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Post #1
10-18-2004, 11:38 AM
gradel
Site Member (inactive)
Sales Engineer Compensation
Heading into 2005, I'm compiling intelligence on SE compensation and
trying to determine if my organization is behind the times or ahead
of the curve. I work for a 2,200 person software company and we have
endured steady growth in our sales and services organization and I
have recently led a shift from pooled SE resources to more discreet
sales teams. In speaking to several industry peers, I understand that
SE compensation is a bit of an enigma that leads to numerous approaches.
Here is what I have currently constructed and would welcome any input
or persepctives on what others are doing and degrees of success or
satisfaction.
Base: 80% Variable: 20% (this is the tricky part!)
20% variable breaks into sales team alignment (Commercial accts is
one bucket and Government, Education & Health is another one).
Once assigned to one of those lines of business, there is one last
breakout to a "sales team" and this is one or two sales professionals.
A typical 20% component might look like this:
50% - Commercial quota for region
25% - sales professional #1
25% - sales professional #2
In closing, here are my basic questions:
Does this appear in line with industry trend?
What are others doing to incent SE's?
Regards
Jason Gradel

Post #2
10-22-2004, 09:02 AM
stever11
Newsletter/Forums Member
SE Comp
I've hired many SE's over the past 6 years. The comp plan you suggest
is reasonable. However, rather than going with a 80-20 rule, most of
the enterprise software firms that i work with go with a 70-30 or 75-25
breakdown. You want to minimize your up front investment and make sure
the SE's produce and drive revenue. A typical SE plan is 100K base
+ 50K variable. The variable component is usually tied into regional
or company performance. I would stay away from tying the SE's comp
to specific sales people. It will start to create conflict throughout
the sales and sales engineering ranks.
Regards,
Steve Rosenblum

Post #3
11-01-2004, 01:36 PM
Gilmore
Newsletter/Forums Member
Jason,
Most of the compensation plans I have created for SEs were in the
80/20 range. Trends come and go so you may get a wide range of feedback
from others here who have a different experience. You also need to
compare apples and apples to be sure you are looking at the same total
target compensation if you are considering different ratios. Company
culture may influence the type of SEs you want to attract. Some companies
want them hungry like sales reps with more compensation at risk and
others value stability with a higher base.
As for the commission component I would stick with one quota based
on a territory they support or if they are territory independent (SWAT
team) then their division. Since their commission component at 20%
or a little higher is still so small it makes little sense to segment
it further.
__________________
Regards,
Mark F. Gilmore, President
Gilmore Consulting, Inc.
www.ConsultGilmore.com
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