Future of Sales Compensation Think Tank - May 8th 2025

You know what? That always makes me laugh.

Makes me cringe a bit.

So here we are, getting ready for another think tank. Hey, guys. How you doing over there? Gail, Matt,

we're great. How are you guys?

Doing well. Doing well. So for people just joining on, we're just hanging out. We showed a short, short film there just for fun from our holiday film, which was our little office spoof. And you know, Michelle, this is not your father's webinar. Not that your father would go on a web. He doesn't even have an iPhone, but it's not your father's webinar.

Kind of like my father. Don't you even think about it.

So the idea, this is the unwebinar for anybody that remembers 7Up back in the 70s, which you have after you probably weren't even born. But yeah, this is the unwebinar. And so we don't just wait with a screen before this thing starts. And you sit there and you're like, is this the right. Did I log into the right place? I don't know. Or the webinar will start shortly. No, we don't do that. We just get on and we just talk a little more. So you know that we're here, right. So that you're, you're comfortable or otherwise,

or nervous like me never knowing what's going to come out of your mouth next.

Well, you're not the only one, Michelle. You're not the only one.

So we have a really exciting meeting coming up while we're waiting for people to get on. I will say that I am super excited because I saw a lot of new companies on the list. This time we've got some old friends and new Gail, Matt, you guys worked super hard to conduct a live, real time near time survey with everyone and how we're using AI so we're super excited about that, too. And Mark, you got some stuff. We'll be doing some good reveals on economic indicators based on your participation with the Federal Reserve Board here in Atlanta.

That's right. That's right.

It's going to be really fun.

I can reveal what it is yet, though. No, because.

No, you got to, you got to stay on. If you want to know what's going on in the economy, you're going to have to stay on till the end.

Yeah, that's right. That's right. That's the reveal at the end. Oh, boy. Well, sunny day here in Roswell, Georgia. In historic Roswell, Georgia. We're in the sales Globe Studio, which you can see there's. Kate. You can see our people here. A bit of our background here. So this is our. Nobody can see the studio. This. That's looking. Because we have it all kind of. Gail, Galen and Matt are in the. In the podcast room, in the soundproof room, and I are in front of the. The big green wall. Not in Boston, but the big green wall here in Roswell. Yeah, we got beautiful. We call it the sales Globe studio because we've got all beautiful brick and exposed wood ceilings and concrete floors. And it just kind of inspires creativity, doesn't it?

Oh, it does, yes. And we have a very big, beautiful kitchen filled with snacks to keep everybody, you know, like, happy.

Right?

Yeah. You know what we noticed, Michelle, was that we are all about back to office. Get back to office. In fact, everybody's back to office here. We don't have any people that aren't back in the office. But, man, the usage of the water and the coffee and the food, it's something that. Yeah, yeah.

No, no, yeah. Because I have a complaint about that. I feel like we need to add a few more restrooms personally.

Well, we won't go there. This is rated G here. Pg.

We're just having this discussion, unfortunately. Let's change the topic.

So, Parker, give us a signal when we have enough people on here that we're going live. Well, we're already live, technically. So I see Todd Abbott out there. Todd Abbott, one of my favorite chief revenue officers.

Jeff.

What's that? Oh, I see Jeff Abbott. Well, Todd Abbott. I know Jeff Abbott too, from AT&T. Well, Jeff. And I guess my, my. I'm not wearing my glass at the moment, so that, that caught me off. I thought the J was the T and the Fs were Ds and the E was an O or something. That would have made Todd.

I do that sometimes, too.

So I don't know what that's called.

Anyway, sounds like I need to meet Todd.

Well, I'll say one thing as just before we get started, which will be repeated. Do not forget. So this is going to be a super interactive. What do we call it?

Think tank.

Live webinar Think tank. This is going to be a live think tank and we're going to expand and ask for your participation because this is a really cool opportunity for you to meet other people in your space. That's the real reason we do this. And when you get information, we get information, too. So we love it. We love to introduce people to each other. So we ask you to make sure that you connect through our LinkedIn group. And make sure you connect with others here, your peers. And we're looking forward to a good day.

Okay, so why don't we get started?

Yeah, that sounds great.

So how you doing today, Michelle? Like Kevin talk.

We're going to like, act like that now. I'm great, Mark.

How are you?

Fantastic.

Yeah.

So welcome everybody, to the future of sales compensation think tank. The reason we call it a think tank is because this is not your father's webinar. This is basically us talking with everybody and we're looking forward. Right. So we're going to be sharing some things that are forward looking in terms of not just what's happening now, but what's potentially going to happen ahead. And we want to put our thinking hats on about what it means to you. And, and so we want to invite you to have some conversation as well.

And.

Yeah, so highly interactive. Just jump right in.

Yeah, but before we jump right in, we thought we'd give people kind of a view into just a little bit of, of how we put together. Yeah, the behind the scenes of the think tank.

Right. We're going to check out the behind the scenes of the think tank here. So we'll give you a little, little preview of that right now.

Yeah, just give us a sec.

You ready?

I thought this was a sales comp thing. With sales compensation, you're either driving or chasing. All right, now you know what we do for fun, right, Parker? Oh, man, Mark, I'm just so excited to be here at the future of sales compensation think tank. You know, I had to run five miles and hop two fences to be here today. Yeah, well, we appreciate the commitment. So this little film was the, the brainchild of, of Parker Bonner here, who does fantastic work for us. And we had to do the thing, Parker, where you actually got to get in the car because we originally had me taken off on you twice. Yeah. But what the video doesn't show is right after we cut, he threw me back out. So. But I think with that I've overspent my due here, so I'm going to let Michelle get back in the driver's seat.

Thanks so much, Parker. So now, you guys, I know that you probably have seen a lot of the videos that we put on LinkedIn. We are actually going viral across TikTok and some other mediums, which is, you know, kind of the brainchild of Parker, a lot of these videos. We are so privileged and excited to have him along with the team. So onto the think tank team. Thank you so much. We Couldn't do it without you. Everyone who's here joining us today and Gail Wright and Matt Kayer here from Sales Globe. Thank you so much, so much for putting together an excellent think tank. I think you all will appreciate all of the hard work. Great to see you guys. And little about us.

Mark.

Yes, a little bit about Sales Globe. We are a sales effectiveness consulting firm. We focus on revenue growth and you can see the things we do on the right hand side from insight and strategy and customer coverage, sales role design to sales compensation and quotas, which is what we're here to talk about today. And the two big things that are important to us are right in the middle there, which is number one, partnering with you to get to the real result and solve the real problem. Not just give you the benchmark or the practice of what's happening in your industry, although we know that, but to help you get to the root cause and solve the problem. Number two, to help you implement and operationalize so we get beyond the PowerPoint so we can sit down with you and work alongside you to actually get things done and get the result you're looking for. And you can see we have a few books there that you can check out what your CEO needs to know about. Sales compensation is most relevant to what we're talking about here. And also quotas because it's got an exclamation point because everybody, they're always screaming at. That's right, we're always yelling about quotas. So we put an exclamation point on that. So that's a little bit about us. But this is all going to be about you.

Yeah. So we're pretty excited here. I don't know if you can see that. If you can see this, you have very good eyesight. We've got over 100 companies that have registered for the think tank today. You can see some of their names there. But really important, a couple important points. One, I mentioned it earlier, your participation is really key. We are going to ask you to please raise your hand or put comments in the chat. You will be unmuted and we're going to ask for your participation. Secondly, and as important, please connect with your peers through LinkedIn. We've got a future of sales comp think tank group out there and you can find out who the other members are. We encourage you to connect outside of this team as well. And with that, I'm going to turn this over to Gail.

Hi everyone. I am so excited that you are all here with us today. And you know what was really neat about this. And Matt, we were talking about this. This is a very collaborative effort in that we got people to participate in a survey. So we're going to talk about our AI survey and then after that we're going to talk about the economy and its impact on sales comp and how it might be impacting you. So let's dive in. The first question we asked is we wanted to hear from you how you guys were using AI and if you were leveraging it. Now we do see that about 70% of you today are not really using it. However, those of you that are using it, you're using it in sales compensation. Exactly how we would use it. Sales comp design, we're doing comp documents governance. But the really great news is the simple fact that you guys are planning on using it a lot more in the future. So we would like to open it up and hear from you. How are you planning on using it in the future and how is it going to impact you? And reminder, you can raise your hand or you can go ahead and put a question or a comment into the chat. If you do put something in the chat, just make sure that you do put it to everyone so that we see it. And I see some hands raised.

I just wanted to. And can I just make one notation? So I thought it was really interesting, Gail and Matt and everyone that 30% of companies are currently using AI within their company. And that number though I think it's significant that it's going to planned to jump a good 40% over the next year. So it looks like, you know, adoption will be coming on the way. So yeah, it would be great to hear what you all might be doing now. Yep.

Do we have specific hands?

I thought I saw a hand raise, but it may have gone down. I know, Matt, I've been using AI pretty much every day to do. I use it for helping me with some of the analysis that I do. I've been using it for helping with creating some of that comp plan documents and it's actually freed up my time so I can spend more time with my client and not so much time into the data. Although I still look at the data and I still analyze it. But I get to spend more time helping you strategically think about your comp plan designs. Matt, what about you?

Yes, so I have one that's actually a little bit hot off the press because it's something I've been working on. It's not a question or a response here, but as I recall back through my Career. Whether I was a compensation analyst, whether I was a manager, whether I was running an entire program, or like I'm doing now as a consultant, I often needed to create a lot of different flowcharts and process diagrams. Right. If I'm doing an SPM implementation that's going to involve sales operations, revenue operations, IT accounting, a wide array. Right. And we would have to do the beginning step all the way through the end. And if I tried to document that manually using some of the tools that I have historically used, I would always get really frustrated because it would take a ton of time. As soon as you're done, something's going to change. A comp plan, change an IP system, and you'd have to go back and manually redo all of it.

A lot of work.

There's a lot of work. It took up a lot of time, but I like to do it because I saw a huge value in it. Yes. However, you know, based upon a lot of the company sizes we have here, I would imagine you guys, if you're processing out or you're drawing out your process flows of all the steps you're doing, it's huge. It takes a ton of time. It's frustrating, but maybe you need to do it for internal audit, external audit, or for your own team. So what I have been doing over the last few months is looking at how can AI help me do that?

Yep.

Right.

And it looks like. Matt, we've got some people wanting to share. Nate, can we hear from you? Nate Garcia? Yes. Hi.

I. I just like using AI to decipher through all sorts of information where, you know, you get a file that has just so much content in there,

you don't know where to start or what to do.

So I love using AI for that.

Awesome. Adelaide.

Yeah. Hi, Gail.

Hi, Adelaide.

Hi. I go by Addy. It's a little bit easier. So here at Fluke, we have built, built in bots. They're RPA bots, so they're not the smartest, but they get the job done when they're needed. So we've actually overlaid them into our. Onto our SPM platform and they go into our system for us. They develop whatever reports that we need, like payroll, different incentive reports that my team then takes to just. It flags very specific. High attainment, low attainment, what, what are the outliers? And then from there, then my team can actually take that and have conversations with our sales leaders as to why are these. Is there the reasoning? Or dig. Dig in deeper to find out what is right. Or what's wrong with specific attainments. So they they also use that as well as do using it for audit purposes. And instead of just having an analyst sit there and download all of these reports and do the comparisons, our bots do them for us.

So Adelaide, you're looking for exceptions then you're using it to find things that don't look right information sounds like and did you. Is there a platform underneath that that you develop it on or is that built internally or what is that?

It is built by external consultants but using UiPath.

Beautiful, beautiful. Greg, let's hear from you.

A couple different areas that we found it a little different than the quantitative analysis type of stuff but building in ChatGPT, building GPTs that specifically are taking gong recordings and being able to evaluate the quality of the call both from the perspective of a comparison against you can upload Medic or something like that and see how the framework's going and whether the reps are doing the right things in terms of following that framework. We do it against comparing it to our optimal value proposition and then just general sales skills. We found that a bunch of our opportunities were getting lost because people weren't asking for the next meeting at the end of a call so close for a follow up action. I so simple things like that, especially with some of our BDRs as well. The other is in the identification of our icps. We have a lot of different subverticals. We have an incredibly diverse TAM that we work with so trying to sort through the best companies to target and surface those that's been a place that we've been able to use it. And then last is account research so coaching the reps if you're going to go in and be strategic and be viewed as a trusted advisor then go in with a thesis and we've got a one page business case that we've built and ultimately they're using that now to auto populate the one page business thesis. So you go in and then you can create the exploratory discussions to validate or adjust the business case. So some of the early stage stuff that we've started looking at.

Beautiful. Yeah. And I'm thinking also Greg, as you mentioned that you know applications to the sales comp area when you're doing call monitoring, if you're having interactions with you know, good number large numbers of people in the field around sales comp questions or dealing with disputes or different things like that, you know that you might be able to make sure that those conversations are happening correctly as well, so those are. Those are possibilities.

Yep. And again, I think the big news around the survey is that we've got. Because we'll wrap up this part. The big news is that about 70% of companies are planning on using AI over the next 12 months or so. And it looks like no surprise because we were talking about this. Oh, I think at last, world at work, Mark, the first out of the box is really this sales compensation design support. So I think that's really great. And then the reporting. So I think really interesting things are just coming right down the path.

Yeah. Yeah. And I think is kind of foreshadowed a little bit about what we're going to see. I think one of the patterns we'll see too, as you said early on, certain things happen differently than maybe later on. Early on, what we're seeing is like things that Addie talked about with finding exceptions or analyzing, crunching information, combining information, increasing efficiency and then moving, I think as we get going further probably into more the advanced problem solving. Because I don't. I don't think we're there yet. We see that in other spaces, but not in sales comp yet.

Not quite yet. Nope.

Yep. And just a final comment on these points here. I think it's interesting on the bottom section there that some of the lower responses, the below 10 percents, are actually popping up in terms of. Here's what we would like to be doing in the future. More scenarios, more forecasting compensation design, accelerating compensation design. So thinking ahead about how those things can be done. But a lot of it right now is around the analysis.

Yep.

And I think a lot about what we're talking about here too is what I'm hearing is it's saving us time in a lot of different aspects, which leads me to my next. The next. Sorry, let me get my mouse found again, leading me to my next. Next. Piece of this is that we're seeing it's improving speed and efficiency and it's leading to better solution development and maybe even faster solution development within our comp designs and creating those better ideas. I'd love to hear again from you. How are you seeing it? Save your time or reduce time so that you can focus on more strategic things.

As we're waiting for responses here, I'll. I won't resist the temptation to comment on this.

So this is gonna comment on it. Oh, go ahead, go first. You go first.

You never.

You never ask permission to.

Never.

So guys, this is the difference here, right? So you see some of these, the division here, speed and efficiency versus solution development. So right now it's about all about how do we automate things and that kind of thing. The solution development just seems to be emerging. So if you look at it, if freeze my team's timed for other work, reduces workload, more efficient administration on the back end, freeze my time, my team's time to create better ideas. Okay, well, that one I'd like to see a lot more of. So that, you know this whole idea that we talked about last August about AI or you. Right. It's a human AI iteration. It's not just pushing things to AI to make it faster or more efficient. So it should be freeing our time up to have more time to work on solution development. I think not to get too long on this, but I think the challenge is us. Right? The challenge is thinking and, and thinking is hard, right. Sitting down and saying, okay, I've got all this information now. I didn't spend all my time on spreadsheets, but I have time now to actually solution on this. I don't know how to do that. I'm not comfortable with that. I don't. I. I'm, you know, it's. It's too taxing on the prefrontal cortex.

Right.

So that's going to challenge us as humans to be better. Okay. End of speech on that. But I think this really tells you a lot. And seeing. In terms of seeing this division.

Yes. Yeah. Now, just two practical notes as I think about sales comp professionals and some of the work that I've been doing with our team. When you think about gathering information, you may be talking to your sales organization, your sales leader, other stakeholders in the plan design. One of the things that we have found is that AI has helped us pull together multiple interviews, multiple pieces of information, put it together to help tell the story and just create that outline for you. Again, it's that trust and validate. But when I think about the amount of time that you probably all spend, right. Talking to people, you remember pieces and parts and pull it all together, you can leverage AI to help you with that as well. So I think there's a lot of great things that are very practical that you can use this for on your job today.

All right.

And Matt, I know you and I were talking too, and you were telling me some ways that it's been helping you to free up your time. I know one of the things we talked about earlier was how it used to take forever to do 200 plan documents. And now with AI, it can free up our time to maybe so we don't have to maybe update 200 documents.

Oh, absolutely. So that's the one area that excites me the most, is the impact that it has on our industry and the teams. Right. So when we're thinking of building a sales compensation team, maybe have a junior analyst, if all they're ever doing is manual exceptions, checking accruals, doing audits. Right. It's very hard to keep that person focused and wanting to stay with the organization for a long time. Whereas if you can start them there, but then reduce those activities using AI, they can come up with good spiff ideas. They can help do rollouts, things that are more interesting and would keep employees longer.

And, Kate, I see you have your hand up.

Hi. Yeah, I was just thinking about the idea of aggregation of data, and it just kind of dawned on me in this moment as we're thinking about deploying a survey to all of our sellers to get feedback for the next design season. The act of actually synthesizing and teasing out core themes, instead of that being a manual assessment, I'm sure some bot thing could do it better.

Yeah, we've. We've used this a lot.

Yeah, I was an expert.

We can help you with that, Kate. Yeah, it's really simple for anybody, anybody who wants to share what they're doing, but it's really easy and it definitely helps.

Yeah, absolutely.

So two, Two. I'll just throw out two tips here based on what Kate said. Number one, creating that survey. Yeah, so we'll. We'll share with you guys what we called sales compensation for results is a little bit later here. But basically it's a program that's got a hundred and something different videos on everything from, from strategy to. To implementation, communications. Long story short, you get hours and hours and hours of video and you go, okay, how do I like survey? How do I put together a test or an exam on all this information? We could take, or we did take the entire script for hours and hours and hours of this, dumped it in there and said, okay, give me 125 questions, five choices, blah, blah, blah, and it did it. And it gives you a good starting point. So, Kate, you could do that for a survey. You could say, here are the things we want to learn about, or write up a, you know, 10 question, 20 question survey, three options, five options, whatever. It'll do it, you know, very, very quickly, and then you can start to work on top of that. And then when you get the results, you can dump it straight in. Key points, themes, quotes, etc.

Yeah. That's right.

Absolutely.

Great idea.

So we know, too. We know out there, too, there are a lot of AI tools available, and we hear every day something new is coming up. What we've found here, you guys are using AI too, and you're using. No. Surprise. Let me get here. Sorry. No surprise. Chat, GPT, Microsoft, Copilot are the number one tools that you are leveraging. We leverage those as well. Gemini, I think, is going to be an interesting one, because I know if, if you run, if you're one that said, no, I'm not really using AI, Surprise, you are. If you Google anything now, you'll notice that you'll get a Gemini prompt. So I think it's going to be really surprising to see how Gemini starts to move up that ladder. But we do want to hear from you. Are you using any of these tools? What else are you using and how are you using those?

It looks like one person said. Nate, GPT and Claude.

Okay, GPT.

Claude, can I just make a comment? Because we've talked to a lot of companies, so what we're finding is you're using Copilot because you've got the Microsoft licenses. What we're also finding, however, is that ChatGPT does have more functionality, at least today. Our team has been testing both side by side to see how, you know, they respond to different things in their work. And we are finding ChatGPT has a bit of an advantage. I don't know. Everybody, I think, knows that there's been a little bit. It even hit the. Hit the paper with Microsoft. Not too happy with ChatGPT right now. Right. Feeling that they're holding back some. Some technology that they had hoped to have. But I, I think you'll see that changing over time. And we're going to keep watching both. But that's, you know, you know, I kind of.

The. Yeah. The analogy I pulled off of this one is kind of like when we were coming out of COVID you had Zoom and you had teams, right?

Oh, yeah.

And so Zoom. Okay. This is just my bias. I love Zoom. Right. So you got Zoom, which is a really great product, but then everybody's on teams because it's included with Microsoft. Right. So it's easy to use. Yeah.

Approved.

Approved. Approved.

Right.

That's approved.

That's okay.

So any. Any thoughts?

Anything else?

Are you guys using anything different than. Than what you see here? And I know there's some other ones that didn't quite show up on the list.

No, I think I wasn't surprised at Chat gbt coming in as the top number. Right. The ease of use, the barrier to entry is really, really low. If you know how to use Google, you know how to use Chat gbt. Right. You could open up your phone, your computer, type in chatgpt.com and then give it a prompt. So if you haven't used it, you know, we certainly recommend. It's pretty straightforward, a great place to start. And again, not surprised that that's kind of the number one response we got.

Yeah. And then Addie, I know you mentioned earlier and you actually put it in the chat that you're using it for ulipath bots overlaid with your SPM platforms. And then you're using Copilot and Chat GPT as well. And then I see others Chat GPT and Claude Chat GPT. Jeff, I see you just started using Copilot this week. Would love to hear from one of you. What are your interactions so far if you've just started using it?

Well, it's, it's very, it's very early. I had only one really good success

with it, so I have to get

in there and die and try some more.

It was really about putting a letter together more than anything else. So being able to use it more in Excel or trying to dive into that kind of data that might be

more helpful in compensation is still.

Still on my list to do good. I think, I think the best way Jeff and everybody to. To learn this, you know, again, we're looking at 29, 30% of people using it in sales comp. Is. Is just try it. Right. Just. Just kind of get in and start trying it for things. So Kate brings up a good point like, hey, I could use it to design a survey. I mean you can use it for mass amounts of information. So as a consulting firm, we do lots and lots of interviews. Right. So, you know, start at the very beginning of the process. What used to take us like days of going through interview notes, redlining stuff, finding stuff. You can throw it into chat or other AI tools and it'll. It'll find all those themes in the interviews. Obviously the data analysis. Gail's got a great course on sales comp for results on. On Excel and she uses, uses AI to in that course as well. So amassing tons of data. We have this one, Michelle. It's kind of funny. We have. So when we hire new consultants here, we make them take this case study.

Right Do.

Because if anybody's ever been to business school here on this call and you've had to do case studies look at

them nodding their head. They're like, oh, we remember the case,

we remember anybody's ever, everybody's, anybody's have to do case studies in business school or in an interview coming out of business school. The rule of thumb is that you turn that, that pain and punishment onto the other generations that pass after you. So everybody has to take case studies or not. But we have this one that's got like I don't know, 75,000 lines of data and you know, I don't know how many columns. And it's about all about these call center situations and people we like. Okay, do they have the chops to handle Excel with this data?

Right.

So I took that whole thing and threw it into an AI tool and it found all the key themes and stuff within like five minutes. And I'm like, wow.

Yeah, pretty incredible.

Yeah, yeah. I didn't even have to sit, you know, I didn't even have to enter information. I just told it what it was and then it figured it out.

Which makes it even harder for how we go through this process. But yeah, yeah.

And then I just saw we have another chat that came in from Joseph Beerkak. Would love to hear from you, Joseph. I know you're leveraging it multiple ways, generating spiff ideas, stress testing existing concepts. If you're on, would love to hear you talk a little bit more about that as well.

Yeah. Hey everyone. So I pretty much use Chat GPT in every kind of scenario that I can possibly try to work on. Like if I'm doing some kind of work, can I use ChatGPT in some way to build my. Just recently we had a quarterly business review around our incentive payouts and I just had, you know, a few visuals and I just took a screenshot of my quarter team and distribution of the company on. We have multiple different components, so we had different. I usually have a quarter distribution on different components that we have. I said, here it is posted in ChatGPT. Can you give me the reasoning and insight? What kind of insight can you give me? And it gave me a really good in depth review of what I have. One thing that I like to use as well is you can upload memory to it. So I try to give it kind of resources and templates. So I try to give it to say, provide me back feedback as if you were, you know, a thought leader in the, in the field. Right. So that's just one of the ways that I use it.

So absolutely.

Good example, great example.

Thank you. Welcome. Okay, now we did, we do Understand that some of you may not be using any of the AI, at least not in your organization right now, with one of the biggest reasons being because of security. Now we know that's something you yourselves probably cannot control. But some of the other reasons or barriers that you guys have listed is that you're not using it was you're, some of you may not be feel comfortable because you're not trained on it. Maybe you don't have an AI expertise at your organization, but these are some of the things that you can overcome on your own. Like when we, when we think about training on it, there are a lot of training videos out there that you can watch. But the biggest thing, and Mark talked about this earlier, was getting in and just giving it a try. Now if a lot of you were on the think tank that we had back in February, you might remember that I told you one of the things I did with it is took it in my personal life and used it to help me find a vacuum cleaner. And those of you that remember that, you will be happy to know I did finally purchase a vacuum cleaner. My floors are nice and clean again. But I also, I'm getting ready to go on a trip to Texas and it's a multi city trip and I'm trying to debate do I want to fly and drive and do I want to drive from Dallas to Houston and all of that. And I actually used it and I have a project going on right now for it to give me. Okay, what is the best option? What's the most cost effective way that I can plan my travel? So that's another, just another way to use it in your personal life because you can use it on your cell phone, for example. Matt, I know you've talked about some other ideas as well. I'd love to hear those again.

Yeah, sure, sure. When it comes to maybe not being trained or not having the knowledge, one of the things that I've really found to be true is when it comes to AI, people can be very, very passionate about the topic. So even if you feel maybe you don't have all the knowledge, based upon the roles that we're in, where we're trying to increase sales, we're trying to increase profit, we're trying to drive down cost. If you find someone in your organization that's passionate about AI, even if you don't know everything about it, they're probably going to want to help you because they're passionate about it. And also how great is it to take a skill that you've learned Work with another person in organization to increase profit, to increase sales or reduce costs. Right. People are going to be excited. I know I would be. To be attached to that project. So don't be afraid to approach someone, whether it's in it somewhere else in the organization that might have way more knowledge than you. Because every time I've done that, I found the person is really excited to help me.

Absolutely. I know. I'm always excited to help you, Matt. You should reach out to me more often. I see too over here, Anu A you're using it, and this is an interesting one too. Using it to help do performance reviews or researching plan ideas. That's actually a pretty interesting way to use it as well. And I know, Michelle, let's talk about how you've been using and I know you've talked about using it in some of the research you're doing for your Riding the big wheel.

Oh. So those. I think many people know that I've got a podcast for women in leadership. And yeah, it's really very interesting because I spent a lot of time, hours and hours researching my guests. I want to know everything about them. And so I'm sorry, Super excited because I've got a pretty renowned cardiologist who will be coming on, who's focused on women's health and doing the research on someone like that has taken me in the past several hours, a few days, definitely an entire weekend. Right. Like, no qualms about that. But I enjoy doing it. However, now I just enter in someone's name. This is what ChatGPT does now. It continually is getting new links. So now it's linked into LinkedIn. All YouTube videos. Relevant YouTube videos about this guest popped in. Everything that I need summarized around the conversation. And I said, you know, here are the things I want to talk about. Even help me with the outline. So it got me 80% there and I had more time to actually listen to her videos and get more into her thinking. So, guys, when you think about leveraging the technology, this isn't about just saving time to put your feet up on the couch. It's a really awesome opportunity for you to grow and to think and to grow your own competency. And just like what Matt said, get a user group going at your organization. People really love to share what they learn. I know I do. And I learn from my team every day here at Sales Globe.

Absolutely. And then, Remy, I see you're using it for your quota methodology then helping you generate ideas there on you. I also saw you had a question about on the sales comp, is there some sort of a library of prompts for incentive comp? Marc, Michelle, I think you guys would love to maybe talk about that a little bit.

Well, I think we're going to be showing them a little bit about that. So guys, you can today. I mean we'll be pretty transparent about this today. If you want to know something about incentive comp. Not exactly a library. Yeah, you can, you can type it in to copilot. You can ask chat. I have done it. We've tested it. You're going to get stuff from all kinds of sources, some of which are reputable and some that are just not. So we ended up just creating an internal GPT for that and are. It's really exciting because we actually designed it transparently having in mind our clients. Right. Just providing an on site advisor when we're not on site. And what we found is that our team is leveraging it, highly leveraging it when they've got questions. Anything from I need a good megadeal clause. Can you give me that today? So some of you on this call call I mentioned that one in particular, who are our clients will have asked us to do that for you. So you know, I think you gotta trust and validate and verify. But that's what, that's how we are leveraging it today. And that's how you kind of get that internal repository.

Yeah, so.

Oh yeah, yeah.

So I mentioned, I mentioned that I use it in my personal life and I also use it in my professional life in sales compensation. And I know Michelle was talking about this just a minute ago how we do have an AI here at Sales Globe. We call it Sales Globe Sage. And I've been leveraging it to help me with some of my sales comp design questions. So let's take a look at what that looks like. Hi, Sales Globe. Sage. I'm Gail. How's it going today?

Hey Gail, it's great to see you.

I'm doing well, thanks for asking.

How about you?

Ready to tackle some sales compensation magic today?

Hey. We made two acquisitions this year and each company added some new products to the overall portfolio. The vision is that our legacy sales organization would sell all the products, including these new products we just added. But it just isn't happening. Why might this be the case and what should we do about it from a sales and sales compensation perspective?

Gail, this is a classic challenge and it boils down to a few key reasons. First, your legacy sales team might not feel confident selling the new products they may lack the training or understanding to position them effectively. Second, they could be sticking to what's familiar because their compensation plan rewards them for selling legacy products, not the new ones. Third, there might be a cultural disconnect between a legacy team and the acquired companies. To fix this, you'll want to adjust the compensation plan to incentivize selling the new products. Make it worth their while. Pair that with targeted training to build their confidence and knowledge. Also, focus on aligning the teams culturally and operationally to make cross selling feel natural. What do you think? Does this resonate with what you're seeing?

Yes, it absolutely does. So how might you design the plan to motivate the sale of the full portfolio?

Portfolio of products to motivate the sale of the full portfolio, Gail, you've got to align the compensation plan with the behaviors you want to drive.

I think that sounds great. Are you able to give me three design options for the plan?

All right, Gail, let's explore three design options for your plan to motivate selling the full portfolio. First, you could implement a product mix multiplier. This means tying a portion of the payout to achieving a balanced mix of legacy and new products.

Second.

Second, consider a tiered bonus structure. Reps earn incremental bonuses as they sell

more of the new products.

For instance, selling one new product might earn a small bonus, but selling three or more could unlock a significantly larger payout. This creates a clear incentive to go beyond just dabbling in the new offerings. And third, you could introduce team based incentives. If your legacy and acquired sales teams collaborate to close deals that include products from both portfolios, everyone involved gets a share of the reward.

Can you write up the tiered structure design defining the measures, weights, and mechanics for me though?

All right, Gail, let's map out a tiered structure design that combines measures, weights, and mechanics to motivate selling the full portfolio. Here's how it could look. First, let's define the measures. You'd want two key performance measures. One for total revenue to ensure overall sales performance and one for new product sales to drive focus on the new portfolio. Each measure should have a clear definition like total revenue from all products sold and revenue from products introduced post acquisition.

So very cool. So that's our how we're using it. And you see that. I mean, we actually are doing that and that was why we created this advisor. And just to be clear, that wasn't really Mark. He actually really is right here. So what was that, Mark?

Well, you know, it's funny. We, we, we mapped it and mapped all the video. So this works in video, it works in voice, it works in text. So you can basically dump documents into the text. You can do anything you want. It'll create documents for you, it'll do analysis, et cetera. But what this does. So you looked at the two different areas where people are using AI before in terms of speed and efficiency and idea generation or problems problem solving. This does both. So it's increasing speed and efficiency because you can move faster on things, but it's helping you with ideas because it's a closed system. So we basically took our databases, books, reports, everything and dumped it into this. And it's all curated so it's all correct information. It's not pulling something from a Forbes article or something like that. And it'll also supplement with external information. So yeah. So really became a. Has become a really valuable tool.

Anybody who has not just get a hold of us and we'll let you check it out. Okay. Not, not a. We'd love for you to check it out actually some of you have a

chance to drive it. Yep.

Yeah. All right, that sounds great. So now this next segment and okay, so that's all we got on AI and I would say that was a lot of information.

But before we go, any other questions on the AI? Oh, there you go.

Mark and Michelle, I we have a. Have a great one here from on. On you and talking about confidentiality with using chat and if we are uploading client data, how do we do that in a responsible way basically. And I think that's going to be all about that governance on how you use AI that your organization's going to set. But one of the things too about some sales web page is that when we do load information into that or talk about that, that's not getting pushed back out there on the web. It is closed. But when you are loading into chat, if you are loading data, I would say be careful not to be loading any client specific information. And you guys can create, what you can do is create like a cheater sheet for yourself. So you know what it is. But just be very careful not to be loading clients specific information that calls that out.

Absolutely.

I don't think there's, you know, I don't know, I don't know how chat works in terms of security. I know with ours it's closed. Right. So it doesn't go anywhere. But that's, that's a very good question. So.

Yep. All right, so I want to introduce our next section on economic factors and what we're going to Talk about or. I was very excited about this. So I don't know, maybe a year ago Mark was asked to be part of the Federal Reserve Board here in Atlanta, which made us pretty excited. And what it is is they, they pull together economic forecast information poll. About 700 companies or so are involved in this.

Right. It's the inflation expectations panel.

Yeah, the inflation expectation panel. So we decided to bring this thinking out to you guys and then we're going to have a conversation as to what we think that's going to mean to you on your job and sales comp overall and quotas. But we want your feedback after this because if you like it, we love it. If you like it, we want to bring it back to each one of the think tanks. Just give you some indications and information that maybe you. Isn't readily available right now. So yeah, Mark.

Yeah. And I think where this started, Michelle, was really the question of where do you find out what's going on?

Yeah.

For sales compensation. And too often the answers we'd get is like, well, you know, I look at the such and such survey and I'm like, okay, that's kind of like looking at an oil painting, you know, to drive the car. It's like it's historical information, it's not giving you current information. And so it's important as we're doing sales comp. And you see our revenue roadmap here that we talk about quite a bit. You know, those layers of insights, strategy, coverage and enablement. Tying those things together with compensation, of course, being an enablement discipline. It's really important to have good insight or understanding what's going on in the market, customers, et cetera, to be able to inform your sales compensation design. And so the questions that I'm always asking and asking of people and asking of clients is this first one here. How do we understand what our C level is concerned about? Because looking at pay surveys is not telling us that unless that's like the biggest thing, you know, that's going on, which is usually not the biggest thing. So how do you know what's, what's going on? The sea level. And how do we know that before we even get to work in the morning so that we know what we should be thinking about versus reacting. Right. So daily sources of information. But then how do we get the bigger view on what's going on in the market? So what does that big view tell us about where sales compensation may be headed and what might we plan or do based on. On what we see? So with so Much moving in the market, that's really important, but I'd argue at any time that's really important. So we pulled a few different views here and we're going to show you in two pieces. So we're going to show you first inflation, unemployment and cost of labor and just a few views and then we're going to pull that together. And what does that mean? And then we're going to take a look at some other ones that include tariffs, which I know everybody wants to hear something about tariffs as well. So the big one, this has been the big one in the news for what, the past several years? Well, you can look at the timeline and I don't even have to say it, but the past several years this one's been in the news, which is inflation. And we hear, well, inflation's transitory. Well, we know that wasn't true. And you know inflation's actually getting better, right? Well, the rate of inflation may be getting better, but the level of prices doesn't go down necessarily maybe in some, in certain pockets. So I pulled a couple of snapshots here and in what you see on the top in the red box is just a closer in view of what's going on with inflation. So believe it or not, inflation is down in the March report. So we haven't seen the April report in this yet, but in the March report inflation is down, it's a 2.4% from 3.5% a year prior. And so it's like, well, doesn't really feel that great. Well, why doesn't it feel that great? And this is the view I don't think a lot of people see. But it has implications to things like sales comp. Because it has implications to pay levels and people's ability to, you know, to, to, to afford to make a living and those kind of things. If you take the big view, it's very revealing. So left hand side of the chart here. And I only went back to the year 2015 in the visual, but I took the data and went back to the year 2000. So year 2000 to year 2020, the cumulative inflation rate was 50.3%. So what does that mean? It means if you paid a hundred dollars for something in 20 in it would cost you $150 in 2020. Right. So that's a big difference. Okay, so now the big one. The big one. So if you look at the year 2020 through the year 2024 up to where we are right now, that four year period or so, the cumulative inflation rate is 21.2%. So if you bought something for $100 in 2020 would cost you $120 right now. Right now. So what does that mean? That means you almost have half of a 20 year inflation rate in a 4/5 year period. And that is why we're hearing so much about it and that's why it's causing so much pain. Basically the noose is very tight around our necks right now and it's not loosening, even though we say, well, the rate is slowing. Yeah, but it's, but it's still tight. Okay, so what does that mean for sales compensation? We'll come back to that in a few minutes here after I hit a couple other charts and talk about what that means. But, but basically think about things like pay levels, affordability, what we have to pay people, et cetera. So let's go to the next one. Unemployment. So unemployment, you can see up and down. It hit some peaks around 2010 and also of course in 2020 and now it's at about 4.2%. So what is full employment, Michelle?

4%.

You got it?

I got it.

Yeah, that's exactly right.

Oh my God. You guys about at full employment, right? Yes.

You can say the labor participation rate is actually a little bit lower. Trending lower, but not significantly. But we're at full employment, which means that we have a lot of people in jobs. We don't have a lot of people out looking for jobs. So we don't have people just, you know, running around trying to get jobs in your companies that don't have jobs right now. So it may make it a little more challenging to find them because already in jobs. Okay, so then last one is, and I love this one, this, I really geeked out on this one. Okay, so this is cost, this is employment cost. And it's the employment cost index in the gray line. In that gray shape. Employment cost index includes everything that we pay people. So it's base salaries and incentives and benefits and everything we, we have to pay to get people. And you can see how that's trended. And you can see also the blue line, which is quit rates. So this is the change in quit rates, so people quitting their jobs and leaving. And you see an interesting relationship. I mean they're, they're correlated to some degree, but you'll see there's a peak there for both of them around 2022. And I put some brackets on it. That's what we remember as play the harp music for the memory. The War for talent.

War for talent.

The war for talent. So what was happening was people were quitting jobs and they were going to new jobs and the quitting was driving up prices for jobs because people were, you know, jobs are getting bid up and we were getting, you know, people that were coming in saying, you know, I want to make this much money. And it was like, but you're not worth that, you know, because people were paying ridiculous amounts. And what were companies doing then? They were increasing their costs by raising not just incentives, but they were raising salaries.

They were, yeah.

So what, what companies were doing? They were raising fixed costs. And we here at Sales Global crowing away, we're going, why would you raise fixed cost? For a short term disequilibrium between price and demand. Right. For supply and demand for labor. And what are they going to do? Their margins are going to go down, etc. Well, what did the companies end up doing?

They ended up laying people.

People off. Right. Just layoffs. And so you can see then the price goes down. So we're at a point now where we actually have lower, lower costs relative to where we had been over the past several years. So let's pull that together in terms of what it means then get some of your thoughts as well.

Yeah, so I think the big story, Gail, would you mind bringing up like, all three, because they're pretty much related here. So we've got slowing inflation, right, as Mark talked about, but prices are still high. Right. We got 21% higher than 2020, lower unemployment and lower employment costs and quick rates. So what we're seeing is that prices are still remaining high. There is definitely lower employee purchasing power. Right. So that's putting pressure on pay levels. At the same time, though, you've got more open supply or less open supply in the market because people are staying in their jobs. Right. So with layoffs in particular, we always see people tend to stay in their jobs. So we're seeing there's more stability for your team and the business. We're seeing more people are in the office. Right. The cost of labor is stable. There's a little bit less job jumping. But, you know, so for sales comp, what does that mean? Right. From our perspective, we think that if you want to keep the top performers, it's time to sharpen your employee value proposition. For us sales comp professionals, as we think about high performers, we want to think about incentive compensation plans that are competitive with the market. Maybe now is a good time to understand what your competitors and what similar industries may or may not be doing. And then for you in your own job. Right. Great opportunity to be looking for the talent that you need as well. So those are a few of the things. Oh and then we did talk about the whole performance management. Great time to be looking at across your team and understanding and trimming out those who may be lower performers. So we wanted to open that up to you. This is just a little bit of our thinking. Anybody have any comments on this?

Yeah. And so what are you doing in, in this with these factors, you know, and, and are you seeing these in your business? Or maybe it's different. I mean obviously it's could be different by industry as well.

Yep.

Comments, reactions. I think everybody is like agreeing it's

a toughie this one. Well, I mean I think. But the big point. Right. And I, I want to get onto the. I love the neck set of data that you talked to him. But the big point here is we just want people to think about as we're getting ready for sales comp season, pay attention to the comp plans, are they competitive? What's your incentive look like? And then just, just make sure that you're lining of course your pay for performance.

Yeah. And, and you know, again the point too that you should be looking at this kind of information as your planning and doing your work to have the bigger view. And I think what it does as well is it elevates us all as sales comp professionals in terms of having that bigger level of visibility versus myopically looking at plan mechanics or some pay survey. Right. And we'll provide all this to you guys as well so you can take a look at it. So let's look at the next view, shall we?

Yeah. This stuff I found super exciting, Mark.

Yeah. I mean if you like numbers, you're going to love this. And even if you don't like numbers, you're going to love this.

I know, I liked it. No, actually pretty good numbers.

Tariffs, recession and interest rates. And let's, let's take a jump in here. And this is from the Atlanta Fed. This is from the inflation expectations panel. We're sixth district. We're a member of that. This has been highly correlated or this has been matched up to broadcast u. S Economic data and it's a very high correlation. So I think the mix of businesses, etc is similar to the country as a whole in terms of the areas that it covers. So it's a very good representation of the country as a whole. This why by the way, sixth district of the, of. Of the Fed is The only one that does this kind of business insight.

That's right, yep.

Survey and panel as well. So looked at two things here. One is sales levels and the other is profit margins. Top chart is sales level, bottom chart is profit margins. And it's looking at it over roughly a 10 year period, 10 to 12 year period. And it's looking at the change in sales levels and the change in, in profit margins. And it measures something called the diffusion index. Anybody know what a diffusion index is? I know it's hard to answer that question. So diffusion index is basically the net, net change or net change in terms of companies that reported an increase in that thing like sales levels or companies that reported a decrease. So if you had 10 companies report an increase in sales levels and an 8 report a decrease in sales levels, that difference would be the diffusion index. So that would be a positive number versus if you had the opposite, it would be a negative number. So it's looking at the change, not the magnitude. So it doesn't say what was the size of that increase as an example. So what you'll see is a general trend here. Sales levels dropping of course, during COVID and profit levels also going up in, in early 2021. And then you can see the trend down here. And, and you can see to the current level where we are on that trend down. And so we actually have a bit of a downtick. And so that's saying, you know, we're feeling some pressure there in terms of sales levels. What does it mean for sales? Well, probably a tougher selling environment, tougher to get margins. And we might need to think about that relative to quotas.

Yep.

Let's take a look at the next one. That pause was for anybody that wanted to jump in as well. Oh, nobody grabbed on that.

Nobody grabbed it. No.

We did have somebody chime in.

Oh, did we have a question? Was it a question?

Oh, hold on.

Oh, okay.

Go ahead, Mark.

Okay, so, so then this one, this one's everybody's favorite subject now, or at least favorite subject now, which is tariffs. So unit cost growth and units unit cost expectations. So what's a unit cost? That's what if you're a manufacturer or you're a, you're a company making something, that's what you're paying for your input. So we have to buy parts from China or we have to buy parts from Mexico or, or whatever it might be, or maybe we just have to buy things directly from those countries or, or internally. And so you can see with the, the light gray line that is the actual unit cost. And we broke this out by industry. So we've got a few different industries that you can see there. But you can see the trend is in terms of the actual unit costs going into where the red dotted line is that's actually low or decreasing. It is not going up up, but the dark green line, which is the expectations one year out are going up. So it's basically saying our costs are not yet up, although there's a lot of talk about it.

Right.

But we expect that our costs will be up. So it's showing a sharp increase. And so you see the two boxes on the left hand side. 2% actual unit cost growth, 3% expectation. And I would argue that the expectation really seems to be higher than what that number is showing. Because if you look at the text just below that, if you look at the producer price index over the past decade, that increase has been annually about two and a half to 3%, which is right within this range. So I think, you know, the smoke is bigger than the fire so far, but there's definitely concern or sentiment that we're going to have these cost increases. I'm going to pause right there for any comments. Again, just a little brief Zen moment for anybody to throw any comments in or questions. Go to the next one. I'm just going to hit a couple more guys and we'll summarize on these points. Okay, so let's go to the next one.

Hold on

a little more Zen time. There we go. Okay, so then we, then what we hear is, okay, well, wow, the cost, things are going to go up because prices are going to go up. Therefore we need to raise quotas or we're not going to sell as much. We need to lower quotas. Right. And so there are a lot of things that depend in here. We're going to show you the puts and takes in a minute. So this one is a question of how much tariff cost would you push through as a company? And we broke this into two groups, Goods producing firms and services producing firms.

This I thought was a great, great information, Mark.

Yeah, so, so the goods producing firm makes sense. It's like, okay, I'm buying goods, I'm buying stuff and I'm putting it into my machinery or whatever I'm selling, right? Yeah, but you look at it and you're like, well, why would a service producing firm have increase in, in costs? Well, it's because a lot of service producing firms use things to produce their services. So if you're an I. T. Consulting firm, you're probably buying equipment, right? You're buying, you're buying hardware and stuff like that. So there is that cost. So it shows two areas. On the left hand side, what, what would you do in a 10 cost increase scenario? On the right hand side, what would you do in a 25 cost increase scenario? How much would you pass through? And you can see the service, the goods producing firms are much more aggressive about this. So goods producing firms saying we'll pass, keep. Go back to the last slide, please. We'll, we'll pass through 62% of that cost increase versus services 55%. But then they both pass through less as that cost increases. So 25% cost increase, they're able to pass less through, which you might say that makes sense because you can only push so much through. So if you break this apart, you got part of the cost that gets pushed through to the customer. Raises prices. Oh, raise quotas. But then you have part of it that or maybe not, depending on the elasticity of demand, which we'll talk about in a second. Or some of that's not passed through, which means that decreases our margins because you can't, you don't get the same margin on passing through a tax that you do on actually producing product.

Yeah.

Okay, so a couple things to think about there.

Yep.

All right, let's hit the next one. And so then size matters and sector matters because that's different for what companies are going to do on the pass through. So two charts here. The top one is company size just roughly broken into smaller companies and, and larger companies. And then industry group. And we broke out five industry groups there. So the larger companies say they're going to push through more to customers as cost increase. In fact, you can see the bigger companies say we'll pass 43, 3% through at a 10% cost increase. They go up 46 and a half percent through at a 25 cost increase. Meaning they apparently have some pricing power. They're able to do that. But smaller companies don't have that same power. They're actually decreasing. And where we're seeing that increase is actually in the manufacturers. So let's look down to the bottom chart there. So retail and transportation highlighted in red, they're going to push the hardest. Okay, so those are the retailers. Whether you're buying online on Amazon or Wayfair or you're going to Walmart or Nordstrom or wherever you like to shop. Right. The retailers are going to push it through because they have the pricing power and they can push it through. On the consumer. And so it's going to depend on, like I said before, the elasticity of. Of demand. Meaning basically, if, if my demand is inelastic, it might be something like I'm buying a washer. My washer broke, and I'm not going to go get a washboard or do my wash by hand. So I have inelastic demand. So I have to buy that. So I will tolerate the price increase. And inelastic demand is basically okay. The price of Corona just went up. Well, I'm just gonna. I'm gonna, you know, I'm gonna get a Molson. No, I'm not gonna do that. That's. Let's go to another place. I'm gonna have. I'm gonna have a Sam Adams. All right, so. But I have elastic demand because I could switch my brand date like Sam Adams. She's in Boston. So. So I'm going to switch. I'm going to my demand switches. And then the next one in the yellow is manufacturing. They're the next most aggressive. So they're basically saying, we're gonna. And you can see they'll increase prices or pass through more as prices increase. So then you see a little bit of a supply chain thing there where you've got manufacturing raising prices and then the retailers having to buy that and also raising prices.

Hey, Mark, we do have a. I think a great and timely question from Nate that I think we should get your perspective on. And then I know we do have some people who have run both pricing or revenue operations as well as sales compensation. So are you seeing companies adjust pricing strategy, margin targets, or compensation planning because of what's going on in the economy?

Well, they're definitely adjusting pricing strategy and margin targets based on anticipation. And I did not. I guess it's in the appendix, but I won't go all the way back there to show you this. But if you look at what companies did in the last quarter in terms of the. The GDP report that just came out, there is a massive spike in imports. Right. So they're apparently considering that, but they're trying to get in before the. Before the tariffs hit. Massive spike in imports, which is, I guess actually reducing our GDP because it's imports. Right.

So, yeah, and so I want to comment on that. What we're seeing is that companies are anticipating this is going to happen. And so what I'm seeing is at least the proposals coming across my desk and the things that our clients are asking us about is how do I get more productivity and efficiency out of my Team. So the things like job role decontamination, the things like sales capacity and what it really looks like today, those. The things that we're being asked to look at before the incentive compensation plan design, which is really the right way to look at it, because the plan, if you think about it, and you guys, you professionals, you deal with this every day. It's. We need to fix the plan. So reduce commission rates, make the pay curve less aggressive. But they may not be addressing the root cause or where you really have opportunity. So in this time that, you know, companies are where we're expecting them to say, okay, we're stopping. Oh, and I saw in the paper, you know, like, we're consulting engagements are being canceled, you know, by Norfolk Railroad and other things like that. But really what we're seeing is the smart companies, they're coming to us and they're saying, look, now is the time and a good time for us to clean up our own house. And we need to be looking at how we can drive efficiency and productivity. And then, you know what? That still does lead into your comp plan. Right. So we're being asked about how many people should be paid on a deal like these things when. When we're anticipating markets are tough or going to be tougher. That's when those questions are being asked us as professionals, you know, in this field, we should be asking them all the time so that when these times come, you're not having to react. Right. But now. But that is what we are seeing, so. Great question, Nate. And, yeah, we're seeing that companies are beginning to focus on that, but in a little bit different way.

Yeah. And there was a great Wall Street Journal headline that came out several days back, and it was like, amid all the uncertainty, CEOs are doing or controlling what they can, which is like cost and efficiency, Right?

Yep.

And. And the problem with controlling cost too much is you're cutting into cutting into muscle. But if you're increasing efficiency like you're describing, then you're becoming more effective.

Yep. And so it. It's music to our ears when. When we're being asked to support that because it's so easy. And how many of you are in situations where times are bad, layoffs occur and you cut into the muscle. It's also very difficult to build a sustainable sales strategy when that's your. Your environment or way of working.

Yep.

Yeah.

All right, I want to hit Justin's question real quick, which I do not know the answer to. Curious. How long you think companies will absorb price Increases versus pull full past full pass through. I guess Justin, you probably agree when I say the biggest issue here is lack of clarity and visibility on what's going on. I think that's what's really affecting everybody is, you know, if we said we knew what was going to happen and there was a firm policy and firm decision and it was done, then we'd say, okay, we know what's going to

happen, we'd know where to invest.

And the idea of moving manufacturing to the, to the U.S. you know, quickly is, is not realistic. And obviously the companies will move it to, to lower tariff countries. But you have to know the rules of the game. So nobody knows the answer to that. Obviously.

Yeah.

Okay, let's jump to the, the last little piece here. And, and this one's on probability of recession. I think this one's really interesting, guys. Okay, so, so according to the numbers, if we look at prediction of recession happening in the next year, which is the way they predict this, here is the difference between 10 year and 3 month treasury rates. It says basically we've got about a 30% firms being more concerned than the smaller firms either because they think they have better information or do have better information or maybe they're just more cautious, it's hard to know. But the sentiment says recession is going to happen. But the sentiment is not necessarily the data. I was listening to a financial analyst the other day and a person that, you know, does a lot of, a lot of trading and things like that. And this is, you know, the big company does this and they were saying it was about a 30% chance. So the people that are doing the numbers kind of feel a little bit differently than the people that are just talking about how they feel.

Interesting, right? Yeah.

Feelings.

No.

Got to go by the numbers. Right. All right, so let's wind this up appropriately so and talk about what it means.

Let's wind it up. Okay, so we got three things that Mark just touched upon. Declining sales and profit levels, tariffs, higher the anticipated costs and pushing through about 40 to 60% high recession sentiment. Now what we know, and I asked my friend Matt over there if he would join me in this conversation. We know it can be, it could be challenging sales environment. There's going to be some pressure on pricing. Yeah, we can say all this stuff about let's strengthen our value prop, but the reality is you're going to be asked about quotas. Right. Either pushing those quotas down if we don't have the, if we have the elasticity demand, where you're going to be looking at driving quotas up or if you don't change your quota, Right. People not hitting quota. If you've got the elastic product and then inelastic, you know, everybody's going to

over exceed potentially it's a mixed, mixed signal. So you can't make a blanket statement on anything.

You cannot. So, you know, our advice is know your business and ask these questions. But I thought it would be really great if Matt could give us some perspective having to deal with those different environments across different types of industries.

Sure, sure. So I think as you noted, it's going to vary by industry. Right. Every company will be different and there'll be different elasticities of demand, especially around pricing. So the example I always like to use, I have three kids, I have a wife, and if my refrigerator breaks, I'm not happy that I got to go buy a new refrigerator. But guess what, I got, you know, an hour later I'm going to the store and I'm buying a refrigerator. If it used to be $1,000 and now maybe tariffs come into play and it's going to be 1500, I still have to buy that refrigerator. Right. I don't have too many options other than buying a used one, something like that. Whereas if I break a golf club, which is a luxury good. Right. I don't need one. I can make a decision like I can continue to live without buying another golf club.

Or change the golf club.

Or change the golf. Yeah, exactly, exactly.

So if I'm golf Matt and this man can hit a seven iron holy. Like 200 yards. Which we saw last night.

Just saw it.

Yeah. Yeah. So if, if I'm setting quota for cent when the refrigerator was $1,000, that's going to be impacted. As Mark showed us before, if they're only passing through 40 to 60% of a tariff cost. Now every refrigerator we sell, if they're quoted on profit, they're going to be. It's going to be harder to get to that number.

Much harder.

Right. Because every single deal that they sell is only going to get them smaller profit than they got before.

Right.

So is there a safer compensation plan type or measurement, you know, that's more recession resistant or tariff resistant? Right. When you think about a quota based plan, a commission based plan or an mbo, I think as we noted before, every company is going to be different. You have to look at what's the elasticity of demand on your products. And then the number one thing I would recommend is if we're in an incentive compensation role, you gotta Sit down and have a coffee and long discussion with your pricing and revenue management team. Because maybe the quotas you rolled out back in January that sales loved and finance loved, things are changing a bit and it's a bit scary. We don't want to go out there and just raise quotas, lower quotas, because things continue to change. But it's something we have to monitor because it's. Realistically, we're going to maybe have to do something different. Maybe we need a spare spiff. Right. Maybe a spiff isn't going to cut it. And certainly when it comes to quotas, we like to roll them out. We like to be strong with it. We don't want to change them. Right. We don't want to increase quotas, we don't want to reduce. But you know, that question is being asked more and more, I think, in our industry.

Yeah. And I think there's this fear of changing quotas in the middle of the year. Like, I don't want to do that in the middle of the year. Nope.

But I think for, you know, a lot of us on this call, you know, we may hang up on this call and you leave your office to go get a cup of water, there might be a hundred sales reps out there who are wondering, what the heck are you doing with my quota?

Yeah.

Yeah. So I would take these. Thank you, Matt. And to your, to your points, Matt's points. I would take these three questions on the right hand side, the top three, and ask those. Right. So you got to basically break apart your product mix and your customer mix. So what's going to have elastic versus inelastic demand? How much of the price are we increase? Are we going to pass through? And in terms of customer mix, which are the right customers to be selling to, which may have an impact on the sales compensation plan, because we may motivate people to steer towards certain types of customers. They're going to have more inelastic demand. Right. So anybody that tells you, oh, you got to raise quotas or lower quotas, unless you've done this analysis, you don't know that answer.

That's right.

And to the point, Gail's kind of making too wait and see is not a bad strategy either because changing things without knowing any, having any visibility is very hard to do. So right now's the time to plan for what you might do.

Yeah.

And I'll encourage people to, you know, think about and go back to what happened during the pandemic. Now, we know there are a lot of things that are different, but some things that are the same and the reactivity does not serve companies well. We do know that.

Right.

So, you know, kind of learn from what you guys did in the past as well your companies did, and see if you can do something a little bit different.

Yep, yep. I'm looking at some of the Boston folks on the phone there. There are others on here that I know from Boston. There's Greg. And I remember during the pandemic, everybody was like, we're going to lower thresholds or take thresholds away or we're going to lower quotas. And there were a couple of Boston companies I know, and I bring this up because the Boston companies tended to be a little tougher. They're like, look, there's good times and there's bad times. We'll get through this. And they just held steady.

That's a tough New England.

That is a strategy. That's a strategy.

We're tough, tough people.

We do have a question from Nate Garcia. When quotas are being changed, would you recommend working on sales roles and segmentation?

Well, I think quotas are going to react or respond to your sales roles and segmentation, so I would not say you necessarily need to work on those. It might be just adjusting the goals themselves. If you said, well, we know things are different because different customer groups are going to buy differently and we need to focus in different areas, then you might do some adjustments and segmentation to. To redeploy.

Yeah.

Or possibly on roles. But, yeah, again, think about the revenue roadmap. You know, you got to do the upstream disciplines first, so make sure those are all in line, then deal with the compensation.

Do you know, I could not have said that better myself. Sales club Sage. I mean, Mark. I mean, Mark, go ahead. Sorry.

All right, so what do we do now?

I think we are. We are ready to.

Well, I think, you know, first, let's see. Do you have any questions whether. About.

What do you mean?

What's this talk about?

Do we have any more questions out there?

Okay, Nate, Nate, Nate, Nate. What's the revenue roadmap? Okay, what have you been.

What's this?

Have people been listening? Anyway, so in short, revenue roadmap, mate, We'll. We'll share this with you. Is the. The. The. The model that had, you know, all the sunlight and clouds on it and stuff before, you know, Angel Sing is the model we saw before, the big square model that has. There you go. It has the four levels of insight strategy. There you go. Yeah. Insight strategy, customer coverage and enablement. And the whole point on this is that when organizations are performing well from a sales standpoint, they're doing these four things well. These four layers, well inside on the market, customers, competitors, macro trends like we talked about, using that to inform the sales strategy, which is our action plan for growth. Like, what are we going to. What are we going to sell? Value proposition, segmentation and targeting. And then put into action by the coverage model, which is your roles, channels, deployment and sales process. And then supported by the enablement layer, which is your compensation technology people program. So whenever you're working on sales compensation, you want to make sure you understand the alignment of these points. Because a lot of times sales compensation issues that show up aren't sales compensation issues proper. They're things that are maybe misalignment issues. And the other thing you want to do is from your revenue roadmap, interpretation what we call the C level goal. So you can look at the book what your CEO and ews that show up aren't sales compensation issues proper? There are things that are maybe misalignment issues. And the other thing you want to do is from your revenue roadmap, interpret what we call the C level goals. You can look at the book what your CEO needs to know about sales compensation. But the five big priorities around customer and product and coverage, talent and financial. See, I remembered all five.

Good thing.

I was taught a long time ago, never say I have five things. Say I have several things, because then you're going to know about sales compensation. But the five big priorities around customer and products, forget halfway through.

Well, that's what I always say.

I knew those.

Oh, yeah.

All right, so there's the answer to your question, Nate.

Yep. Okay, so I think that that does wrap us up today. And guys, like, I thought it was really a great. A great think tank today. I appreciated everyone's input and feedback. We are sending out this deck and we're actually sending out an extended version, if you can believe it or not.

We have graphs and coverage, talent and financial. See, I remembered all five that Mark

created that are not in this. You know, in today's thing.

Right.

We got a few more in there. No, it's good thing I was taught

a long time ago, never say I have five things. I have several things. Because then you're gonna.

Pretty exciting. So we want your feedback. Please, as always, reach out to us. Please be sure to reconnect with people as well.

And Gail, I think you're gonna jump to the next slide.

Yeah.

Yes. And then I want you also, we've talked a little bit about sales compensation for results. Go check it out. And that's where you're gonna see my new course, which I'm super excited about. Excel for sales comp professionals. Be sure to check that out and you can get to it by clicking on the QR code that you see here on your screen.

It's really good. Gail, you did a really wonderful job. But it's kind of cool, you guys, how she kind of stepped you through how you can use Excel and create those pay curves, etc. It's super cool.

Great course. So it's all, it's all on demand as you need it. So check it out like, like, like we said before, if you want to try out Sales Globe Sage and give it a, a drive, just contact us. You can contact us through the platform or just drop us a note and we'd be happy to do that for you.

Okay. And thank you so much, guys. I guess we. Okay, our next think tank will be coming out with a date in August and then probably in November. And look, I do encourage you guys all to go out to riding the big wheel. We've got some great guests on there, some people talking about AI and as always, if you know some fantastic leader, female who you would love to be on the podcast, please let us know. Sales comp for results we've already talked about. And free ATIVE Friday. Check out our videos. They're a lot of fun. Thank you again, Parker.

Yep. And, and if you need help, need advice, consulting help, just, you know, drop us a note or give us a call. Be happy to help you out as well because we showed you a lot of cool AI stuff, but we do full projects as well. Well end to end, so.

Yep. And be sure that everybody stays in contact with each other by checking out our LinkedIn group. Yep.

All right, thanks so much, everybody. Have a great rest of your day and an excellent weekend.

Thank you.

Thanks, everybody.

Thank you.