Decision Tool

The Forrester Compensation Effectiveness Tool

January 26th, 2021

Summary

Sales compensation success is typically measured in terms of percentage of quota attainment or overall sales growth, but focusing on these measures is not the best way to assess the effectiveness of a compensation program. In a healthy compensation plan, sales should grow at the same rate or faster than the cost of commission. Organizations should first evaluate overall sales performance, then extend that evaluation to the individual plan level. The Compensation Effectiveness Tool helps organizations determine the overall effectiveness of their compensation program, then compare that performance to an individual plan to evaluate plan performance and alignment to the overall plan objectives.

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