The WorldatWork Handbook of Compensation, Benefits & Total Rewards: A Comprehensive Guide for HR Professionals

Chapter 12. Sales Compensation Fundamentals

The degree of an HR department’s involvement with sales compensation plan design and implementation varies from company to company. In some companies, HR’s involvement is actively sought by the sales department. In others, HR’s involvement is discouraged or prevented. HR professionals frequently ask, “What can I do to play a more meaningful role in plan design and implementation at my company?” This question is not surprising, because having limited or no involvement in the process of shaping and launching a sales compensation plan means that companies miss the opportunity to use the expertise of their HR staff in key people-management areas. These key areas include ensuring that a company’s sales compensation plan is designed to attract, retain, and reward talented salespeople who can win and keep customers. It is clear that developing and using a compensation plan that helps a company achieve that goal should draw upon the expertise of the HR function. This chapter describes the aspects of sales compensation plan design and implementation in which the HR professional can play a meaningful role. Further, it provides suggestions about actions that an HR professional can take to perform that role effectively.

Working with the Sales Organization

At many companies, the business partner role defines how HR is expected to work with its assigned organizational client. The assigned client may be either a business unit that includes the sales organization ...