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Enterprise incentive management fills niche need

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In early 2002, Sealed Air Corp., a Saddle Brook, N.J.-based manufacturer and marketer of bubble wrap and other protective packaging, formed regional sales teams with representatives from each of its five divisions. The groups met monthly to exchange sales leads, focusing on opportunities recognized by a rep in one division for sales through another.

But a review of the structure last summer showed procedural weaknesses: sketchy voice mails for colleagues and informal chatter over coffee that didn’t transmit qualified leads or provide enough information for reps interested in following up. Sealed Air not only needed a standardized solution, it needed one that provided an incentive for salespeople to learn a new process and take the time to enter lead data.

The company hired InMarketing Group Inc., Mahwah, N.J., to deploy an enterprise incentive management (EIM) program.

Impressive results

The result? Sealed Air has moved from about a dozen leads exchanged within a regional group every couple of months to 40 leads a day from some reps, resulting in more than 3,000 leads overall since January. That’s meant more than $500,000 in incremental sales from 33 closed sales in that period.

EIM programs are specialized solutions that help close deals, streamline the flow of information, and reduce paper waste and processing headaches. They typically are Web-based and have several customized interfaces for different kinds of users, from the CEO, sales director, field salesperson or customer service agent.

Because EIM systems enable bidirectional communication through integrated survey tools, administrators and managers can talk to salespeople, and salespeople can talk to one another. An administrator can build an online survey that reaches all salespeople and asks, for instance, how a new pricing structure is working. Such features eliminate voice mails and conference calls in which vital information can fall between the cracks.

Sealed Air’s several hundred salespeople adopted InMarketing’s Gold Rush system, a customized online program that rewards qualified sales lead generation, cross-division sharing and follow-up.

According to Fred Smagorinsky, VP-corporate sales and marketing at Sealed Air, reps embraced the program because it reflected an understanding of their work.

"We have gone way beyond critical mass in getting people to use this," Smagorinsky said. "Critical mass for me was the $64,000 question. I worried it would be received with a collective yawn. I worried, ‘Will anybody be using this?’ "

Sales VPs in Sealed Air’s five divisions can now look at how much information appears in leads and assess their quality, making sure reps aren‘t flooding the system with bogus leads in order to rack up points (the program automatically filters some leads that seem inadequate). And team leaders can forward leads to their counterparts in other regions or distribute incoming leads to their own staffs.

Salespeople and sales support staff have their own view in which to enter data for incentive points. Program rules dictate that salespeople receive e-mails when the leads they’ve generated for colleagues are followed up on or closed. And salespeople can see how many points they’ve accumulated, as well the point totals of teammates and salespeople in other regions.

Gold Rush reportedly paid for itself in its first month. "I can’t see us doing any paper-based faxing around of incentives again," Smagorinsky said. Gold Rush combines delayed gratification, with awards earned through point acquisition, and instant gratification, with fast access to qualified sales leads.

"Now the activity of generating leads has become more important to daily activity," said Keith Simon, director of sales and marketing at InMarketing Group.

These EIM pluses may change the nature of employee and b-to-b incentive programs, said Mark Sullivan, VP-Sales Driver for Carlson Marketing Group, Plymouth, Minn.

"If the vice president of sales starts looking at the pipeline and sees [the sales force] is not going to hit its quota, he doesn’t have two to three months to build an incentives program," Sullivan said. Carlson claims it can set up a program in days, eliminating manual labor for tasks such as creating brochures, conducting direct mailings and making phone calls.

EIM vendors that run on the ASP model, such as InMarketing and Carlson, have the flexibility to work with clients of all sizes. InMarketing typically looks for incentive budgets of $50,000 or more, but Carlson will accept clients with budgets as low as $20,000 and 50 salespeople. A self-service version of Carlson’s Sales Driver product works for companies that have as few as 15 salespeople and an annual incentives budget of as little as $2,000.

Licensed solutions

For larger companies interested in sticking with cash incentives, Motiva, Pleasanton, Calif., offers licensed solutions that improve the accuracy and efficiency of payments.

"Companies are leaking a huge amount in compensation that they can’t really track," said Kit Robinson, VP-marketing at Motiva. "The companies today that are buying EIM know they have a problem. At the same time, from a marketing perspective, we have to educate the marketplace."

Motiva customers such as Mitsubishi of North America obviously are paying attention to their incentives flow. Mitsubishi, which has an EIM deployment involving 600 dealerships, changes incentive plans every 10 days and reduces its incentive investment in participants not meeting their sales goals.

Memphis-based First Tennessee Bank, another Motiva customer, includes more than 2,500 employees in its incentive plan. The deployment has addressed accounting errors—in incentive payment amounts, participant payment statements and management reports—that plagued an earlier system. Compensation managers and executives at First Tennessee now use Motiva’s Web-based analytic and reporting capabilities to align multiple sales compensation plans with company objectives and easily communicate plan metrics to employees.

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