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The Compensation Handbook, Sixth Edition: A State-of-the-Art Guide to Compensation Strategy and Design, 6th Edition by Dorothy Berger, Lance Berger

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18

Developing and Applying a Return-on-Investment Methodology to Drive Sales Force Performance

REBECCA SANDBERG

SalesGlobe

CARRIE WARD

SalesGlobe

Return on investment (ROI) pertains only to financial transactions such as acquisitions or product purchases, right? And it is really just a calculation that finance professionals use, right? Wrong. ROI is important in every type of investment. We will focus here on sales compensation. This approach focuses on creating and maintaining a culture of performance in the sales force based on a customized application of ROI.

Why is ROI important in sales compensation? Most C-level executives want to know the answer to two questions:

1.   What are we getting out of our sales compensation plan?

2.   How much ...

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