Whether for salespeople, brokers, agents, or any other channels – sales compensation plans are critical organizational levers to drive desired behaviors and performance. Yet, when it comes to the management of these plans, many organizations view it as an administrative process rather than a strategic tool for increasing revenue and profits.

Most companies are saddled with the effects of poorly managed sales compensation plans. Sometimes, from the surface, it may seem that everything is under control. However, when you take a closer look, there are almost always areas for improvements
that will lead to enhanced sales force effectiveness, productivity, and performance.

The following study article – which is based upon an analysis of more than 100 companies with large sales forces – examines the problems that occur during the design, implementation, and management of sales compensation plans that cause breakdowns
between strategy formulation and execution. The paper aims to help large enterprises diagnose their sales compensation management problems before they start impacting their performance.