In a BLR webinar entitled "Sales Compensation Strategies: How to Motivate and Re-Energize Your Sales Staff in a Challenging Economy," Dan Kleinman, principal of California-based Dan Kleinman Consulting, explained that in a team-oriented sales approach, everyone grows the relationship.
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- There is a "for the common good" ethic.
- There is a focus on new services and sales.
- There is a drive to ensure that every action supports customer loyalty.
But there is a need to differentiate between sales and sales support. Sales actions encompass:
- New selling
- Cross selling
- Up selling
- Renewals
Support actions encompass:
- Installation
- Upgrades
- Servicing
The following compensation model can work with an ongoing customer relationship:
- Sales staff receives 75% for selling, 20% for follow-up and 5% for support
- Support staff receives 25% for selling, 15% for follow-up and 60% for support
For a first-time sale, team compensation may looking like this:
- Sales staff receives 10% for generating, 15% for clarifying and 75% for closing
- Support staff receives 0% for generating, 70% for clarifying and 30% for closing
The team approach only works if:
- It reflects the way you want to secure longer term clients.
- Your stiff is skilled and oriented towards a team approach.
- If you promote and reinforce it.
- If your reward plans are tailored to each segment of the team.
Dan Kleinman is the principal of Dan Kleinman Consulting (www. dankleinmanconsulting.com), a California-based compensation and human resource consulting firm. For the past 18 years, he has served as an independent consultant for a broad spectrum of regional, national, and international companies, providing compensation, performance, organizational planning, and reward-system design services. His last assignment was serving as vice president and manager of compensation, benefits, human resources information systems, and payroll for Charles Schwab.
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