The AuctusIQ Blog:
Navigating Your Sales Compensation Plan

AuctusIQ partner and sales consultant Tim Geisert talks about a better way to creating and navigating your sales compensation plan – and how entrepreneurs see business problems differently.

One of the best parts of my job is working closely with so many successful entrepreneurs. I’m fascinated to learn what makes them tick and how they got their start. Of course, every person and every story is unique, but there are plenty of common themes.

It usually starts at a very young age – there’s a curiosity and a drive that some people are just born with. When they look around them, they see unsolved problems. They’re naturally motivated to find solutions, which blossom into opportunities. And once they’re off and running, it’s uncanny how often one opportunity leads to the next. Serendipity sometimes plays a hand, but as they say, fortune favors preparedness.

I was reminded of all this during a recent conversation with my friend and client, Nabeil Alazzam. Nabeil is the founder of Forma.ai, a single-platform solution that solves multiple common problems organizations face in planning, building, and managing their sales compensation systems.

Nabeil started out as a newspaper carrier at around age 10. His publisher desperately needed to increase circulation, so Nabeil figured out a way to offer free two-week trial subscriptions that increased the size of his route – and his income – by 4x. That opened the door to the next opportunity: one of his new subscribers was a computer shop. Nabeil started hanging around the shop and learning all about computers, including how to build and repair them. Soon he was buying parts wholesale and building and selling his own computers.

After university, Nabeil went into management consulting at the highly regarded ZS Associates. There he witnessed the pain and frustration that even successful Fortune 500 companies face in managing and driving specific behaviors among their sales teams – one more big problem in need of a solution.

The Problem(s)

Nabeil observed that there were actually several problems with the way organizations were managing their sales comp programs:

1. Different stages of the process were owned by many separate BUs with different tools. Sales leaders might design the incentives, then hand them off to finance for modeling and budgeting. Sometimes they’d hire consultants to help plan strategy and implementation. Finally, everything went to IT and the sales comp team to execute the actual payouts to reps. The whole process was so complex and disjointed that most organizations resisted making anything but minor tweaks until things were truly broken.
2. Each of these groups was using its own tools to build its piece of the puzzle – sales comp tools, reporting, and data transformation. As a result, the ZS team was effectively architecting and designing a new data pipeline from scratch for every client they worked with. There was no cumulative knowledge, and there were no portable solutions. The people creating these solutions were a select and skilled group, hard to hire, yet they were forced to waste all their time reinventing the wheel.
3. Once the system was operational, the next challenge was making it work for the sales force. The big picture was confusing, the finer details were worse, and individual reps rarely had a current understanding of where they stood, what they were making, and what it would take to reach the next incentive.
4. Finally, as a result of all these unsolved problems, companies generally settled for simplistic sales compensation plans that didn’t do a great job of driving the right behaviors and, ultimately, success.

The Solution

Nabeil could see that the solution was to bring planning and execution together in a single platform – removing all the redundancy, building one data model across every single customer on the platform, and enabling reporting in real-time. This would allow sales compensation to be as dynamic, responsive, and individualized as the people in the salesforce. That’s the big idea that became Forma.ai.

With the Forma.ai platform, reps have real-time transparency into how they’re performing, what they’re getting paid, and what they need to do next to hit their earnings target. The bottom line is simply this: the reps understand the sales compensation plan. If you don’t have that, nothing else matters.

In the past, the best way to make sure reps understood their comp plan was to keep it as simple as possible. But with Forma.ai, you can actually create a complex plan that’s still easy to understand. This is critical because a simple plan won’t accommodate everything your business needs. Maybe you need to focus on driving margin or selling more of Product X rather than Product Y. Maybe you need to drive different behaviors at different times during the quarter. It’s a huge advantage when you can address these elements and still be confident that your reps truly understand what it means for them.

Combining Our Strengths  

I mentioned serendipity before. One thing I have found is that the AuctusIQ platform and our clients’ solutions often become more powerful when used together. That’s exactly what happened with Forma.ai. The basic idea is simple: Forma.ai delivers the compensation data, AuctusIQ adds the psychometrics. But when you get into the details, the results are truly transformative.

Coaching, competency, and compensation all demand more than a “one size fits all” solution. All are driven by real-time data and a means to act on it. When our two platforms are used in concert, you can apply Auctus’ psychometric insights – how is a given rep wired? What drives their upside and fears? Where can we make them better? – to the decisions and computations you make with Forma.ai.

Think for a second about how much your marketing engine has evolved in the past 10 years – gathering and analyzing data, responding dynamically, and breaking down results to improve continuously. Now think about the vital role your salespeople play in your business. Imagine what happens when your selling operation is as informed and responsive as the rest of your business.

If that’s something you’d like to see, Nabeil and I would be happy to show you the solution!

Want to hear Tim and Nabeil talk more about what compelled them both to make sales their careers? Listen to our corresponding podcast episode here.

Tim Geisert is the executive on the leadership team that crafts the vision, shapes the product strategy, and inspires teams to grow the business. That, and more than 30 years of experience growing companies through marketing and sales, is what Geisert brings to AuctusIQ.

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