Compensation System for Sales Personnel

With the improvement and development of the market economy, as the cell of the market economy, the success of the enterprise is more and more dependent on its ability to attract and retain customers, sales staff has undoubtedly become a core factor in determining the growth and profitability of the enterprise is one of the most important class of human resources resources; at the same time, the enterprise's human resources management and development are also facing a completely new environment, more and more enterprise managers realize that "Attracting talents, retaining talents and motivating talents" is the key to the long-term development of enterprises, and this is especially true for sales staff.　Enterprise compensation system is an important part of human resource management, according to modern human resource management theory, compensation not only provides workers with basic livelihood security, more to play a role in motivating and restraining, mobilizing the enthusiasm of the staff; sales staff in the enterprise, with the relative flexibility of the way and time of work, measurable and risky work performance and other characteristics. How to combine the characteristics of the sales staff, the design of a scientific salary system, an important part of enterprise human resource management.　First, at present, China's enterprise sales personnel compensation model Compensation refers to the employee for the enterprise to pay for the return of labor and remuneration, including economic compensation and non-economic compensation. We usually refer to the economic compensation as remuneration, i.e., all the direct and indirect economic income received from the employer because of the existence of the employment relationship, including wages, bonuses, allowances, pensions, and other kinds of welfare and health care income.　At present, China's enterprises in the sales staff of the remuneration model include: (a) pure commission system: a certain percentage of sales commission, as sales compensation, in addition to the sales staff do not have any fixed salary, income is completely variable.　(b) Pure salary system: pure salary system is the implementation of a fixed salary system for sales staff, regardless of the current sales completed or not.　(C) the basic salary and commission system: basic salary and commission system refers to the income of sales staff is divided into two parts of the fixed salary and sales commission, sales staff have a certain sales quota, regardless of whether the month to complete the sales target, you can get the basic salary that is the base salary; if the sales staff to complete the current period of sales more than the set target, more than the above part of the proportional commission.　(D) basic salary plus bonus system: this compensation system is somewhat similar to the previous one, but there are still some differences. This difference is mainly reflected in the commission is directly determined by performance, while the relationship between bonuses and performance is indirect. Usually the performance of the sales staff only exceeds a certain sales volume, in order to obtain a certain amount of bonus.　(E) basic salary plus commission plus bonus system: the particularity of this compensation system design is that it will commission system and bonus system combined together, so that the sales staff remuneration contains base salary, commission and bonus three components.　Second, at present, China's enterprises in the sales personnel compensation system problems (a) the pay system is backward, old-fashioned in the establishment of the market economy and state-owned enterprises in the process of restructuring, the salary system of skilled workers is becoming more and more perfect, but many enterprises for the salary of the sales staff is still inherited before the reform of the model, or only to do the minutiae of the modification. The remuneration of sales staff is strongly colored by the traditional planned economy system, and a scientific remuneration system suitable for their work characteristics has not been established. A part of the enterprise is still based on the hierarchical wage system, mainly considering the position of the employee, educational background, work experience, years of experience and other factors, sales staff compensation lack of vitality and incentive.　(ii) Lack of strategy in the remuneration system 1. The remuneration system and its management are out of touch with corporate strategy and culture. When it comes to the role of compensation, usually emphasized is often the talent attraction, retention, motivation and development, but attraction, retention, motivation and development of talent for the ultimate purpose of what? Obviously, it is to promote the construction of corporate culture and to help enterprises realize their strategic goals and visions. Therefore, in the end, the design and management of the compensation system must be centered on the enterprise strategy and vision, and adapt to the type of enterprise culture, not by itself. For example, IBM's corporate culture change in the 1980s led to the original hierarchical bureaucracy, internal fairness and low-risk pay system, changing to a new type of pay system that emphasizes flexibility, external competitiveness, and links pay to risk factors. However, many enterprises in China's payroll management are in the direction of the chaos of the state, in their own independent kingdom "live their own days". Lack of clear strategic guidance, enterprise payroll management will often be on the realization of corporate strategy and cultural construction of obstacles and even destructive effect. For example, some enterprises, on the one hand, chanting the slogan of innovation and learning, but on the other hand, do not provide any compensation for those who strive for innovation and continuous learning in the compensation system. The result is that enterprises on the one hand constantly emphasize and expect to shape a strong performance-driven culture, but on the other hand, but repeatedly disappointed.　2、The adaptability of the sales force compensation system to the development stage of the enterprise is not strong. Enterprises should be based on their own stage of development and the current competitive strategy, the design of the enterprise's stage of development and can effectively support the competitive strategy of the compensation system. For example, when the enterprise is in the initial stage, the urgent need for a large number of excellent talents, but its own talent competitiveness is very weak, which requires the remuneration of the external competition is strong. At this time, the enterprise liquidity is relatively tense, in order to reduce the financial burden of enterprises, for sales staff base salary can be lower, commission and bonuses to have temptation. Coca-Cola entered China in the early 1980s, the salary provided to employees was two to three times the domestic beverage industry, relying on highly competitive high salary policy, attracted a large number of talented people to join the company to vigorously promote the realization of the company's strategic objectives. And many enterprises in our country when they were first established, they emphasize their own difficulties and the dedication of the staff, the salary level is very low, can not attract excellent talents, obviously not conducive to the development of the enterprise.　(C) the establishment and management of the remuneration system is not scientific 1, the establishment of the remuneration system has a great deal of arbitrariness. First, the remuneration is determined by the boss to make a decision. The boss by virtue of his administrative authority and management experience, rigidly stipulate the salary of the enterprise sales staff, with poor democracy. Secondly, there is a lack of systematic salary survey and analysis. In the development of the company's sales staff compensation system behind closed doors, or copying the theoretical model, blindly imitating the pay program of other enterprises, not the industry, the region and similar enterprises to investigate, not specifically analyze the characteristics of the enterprise, has a great deal of blindness and dogmatism, the lack of their own characteristics and applicability.　2、The management of salary is too rigid, not paying attention to timely adjustment. This is more obvious in state-owned enterprises and small enterprises. The market economy is changing rapidly, all aspects of enterprise management, including payroll management, should actively adapt to changes in the internal and external environment, make the appropriate adjustments, for example, the industry as a whole may force enterprises to reduce the level of payroll; at the same time, the enterprise is also constantly moving forward, the introduction of new products, new market development, etc., are required to the sales staff payroll system " Keeping up with the times". In the 1990s, Panasonic set up an age wage according to the survival requirements of different age groups of employees to ensure the basic needs of employees and stabilize their lifelong employment. With the development of the society, the industrial structure, technology level and the concept of the employees have changed dramatically. Excessive labor cost expenditure under the annual merit sequence salary system formed for many years has caused a heavy burden to Panasonic, and together with other problems in the management, it led to Panasonic's first company-wide loss in more than 80 years in 2001, and Panasonic's salary system had to be adjusted.　(D) the lack of overall and long-term vision of the payment of sales staff compensation Modern market economy increasingly emphasizes the cooperation * * * win, product sales are increasingly dependent on the team * * * the same efforts. Most of the enterprise sales personnel compensation system only measure individual performance, overemphasis on personal efforts, the result is that sales staff are inefficiently single, and even in pursuit of personal goals to discredit each other, will inevitably lead to the overall performance of the enterprise and the overall image of the damage; furthermore, the measurement of the sales staff compensation only rely on short-term economic indicators, for "customer satisfaction ", "after-sales service", "personal learning and growth" and other aspects of the long-term development of enterprises rarely or even no consideration. However, from a long-term perspective, the customer turnover rate and the improvement of staff capacity is a prerequisite for the realization of long-term sustainable profitability.　(E) The compensation system lacks a proper basis for job evaluation and performance appraisal The three systems of job evaluation, performance appraisal and compensation management are known as the 3P model of human resource management. Position assessment system through the measurement of the value of the employee's position, for the development of employee compensation laid the foundation; performance appraisal assessment results are the basic basis for the payment of salary to the staff; salary and position assessment, performance appraisal linked to reflect its scientific and reasonable.　But in fact, many companies have not combined the salary management of sales staff with job evaluation and performance appraisal. Because the sales staff's work objectives directly, easy to measure performance, many people feel that my work is not sales? My sales is not my assessment target? Why do you need to do assessment and appraisal again? It is because of this kind of thinking, the sales staff's job evaluation and performance appraisal is often ignored.　In the actual job evaluation process, managers subjectively set the grade level. For example, due to the influence of the "will of the chief", some position managers think it is very important, the grade is set very high, but the fact is not so; some positions are set at a lower level, but with the salary of the level in the market can not be hired to the right talent. In addition, enterprises only use a simple sorting method to rank and categorize posts of the same grade and category. These are unscientific job evaluation, reflecting the inherent fairness of employee compensation. Second, the lack of scientific performance appraisal system, relying solely on the "sales volume" as an indicator. In reality, due to the different profits of the product, may sell a certain product, sales volume is very large, but profits are very small; may be my new launch of a product, the salesman's sales volume is not small, but the promotion of this new product alone is not ideal; may be my goal this year is to expand the market share, not to increase profits; may be the salesman to take the "chicken and egg" type of sales, although the salesman to take the "chicken and egg" type of sales, although it is not good. The salesman may have adopted the "kill the chicken to get the eggs" type of sales, although the sales volume is very large, but the customer is not satisfied with the product and after-sales service ...... etc. These are the "sales volume". These are "sales volume" this indicator can not cover.　(F) the efficiency and fairness of the remuneration is not properly dealt with 1, the sales backbone of the lack of incentives. China's traditional enterprise compensation system has been the internal fairness of income distribution as the supreme goal, in this regard, the enterprise even at the expense of corporate efficiency at the expense of trying to ensure that all employees are satisfied. In fact, the efficiency of the enterprise is undoubtedly the first, at the expense of efficiency in exchange for fairness can not be long. Enterprise 80% of the sales task is completed by 20% of the sales backbone, but most companies did not implement this law in the distribution of salaries, because income can not pull the grade, the sales backbone of low satisfaction. Enterprises do not realize that those who really create value for the enterprise is the most important satisfaction, because the enterprise can not make all the people are satisfied.　2, in the remuneration of special employees is not enough tilt, poor humanistic care. First of all, in the enterprise is generally new sales staff and the original staff and the same pay system, in this case, in the base salary is low, the market is difficult to promote the situation is easy to combat the enthusiasm of the new staff; In addition, for many years of service for the enterprise, there are family burdens of the married sales staff, often with relatively low education in some of the pursuit of academic perfection in the enterprise, their pay is bound to bring their own unfairness! sense. For example, some companies on the sales staff regulations, freshly graduated college students majoring in marketing basic monthly salary than non-professional secondary school students to be much higher, and the latter is often a wealth of experience in marketing, to the enterprise to bring greater profits to the backbone of the sales.　(G) pay rise channel single China is the "official" consciousness is relatively strong country. This consciousness is reflected in the relative value of enterprise staff positioning, people generally rely on employees in the management of the "career anchor" on the progress, or according to the "official" size, determine their contribution to the enterprise more or less, in this pay system, the outstanding sales elite's Under this kind of compensation system, the excellent sales elites will never be able to catch up with the poor sales managers with higher positions. A single "official position" or management "career anchor" channel, to the individual employee and enterprise development brings many disadvantages: big enterprise disease, high-quality staff survival and development space limitations, as well as staff configuration of the dislocation and waste, etc., and ultimately thwarted the enthusiasm of the staff, for many high-quality talents, the staff will not be able to make any contribution to the enterprise. Motivation, for many high-quality talent has lost its appeal.　Third, the solution to the problem of enterprise sales compensation system (a) in the development of sales compensation system, before the scientific salary survey and analysis In the early days of the establishment of the enterprise have gone through the leadership of a pair of eyes, a pen to determine the salary of the staff stage. However, with the development of enterprise scale to a certain extent, the boss can not understand each person very clearly, which requires a scientific salary survey (outside the enterprise) and analysis (within the enterprise) to establish its own salary system. This is especially true for salespeople who have distinctive work characteristics. Take Huawei Group, in 1995, Huawei has more than 500 people, at this time, when the human resources manager reported their salary figures to the boss, because the number of people is not the dozens of people at the time of the start-up, the boss can not be familiar with the performance of each person, then, at this time the boss how to sign it? So, Ren Zhengfei asked to come up with a salary program system, then they set up a salary design team, three months held a dozen meetings, but also asked the Hong Kong consulting firm to participate in the study, and finally formed its own salary system framework.　The pay survey focuses on addressing the external competitiveness of pay. When determining the remuneration of employees, companies need to refer to the remuneration situation in the labor market. The company may commission a more specialized consulting firm to conduct a survey in this regard. The target of the salary survey should preferably be a company in competition with itself or a similar company in the same industry, focusing on the direction of employee turnover and sources of recruitment. The data of the salary survey should include the salary growth status of the previous year, comparison of different salary structures, salary data of different positions and positions at different levels, bonus and welfare status, long-term incentives and analysis of future salary trends. The accuracy of a salary survey can only be ensured if the same criteria are used for job evaluation and real salary data are provided by each. In newspapers and websites, you can often see articles such as "xxx position salary demystification", the data of which mostly contain random sampling elements and their accuracy is doubtful. Even the statistical data from the national labor department cannot be used as the basis for salary setting instead of salary survey. Enterprises in the salary survey at the same time, but also to analyze their own situation (in this regard, the author will be in the "three, (b)" part of the description).　(B) combined with the situation of the enterprise, to determine a reasonable salary structure compared with other types of personnel, sales personnel in the structure of the salary shows great differences. Establishment of sales personnel compensation system, the first issue is to determine the proportion of base salary, commission and bonus components of the salary, to establish a reasonable salary structure. For a particular company, its compensation structure depends on a number of factors, including an analysis of the industry in which it operates, the company's product life cycle, and the organization's past practices.　To industry factors, for example, the insurance industry, nutrition industry, cosmetics industry for sales staff salary design is mostly "high commission + low fixed" salary model, or even the implementation of pure commission system, and in some products with strong technical content and professionalism, the market is very narrow and the sales cycle is relatively long in the sales field, the enterprise for the quality of sales staff and their stability. In some products with strong technical content and specialization, very narrow market and long sales cycle, the quality and stability of the sales staff are required to be very high, and then the remuneration model of "high fixed + low commission/bonus" is more appropriate.　Another example, in terms of the product life cycle, when the company's products are just listed, the product does not have any popularity or popularity is very small, the enterprise is best to take the fixed remuneration mode, or to take "high fixed + low commission / bonus" mode, because at this time, the risk of product sales is very high, the efforts of the sales staff may not get enough market share. Because at this time, product sales are very risky and the salesperson's efforts may not be rewarded by the market, therefore, the salesperson should not be allowed to bear the risk at this time. However, if after a period of effort, the product has been recognized by customers, and gradually opened up sales in the market, the risk of sales gradually reduced, sales are in a period of growth, then the enterprise can appropriately reduce the fixed part of the sales staff compensation, increase the variable part, in order to encourage sales staff to more actively expand market share and increase sales. Finally, as the product reaches maturity, the product brand or company brand for consumer purchasing behavior is more important than the persuasive power of the sales force, the enterprise can be changed back to the compensation plan of the sales staff "high fixed + low variable" compensation model.　(C) the establishment of scientific and systematic quantitative index system sales personnel salary design seems to be just base salary, commission and bonus between the trade-off ratio, but to achieve its due role, need a lot of detailed work, so as to establish a scientific and systematic quantitative index system. This requires, on the one hand, strengthening the research and application of advanced tools in computer aids, mathematical modeling, management science and other aspects of the compensation system, and on the other hand, doing a good job in job evaluation and performance appraisal and other basic work.　The purpose of conducting job evaluation is to determine the scientific standard of job quality and reasonable job value, which includes the formal and systematic comparison made for the purpose of determining the value of a job in relation to other jobs, and ultimately determining the pay grade of the job. The basic procedure for job evaluation is to compare the components of each job (e.g., the level of effort, technical complexity and responsibility required by the job) with each other, resulting in a "job compensation factor". When evaluating positions, each position is compared to all comparable positions on the same evaluation factors. As a salesman, compared to managers, may not require him to have any leadership ability; compared to technical personnel, and do not require him to have a high level of professionalism, but his communication and expression skills must be excellent ...... and so on. This is also for the performance appraisal made a good pad.　Performance appraisal should pay attention to the KPI (Key Performance Indicator method), balanced scorecard, MBO (Management by Objectives) and other advanced methods of utilization, all-round, multi-angle 360 ° appraisal of employees. Among them, in a salesperson's performance appraisal should pay attention to the following points: 1, the determination of indicators to follow the SMART principle. SMART is an acronym for the first letter of five English words: S (Specific) on behalf of the specific, referring to the performance appraisal to be cut in the specific work indicators, can not be generalized; M (Measurable) on behalf of the metrics, refers to the performance indicators are quantitative or behavioral M (Measurable) on behalf of measurable, refers to the performance indicators are quantitative or behavioral, verification of these indicators of data or information is available; A (Attainable) on behalf of achievable, refers to the performance indicators in the case of efforts can be achieved, to avoid the establishment of over- or under-estimated goals; R (Realistic) on behalf of the realism, refers to the performance indicators are real, can be proved and examined; T (Time Bound) on behalf of the time limit, the performance appraisal should focus on the completion of specific performance indicators of a specific time frame, not generalized. Focus on the completion of specific performance indicators of a specific time frame. 2, pay attention to the views of customers. Because of the characteristics of the sales staff themselves, they are more in dealing with customers, on behalf of the company's image, affecting the continuing source of customers, so that customers involved in the assessment of sales staff is particularly important. 3, business indicators should account for the absolute proportion. But this business indicators are not necessarily sales volume, but should be combined with this year's corporate strategy and program. That is to say, this year's business focus on what is the sales volume, or profit, or customer satisfaction, market share, market share of new products? These indicators can not be all-encompassing, each year can be adjusted appropriately, but the strategic intent of the enterprise should be fully reflected in the assessment, rather than just a fixed indicator.4, supplemented by other indicators. Including learning and growth, personal behavior, personal competence and so on. The proportion of these indicators can be not too large, but can effectively encourage the growth of sales staff. And from a long-term perspective, the improvement of employee competence is a prerequisite for the realization of long-term sustainable profitability. However, this ability to quality assessment should not be a formality, do not cover everything, but should be for this category, and the results of the job evaluation combined to see what he needs the professional quality.　(D) the use of personalized pay system, to take care of different employees 1, the establishment of a flexible and diversified menu-type commission system. Current business practice, often based on the size of the business volume and increase or decrease to set the percentage of commission. For example, the monthly completion of 10,000 yuan of business commission rate of 3%, 20,000 yuan of commission rate is 4%, 30,000 yuan of commission rate is 5%. This practice has great significance, however, I think also according to the business territory of different sales staff, the speed of business progress, business completion ratio, business growth rate and the flexibility to change the commission rate, to take care of the situation of different employees, to amplify the effect of pay commission.　2, for the sales of novice to adopt a protection strategy. On the one hand, you can set up a certain period of protection for new sales, in the protection period, enjoy certain salary concessions, such as higher base salary. In addition, can also implement the "split system" of the pay system, in order to protect its certain salary level at the same time, but also fully embodies the competitive system. The so-called "split system" is the new entry into the enterprise sales staff as a whole, to determine the sum of its income, each salesperson's income is calculated according to the size of the contribution to the proportion of the total contribution, such as the base salary into the system, you can further "split system" and "mixed system". If you want to import the base salary, you can further combine the "split system" and the "hybrid system", calculated according to the following formula: individual monthly salary = base salary + (total salary - base salary) × (individual monthly contribution ÷ all monthly contribution). In this way, not only the income of new sales staff closer to the distance, to protect their livelihood needs, but also reflects the principle of more work, more pay, can increase their sense of belonging to the profession and enterprising spirit.　3, the establishment of special salary system, the establishment of special contribution awards. On the one hand, we can consider establishing a special pay system for special talents, such as annual salary system. Special talents are those who are urgently needed in marketing and play a key role in the post (position) and make outstanding contributions. Determine the special salary personnel should be based on the requirements of the position (position) and the contribution made in the field of production, management or science and technology, after a scientific assessment of the position, it is not appropriate to one size fits all. It is taboo to discuss seniority and advocate rewarding on the basis of merit. In particular, it is pointed out to eliminate the blind worship of education, because many of the best salespeople in the enterprise because of age, age, family burden and other reasons for the low grade of education, and sales itself is a strong experience and flexibility of the work. Many well-known enterprises believe that, for sales staff, the basic education is to be, but experience is more important. In addition, some domestic enterprises have set up a "sales contribution to the Grand Prize", for example, Taikang Life Insurance Company, Yutong Group and other well-known enterprises through the convening of the annual sales elite commendation meeting, to make special contributions to the staff to give high honors and high bonuses, this practice is worth advocating.　(E) the salary system should be set up to "follow the market" sales staff compensation to reflect the market situation, weakening the drastic changes in the environment on the impact of sales staff compensation. In this regard, the commission base can be done to consider the use of "variable quota system". Floating quota system refers to a sales group in a monthly per capita sales or per capita sales in the last month as a certain percentage of the quota, the compensation of the sales staff and this quota is closely linked to the actual quota of sales staff in the following basic salary, in the quota above the basic salary in addition to those who can receive a basic salary, you can also be more than part of a certain percentage of the withdrawal of compensation. In this way, the salary and compensation of sales staff will change with the market situation, when the market situation is better, the sales work is relatively easy, the variable quota is bound to rise, when the market situation is poor, the sales work is more difficult, the variable quota decline.　(F) the implementation of "order-based" payroll model to encourage teamwork Some sales tasks can not be completed by one person, in the publicity, negotiation, contracting, billing, after-sales and other aspects, there are different people in the efforts to be united in the need for everyone to work together, which needs to be reflected in the payroll. This is difficult to realize with the traditional way of paying individuals. The "order-based" payroll model is for the completion of the sales order (sales task), the staff as a whole payroll, according to the prescribed formula, so that all employees involved (including sales management, sales staff, shopping mall sales staff, after-sales service staff, etc.) *** with the share of the benefits due. This model improves the motivation of employees to participate in the team and promotes the improvement of the overall performance of the enterprise.　(G) the establishment of multi-channel career development path GE proposed "do not tie the compensation and power together", otherwise, you will build a team of wrath, experts call these people "POPOS", meaning that "Neglected and Outraged People". They advocate giving employees more opportunities to move up the pay scale without being promoted. In fact, there is often more than one "career anchor" for an employee's career development in an organization, and companies should establish multiple career development paths such as management career anchors, technical career anchors, and business (professional) career anchors. At Panasonic, the growth and progress of employees can be reflected through a unique cadre system, the "special title promotion system," which is a system for recognizing the qualifications of employees' abilities. The special title can be categorized into several levels, such as principal, vice-councillor, councillor, vice-councilor, and councilor, and the qualification of the special title is directly linked to the salary of the employee. If three people together into the Panasonic Corporation, the ability are very good, one rose to the manager, the other two can not rise to the manager, but they can rise to the main stretcher, although there is no position, but get the same compensation. I suggest that the enterprise sales staff to implement the "title system", such as assistant marketer, marketer, assistant marketing engineer, marketing engineer, senior marketing engineer, etc., so that in the management of the professional anchor outside the development of a professional career anchor, so that the development of the sales staff in the personal achievements, pay more than one development path.