Today, it is more challenging than ever to achieve optimal market outcomes, and the formula that is often used to design sales Incentive Plans – manual approaches that primarily utilise static data – diminishes the ability to drive and align the expected market outcomes through the plan. Organisations that wish to remain in the game need to embrace automation in Incentive Plan design to achieve maximal effectiveness.
Aligning Incentives with Strategic Goals
Automation eliminates the misalignment in allocating incentives that is the bane of manual processes. In manual processes, sales teams can shift focus to activities that benefit them, not the business. For example, an international software company found its incentives misaligned with the strategic focus that drove its business. Success metrics were randomly created with the understanding that each initiative might bring varying degrees of success. These metrics clogged the company’s pipelines, resulting in inconsistent sales figures. After implementing its workforce Incentive Plan, the company could continuously reallocate incentives to high-priority products while bringing the most value to the business. This approach resulted in an increase of more than 20 per cent in sales of the high-priority products.
Real-Time Adaptation to Market Changes
Given today’s rapidly changing landscape, the nimbleness to adapt quickly to changing market circumstances is essential. Automation allows companies to refocus Incentive Plans as real-time data become available, ensuring that sales teams have their incentives aligned with the latest, most optimal targets. One automotive manufacturer, for example, automated and shortened the incentive design process, equipping it to shift production to meet changing demand in both mature and growth markets. This agility contributed to a 15 per cent increase in market share in key growth regions.
Predictable and Measurable Outcomes
Secondly, automation adds predictability and measurability to the incentives. Thirty per cent of firms say that it allows them to adopt a more data-led and predictive approach for plan-design, likelihood of the desired outcomes of hitting revenue targets by a factor of 30 per cent after automating its incentive-design process. The predictability that automation generates also helped the firm better predict sales performance and make better informed strategic decisions.
Automating the design of an Incentive Plan is fundamentally important to organisations that want to generate the targeted results in the marketplace – Business Goals are connected to Incentives in a direct manner (Immutably); There are the Management Practices that can be implemented quickly in the marketplace, and modified/corrected quickly – adaptively; The Company Path to Success is predictable and easy to follow – in the marketplace. In a world where dynamism and accuracy are dominating the game, automation is the king that sets it in motion for continued success.
