Global sales compensation practices

By: David Cichelli Sales Compensation, Sales Strategy

Global corporate entities deploy numerous and diverse sales resources to serve local markets. Whether the business model features country, world region or line-of-business configuration, sales teams are usually a “local” solution with local management and local sales practices – including local sales compensation programs. When corporate sales compensation designers seek to create uniform sales compensation plans, some local sales leaders will question this approach.

“Worldwide” sales compensation solutions seems implausible to most local sales leaders. They struggle to understand how uniform sales compensation could apply to their unique situation. A natural reaction from local sales leaders is to ask, “Why?”

  • Why does the company need a uniform sales compensation design?
  • Why should local sales leaders consider design solutions not “tuned” to their local market?
  • Why should a sales team accept the sales management philosophy from a “foreign” location?

Frankly, pro-global/uniform sales compensation advocates struggle to adequately answer these questions. The following advertised reasons seem weak at-best:

  • Simplicity: The “simplicity” argument suggests that numerous local sales compensation plans are too confusing. Actually, the test of “simplicity” should not be from the perspective of a corporate over-seer, but instead from the participant’s perspective. If the salesperson understands his or her sales compensation plan, then the test of simplicity is met.
  • Too Many Plans: Again, this is another false objective. The number of plans should equal the number of sales jobs. Local sales leaders correctly craft sales compensation plans to serve local conditions. Experience teaches companies that artificially trying to reduce the number of designs often produces unsatisfactory pay plans for most jobs.
  • Audit and Administration: A final argument suggests numerous incentive plans produce an audit and administration conundrum. In some cases, this is true. However, because pay programs sit within local sales entities, normal accounting and financial oversight provide satisfactory frameworks for plan management.

The ambitions of central corporate sales compensation planners often find a natural conflict with local sales leaders who seldom see the need for help or direction when designing sales reward programs for their local sales teams.

Visit AGI’s Sales Compensation practice to learn more.


David Cichelli

David Cichelli contributes his revenue growth knowledge and experience to a wide array of sales organizations. His clients include leading companies in technology, telecommunications, wholesale/distribution, financial services and healthcare. David helps clients redefine and deploy go-to-customer solutions to ensure optimal revenue performance. By applying the Alexander Group’s Revenue Growth Model™, he helps companies achieve their revenue objectives through the coordination of marketing, sales and service resources. These efforts include revenue planning, customer engagement design, sales force configuration, and program design and management. He is the Alexander Group’s sales compensation practice leader.

Widely recognized by national professional associations and trade publications for his work in linking sales compensation to management’s objectives, David is a frequent speaker on sales compensation topics. He is author of Compensating the Sales Force (3rd edition) and The Sales Growth Imperative, published by McGraw Hill. He serves a leadership role in the design of the firm’s revenue growth conceptual models. David is an officer of the company. He is also the author of the 2018 Sales Compensation Almanac, published by AGI Press.

Prior to joining the Alexander Group in 1985, David served for five years as a national practice manager in sales compensation for a leading compensation consulting firm. Previously, he had spent seven years providing support to the field sales organization of a multinational Fortune 200 chemical company. David has a B.A. from Pennsylvania State University and an M.S. from Michigan State University.