Re: bonuses

At one retail chain where I worked in the distant past, the bonus structure 
for sales dept people in those stores was based on inventory rolls by type 
.... if a dept sold $10,000.00 worth of stuff & there was $100,000.00 in 
stock at that store, then they would be eligible to get a larger % bonus than 
a dept that sold $10,000.00 worth of stuff & there was $250,000.00 in stock.  
This inventory valuation was highly inaccurate as demonstrated by each year's 
physical inventory & was highly subject to mass embezzlement of reporting 
errors so as to make localized on-hand appear lower than it really was so as 
to jack up the local bonus percentage.

This incentive system basically forced us to have useless inventory records.

I always thought a better incentive system would be one that encourages 
actual sales ... like if the inventory was accurate & a potential customer 
walks into one store & looks at merchandise & describes what they want & our 
people know that we have that precise version at another store 50 miles away, 
they are going to drive that customer there to see it & get the commission, 
even though the physical sale is at the other store.

At Central they are currently struggling with a bonus structure to be paid 
any employee who brings us a new customer with whom we do $ X amount of 
business in the first year ... should the rules be different for the folks 
who work the sales dept?  I think that once a customer is assigned some sales 
rep, and our business with that customer increases dramatically, that sales 
rep should get some kind of bonus, and subtract from that if some other 
customer that rep is assigned to has declining business.

And the point is well taken that the quality of information at the fingertips 
of the sales rep is highly dependent on the performance of the computer staff 
& in fact there is no co-worker whose contributions have zero impact on this. 

Al Macintyre  ©¿©
http://www.cen-elec.com MIS Manager Programmer & Computer Janitor
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