CLIENT
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High-growth medical device company.
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SITUATION
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The head of Sales wanted to re-design the sales rep compensation system to drive higher levels of sales performance and growth. His goal was to achieve the right balance on completed sales vs. activities leading to sales and on the three main product lines. |
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APPROACH
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To accomplish the re-design, ThreePoint Consulting:
- Conducted an in-depth diagnosis of “current state,” including defining key characteristics of the sales process, reviewing the distribution of sales rep performance and analyzing the link between performance and compensation
- Created a series of alternative compensation systems that offered different methods of rewarding for territory growth, performance vs. quota, and key strategic activities
- Selected and refined an alternative system, based on a series of discussions with a design committee that included representatives from Sales, Human Resources, and Finance
- Conducted extensive financial modeling to determine total compensation spend at various levels of company and territory performance
- Developed a series of communication materials, tools, and modelers to help sales reps understand the new system and see how compensation levels varied with performance
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RESULTS
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The new system was widely accepted by the sales reps. Sales performance versus budget improved steadily after implementation of the new system - from 83% to 98% in the first 18 months of the program.
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