Compensation Plans
Compensation Management is not for Sissies
Monday, August 17th, 2009 | Compensation Plans, EIM | No Comments
Any of us who have had the pleasure of being responsible for compensation management can relate to some of the recent events at AIG, albeit on a smaller and hopefully less dramatic scale. If you’re not up to speed, this article will give you the scenario.
Here are some key excerpts:
The disclosures came as AIG was lambasted for about $450 million in bonus payments planned for employees at a business unit that lost $40.5 billion last year. The unit’s woes pushed the company to near-collapse, forcing the government bailout.
“Something is terribly wrong with this picture, and the reckless behavior at AIG must stop immediately,” said Rep. Elijah Cummings (D., Md.), in a statement Sunday. He called on AIG’s government-appointed chief executive, Edward Liddy, to resign over the bonus-payments issue.
The reason we can relate is because this basic scenario occurs regularly at every company that uses variable pay to incent performance. That is, sometimes people achieve on their plans even though the business overall is suffering. And in many cases we have people who qualify for large payouts even though they clearly don’t deserve them. › Continue reading
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Living by Numbers in SPM
Friday, June 26th, 2009 | Non cash incentive, SPM, analytics | No Comments
Nike+ with iPod Nano
I can personally attest to the motivating effect of competition and knowing that I am or will be measured. › Continue reading
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Recession Coming to a Close
Friday, May 29th, 2009 | Compensation Plans, SPM | 1 Comment
Going into the weekend, I wanted to share some bright news I noticed this week. Evidently a team of leading economists from the National Association of Business Economists (NABE) have predicted an end of the recession to come in 2009. Yes, that’s this year!
The NABE panel does temper the enthusiasm of the report saying that the predicted recovery will be “more moderate than is typical following a severe downturn”. Still, to those of us in the sales performance industry that have consistently seen companies’ attainment versus quota numbers way down, it’s refreshing to see a (somewhat) bright forecast.
A late 2009 recovery is definitely something to keep in mind when considering your 2010 plan changes and quotas. Of course, depending on your industry and its tendency to lead or lag, your mileage may vary. Hopefully upward activity will be contagious in the same way that things snowballed on the way down.
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Coaching with MBOs during Periods of Revenue Decline
Tuesday, May 26th, 2009 | Callidus, Compensation Plans, EIM | No Comments
In industries particularly hard hit by the struggling economy, even the best sales representatives may appear to be under performing based on the most important sales objective, the sales revenue target. How do you know if sales personnel are doing their jobs when their corporate customers’ budget freezes don’t allow for deals to close? Good sales reps will continue with the proven processes that under normal circumstances allow for them to exceed revenue targets — practices like scheduled check-ins with existing accounts, accurate and timely CRM record keeping, deal / budget qualification, etc. Attention to these items, should allow your sales reps to be first out of the gate when budgets free up and money starts flowing again.
› Continue reading
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