Print this Article
RSSWorkspan
In an effort to boost salesforce productivity, U.S. employers are raising the bar when it comes to performance goals and quotas. At the same time, a growing number of employers are pushing performance- based pay programs deeper into their sales organizations.
According to Watson Wyatt's survey of 186 companies with more than 100,000 sales professionals, 75 percent of companies have increased the 2005 performance goals and quotas that sales representatives must achieve to earn a commission or bonus. Twenty percent of companies left their quotas unchanged, while only 5 percent decreased them.
The survey also found that employers are expanding their salesforces at the highest pace in nearly five years. One in three employers (33 percent) plans to increase the number of sales team staff in 2005, while 62 percent say they will maintain current staffing levels. Meanwhile, the percentage of companies that reported difficulty in attracting key salesforce talent increased from 82 percent in 2002 to 92 percent in 2005.
The survey also found that more companies are using performance- based variable pay programs to compensate a larger share of their salesforces. The number of employers that are now using variable pay programs among their lowest-paid sales representatives soared to 92 percent in 2005 from just 49 percent in 2002. Furthermore, the use of performance-based pay for sales support and administrative positions increased 15 percentage points over the past three years.
Copyright WorldatWork Aug 2005
