Introduction
Leveraging a Persistent Need
Healthcare, technology, and a handful of other industry verticals have a critical need for qualified candidates, especially when their recruiting resources are stretched thin. As a leader in the staffing and recruitment sector, this client was ready to scale their footprint across the U.S. and grow revenue 40% over the next three years.
To reach this goal, this firm required assistance in evaluating five key areas:
Project Approach
Current State to Future Success
To clarify the current state, assessing these five areas required a comprehensive review of the company’s current GTM strategy, organization, and sales compensation programs. Cost, investment, coverage, and compensation metrics and benchmarks would reveal areas for improvement. In addition, Alexander Group conducted a sales time survey to clarify seller roles and perspectives. Finally, developing future state plans needed to be cost-effective and align with the client’s growth strategy, goals and market practices.
Key Findings
Time is Money
Alexander Group’s assessment revealed that account executives spent 36% of their time in pre-sales activities, compared to an industry average of 25%. This finding highlighted the opportunity for additional focus and the need to optimize prospecting activities performed by Marketing.
In addition, less than half of deals achieved the desired gross margin targets, indicating an opportunity to modify compensation plans.
time spent in pre-sales activities, compared to an industry average of 25%
less than half of deals
achieved the desired gross margin targets
Recommendations and Outcomes
Sales Comp Redesign as Part of GTM Strategy
Scaling requires more than just sales comp adjustments. Understanding customer profiles is also essential. This client benefited from an evolved customer segmentation model based on drivers that included customer lifetime value (CLV), attractiveness and account profitability, requiring better alignment between sales roles and their assigned account lists.
After finalizing the coverage design, Alexander Group created a headcount deployment model based on the overall GTM framework for each region, considering market opportunities and current account volume. Next, Alexander Group redesigned the GTM organizational structure, creating appropriate sales roles and rules of engagement. Finally, assessing the marketing organization led to recommendations for better alignment with the sales organization.
Specific recommendations included:
Adding new logo acquisition metrics, including customers and sales volume, to further incentivize account executives
Refining cross-sell and upsell mechanics while ensuring proper crediting of commissions and bookings
Increasing the gross margin target while incentivizing sales reps to exceed the new target via more inflection points and higher commission rates
Aligning payouts with persuasion events to streamline processes and provide greater payouts upfront
Shifting from a cost-of-sales approach to a cost-of-labor model and metrics
During the first implementation phase, the client experienced the benefits of simpler, more strategy-aligned compensation plan designs and streamlined administration. In addition, more attractive compensation plans better support recruiting and retaining top talent.
The client also realized the importance of an advanced GTM market model would be required to scale the organization and is putting projects in place to ensure a holistic, strategic approach.
Partner with Us
Alexander Group is a leader in sales compensation design, serving leading companies across industries. Our clients benefit from our proprietary benchmarks, industry practices, best-in-class principles and decision-making frameworks that allow companies to scale and appropriately incentivize their sales professionals.
For more information or to schedule a consultation, please contact an Alexander Group Business Services practice lead.
About Alexander Group
Alexander Group understands your revenue growth challenges. Since 1985, we’ve served more than 3,000 companies across the globe. This experience gives us not only a highly sophisticated set of best practices to grow revenue—we also have a rich repository of unique industry data that informs all our recommendations. Aligning product, marketing, operations and finance efforts behind a successful sales organization takes insight and hard work. We help the world’s leading organizations build the right revenue vision, transform their organizations and deliver results.
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