Incentives: Heart of the Sell

Checking the pulse of pharma sales incentive compensation plans.
May 01, 2006
By Pharmaceutical Executive Editors

Incentives are the icing on the cake companies offer to motivate their employees. Mary Kay Ash was famous for offering her team pink Cadillacs for selling cosmetics; Girl Scouts earn badges for the highest number of cookie boxes sold; and a New York real estate company recently offered its top seller a chauffered Lamborghini for one whole year. Whatever the prize, incentives are an effective and practical motivational tool.

The pharmaceutical industry is no exception. In fact, using incentives to drive reps' sales is standard and expected in this industry. To uncover compensation practices happening across pharma, Synygy and Towers Perrin conducted the Strategic Sales Incentive Design and Governance in the Pharmaceutical Industry survey. Conducted in August and September 2005, the annual survey was designed to provide insight into industry trends, best practices, and benchmarking data. More than 45 companies representing nearly 75,000 sales reps were asked to weigh in on sales-compensation design and effectiveness at their organizations.

"The survey gives us an industry marker as to what the top sales compensation challenges are, so we can identify where we can be more effective at managing and driving performance," said Jim Daly, director of sales operations for business intelligence at Sepracor, one of the survey participants. "Clearly, one of the industry's top challenges is measuring performance, especially when it comes to deciding whether to compensate the individual or team."

Below are the highlights and results of the Synygy survey:

The primary objective of sales incentive compensation plans

David Grossberg is managing director for Synygy. He can be reached at

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