ISBN-10:
0814473245
ISBN-13:
9780814473245
Pub. Date:
08/07/2006
Publisher:
AMACOM
The Complete Guide to Sales Force Incentive Compensation: How to Design and Implement Plans That Work

The Complete Guide to Sales Force Incentive Compensation: How to Design and Implement Plans That Work

by Andris A. Zoltners, Prabhakant Sinha

Hardcover

Current price is , Original price is $65.0. You
Select a Purchase Option (New Edition)
  • purchase options

Product Details

ISBN-13: 9780814473245
Publisher: AMACOM
Publication date: 08/07/2006
Edition description: New Edition
Pages: 496
Product dimensions: 7.10(w) x 10.10(h) x 1.80(d)
Age Range: 17 Years

About the Author

"Andris A. Zoltners is a Professor of Marketing at the Kellogg School of Management at Northwestern University. He is a founder and co-chairman of ZS Associates, a global business consulting firm. For over 30 years, he has served the business community as a professor, consultant, speaker, and author on marketing and sales force performance. He lives in Evanston, Illinois.

Prabhakant Sinha is a founder and co-chairman of ZS Associates, where he has consulted with more than 200 firms in North America, Europe, and Asia. He also teaches executive education courses on sales force effectiveness at Kellogg, the London Business School, and the Indian School of Business, and leads custom workshops for sales leadership teams. He lives in Evanston, Illinois.

Sally E. Lorimer is a consultant, specializing in sales and marketing, and business writer. She was previously a principal at ZS Associates, where she consulted with numerous companies on sales force design. She lives in Northville, Michigan.

All three are coauthors of Sales Force Design for Strategic Advantage, and Zoltners and Sinha are coauthors (with Greggor A. Zoltners) of The Complete Guide to Accelerating Sales Force Performance."

Table of Contents

"Preface viii

Acknowledgments xi

Chapter 1 Sales Force Incentive Compensation and the Successful

Sales Organization

Introduction 2

The Drivers of Sales Force Compensation Change 12

The Sales Force Compensation Challenge 17

The Sales Management System 19

The Role of Incentive Compensation Within the Sales

Management System 23

Diagnosing Sales Force Issues 29

How This Book Is Organized 32

Chapter 2 Reviewing a Current Incentive Compensation Plan and

Setting Objectives for a New Plan

Introduction 40

Is It Really an Incentive Compensation Plan Problem? 41

An Overview of a Sales Incentive Plan Assessment Process 44

Assessment of Current Sales Compensation Plan Consequences 45

Assessment of Current Sales Compensation Plan Consistency and

Compatibility 76

Developing New Plan Objectives 83

PAGE v

v

.................15869$ CNTS 05-19-06 09:21:54 PS

vi Contents

Chapter 3 Plan Design Fundamentals

Introduction 93

Sales Compensation Plan Design Terminology 94

Chapter 4 Plan Design Part 1: Determining the Correct Pay Level

Is Your Sales Force Pay Level Correct? 108

The Range of Sales Force Pay Levels 112

How to Determine the Right Sales Force Pay Level 115

Conclusion 137

Chapter 5 Plan Design Part 2: Finding the Best Salary–Incentive

Mix

Introduction 141

Do You Have the Right Pay Mix? 143

The Range of Salary–Incentive Mix 151

How to Determine the Right Salary–Incentive Mix 160

A Pay Mix Scorecard 179

Chapter 6 Plan Design Part 3: Selecting Performance Measures

Are You Using the Most Appropriate Performance Measures to

Determine Your Incentive Plan Payout? 184

Types of Measures 187

How to Determine the Most Appropriate Sales Incentive

Measures: An Advisory 192

How to Determine the Most Appropriate Sales Incentive

Measures: Specifics 198

Chapter 7 Plan Design Part 4: Determining the Right

Performance–Payout Relationship

Introduction 226

Is the Most Appropriate Performance -- Payout Relationship

Used for Determining the Incentive Plan Payout? 227

Representing Performance -- Payout Relationships 228

Decision 1: Bonus Plan or Commission Plan? 231

Decision 2: Progressive or Regressive Plan? 237

Decision 3: Caps or No Caps? 243

Decision 4: Pay from the First Dollar or from Goal or a Fraction

of Goal? 245

Decision 5: Single Measure or Multiple Measures? 251

Concluding Insights 261

Chapter 8 Evaluating Proposed Sales Incentive Compensation

Plan Alternatives and Selecting a New Plan

Introduction 265

An Overview of Candidate Sales Compensation Plan Assessment 267

PAGE .................15869$ CNTS 05-19-06 09:21:55 PS vi

Contents vii

Quantitative Assessment of a Candidate Sales Compensation Plan 271

Qualitative Assessment of a Candidate Sales Compensation Plan 295

Future-Proofing Assessment of a Candidate Sales Compensation

Plan 306

Conclusion: From Objectives to Reality 308

Chapter 9 Setting Effective Goals and Objectives

Introduction 313

Are Your Sales Force Goals Appropriate? 314

Types of Goals 327

How to Set Effective Sales Force Goals: a Five Step Process 330

Tracking Performance Against Goals 369

Goal-Setting Recommendations 372

Concluding Insights 375

Chapter 10 Increasing Sales Force Motivation Through Sales

Contests, SPIFFs, and Recognition Programs

Introduction 378

Sales Contests and SPIFFS 380

Recognition Programs 403

Insights 407

Chapter 11 Making an Effective Transition with a Major

Incentive Compensation Plan Change

Introduction 410

Sales Incentive Compensation Plan Change and the Sales

Management System 415

Challenging Sales Incentive Compensation Plan Transitions 421

A Sales Force Change Process Framework 435

Chapter 12 Incentive Compensation Plan Administration

Introduction 454

Is the Incentive Compensation Plan Administered Well? 458

IC Plan Administration Systems and Processes 461

How to Design an Effective IC Plan Administration System 476

Summary 489

Index 491

About the Authors"

What People are Saying About This

Peggy Forssell

" This book provides clear instruction for the important problems of how to set goals, how to measure performance, and how to effectively manage change."
Director, Sales Operations, Summit, NJ

Jeff Foland

"This book does a wonderful job highlighting how sales force incentives fit within the overall context of the sales effectiveness system."
Vice President of Sales, United Airlines

Mark A. Bate

"Tapping into a wealth of academic and workplace experience, this guide answers all the compensation questions your organization is asking...or should be asking."
President, MasterBrand Cabinets Inc. / HomeCrest Cabinetry

John T. Early

"The authors use examples of the real-world challenges of scores of companies to create a road map to effective sales force compensation."
Vice President Sales and Marketing, Harley-Davidson Financial ServicesInc.

Neil Rackham

"The 3-C's framework in this excellent book takes a strategic approach to compensation that is practical and really motivates for the right results."
Author of SPIN Selling

Stephen Grimaldi

"A comprehensive guide to effective compensation programs for all environments, whether the sales force is large or small or the products are complex or simple."
VP, Compensation & Benefits, GE Consumer Finance - Americas

Philip Kotler

"Rich with real examples and analysis, this is the best book I have seen on sales force compensation."
S. C. Johnson Distinguished Professor of International Marketing, Kellogg School of Management, Northwestern

From the Publisher

"""Rich with real examples and analysis, this is the best book I have seen on sales force compensation.""

-- Philip Kotler, S. C. Johnson Distinguished Professor of International Marketing, Kellogg School of Management, Northwestern University

“The 3-Cs framework in this excellent book takes a strategic approach to compensation that is practical and really motivates for the right results.” -- Neil Rackham, author of SPIN Selling

“This book does a wonderful job of highlighting how sales force incentives fit within the overall context of the sales effectiveness system.”

-- Jeff Foland, Vice President of Sales, United Airlines

“This brilliantly architected book is not just a ‘must read,’ it is a ‘must act upon’ if you want to improve your bottom line.”

-- Kash Rangan, Malcolm McNair Professor of Marketing, Harvard Business School

“The authors use examples of the real-world challenges of scores of companies to create a road map to effective sales force compensation.”

-- John T. Early, Vice President–Sales and Marketing, Harley-Davidson Financial Services Inc.

“Tapping into a wealth of academic and workplace experience, this guide answers all the compensation questions your organization is asking -- or should be asking.”

-- Mark A. Bate, President, MasterBrand Cabinets Inc./HomeCrest Cabinetry

“A comprehensive guide to effective compensation programs for all environments, whether the sales force is large or small or the products are complex or simple.”

-- Stephen Grimaldi, Vice President–Compensation & Benefits, GE Consumer Finance–Americas

""This book expertly balances qualitative and quantitative considerations for developing and implementing sales force incentive programs.""

-- Bill Kotcher, Market Manager, UGI/AmeriGas Propane

""This book provides clear instruction for the important problems of how to set goals, how to measure performance, and how to effectively manage change.""

-- Peggy Forssell, Director, Sales Operations, Summit, NJ"

Bill Kotcher

"This book expertly balances qualitative and quantitative considerations for developing and implementing sales force incentive programs."
Market Manager, UGI/AmeriGas Propane

Kash Rangan

"This brilliantly architected book is not just a ‘must read,’ it is a ‘must act upon’ if you want to improve your bottom line."
Malcolm McNair Professor of Marketing, Harvard Business School

Customer Reviews

Most Helpful Customer Reviews

See All Customer Reviews

The Complete Guide to Sales Force Incentive Compensation: How to Design and Implement Plans That Work 4.5 out of 5 based on 0 ratings. 2 reviews.
RolfDobelli More than 1 year ago
Planning the ideal salesforce incentive compensation program is very challenging. Pay enough, and you'll energize your salespeople. Pay too much, and you'll throw money away while turning salespeople into loafers who can get by on fewer sales. Pay too little, and you'll push your best salespeople out the door. But how much is enough, too much or too little? How do you figure out the best mix of salary, commissions and bonuses to pay your salespeople? This comprehensive compensation guide is a good place to start answering these questions. Written by sales and marketing experts Andris A. Zoltners, Prabhakant Sinha and Sally E. Lorimer, this is your essential map for developing and implementing the ideal compensation incentive plan for your salespeople. getAbstract recommends it to sales managers who want to do a better job of meeting their personnel needs and, therefore, their sales targets. (Read this before you negotiate compensation with anyone else.)
Anonymous More than 1 year ago