Sales Performance Management Best Practices in 2023
• Robert Bieshaar is the Sr. Dir. of Worldwide Incentive Compensation at Autodesk, a multinational software corporation for the construction, manufacturing, engineering, architecture, and entertainment industries.
• He recently spoke with Justin Lane, host of The Sales Compensation Show to discuss the evolution of sales compensation and the guidelines for designing an effective sales performance management plan.
• Justin and Robert dive deep into the world of sales, incentives, and enterprise performance management for an in-depth, data-driven conversation.
• Visit the Podcast homepage to hear more episodes.
Developing a Sales Performance Management Program
As a tenured professional, Robert Bieshaar has experienced a lot of change in the sales compensation industry.
In a conversation with Justin Lane, Robert discusses the industry transition from Incentive Compensation Management (ICM) programs to Sales Performance Management (SPM) and the roadmap for developing an effective sales performance management program.
What is the most significant change you have seen in your sales compensation career?
The shift from Incentive Compensation Management to Sales Performance Management.
In the past, sales were fully transactional. You sold something, you got paid for it, and there was no maintenance. Now, the industry has moved to a subscription business model. It’s more focused on the renewal, the upsell, and the subscription expansion.
This requires a different approach to sales incentive compensation, and as such, we’ve moved away from ICM and towards SPM programs.
AI is the true value-add to Sales Performance Management.Robert Bieshaar, Autodesk
With SPM, you can truly model your sales comp plans. You can better predict outcomes and run multiple different test scenarios. And you can do it promptly without the limitations of Excel spreadsheets. This wasn’t possible with traditional ICM solutions.
Our biggest inhibitor was our inability to model in Excel. When we noticed this shift, we started to look around to find a new solution that did true SPM, and that’s when we found Forma.ai.
Does sales compensation affect rep tenure and productivity?
Yes, sales compensation plays a critical role in tenure and productivity.
If the average tenure of a sales rep is estimated to be 1.8 years, they won’t be fully productive for that time. It takes months to get acclimated to a new company and sell a new set of products or services.
Sales organizations must ask themselves if they are doing everything possible to set these reps up for success.
First, are you giving a new rep enough time to ramp up, familiarize themselves with the customer base, and learn the ins and out of the company?
Second, are you setting quotas based on that rep’s ability to work with customers, create relationships, and sell across the year?
If you’re looking for longevity out of a salesperson, you need to give them the time and tools to succeed. This is where sales compensation comes into play. Without a motivating and rewarding comp plan, the rep will struggle to produce results and quickly move on to another organization.
Transparency in goal-setting earns trust, and retention improves when these factors are aligned.Robert Bieshaar, Autodesk
The product or service you’re selling also plays a significant role in tenure.
If what you’re selling is more complicated and requires a knowledge-based sale, the salespeople tend to develop a level of pride, typically increasing their tenure. The easier a product is to sell, the less education a salesperson requires, and the more you’ll see turnover because the rep can move on to something else that either challenges them or pays more for the same effort.
What advice would you give to sales compensation managers?
I follow these three rules:
1. People don’t work for you; they work with you
2. Encourage people to share their ideas
3. Support people and let them take center stage when presenting ideas to senior leaders
I’ve been very fortunate to have many people work for me over my career, some of whom are now Heads of Sales Compensation at other companies. Giving them equal opportunity to share, promote, and work on complex ideas has gotten me far, and I would advise any sales compensation leader to do the same.Great piece from Robert Bieshaar & Justin Lane on Sales Performance Management Best Practices 🚀 Click To Tweet
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