Article Excerpt

Incentive compensation (IC) is critical to attracting, motivating and retaining the sales force talent that will drive company revenues and growth. It's only natural for executives to want an IC plan that maximizes several components, including alignment with company marketing objectives, reward for performance, fairness, simplicity and financial viability.

In today's complex sales environment, however, many of these elements may be mutually exclusive, and no amount of IC plan revamping or reengineering will change that.

The best approach is balance. To design the compensation plan that achieves the most effective balance for each situation, sales leaders must prioritize IC plan objectives--on a scale from "absolutely essential" to "nice to have." This will help the incentive compensation plan design committee evaluate the trade-offs presented by various plan design options. ...

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About the Authors

Stephen Redden is a Principal with ZS Associates and leader of our Incentive Compensation practice area.

Chad Albrecht is an Associate Principal with ZS Associates.