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Study finds common sales performance management problems
November 29, 2004
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Bedford, Mass. -- Centive unveiled survey data compiled from a recent benchmarking study of sales compensation administration practices at mid-sized U.S. companies.  Sponsored by Centive and executed by Growth Solutions, an independent management consulting firm, the study underscores the link between streamlined sales performance management practices and increased growth and profitability.

Conducted over the last four months, the in-depth research study surveyed a cross-section of compensation analysts, finance/HR representatives and sales executives and managers from mid-sized organizations throughout the U.S. Participants were asked to evaluate current sales compensation programs as well as associated sales administration functions.

Survey participants were questioned on their sales compensation practices; for example, how plans were developed, implemented and administered, costs associated with plan administration, issues and challenges administering sales compensation, and satisfaction with current practices.  All participants reported some degree of "pain" associated with their compensation administration programs.  Loss of sales focus was considered the biggest area of pain for companies, with 78 percent of respondents citing this critical business issue as a byproduct of complex sales compensation plans.

"Our research validated commonly known beliefs that organizations need to streamline sales compensation programs and administration to more effectively drive performance and increase profitability," says David Fritz, President of Growth Solutions.  "In the end, sales compensation programs must work and need to be supported by administration practices that provide organizations with the flexibility to motivate and align sales representatives to drive increased revenue."

Although the majority of respondents reported that their organizations pay sales incentives in a timely manner, 67 percent cited sales administration effectiveness as a major pain point.  Primary improvements sought included:

  • Flexibility in reporting
  • Greater compensation program management capabilities
  • Automation capabilities
  • Non-variable compensation management
 
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