The upbeat high-octane sales professionals are the valuable human assets who bring actual business through competent marketing and sales strategies in commercial organisations. It is the sales people who build good customer relations, designate the market position of an enterprise, popularize and promote its product and services. So, retaining the sales people in their steady state of performance is desirable to generate greater revenues. Sales compensation may refer to bonus, commissions and other variable payment modes to reward the achievements in sales and inspire these people to perform better. Sales compensation serves as a positive motivational force to sustain the high performance level. A comprehensive sales compensation plan can help an organisation to achieve optimal success and profit in its business.
The management should design a well-structured sales compensation program to keep its sales performers focussed and committed to their work. Sales compensation is not just rewarding the employees with an increment but retaining them in a stable state of consistent performance to attain business goals. Sales people enjoy a demanding market position in the current business scenario. They have to be retained and best utilized to achieve optimal revenues and high productivity.
The current market conditions, sales proportions, market data and company expenses for the operation of sales motivation activities have to be analysed before preparing a sales compensation plan or program. An effective sales incentive strategy not only attracts, motivates and retains sales talents but also creates sufficient competitive advantage, evaluates current performance, calculates the sales expenditure and the desired return as well as regulates fixed costs through various payment modes based on performance.
Sales compensation is a potential tool that keeps the sales force invigorating and motivated. Inaccurate use of sales incentives can result into low spirit, unhappiness, dissatisfaction, conflict and disintegration among the sales employees. The employees may shift their interests to other employers if such a situation arises. The company may loose some of its lucrative sales talents due to its imprudent sales incentive plans. Recruitment of newer talents will require more costs. Moreover, the results may not be of standard level since the new talents will take considerable time to understand the sales strategies and objectives of the new organisation. Sales compensation directly affects the behavior and attitude of the sales people that in turn affects the sales performance and business results in an organisation. Thus, sales compensation serves as a powerful link between the organisational behavior and performance. A positive alignment between both is desirable for the ultimate growth and success of an enterprise.
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