Lead Qualification Compensation Strategies

Challenge: How do you provide incentives for your lead qualification reps?

Lesson: Simplicity, leverage and breadth can reinforce what is most important in the lead development role.

Challenge: How do you provide incentives for your lead qualification reps?

I strongly believe that the most important forms of ‘compensation’ are feedback on the job and work environment. Employees generally do not leave for 10% more pay. However, they will leave when they do not feel appreciated or when they can’t see how their efforts support the organization as a whole. That said, designing a compensation plan is an important factor in providing incentives and demonstrating what is truly important in the position. The compensation plan should reinforce what management demands from its employees and supports the work environment.

My top recommendations for compensation plan design are simplicity, leverage and breadth. The most important aspect is simplicity. The plan should be easy to understand so reps can easily see how they should organize their activities to maximize the plan. Simplicity creates clarity of purpose for the organization and makes it easy for the reps to make trade-offs with their time. After all, time is the only resource any of us will never get back. So much time can be wasted discussing complex plans and identifying ways to maximize results. Complex plans also create back-end processes which are difficult to manage, are open to interpretations/questions, and require more time to support.

Overall, my preference is to make the base compensation less than 50% of total target compensation (TTC). This creates a strong incentive to achieve the variable compensation component of the plan – or leverage. Assuming lead qualification is the primary focus for a lead development rep, I recommend tying 50% or more to the number of qualified and accepted leads – possibly up to 80% of the variable plan. This emphasizes the simplicity of the plan in that reps clearly understand how to make their TTC. Breadth is achieved by adding in two additional components – albeit significantly smaller. The first is a component tied to revenue – which reinforces the help that lead development reps play in ensuring follow up to their leads and assistance to their sales reps in other ways. The second component is a quarterly goal objective which the manager assigns to each rep. The reps have learned much about the optimal way to qualify leads – and therefore they are in a great position to create tools to make the team more effective. Objectives can include creating vertical intro pitches, reference sheets, pulling stats/reports for the team, running online demonstrations, creating call lists, testing call scripts, etc.. These all help the team to be more effective over time.

Lesson: Simplicity, leverage and breadth can reinforce what is most important in the lead development role.


Author: Larry Stein at TechMarketingStrategies

For the last 20 years, I have led demand generation teams supporting high growth technology companies. Now working as an independent consultant, my responsibility is to apply best practices in the creation of these programs. My goal is to enable marketing teams to become self sufficient with a data driven culture of KPI's, test and measurement in service of achieving company revenue targets. My approach is to work with senior management identifying objectives and wildly important goals. With these in mind, we work together to build programs, processes and systems that will reach these goals along with the measurement KPI's to evaluate progress. Along the way we will enable the team to manage and maintain these systems so achieving these goals becomes a natural cadence of the marketing organization.

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