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Tuning Incentives To Motivate Sales & Drive Profits Christopher W. Cabrera, Founder, President & CEO Jeff Williams, Vice President Sales, IronPort

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Page 1: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

Tuning Incentives To Motivate Sales &Drive Profits

Christopher W. Cabrera, Founder, President & CEOJeff Williams, Vice President Sales, IronPort

Page 2: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

Agenda

• Introduction to Xactly Corporation• How to Use Incentive Compensation as a

Strategic Weapon• IronPort Systems Overview• How IronPort Uses Xactly Solutions to Motivate

Sales to Impact the Bottom line

Page 3: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

Xactly Background• Leader in on-demand sales

compensationmanagement

• Target companies with 25 –2,000 payees

• World-class managementteam with 30+ years ofcombined domainexperience

• Focused on automating keybusiness processes for salesand finance

• Significant customer andpartner traction

Pioneering a newparadigm in automatingsales compensation and

sales performance.

Page 4: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

Xactly Customers Experiencing Success

Page 5: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

Direct SalesReps/Mgrs

Indirect SalesReps/Mgrs

TelesalesReps/Mgrs

ChannelReps/Mgrs

OEMReps/Mgrs

MarketingReps/Mgrs

SystemsEngineers/Mgrs

DealerNetworks

CompensationAdmins

FinancialAnalysts

SalesOperations

FinanceOperations

Page 6: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

88% of Companies are Driven to Align EmployeeBehavior and Performance to Business Goals

Pressures Driving Incentive Compensation Management

The need to align employee behaviorand performance with business goals

Increase revenue and profit

Retention of other employees

All Participants

Source: Aberdeen Group, March 2007

76%

47%

38%

0% 20% 40% 60% 80%

Page 7: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

Tuning Incentives to Motivate Sales andDrive Profits

• Provide robust analytics anddashboards to drive salesperformance efficiency andvisibility

• Pay differently on highermargin products and services

• Incent on discount percent• Create SPIFs• Vary commission rates by

product• Use cash and non-cash

rewards

Page 8: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

Use Innovative Programs & SPIFs to MotivateBehavior and Optimize Sales Performance

Sales reps who sell the “largest amount of terabytes” and highest marginproducts in a quarter received a one-year lease on a Harley

Page 9: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

Use Incentive Compensation Management toAlign Payments to Performance

• Large snack fooddistributor initiatingdiscounting ‘on-the-fly’based on seasonality

• Midwestern storm forecastsignificantly increasessnack food demand andconsumption

• Retailers creatingtargeted incentives forsnack food sales onseasonal basis

Page 10: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

Gear Compensation Toward Sales of Your MostProfitable Products

• Not all products are created equal• Reps will take the path of least resistance• Reps will gravitate to the higher value products

Low Margin Low Revenue

High Revenue High Margin

Page 11: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

Augment Cash Incentives with Non-Cash RewardPrograms

• AutomateInside/Telesales Contests– Issue Reward Points

for SPIFs and contests– Reps that sell at list

price with nodiscounting

– Up-sell & cross-sell ofadd-on products

– Reward reps thatdrive attendance forhigh-profilemarketing events

Page 12: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

Up-sell – Cross-sell – Referral and Team Incentives

Checking account

Savings account

Home Mortgage

Investments

“Drive More Wallet Share”

Page 13: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

On-Demand Sales Performance Management

SalesData

QuotaTerritory

Sales Comp

Rewardsand

Incentives

PriceMgmt

Forecast/Planning

Reportingand

Analytics

Workflow

HR

ERP

Pricing

Product

Orders

On-Premise

Page 14: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

Eight Requirements for Effective SalesPerformance Management

Secure, hosted repository with actionable post-sales business data1

Intuitive compensation plan design, implementation and maintenance2

Rich analytics, reporting and dashboards for sales and finance analytics3

Ability to model and forecast compensation plan changes inadvance of implementing4

Integration with CRM applications for visibility and insight into salesopportunities in the pipeline5

Ability to automate quota allocation and analysis based on territory goals6

Optimize pricing strategy and execution by identifying and analyzingwhat products have been sold7

Motivate and reward performance through automated salescontests and SPIFs with non-cash rewards8

Page 15: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

Company Confidential

IronPort SystemsJeff Williams, Vice President Sales

Page 16: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

IronPort Systems

• Leading gateway securityprovider for organizationsranging from smallbusinesses to the Global2000

• 200 sales reps in 35 countries

INDUSTRY: Email/web security

EMPLOYEES: 400+

GEOGRAPHY: Global

PRODUCT(S) USED: SFA,Service & Support

# USERS: 200

Page 17: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

IronPort Systems – Key Challenges

• Business Challenges

– Excel-based system for managing salescompensation was no longer meeting thecompany’s needs adequately

– Sales reps “flying blind” – no real time visibility– Automating the process of paying differently

on higher margin products and services andrewarding reps that discount the least

– Flexibility to easily create SPIFs and contests

• Technology Challenges– Separate CRM and sales compensation

systems

– Desire to leverage and extendSalesforce.com investment

Page 18: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

IronPort Systems – The Solution

• Solution Criteria– Leveraged existing Salesforce investment– Reduce TCO of compensation

management– Flexibility to create SPIFs and contests for

up-sell and cross-sell– Capex– Opex– Data security and SOX compliance– Seamless integration– Support

Page 19: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

How to Increase Margin Based on DifferentProducts and Services in Your Portfolio

• Drive sales behavior that isaligned with your corporateobjectives

• Example– Owned Intellectual Property vs.

OEM software

Page 20: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

IronPort Systems – Results

• What were the results?– Improved sales results through innovative compensation

programs– Improved margins– Increased trust and efficiencies from a sales perspective– Ultimately increased sales productivity– Rapid deployment– Improved compliance and reporting operations

Page 21: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

• Leading provider of on-demand sales compensationmanagement and on-demand sales performancemanagement solutions

• Helping customers leverage business data to drive businessefficiency and maximize profits

• Strong partner ecosystem

• Superior customer experience and satisfaction

• Continued traction and growth

Summary

Company Confidential

Page 22: Tuning Incentives To Motivate Sales & Drive Profits...Quota Territory Sales Comp Rewards and Incentives Price Mgmt Forecast/ Planning Reporting and Analytics Workflow HR ERP Pricing

Company Confidential

www.xactlycorp.com