What CEOs Need to Know About Sales Compensation

IPSWICH, Mass. - Oct. 11, 2013 - PRLog -- Business Book Summary of What Your CEO Needs to Know About Sales Compensation

EBSCO Publishing has just released a new book summary. A company’s sales compensation plan represents one of its most significant drivers of performance and growth. Nevertheless, too often senior executives fail to recognize critical incongruities between sales strategies and the organization’s greater goals. In What Your CEO Needs to Know About Sales Compensation, Mark Donnolo identifies the four major competencies and 16 related disciplines that direct a company’s “Revenue Roadmap” and enables profitable growth. He shares insights from a range of experts from C-level executives from Fortune 1000 companies to the “foot soldiers” on the front lines of sales. The book concludes with a set of six “Report Cards” for measuring the effectiveness of sales compensation programs.

Mark Donnolo offers readers the following advice:

·         There is a direct connection between sales compensation plans and company growth. Often the greatest expense a company incurs, sales compensation is a primary performance driver.

·         In sales performance metrics, simpler is better. Effective sales compensation plans generally use three or fewer measures, with no measure carrying less than 15 percent of the weight of the target incentive.

·         Top performers should be differentiated from the rest of the field. Upside potential is an effective way to encourage above-average sales performance.

·         Unfair and imbalanced compensation usually comes from bad quota setting. Companies need good compensation plans and strong, realistic quota-setting processes that align with strategic goals.

·         Sales managers are not just big salespeople. The skills and competencies that make some sales representatives top performers do not usually translate into leadership skills. The best managers may be the second-best salespeople.

·         Compensation programs should not be designed by just the sales or finance teams. C-level executives should weigh in on compensation programs early and often, and people in the field should be allowed to provide their insights and suggestions.

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