation could mark the start of an insurrection. Now let’s view that same scenario from a different perspective. You’re the sales manager tasked with handling the fallout from such a bureaucratic balls-up and suddenly the revolution seems to be starting within feet of your desk.
And ultimately, there’s something bigger at stake. If on paper or on screen at least, targets haven’t been reached, that’s a whole lot of damage to KPIs and objectives. You could well be the person held accountable, being ordered by the big guns to see if this failure was down to poor quota management, ill-prepared or under-resourced sales teams or badly configured numbers at the beginning and end of the sales funnel or financial quarter.
Apologies if everything above has given you a waking nightmare. Luckily, this is a sales story about compensation statements with a potentially happy ending, if you trust in the right software.
Ideally, to take the profitable path to just rewards and happy sales teams, you’ll have a great compensation management tool like the one Varicent produces, that offers up reliable and current data that motivates, calculates performance and has dashboards that show exactly how a person or team is performing. There are no hidden KPIs or secret columns and everyone on there can monitor their performance by the day, week, quarter, or year. And rather than waiting for an unpleasant surprise, every user can submit queries so questions over earning potential can be answered in a timely fashion.
Rather than a team of number crunchers scrambling around for spreadsheets, order books and receipts, commission is automatically calculated. Even if there are numerous complications, for example someone moving client account, changing territories or being off work, the right output for those circumstances will be produced.
And there’s no ‘one size fits all’ approach when you successfully pair with the right compensation statement software. In an uncertain climate like the one we’re currently going through, you want software that creates and offers up multiple modelling scenarios, so there’s never a moment of ‘Uh-oh, what do we do now?’.
If this still seems like a far too easy solution for a sticky dilemma like unreliable compensation statements, why not play the longer game? If you have reliable evidence that this quarter’s compensation statements are not going to make anyone happy, start much further back and ensure your satisfied with how sales performance management as a whole is being handled. You’ve guessed it, there’s a nifty Varicent software package for that too. It’s very smart to go further and dig deeper than simply looking at commission. By getting a firmer handle on all aspects of the sales reps job and journey, such as whether they can manage their quota or are placed in the right territory, you’ll be much better informed as to whether an anomaly on the compensation statement is performance-based or a system error.
The bottom line is that very few sales reps are incentivized by the need to spread a little happiness. Whatever way they are motivated, keep your team on side with compensation statements they can trust, and a commission plan they can work towards.
Find out more by visiting www.varicent.com or talk to your Varicent rep today.