At the recent Sales Compensation Summit, participants had the opportunity to engage in Speed Roundtables – 15-minute discussions that allowed attendees to cover multiple topics in a dynamic format.
One of these key discussions took place at Table 3: Sales Incentives Evolution, hosted by Marcus Houghton from Rocket Software. The conversation shed light on the KPIs that drive sales incentives, how companies evaluate them, and the challenges organizations face in evolving their compensation plans.
Key Takeaways from the Discussion
- What Sales Incentive KPIs Are Used in Your Sales Organization?
Sales incentive structures vary significantly across organizations, but some common key performance indicators (KPIs) surfaced during the discussion. These included:
- Revenue Growth: A fundamental metric for most companies.
- New Business Acquisition: Essential for expansion and sustainability.
- Sales Participation: Tracking engagement beyond just closing deals.
- Administrative Tasks: Some organizations use incentives to encourage salesforce engagement with CRM systems.
- Success Measures Unique to the Business: Some companies track more tailored KPIs, such as the number of unsold products at the end of a quarter.
These metrics highlight a mix of traditional revenue-focused KPIs and broader engagement-driven measures, indicating a shift toward more holistic performance assessments.
- Are These KPIs Driving the Right Behavior?
Evaluating the effectiveness of KPIs is a critical step in ensuring they align with company objectives. Participants shared their experiences:
- Some organizations use compensation structures to encourage administrative compliance, such as CRM usage, but not necessarily to drive core company values.
- There is minimal focus on behavior-based incentives, with most companies prioritizing performance acceleration over foundational behaviors.
- A key takeaway was that while existing KPIs contribute to revenue and operational efficiency, there is room for refinement to drive broader strategic goals.
- What Improvements Could Be Made & Why Haven’t They Happened Yet?
Despite recognizing gaps in their incentive plans, many organizations have yet to implement significant changes. Some key observations included:
- The lack of participation-based incentives – many companies still rely on single-metric compensation plans.
- The discussion sparked new thinking about expanding KPIs to measure behaviors, engagement, and alignment with corporate culture.
- Resistance to change was noted as a key barrier – many companies hesitate to overhaul compensation structures due to complexity, risk, and the challenge of gaining internal buy-in.
Final Thoughts
The Sales Incentives Evolution roundtable highlighted the need for a more nuanced and flexible approach to sales compensation. While revenue remains the dominant metric, organizations are beginning to explore how incentives can drive engagement, align with corporate values, and encourage behaviors beyond sales performance alone.
The session left attendees considering how they might refine their own incentive plans to balance performance, participation, and strategic alignment – a challenge that will continue to shape the evolution of sales compensation in the years to come.
