Elements of Sales Compensation
Certification Course: C5

Take an In-depth Look at Sales Compensation

This basic-level, two-day course presents the fundamentals for the design and implementation of sales compensation plans tailored to a company’s business strategy. Emphasis is placed on the special terminology and issues that make sales compensation unique from other incentive plans. Participants are presented with several design options and related information in order to assess which sales compensation approaches may be appropriate for a given company. Participants are also introduced to critical implementation factors including financial modeling of the proposed plan, employee communication and plan assessment over time. On the third morning, an optional certification exam is administered covering the course content.

• Discuss sales compensation rationale, value and uniqueness
• Identify the key influences to all sales compensation plans
• Discover the six key components of a basic sales incentive
• Find out how to introduce a new or revised incentive plan to the sales force
• Review why sales incentive plans fail and ways to determine if your plan is working properly

Who Should Attend

The course is designed for compensation and sales administration personnel relatively new to the sales compensation field and who are involved in designing, implementing and administering sales compensation plans.

What You Will Learn

Sales Compensation Terms and Definitions

• The total rewards model
• The purposes of sales compensation
• Uniqueness of sales compensation
• Key sales compensation terms
• Incentive payment methods

Influences on Sales Compensation Design

• Drivers of sales compensation design
• Go-to-market strategy
• Sales channels
• Direct sales channel
• Indirect sales channel

Design Components

• Eligibility
• Target cash compensation
• Pay mix
• Calculation methods
• Performance measures
• Performance and payout arrangements

Plan Refinement and Testing

• Calculating formulas
• Quotas
• Testing through financial modeling
• Special considerations

Plan Implementation

• Plan terms and conditions
• Plan qualifiers
• Employee administration
• Integration with other programs
• Handling plan changes
• Employee communications
• Tracking and payment administration

Assessing Plan Effectiveness

• Plan evaluation
• Failing plans
• Assessing the plan
• Sample analysis

Variable Pay—Incentives, Recognition and Bonuses
Certification Course: GR6

Components of the Design, Implementation, Management and Assessment

This intermediate-level course presents the fundamentals of variable pay. The course focuses on compensation strategy and variable pay, definitions and the design and implementation of incentive, recognition and bonus plans. On the third morning, an optional certification exam covers the content of this course.

• Discuss variable pay as a component of total rewards
• Learn about the three categories of variable pay
• Examine internal and external factors when developing a variable pay plan
• Discuss the activities for designing the structure of the plan
• Find out aspects to consider in establishing target performance and payouts
• Learn about funding and distribution of plan earnings
• Discover how to implement, communicate and evaluate the success of your plan

Who Should Attend

Course GR6 is designed for HR professionals responsible for designing, assessing or maintaining variable pay programs.

What You Will Learn

Total Rewards and Variable Pay

• Variable pay in total rewards
• Categories of variable pay

Supporting Business Objectives through Variable Pay

• Common business strategies
• Business objectives for achieving business strategies
• Business lifecycle
• Variable pay supports business objectives
• Variable pay in tandem with fixed pay

Types of Variable

• Incentive plans—objectives, approaches and considerations
• Short-term incentive plans
• Long-term incentive plans
• Bonus plans—objectives and considerations
• Referral bonus
• Hiring (sign-on) bonus
• Retention (stay) bonus
• Project completion bonus
• Recognition plans—objectives and considerations
• Spot awards
• Managerial recognition
• Nominations
• Organizationwide recognition

Developing a Variable Pay Plan—Phases 1 and 2

• Phase 1: Pre-design
• Considering internal and external factors
• Obtaining management support
• Identifying the design team
• Phase 2: Design
• Determining plan objectives and plan type
• Defining eligibility
• Selecting performance measures

Developing a Variable Pay Plan—Phase 3

• Phase 3: Funding and distribution
• Determining performance targets and payouts
• Funding the plan
• Distributing plan earnings
• Final approval

Implementation and Evaluation

• Plan implementation
• Selecting the implementation team
• Developing the communication plan
• Introducing the plan
• Coordinating plan administration
• Plan evaluation
• Determining plan effectiveness
• Why plans fail
• Potential evaluation outcomes