Incentive Pay & Upside in 2022

What's the Story? Incentive Pay and Upside Sales roles with the responsibility to identify new business opportunities, which can include new customers, geographies or buyers led headcount increases. New account sellers continue to have the greatest pay at risk, reflecting performance focused on new growth in lieu of account management and retention. These roles have an average variable pay of 45% of total cash compensation. Inside sales Variable pay has increased most dramatically over the past two years, reflecting a shift to a greater sales orientation. We have seen an evolution of the role from order taking and transactional selling to one that is responsible for expanding existing business and winning new business. Inside sales role pay at risk has shifted from an average variable pay of 30% of total cash compensation to an average variable pay of 38% of cash compensation since 2020. Upside pay, which we define as additional incentive opportunity for those that exceed sales expectations, is most aggressive in health care and technology, reflecting the high growth and competitiveness within these sectors. What we discovered is that across all sectors, global and enterpr organizations tend to offer higher upside opportunities than smaller organizations. 58% of organizations provide upside potential between 50% and 100% of target incentive. 29% of organizations provide upside potential of at least 200% of target incentive. Only 13% of organizations provide upside potential of less than 50% of target incentive, which supports a pay for performance philosophy. Sam.