Well-designed channel compensation plans give you the power to align behavior and drive transformation toward a unified goal. As you continue to build and evolve the structure of your channel compensation plans, you may be wondering where to focus your attention and efforts.

To help you, we’ve collected data from a series of industry benchmark assessments and uncovered five invaluable yet easy-to-implement channel sales compensation best practices you can implement today.

1. Keep the structure simple 

“Life is really simple, but we insist on making it complicated.” -Confucius

When building and tracking channel compensation plans, complexity does not equal higher performance or revenue. As the well-known, Keep It Simple Stupid (KISS) principle states, systems and processes work best when the design is kept simple and not complicated. The same is true for tracking compensation plan activity. The most successful activity tracking structures require no more than 60 seconds to explain to your team.

Take a moment to consider your channel compensation plan tracking structure. Can you explain the system to your team in 60-seconds or less? If not, your plan is too complicated, and it’s time to simplify.


2. Establish alignment across your sales and channel teams 

Achieving alignment across your sales team and your channel is critical for success but not always an easy task. To start, your company should create consistent goals within both channel and sales compensation plans across teams to eliminate internal competition. If there is an area important to your company, ensuring alignment across your sales teams and your channel will maximize performance and deliver the best outcome.

For example, let’s say you decide to emphasize customer satisfaction with your channel team, then you must also prioritize customer satisfaction with your direct sales team. And the same is true when emphasizing or deemphasizing a product. You will achieve increased growth and productivity when all your teams are on the same page, working toward the same goals.


3. Publish dashboards in real-time

Now imagine you are a university student and your professor chooses not to post or share grades until the last week of the semester. You immediately panic. How will you know how you are doing or which area(s) you may need to improve upon and spend more time studying?

In this situation, the lack of visibility hinders and distracts you from learning, improving, and growing. If the professor were to return your grades along the way, you would know where you needed to improve and would be motivated to work harder to earn better grades.

This same applies to your compensation plans. When you give your team and your channel the ability to track their activities in real-time, they will be more motivated to achieve or even surpass their goals and quotas.

Remember, your dashboard needs to include real-time updates for every activity, big and small, listed within the compensation plan. For example, if a CAM’s plan includes collecting customer success surveys, then add and track this activity in their dashboard. CAMs value visibility and like to know they’re receiving credit for all activities.


4. Move channel managers to growth KPIs

In part one of this series, we learned the SaaS sales model now involves landing the deal, product activation and expansion, and deal renewal. But how do you encourage your CAMs to look beyond the initial sale and become dedicated to product activation and expansion?

The simplest way (and remember, simple is better) is to move your CAMs toward growth KPIs, especially in the area of product expansion. Within your compensation plan, establish metrics that track and show product use and growth. These metrics will vary based on the product, but a few examples include tracking the number of users within the account or keeping track of the total product runtime. When you highlight these growth KPIs with your CAMs, you incentivize behavior that aligns with your company’s goals and the SaaS sales model.


5. Use uncapped accelerators to drive growth 

Finally, to help drive accelerated growth, consider uncapped compensation plans for the Hunters on your team who consistently find and bring in new business. Hunters are typically very motivated by their ability to earn money. With capped commissions, the Hunters on your team will be less motivated to land new business, and your company will inevitably miss out on potential new business.

Think about it this way: you would not set a speed limit of 100mph for a Formula 1 race when the drivers are capable of driving 223mph. If you imposed a speed limit, professional F1 drivers would not be interested in your race, and although the race may attract locals, you would miss out on a massive audience.

When used wisely and in a targeted manner, uncapped accelerators are a powerful tool to motivate your salespeople.


As you continue to transform your compensation structure, these five best practices will help your company establish a plan that aligns your teams, optimizes performance, and accelerates revenue. Don’t forget to keep it simple!

In the next and final part of this series, we will share the five most common unintended consequences that happen to even the best-designed compensation plans. As well as exclusive tips to help you avoid them. You will not want to miss it!

Did you miss part one of this series? Read ‘The 4 Compensation Trends Driving Revenue’ here.