There are a number of substantial dangers and risks companies take every day to ensure that they come out on top of the competition. Each of these rolls of the dice occurs on a constant basis throughout corporate operations, including everything from business systems and the backups that support them to the retention level and engagement of employees. Finding ways to cut down on the questions and insecurities associated in this loop allows firms to feel more at ease and provide better opportunities for themselves and their workforce.
Identifying and addressing issues
That's why sales incentive compensation has been placed under the risk mitigation umbrella by so many organizations, Canadian Underwriter stated. The source detailed that this strategy itself could result in dangerous outcomes, such as failure to target essential goals in lieu of incentive achievement or lack of adoption for this kind of program. However, the need for incentive compensation plans is undoubtedly present.
"Ensuring that the structure of incentive compensation does not promote unnecessarily risky behavior has been the subject of many recommendations by regulatory agencies," stated a survey by the Joint Risk Management Section of the Canadian Institute of Actuaries. The organization's report further added that these actions were largely due to unstable financial indicators, resulting in poor practices and substantial, unnecessary ventures pursued by personnel and corporations alike.
Creating correct incentives
As the requirements for risk mitigation and corporate accountability continue to increase, it's important for firms to understand they must continue offering sales incentive compensation to encourage more productivity. The shape and quality of these options continues to evolve, however, presenting organizations with a challenge as to how much they're willing to put on the line.
CRN Technology News wrote that there are positives to compensation strategies, so long as corporations use them appropriately. Tapping into the wealth of business information, analytics and metrics help identify the behaviors that personnel most want to be rewarded for, as well as the amount of effort employees are putting toward endeavors that might otherwise go unacknowledged.
The source stressed that compensation planning should therefore always remain a revolving door. Regular reviews and attention to staff sentiments will reduce risky actions and promote more diligence in everyday work. By recognizing and rewarding individuals appropriately, businesses can see the return on investment they need to validate sales incentives without endangering any other corporate aspects.