Uneven Landscape - Pharmaceutical Executive


Uneven Landscape
The Hay Group's 9th Annual Sales Force Survey points to sprouting opportunities amid the harsh soil of pharma's "rightsizing"

Pharmaceutical Executive

Beyond Cash

Companies allocate between 1 and 19 percent of their incentive comp budget to non-cash rewards (the average is 7 percent), although research has found contests and other non-cash incentives are highly motivating. The most common award remains the "President's Award" (which recognizes top performers), offered by 75 percent of companies. On average, 11 percent of sales reps and 10 percent of district managers qualify for it. Trips are still a popular sales award, and approximately 80 percent of companies offer them.

Sales force growth is uneven right now, so recruitment goals differ from one sector—or company—to the next. The companies that are expanding have access to a ready pool of candidates from companies that are downsizing. Smaller firms—the very groups that are hiring now—often are attractive for the greater autonomy, enhanced visibility, and wider scope of responsibility they offer. They need to walk a fine line between the growth that comes with success and maintaining the small-company atmosphere.

The first step in reducing future turnover rates is to understand why salespeople leave an organization—typically, because they are presented with a better opportunity. But opportunity doesn't always mean more pay; rather, it's responsibility and advancement potential for a position.

Given the current environment in Big Pharma, many reps naturally have mounting concerns about the sustainability and stability of their employers—obviously a concern that cannot be countered by a well-conceived compensation plan alone.

Carrie Fisher is Consultant and Project Director of Hay Group's Pharmaceutical Sales Force Effectiveness Study. She can be reached at

ABOUT THE STUDY: Hay Group's Annual Sales Force Effectiveness Study, now in its 18th year, is designed to diagnose the culture, policies, and practices within pharmaceutical sales organizations and to identify factors that either hinder or support sales performance. In May 2008, 42 pharmaceutical and biotechnology companies representing a broad cross section of the US market participated. About half of the responding companies classified themselves as small to mid-sized companies; 25 percent as specialty manufacturers; and the remaining 25 percent as biotechnology firms and "big pharma." This mix has given us insight into the pockets of the industry that are experiencing above-average employment growth. Data were collected on almost 80,000 incumbents holding 81 different types of positions within sales, marketing, sales operations, sales administration, and medical affairs.


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