Incentives play an essential role in keeping employees motivated for hard work. By offering incentives, organizations give employees to be happy about something if they achieve their targets. However, incentives are not always transparent, that often causes discord amongst employees. The solution to this problem is employing an automated sales incentive program. Here we look at reasons why such a program makes more business sense.
Improve Sales Performance Management
Businesses lose 5-10% of sales opportunities every year. This loss can be prevented by improving sales performance management. According to experts from websites like power2motivate.co.uk, automated incentives solutions go beyond reducing administrative costs and saving time. The right solution can help organizations access the current performance of sales reps and their potential earnings.
The system helps sales reps to focus on customers that offer the highest revenue potential and the highest probability of successful close. In simple words, the AIS makes employees more efficient and motivated to give their best performance.
Align for Best-Selling Behavior
Spending on sales incentives is one of the most significant expenses for businesses. It accounts for 11% of revenue. If the incentives are not distributed in the right manner, it can lead to other financial implications. An automated incentive program enhances the effectiveness of incentive programs. It encourages sales reps better to align their selling behavior for better business outcomes.
Compensation managers and sales leaders have a defined role to play in this data-driven world. The sales compensation management needs to be proactive, dynamic, and agile to make the sales team efficient. Generally, the data from sales compensations is consolidated from various sources like quote-to-cash systems, price quote tools, customer relationship management software, and enterprise resource planning software.
If these systems are stand-alone or independent, there is substantial manual processing, making the compensation management process difficult. Also, there are other problems like manual errors and intervention and process delays. Automated incentive solutions streamline the processes of collecting and collating data.
It removes the need for human intervention for compensation management that reduces the possibility of human errors. The software increases payment accuracy while saving time in the process.
A sales representative will not complain if they are overpaid but certainly will if underpaid. Organizations would want to avoid both situations. In the absence of an automated incentive system, you will often find compensation managers working to resolve payment disputes. They need to recalculate, arbitrate, and spend time evaluating records to settle payment disputes.
With an automated incentive system, compensation managers will spend less time backtracking and settling payment disputes. They can focus on strategic activities that can prove more beneficial to the business. In organizations where incentives are calculated manually, employees distrust data and often verify their incentives.
Also, incentive programs are scrutinized by federal agencies, auditing, and government agencies to meet compliance requirements. The spreadsheet calculations leave room for error and make incentive programs a risky business for organizations. Spreadsheet dependent processes leave businesses at risk of corrupt or incorrect data.
Depending on the type of industry, organizations need to comply with EuroSox (8th Company Law Directive), Sarbanes Oxley (SOX), and new accounting laws such as ASC 606/IFRS 15. It calls for businesses to use automated incentive programs to ensure the sales incentive process is streamlined, accurate, and compliant.
To sum up, these are a few reasons for businesses to use automated incentive programs.