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The two basic rules of business: things change and stuff happens.

Competitors wax and wane, markets adapt to new technologies, trusted clients slip away while new opportunities suddenly appear. Business leaders understand there’s only one scenario for long-term growth… adapt or die.

In life, acceptance is a virtue: ride the wave, embrace the now, etc. In business, control is a better bet. You can’t stop change, but you CAN work it to your best advantage.

The key to managing and directing outcomes is flexibility. The more responsive you are, the more control you retain over your bottom line. And the key to achieving that agility is awareness, or what’s usually referred to as “executive visibility.”

To go from surviving to thriving in changing markets, key decision-makers need a centralized hub where they can quickly identify trends and problems, and then make the necessary adjustments with all efficiency. When the lines of sight are clear from the top, the best next steps are easily spotted and quickly implemented.

The arena of compensation management offers a clear example of why the principle of centralization is so important.

Designing sales compensation plans is an art. It depends on matching desired behaviors with company objectives. A powerful incentive program incorporates all aspects of the sales process—who’s selling what to whom, and where, and when—and rewards the types of wins that contribute to big-picture goals, like profitability along specific channels, or improved market share in general.

When determining how to structure their compensation plan, sales leaders use a variety of performance measures to make their calculations: quota, quantity sold, product profitability, and so on. With the right incentive compensation software, these calculations can be easily fine-tuned to flex with changing market landscape and evolving company objectives.

But just as natural systems tend toward entropy, business systems tend toward fragmentation (or silo-fication), the opposite of centralization.

A de-centralized sales organization might be comprised of separate regions that all use different platforms for managing incentive compensation. Likewise, a de-centralized management structure might consist of many lower managers operating independently, and using different systems and approaches, or even striving toward disparate goals.

By centralizing the administration of compensation processes in an interactive hub, executive decision-makers acquire the flexibility to adjust approval patterns or change reporting requirements as needed, without seriously disrupting work-flow or other organizational processes.

A strong centralized compensation management program diminishes the time and energy spent on payout processing, while giving sales leaders the ability to continually ensure that their incentive strategies closely support company objectives.

Register for an Obero SPM Demo to see how you can empower your sales team with a centralized compensation process.

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