In the ever-changing world of sales, incentive compensation(IC) leaders have to consider complexity, volatility, uncertainty, and confusion (VUCA) within their plans for the business. In particular, they must deal with the unpredictable ecosystem of their industry shifts. Reps aren’t certain about returning to the field, and complex IC plans due to local issues. Market conditions are uncertain in the near term. The days are long gone where incentive compensation plans remained similar over many quarters. As IC managers expend time and energy creating plans. Therefore, it is essential that the leaders set IC best practices for operations for smooth, efficient design implementation.
In the general case, a successful IC operations program must have the following seven traits accuracy, timeliness, and flexibility, as well as relevant insights, efficient communication, affordable costs, and ingenuity.
Although a successful IC program should include all of these components,
It can be difficult to manage all of them simultaneously. It can be difficult to keep a balance between:
Continuously on time in addition to adjusting to constantly changing demands due to changing marketplaces and business situations and
In a consistent and timely manner, providing comprehensive incentives compensation plan explanations and business information without overwhelming IC participants with information.
“While juggling all these competing business goals may seem impossible, leaders can achieve them by returning to the fundamentals.”
It is crucial to establish an enduring foundation of quality, project management, and change management as well as stakeholder communication to accomplish these objectives.
Project management that is effective
To ensure that leaders are able to effectively manage process management for their projects, they should be focused on the process of planning. The complex and detailed character of IC projects calls for strong end-to-end management. Leaders must think about the following:
Do I anticipate the unexpected?
Have I thought through all the hand-offs and dependencies?
Have I had regular meetings with different stakeholders? And are all team members aware of the responsibilities and roles of each team member?
There is a myriad of essential elements in project management. Risk management is a multi-faceted process but we can reduce IC Risk Management in the form of the following: Ovik Mkttchyan
Identification of risk:
Do teams evaluate the risk? Do team members know the kinds of risks they could face within the course of an IC operation program, for example, ones related to the quality process, people, or even time?
Have teams devised ways to mitigate risk and shared them with the key people?
While creating documents is straightforward but regularly updating them isn’t easy. Managers need to maintain their working documents while working with the key stakeholders to ensure that documents are current and regularly audited or reviewed. The process of updating the documents is a requirement of the operation’s standard operating procedures. Ovik Mkttchyan
Tracking of key performance indicators:
What should be measured? There should be a consistent interval of results reports based on metrics like timeliness and delays, as well as mistakes, field inquiries, and adjustments. Leaders should attend regular business meetings, or quarterly, that discuss the metrics discussed in-depth with the most important people.
Process enhancements and improvement add benefits to all parties. Regular process audits and value stream mapping will assist leaders in identifying opportunities to eliminate unnecessary waste and identify processes that require re-engineering. Every IC operations project must include a separate workstream that is focused on:
Automation possibilities: If it is manual and repetitive the process can be automated.
Improvements to reporting If they can be improved in its intuition the report should be enhanced by adding more information and benefits.
The quality of the web is created through the culture
Quality is created through the way we live our lives. But establishing that culture of excellence — and living it every day requires a lot of effort. These three steps will help in creating it:
Planning for quality:
The most important thing is to put a quality procedure that is in place. Everyone must be aware of it. If you’re planning quality efforts be aware of:
The project’s RACI matrix that stands for Responsible, Accountable, Conducted, and Informed, creates clearness in the work of ownership. A lack of clarity can lead to nobody taking responsibility for important work.
Implementing multiple quality control layers also known in the form of “makers” and “checkers,” to ensure that critical deliverables are delivered. Find the appropriate rigor for the correct kind of deliverable.
Test changes, exceptions and create a streamlined sign-off procedure.
Once leaders have established the quality procedures that they must follow, every member must follow the rules. They must:
Use a thorough quality checkpoint and ask questions to establish the validations for each stage.
Create detailed, robust, and well-documented checklists that are detailed, well-documented, and robust.
Check periodically and make updates to checks and Validation.
Looking for quality that lasts:
A quality-oriented mindset is essential for long-term success.
The quality management system will guarantee robust quality control. However, making plans and having a quality assurance attitude. A proactive process design that is designed to keep high quality, will guarantee quality over the long term.
Communication is also crucial for ensuring high quality. Leaders should establish an environment of open and honest communications where team members feel at ease sharing information and discussing suspicious signs. A culture of transparency can help reduce the risk and create a high-quality process.
Team members should record external or internal issues using an error tracker, conduct thorough analyses of the root causes (RCA), and then implement the results. This will allow team members to understand the root of any issue and devise short- and long-term solutions. It will help establish a system of learning from mistakes made in the past and can assist teams to avoid repeat mistakes.
A solid Change management system
The only thing that is constant in life. having a well-constructed change management system is essential to successful implementation. Most quality issues stem from poorly-implemented change. As an initial step. Ask whether a change really needed by asking:
Which are expected results (or ROI) and do they exceed the effort or costs involved in making adjustments? For instance, certain field inquiries might require analysis and updates that may be more costly than the advantages of correcting.
If the amount of effort is excessive is there any other inventive ways to satisfy stakeholder needs without having to undergo a change process?
The new governance model is in place now however leaders have to challenge it.
When change is necessary Leaders should collaborate with the person who requested it to confirm the request. The impact must be shared with all the relevant stakeholders. Leaders should keep an ongoing tracker of changes. The key stakeholders should be connected to the tracker to verify the approval and monitoring of any changes. Make sure your reporting tools follow the most effective implementation methods to ensure that any change parametrized is able to revise and implement easily.
George Bernard Shaw famously said that “The single biggest problem in communication is the illusion that it has taken place.” The confusion is usually evident in IC programs in which there is a huge gap between the leadership’s intentions and the sales force’s knowledge of the strategy.
For ensuring that the message is relevant and compelling to the stakeholders, leaders must:
Find all parties involved and their needs.
Customize content and communication channels to meet these stakeholders’ diverse needs and goals.
Encourage your team to think beyond the traditional methods of communication. Do you have more powerful field-based insights? Are you making use of interactive artifacts, video, and playbooks to increase curiosity? What is the best strategy for simplification to simplify complex communication? And how do you measure the understanding of your stakeholders and their engagement?
Develop and manage the annual and quarterly plans using efficient ways of communicating.
In conclusion, incentive compensation has always been a delicate procedure, and the emergence of the pandemic has raised the stakes. IC processes can complicate and expectations are extremely high. However, with a solid base of quality management, project management change management, stakeholder communication, managers can manage VUCA and effectively manage the competing goals of the business.