Compensation management is easier said than done. Just when you think you have a firm grasp, you realise that revenue operations (RevOps) professionals have questions and your company's sales team is in the dark.
But that doesn't mean you should give up and hope for the best. The overall health and well-being of your company depend on your ability to maintain full control of the compensation component of every department and employee.
Decisions about pay can and will have a long-lasting impact on your company. When managed carefully, all employees--from the top down across all departments--are in a position to get on board with your company's strategy and reach their peak performance.
Conversely, when compensation is managed poorly--or not at all--it can result in:
- Unnecessary RevOps challenges
- Unmotivated employees
- High turnover rate (and higher training costs)
- Misaligned objectives across the company which can decrease efficiency
- Sales professionals who don't understand incentive compensation
So, this leads to the million-dollar question: What's the best way to manage compensation payout to keep RevOps happy and sales informed?
How To Keep RevOps Satisfied
The manner in which companies approach revenue continues to evolve. And for this reason, it's critical to have a compensation management plan that aligns with RevOps.
The RevOps structure within your company brings together key areas of responsibility, including but not necessarily limited to operations, sales, marketing and customer success.
Here are three steps you can take to keep RevOps satisfied:
1. Actively Prioritize Budgeting and Forecasting
A company that's not prioritizing budgeting and forecasting or actively improving its internal processes to better manage compensation payout is a company that's playing with fire. Even if you're able to get away with it on some fronts, it'll eventually come to a head. And that often happens with an unhappy RevOps team.
Streamlining budgeting and forecasting allows you to not only better manage your compensation payout to keep RevOps happy and informed but also save time for further in-depth analysis. More specifically, how to:
- Shorten your budgeting cycle
- Plot your path to future growth
- Create rolling forecasts
All of these details are important to the stability and growth of your organisation.
2. Use Scenario Planning
The best way to keep RevOps happy is to prevent surprises. This is where scenario planning comes to the rescue.
Through the use of what-if analysis and advanced financial modelling, you can test for any and every scenario imaginable. This includes best-case, worst-case and any scenario in between.
When you provide RevOps with the results of multiple scenarios, they can better plan for the future.
3. Make Financial Reporting a Priority
Financial reporting isn't something you should put on the back burner. It should be at the forefront at all times because it's something RevOps require in order to stay the course.
Fast, efficient and accurate financial reporting allows you to:
- Analyze customer behaviour
- Review and share key business insights and metrics such as cash flow, customer lifetime value and customer acquisition cost
- Share reports and analysis with RevOps
What About Sales?
Sales is the lifeblood of any organisation, so it's imperative to keep this department informed. This includes everyone from sales development reps to account executives.
Sales professionals need to know how they're performing across the board, including quota planning, territory management and more.
They want and need to know how their compensation is calculated. But they don't want to jump through hoops or be forced to crunch complicated numbers. An accurate, simple-to-comprehend presentation is all they want.
This is why incentive compensation management is so important. With the right system in place, it's not only easier to manage incentive compensation, it's also easier to share the requisite information with sales professionals.
Take these two steps to better manage compensation payout to keep sales informed:
1. Finding Your Sales Performance Management Solution
The use of sales performance management software can be the difference between a happy, informed sales team and one that's confused and disgruntled.
With our sales performance management software, you can carry out your quota planning, capacity planning, territory management and incentive compensation management activities.
Forget about manually tackling these tasks and gain back the hours it takes to do so. The right software allows you to plan accordingly and to share the necessary information with your sales team.
2. Implementation of Incentive Compensation Management (ICM)
Any incentive compensation management program should be designed with two words in mind: efficiency and transparency.
That's what you want and that's what every salesperson needs.
With the help of the right technology, you can take advantage of benefits such as:
- Improved payment accuracy
- More timely payments
- Automated compensation calculations
Efficiency is all about saving time, avoiding mistakes and scaling without challenges.
Transparency makes it easy for you, your department heads and sales managers to provide sales professionals with an easy-to-understand overview of their total compensation and incentive structure.
Final Thoughts
Compensation management doesn't have to keep you up at night. The right strategy and tools can help you implement a system for efficiently and accurately managing compensation, which will benefit RevOps, sales and everyone in between.
Vena for Incentive Compensation Management provides you with full control over managing your compensation payout. From sales incentive programs to workers' compensation management--and that's just the start--you can simplify the process, automate tasks and manage all of your data in one place.
