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Q: What elements of your job as executive in sales dept do you find the most difficult?
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It is vital to a business with a sales force to be working under an incentive sales compensation plan that properly awards salespersons with income that retains and recruits new salespersons to the company.Here is a "real life" illustration of this as I performed the above when I was the Compensation Manager of the USA Branch of a major Japanese Electronics Company. One part of their sales force was involved with selling microchip products & services to the wholesale market:1. Gather overall sales information by conducting an interview with the company executive in charge of all sales production. This, as case in point covered products such as televisions, microwave ovens, high end electronics products such as LCD screens which were developed in 1989, but not ready for sales due to the cost of a 13 inch screen that would have to retail at $5,000.This of course included this executive's views on their microchips Dept.2. Gather sales & product information from the executive in charge of the microchip dept. Gathered information as example would include:2a. Most profitable product;2b. Least profitable product;2c. Products already in the market by other companies and in which "my" company desired to sell;2d. Which microchip product had the highest sales volume & why;2e. The requirements that salespeople needed in order to be hired in the microchip dept. This criteria might be gathered from the senior Human Resource recruiter for microchip sales. This was done to make sure the recruiter, the head of microchips and myself were all on the same page.2f. The requirements were a B.S. in Electrical Engineering or better. M.S. EE's were also recruited. Engineers hired from competing companies had higher starting salaries. The only need for a Ph.d in EE was an advisor in Japan, so no need to be involved with that.2g. Interviews with a sampling of the electrical engineers in the microchip department. The sampling included new hires, engineers with 5 or more years, & those engineers with the highest sales & lowest sales.These interviews were "confidential" therefore no negative information would find its way back to other employees or other electronics executives.Questions asked were their views of the sales compensation plan & what, if any undue pressures existed concerning the sales of specific microchip products.3. Gathered from Human Resources the following:3a. Turnover reports in the microchip dept. for the last three years;3b. Termination reports for the past three years for the microchip dept;3c. Direct pay budgets for this dept. for the last three years. This was gathered from my own records as I recommended these budgets & handled any exceptions ( overages in budgets )4. Gathered from the Accounting Dept. the incentive sales payouts for the past three years. This was done, as prior to my involvement, all sales incentive plans for microchips were handled between the head of Accounting & the executive for overall sales in the company.For the next fiscal year, all sales incentive plans were assigned to the Compensation dept with final approval from the VP in charge of Human Resources;5. Gathered from my compensation counterparts in 10 other electronics companies all direct pay for matching jobs & the incentive plans for microchip sales. This was done on the telephone, however, in 5 situations I was invited to visit my counter parts in other electronics companies. In that way I was able to meet them and make copies of their incentive package plans, along with meeting the executives in charge of microchip sales at these companies.6. As an aside, reported to the HR executive to whom I reported to, the VP of Benefits & Compensation, that there were only male electrical engineers in our microchip dept. This was done as this executive was responsible for filing all Federal & New Jersey EEO reports and was our companies liaison officer for all onsite compliance examinations.7. Contacted the 3 consulting firms that survey the compensation plans & salary scales for engineers in electronics companies. These were nationally recognized surveys which include data on microchip sales positions.8. Formulated a plan for new competitive salary levels and sales incentive plans for the microchip dept. Calculated the potential dollar costs of the new plans & measured how it might affect employee morale & the possible reduction in recruiting costs; and9. Met with the two levels of HR executives above me and with officers of company sales, microchip sales & the head of the Accounting dept. to refine & finalize the new plans.


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