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Optimizing Sales Performance with Incentives - Best Practices

Optimizing Sales Performance with Incentives - Best Practices. Doug Pearson May 15, 2013 Meeting Moderator. Agenda . Polling to set the stage Briefing from Belinda Cavazos, Teche Federal Briefing from Josh Seago , Beacon and Company Some ideas from NSS Interactive Discussion.

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Optimizing Sales Performance with Incentives - Best Practices

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  1. Optimizing Sales Performance with Incentives - Best Practices Doug Pearson May 15, 2013 Meeting Moderator

  2. Agenda • Polling to set the stage • Briefing from Belinda Cavazos, Teche Federal • Briefing from Josh Seago, Beacon and Company • Some ideas from NSS • Interactive Discussion

  3. Belinda Cavazos • Teche Federal Bank • Retail Division Manager – branches, retail lenders, training, and administration • 40 years of experience starting out as a teller • Rolled out their incentive program in 2002 when she started out with Teche

  4. TECHE FEDERAL BANK SALES INCENTIVE PROGRAM

  5. HISTORY • Organized in 1934 as a Savings and Loan Company • State Charter June 2011 • Located in South Central Louisiana • Currently 20 Locations – 19 Full Service Branches • $850 million • 330 Employees • 200 Retail Employees • Management, Branch Staff and Lenders

  6. Retail Sales Incentive Program • Implemented in 2002 • Created and Developed Internally • Production & Profit Driven • Retail Positions Participating: • Retail Management, Administration and Marketing • Branch Lenders and Loan Officer Assistants • Branch Managers • Customer Service Representatives • Future Participants • Tellers (Closed Referral Incentive Payment 6/13)

  7. PROFITABILITY Accounting Department Provides Data: • AVERAGE BALANCE OF PRODUCT PORTFOLIO • LIFE EXPECTANCY OF PRODUCT • RATE DIFFERENTIAL

  8. MONETARY COMPENSATION TARGETS Human Resources Provides Data: • Salary Surveys (Asset Size and Position) Market Survey State Survey National Survey Compare our current salary to that of same position’s salary and incentives/bonus

  9. PRODUCTION ANALYSIS FORECAST • Loans: • Use prior 5 months of loan production as a predictor of production for the next 6 months production • Deposits: • Use prior year’s same 6 months interval of deposit production as a predictor of the next 6 months of production

  10. PLAN RESULTS Monetary Payouts • Threshold • Tiers • Pay Per Point at each Tier

  11. PLAN RESULTS Monetary Payouts Customer Service Reps- • Incentive Target-21% • Average - $500/mo. • High - $1,600/mo.

  12. PLAN RESULTS Monetary Payouts Branch Managers- • Incentive Target-45% • Average - $1675/mo. • High - $4,000/mo.

  13. PLAN RESULTS Monetary Payouts Lenders- • Incentive Target – 74% • Average of $2,750/mo. • High $6,800/mo. (74%)

  14. PLAN RESULTS Monetary Payouts Retail Management, Retail Administration & Marketing Various incentive targets Calculation is based on the total production relating to areas of responsibility and/or support (Ex. Regional Loan Manager’s earn roll up of loan production points for lenders in their region only.)

  15. ADMINISTRATION • Salary Surveys-Annually • Plan Reviews and Adjustments-Semi-annually • 14 Different Plans reviewed and adjusted • Payouts are Monthly

  16. Josh Seago • Josh Seago – Account Executive, Beacon and Company • Vice President, Retail Banking at Naperville Bank & Trust • Transitioned the organization to needs based selling • Vice President, Branch Manager of PNC Bank • Facilitated training for the Chicago market

  17. Beacon and Company

  18. “Incentive programs as a building block of an overall sales culture”

  19. “Incentive programs as a coaching tool”

  20. “Incentive programs as a sales motivator”

  21. Additional ideas from NSS

  22. Incentive Plan Design Tools • Modifiers • Gates • CAPs • Thresholds • Accelerators • SPIFFs • Non-cash rewards • Scorecards

  23. Checklist For Plan Effectiveness • Is it fair? • Is it understandable? • Does earnings reflect effort? • Have targeted earnings level been reached often? • Are payments frequent enough? • Are you confident that doing the right job produces more compensation? • How may people are making quota? • Has the plan changed to reflect external issues? • Is turnover up? • Are we attracting the right people? • Are desired work behavior changes occurring? • Is your commission statement accurate? • Is your commission statement understandable? • Are there too many measurements to focus on?

  24. Questions and Answers • Chat • Raise your hand icon

  25. Contact Information • www.nsscorp.com • dpearson@nsscorp.com • 603-296-2909 • www.beaconandcompany • jseago@beaconandcompany • 630-299-3660

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