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Eyes On the Prize

4 tips for getting the right results from your incentive programs

No matter how much your sales associates love working for your company, none of them love it so much that they would do it for free. And while a base salary and commissions are nice, the sales contests and incentive programs you provide are key to demonstrating that your organization recognizes and appreciates the associates who go the extra mile.

But just as your salespeople aren’t working for the heck of it, you’re not providing performance incentives for the heck of it, either. By definition, an incentive program is designed to steer sales associates toward certain behaviors and achieve certain results.

Companies often run into trouble by failing to create the right balance between these goals – rewarding agents and creating results, or if you’d rather, the carrot and the stick. Here are four things we’ve tried to keep in mind as we’ve built and refined a wide variety of incentives, contests and prizes to capture the attention of a sales force more than 60,000 strong.

Goals must be realistic and attainable.
Every company wants to spur its sales force to the highest peaks of success, but few things alienate a sales force faster than goals they can’t actually reach. This is particularly true for new recruits who are working overtime just to establish themselves on a new sales beat. Set the bar too high for them and their first impression will be that you’re setting them up to fail.

That’s not to say you should shower rewards on people for average performance. But employees will always work harder if they think they actually stand a chance of reaching their goals. Decide what constitutes average performance and what qualifies as “superhuman,” and set your incentive benchmarks somewhere in between.

Make sure you reward what you want each role to focus on.
If your sales force is like Aflac’s, it’s got a number of different roles or hierarchy levels that are supposed to work together as a team. You’ve assigned each of them specific responsibilities for a reason. Why muddy the waters by making their bonuses contingent on tasks that fall outside of their job description?

If you’ve got a position that focuses on recruiting new salespeople, for example, it’s fair to use recruiting numbers and new recruits’ first-year sales as metrics, but unfair to make veteran performance a factor. Likewise, if responsibilities increase as you work your way up the hierarchy, the incentive criteria should get more stringent as well – don’t hold lower-level associates accountable for something only a manager or executive is in a position to affect. Tailoring reward programs to each specific role not only results in a more focused organization, it safeguards morale by ensuring nobody feels overworked or held to unreasonably high standards.

In motivating certain activities, don’t cannibalize others.
As you decide which tasks you want your sales force to focus on, and therefore what actions you want to motivate, don’t leave anything out. It’s fine to hold a sales contest based on opening new accounts, but don’t allow it to overshadow other responsibilities such as servicing existing accounts. You’ll risk creating a sales force that races to close a bunch of new accounts only to let them languish once they’ve signed on the dotted line.

Your sales agents wear a number of hats. Decide what their responsibilities are and how big of a priority they should place on each, and incentivize those activities accordingly.

Examine your incentive criteria every year, and do a major overhaul every two or three years.
I can’t speak for every industry, but the supplemental benefits industry is experiencing major changes as a result of the tighter economy, health care reform and other factors. If we’ve had to make changes in the way we do business, what good is an incentives program that rewards people for doing things the old way?

Completely overhauling a bonus program (and communicating the changes to your sales force) can be a huge undertaking. In the end, though, your associates will appreciate incentives that reflect the real world in which they operate.

The one overarching rule of incentive programs is this: every incentive and bonus you offer should be tied to meeting your company’s overall goals. Anything that deviates or distracts from those goals is a waste of your sales associates’ time – and yours. Establishing unified goals and a unified plan for reaching them is the best motivation possible.

In his role as Senior Vice President and Director of Sales at Aflac U.S., Tom Giddens leads 60,000 independent sales agents.