Restructuring Fixed and Variable Pay in Sales Organizations: A Product Life Cycle Approach

What is it about?

Organizations must review and update sales management practices and their compensation strategies according to the different stages of product life cycle (PLC). The PLC can be a valid framework for assessing organizational response in terms of marketing mix variables and sales force compensation strategy based on sales efforts. Fluctuations in sales growth, profit margins, asset turnover, and return on net assets are normal outcomes of the PLC and strongly influence compensation strategy. Restructuring fixed and variable pay in compensation plans according to the PLC will help organizations design an optimal compensation strategy.

Featured Image

Photo by Hamed Taha on Unsplash

Photo by Hamed Taha on Unsplash