“Lean Distribution: Creating Sales Compensation Effectiveness”

 Recorded November 16, 2006  

Featuring Leading Industry Consultant & Author,

Michael Marks, Indian River Consulting Group

Click here to access the recorded session


 For our fourth quarter webcast, we asked Michael Marks to expand upon topics he discussed in our September presentation, “Lean Distribution: Creating Sales Force Effectiveness”.

 You’ve probably weighed in on the debate in the past: Is it better to pay sales reps primarily through commissions, “to keep them hungry,” or pay a large salary, “so they aren’t fixated on the short-term?” Do you increase market share by paying a commission where a sales rep receives “a piece” of all the sales he or she makes, or with a bonus where nothing is paid until “an acceptable” level of performance is achieved?

Guess what? It doesn’t matter!

In the past, this debate has raged without concrete data to help determine the answer. Now, the surprising research results are detailed in “What’s Your Plan?,” authored by Mike Marks and Mike Emerson of IRCG, and published by the Distribution Research and Education Foundation of the National Association of Wholesaler-Distributors. The authors surveyed 584 companies on compensation practices and performed in-depth interviews with a sample of the market share gainers and market share losers. Findings were consistent throughout the cross-industry study, independent of firm size, line of trade, years in business, or any other factor.

The #1 Finding: There is absolutely no relationship whatsoever between a company’s sales incentive plan structure and its gain or loss in market share.

Using questions from the webcast attendees as a basis, Mike shared the highlights of the research findings.  Topics discussed include:

• The key elements that separate share gainers from share losers
• The role of an effective sales management process
• Best practices for developing and implementing effective sales incentive structures

 
Link to the recorded session

J. Michael Marks is Principal and Managing Partner of Indian River Consulting Group, an experience-driven firm that focuses on channel design, marketing strategies, supply chain management, compensation plans, and practical application of technology.  Marks founded IRCG in 1986 and is well known throughout the wholesale-distribution industry as both a speaker and consultant. Marks, a Fellow of NAW's Distribution and Research Education Foundation, is co-author of “What’s Your Plan?  Smart Salesforce Compensation in Wholesale Distribution” and “Working at Cross-Purposes: How Distributors and Manufacturers Can Manage Conflict Successfully”.  For more information about Mike Marks, visit http://www.ircg.com/ or call 321-956-8617.

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