Sales Performance Management Best Practices Blog

The vital role of Sales Performance Management in Sales Transformation

Posted by Jerry Hegarty on Mon, Feb 10, 2020 @ 12:02 PM

In many industry segments, customers are changing the way they interact with, and purchase from, Vendors & Wholesale Distributors. As we’ve seen many times over, the change often seems imperceptible at first, but gains a momentum that soon becomes unstoppable. Technology and the rapid maturation of the web are a key driving force behind this transformation.

There is an old saying that when challenged by a new reality (change) you have three choices; embrace it, change it or become a victim. Assuming that the people reading this blog do not like playing the role of victim and that the force you’re challenged with is out of your control; it stands to reason that whenever there is a fundamental change of any sort to your customer and prospect base, executive teams soon embrace it and a shift in strategy is soon to follow. This is what is at the core of sales transformation efforts we see happening currently in Wholesale Distribution Changing customer needs drive changing sales strategies which drive sales transformation.

Sales transformations manifest themselves on many levels and in many ways;sales transformation

  • Sales roles that have set in stone for generations are suddenly brought into question and redefined.
  • Customer communication is shifting from a single point of contact (sales rep) to multiple points of contact (Team).
  • The definition of what is being sold may change, the product is no longer considered a device, but rather a solution.
  • With changing sales strategies comes changing sales compensation plans.
    • Sales reps who have been compensated the same basic way for decades may suddenly be faced with a completely new type of compensation plan.

Transformation, as the name implies, is about change and with change comes uncertainty. Anytime an executive team is faced with leading an organization through a period of change, Building and reinforcing a culture of excellence, execution and trust with clear communication and transparency is paramount. This is where systems that enhance organizational trust in the process are so critical.

For sales, few things communicate a message like commissions, Sales Performance & Commission Management systems are just that type of technology investment in scalable flexible infrastructure that delivers real upgrades in service levels to your sales team in a way that builds positive momentum and trust while working to minimize fear and uncertainty.

To summarize how this can impact your sales transformation process here are 5 key highlights of Sales Performance & Commission Management systems that compliment answering the fundamental question of every rep “what am I getting paid and why”;

  1. Strategic goals are clearly communicated and supported with compensation plans whose key performance measures support specific, strategically aligned goals.
    • New Accounts, revenue growth, increase in Gross Margin, etc.
    • Workflows that compliment communication of plan updates and approvals.
  2. Sales Activity is actively tracked in line with each reps plan and is updated real-time so action is quickly reinforced with performance rewards (Commissions dollars).
  3. Performance against these goals can be tracked real time so that on a daily basis reps know exactly where they stand.
  4. Plan calculations occur in a timely and accurate manner building trust throughout the sales organization.
    • No more spreadsheet based manual calculation errors.
  5. As sales transformation is undertaken, it is inevitable that company strategy will get tweaked over time and you need to be able to count on your technology investments when making adjustments such as comp plan changes quickly and efficiently.
    • Avoid custom coded homegrown software solutions, they often are geared at automating a static process with little consideration of easily adapting as strategy and plans change over time.
      • Plan changes must be made quickly and seamlessly

Let's face it, the forces that are driving sales transformation are not a one-time event, change is increasingly becoming a competitive reality and being able to not only keep pace with change but proactively benefit from it is the objective. Sales Performance & Commission Management systems are a vital tool in helping you turn your organization into one that views change as opportunity and eagerly look forward to the sales transformation efforts that result as an opportunity for a sales rebirth.

Interested in learning more? The following eBook is a great place to start, just click on icon to download:

Download your free eBook: Why leading Wholesale Distributors are choosing Best-in-Class Sales Compensation Management Solutions. 

Topics: Gross Margin, Sales Performance Reporting, Wholesale Distribution, Commissions for distributors