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Overcoming 5 common mistakes with sales incentive systems
COMMON MISTAKE Not ensuring that Sales and Finance are aligned #
Sales and Finance have different plans and goals for the sales compensation system. We need to increase revenue! We need to improve our margins. Sophisticated and complex plans drive profitable behavior. Simple and clear plans are more effective in the field. We need more analytics. We need to reduce IT and admin costs. Admin tasks take away from time with clients. There should be more self-service in Sales. Decrease cycle times! More regulation! Reduce errors! Faster information! Sales Finance
Tip Address the natural tensions between the Sales and Finance teams. Leaders in each department must openly discuss their challenges, needs and environments. Find a compromise that communicates goals, expectations and timeframes. Use Finance’s experience to help in analytics, reporting and compliance.
Tip Work with both Sales and Finance teams to design a plan and system that work overall. Sales Sales compensation Plan and system Unify the Sales and Finance departments Finance
Tip Invest in technology. It’s a win–win situation for both Finance and Sales teams. of respondents using an incentive compensation system say that it has “substantially contributed to an effective sales incentive system.” CFO Research Study
Download the white paper Conversations on incentive compensation: The changing role of finance in pay for performance. Reasons for the tension between Sales and Finance Ideas for bridging the gap between Sales and Finance Benefits you can expect as your sales compensation strategy successfully evolves
Discover additional IBM sales performance management resources. http://ibm.co/SPM