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The Seven Deadly Sins of Incentive Compensation
Michael DeLeonardisVICE PRESIDENT – INSIGHTS & BENCHMARKING, XACTLY CORP
WHAT IS XACTLY INSIGHTS
Who is making their numbers?
What is great performance?
Where are the bright spots?
How should you measure?
EXPERT SERVICES AND DATA FOCUSED ON WHAT BEST IN CLASS INCENTIVES LOOK LIKE?
VALUEVALUEDATADATA
COST &COMPLEXITY
COST &COMPLEXITY
COST &COMPLEXITY
COST &COMPLEXITY
TERABYTES
HUNDREDS ofTHOUSANDS
Subscribers
$BILLIONSPayments
BILLIONSCredits
The Seven Deadly SinsOF INCENTIVE COMPENSATION
The Seven Deadly Sins
1. Poor Alignment with Business Objectives
2. Lack of Traceability to Sales Behavior
3. Inability to Measure Success
4. Excessive Plan Components
5. Sharing the Wealth
6. Demotivating Measures
7. Eroding Profitability with Accelerators
The Seven Deadly Sins – 1-Alignment
$100k
$150k
$200k
$125kMonth 2Quota
Month 4Quota
Month 5Quota
Month 3Quota
$75k
Month 1Quota
Poor Alignment with Business Objectives
The Seven Deadly Sins – 2-Traceability
HCM ERP CPQ CRM
INCENTIVE COMPENSATION BIG DATA PLATFORM
The Seven Deadly Sins – 3-Measure Success
11
1 2 3 4 56 7
PERF
ORM
ANCE
The Seven Deadly Sins – 4-Plan Components
1 DEAL
75%
5 30 161
The Seven Deadly Sins – 5-Sharing the Wealth
Name variable compensation concepts that drive attainment
1
2
3
4
Pay Mix
Quota Timing
Commission Based Plans
Commission Rates
Holds & Releases
Capping
Bonus Based Plans
The Seven Deadly Sins – 6-Demotivating
The Seven Deadly Sins – 7-Accelerators
BUSINESS IMPACT WITH BIG DATA
+10%REVENUE
+30%SALES
PRODUCTIVITY
+40%MARGINS
$3MIN SAVINGS
INSIGHTS & BENCHMARK EXAMPLES
• Executive• Quota Setting• Quota Distribution• Sales Team Mix• Production by Product, Region,
Rep
• Finance• Sales Comp Profitability
(Spend/Revenue)• Spend by Plan• Spend by Role
• Sales Ops• Payout Curve Benchmarking• # of Components per Plan• Component Type by Role• Payment Triggers• Credits by Deal• Avg Commission Rates
• IT• Data Quality• System Usage Distribution• Processing Distributions
QUESTIONS
225 W. Santa Clara St., Suite 1200San Jose, CA 95113T (720) 484-1829
www.xactlycorp.com
Michael DeLeonardis
mdeleonardis@xactlycorp.com
facebook.com/xactlycorp
@XactlyCorp
linkedin.com/company/xactly-corporation
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