FY <xx> Presented <date> Sales Incentive Plan FY <xx> Presented <date> <Company Name/Logo Here>

<Company>’s Strategic Imperatives The basic components of the business strategy point to a key role for the sales team <Company>’s Strategic Imperatives List the 3-5 things the entire company must accomplish in the next few years to meet its objectives in the marketplace – examples are… Develop xx product line to serve yy by zz Expand sales presence into xx (geographic area) …industry vertical focus?... …value proposition?...

The sales team is central to executing the strategy What Sales need to do to help maintain domestic market share List specific objectives for the sales organization …

Incentive Plan Measures Key accountabilities of the sales and sales management roles are directly linked to the new incentive plan measures Roles Key Accountabilities Incentive Plan Measures <Role Name 1> … <Role Name 2>

Plan Overview: <Role Name> Details for each component are shown on the following pages Total Compensation = Base Salary + <highest weight component> <2nd highest weight component> <etc.> Weighting <50%> <30%> <20%> Annual Incentive Target <$10,000> <$6,000> <$4,000> Timing <Quarterly> Overview <Incentive based on overall percent goal attainment for Gross Margin vs. quarterly goal for all direct reports> <Incentive based on percent goal attainment for overall business unit performance vs. annual Gross Margin goal> <Bonus based on the percent of Account Managers reporting to the Sales Manager who are at or above goal on Individual Gross Margin for the quarter> Caps <Uncapped> <Capped at $9,000 per year> <Capped at $2,000 per quarter>

Role: <Role Name> Component: <First Component> Total Compensation = Base Salary + <First Component> <Second Component> <Third Component> Rationale <Why is this incentive offered?> Measurement and calculation <Definitions and verbal description of the measure – may refer to payout table on following page> …

Role: <Role Name> Component: <First Component> Show payout table and calculation steps – example provided (table pasted in from Excel) Total Compensation = Base Salary + <First Component> <Second Component> <Third Component> Sales Manager Sales Team Gross Margin Bonus Payout Table Example Calculation Step 1: Determine Actual Quarterly Performance % Goal Consider a Sales Manager with a goal of $3,000,000 in Sales Team Gross Margin for Q1, and actual results of $3,300,000 Actual% Goal = $3,300,000/$3,000,000 = 110% Step 2: Look up the Actual Quarterly Performance % Goal in the payout table For 110% goal performance, the quarterly payout is $3,333 Actual Quarterly Performance % Goal Quarterly Payout Over 115% $3,750 + $42 per percentage point over 115% of goal 115% $3,750 110% $3,333 105% $2,917 100% $2,500 95% $2,188 90% $1,875 85% $1,563 80% $1,250 Below 80% $0

<Measure> goals will be determined using a consistent process Explain the goal setting process (timing, involvement, criteria)

If applicable – simple plans may not need an earnings calculator An Earnings Estimation Calculator will be provided to speed your understanding of the new plan Screen shot here

“Translate” the comp plan into a clear message about what the sales person needs to do to “win” – Example provided The greatest rewards will go to those who exceed their Gross Margin goals Focus on profitable accounts and opportunities Maintain high service levels and ensure customers are satisfied with the entire experience of buying from <company> Kill bad business If an account or opportunity cannot be serviced profitably, walk away Focus on premium products Represent the entire company product line to assigned accounts, including those outside your business unit Add value with customers by sharing market insights, offering premium products, and meeting needs for specialized capabilities Run it like you own it