• February 15, 2006
  • By Colin Beasty, (former) Associate Editor, CRM Magazine

Sales Compensation Gets Into Relationships

Looking to keep pace with the increasing complexities associated with sales compensation, new on-demand player Xactly made the latest version of its flagship product available yesterday. Winter '06 Xactly Incent enhancements include improved support for multiple currencies, improved reporting flexibility, and flexible pay rates based on an employee's relationship or position within the company. "These updates were made because they attracted the most demand from our customers," says Chris Cabrera, founder, president, and CEO of Xactly. "In some cases, such as with the pay rates based on an employee's relationship with the company, we had to move them up the schedule so we could incorporate them sooner." Besides enabling companies to pay salespeople in as many as 20 different legal tenders, Winter '06 Incent now lets "companies with worldwide sales forces role those paychecks and dollar amounts back to the accounting department in order to compare apples to apples," says Desta Buchowski, vice president of product management. Winter '06 Incent also allows sales management to determine when their sales force will see incentive data. Previously, Incent updated this information automatically and in real time, without any control from management. Now, managers can first crunch some accounting numbers and then tell the program when to dangle the carrot to drive behavior. "It's real time when [the managers] want it to be real time," Cabrera says. Finally, calculating compensation can now be taken outside of the sales force to those employees who don't directly drive sales, such as paying a marketing person for year-over-year product growth for designing a product promotion or a specific channel salesperson could be compensated for channel growth. These changes are representative of the sales compensation market in general, according to Denis Pombriant, managing principal of Beagle Research. "Managing sales compensation has always been a difficult task," Pombriant says. "As products and product configurations continue to get more complex, more and more companies are trying to use incentives as a way to drive specific behaviors. There are so many variables to this that compensation challenges mount to the point where traditional solutions like spreadsheets no longer provide an adequate remedy." Related articles: Dangling the Carrot: Drive Your Sales Force to Profitability
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