Targets setting and variable payments
When my yearly targets were set, I intuitively started crying. ‘Com’on, Bru, we’re used now to your recurring sadness at the FY kick-off and your contrasting exuberance at the year-end.’
Allow me to share some recommendations related to targets setting and variable payments. This is the process:
1. Bottom-up outlook based on individual funnel predictions;
2. Top-down targets setting based on market potential, market growth, market share, economic climat, etc.
3. Closing the gap between bottom-up and top-down. Always present a gap breakdown to your Sales to make targets achievable;
4. A fixed salary is not an attendance premium. It also includes some Olympic minimum achievements. Variable payments are meant to drive your Sales to better or outstanding performances. And from a senior you may expect more.
In defense of Sales, Management tend to over-distribute (e.g. 120%) their personal targets, providing themselves with a safety margin. In addition, variable payments should never be topped or limited.
That’s all for now, folks!
#targets #targetsetting #variablepayment #commissions #salesmanagement