Continuing to make sales calls despite little supervision o Growing trend

Continuing to make sales calls despite little

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Continuing to make sales calls despite little supervision o Growing trend toward linking sales compensation to customer satisfaction measures o Standard compensation might not work More reliance on incentive payments tied to individual performance For top-level sales representatives, the incentive-based pay can be over 40% of total compensation o Nature of people who enter sales profession Motivated by money o Organizational strategy Customer service vs. volume sales
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o Market maturity Maturing market – focus on customer service and retention o Competitor practices Competitors may chat about pay o Size of company Larger companies pay more o Economic environment In a recession, focus on top-level performers and those who achieve high levels despite the downturn o Product to be sold Technical products have high barriers to entry and need training – high base-pay component Low barriers to entry – higher incentive component Products that sell themselves – base pay Products that require harder work – incentives o Sales jobs don’t fit with either straight salary or straight commission packages o Combination plans are often used Guaranteed straight salary can be linked to performance of nonsales functions Sales commissions for volume yields incentive to sell Guaranteed base salary Guaranteed base salary + commission Guaranteed base salary + bonus Guarantedd base salary + commission + bonus Commission only Contingent workers o Include a person who works: Through a temporary help agency On an on-call basis As independent contractor o Typical salary arrangements Workers in first two categories often earn less than workers in traditional arrangements Independent contractors often earn more o Identify was to deal with equity issues View workers as pool of candidates for more permanent hiring status Champion the idea of boundary-less careers Chapter 15 Impact on general wage and benefit levels—do unions get higher wages and by how much, are wage cuts more prevalent in unionized organizations
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- Unions make a difference in wages o Union workers earn between 8.9% and 12.4% more than nonunion workers - Size of gap varies from year to year o During periods of higher unemployment, impact of unions is larger o During strong economies, union-nonunion gap is smaller - Union-nonunion wage differentials in public sector o Union employees earn about 22% more than their nonunion counterparts Impact on the structure of wages—benefits, two-tier wage structures, worker vs. management wages - Impact on general wage and benefit levels o Presence of a union adds 30% to 40% to employee benefits o Greater percentage of total wage bill allocated to employee benefits Benefits are 37.9% of total compensation package for union workers Benefits are 27.8% for nonunion workers Higher costs due to Higher pension expenditures Higher insurance benefits - Impact on structure of wages o Two-tier pay structures are a phenomenon of union sector Contract differentiates pay based upon hire date Employees hired after a target date receive lower wages
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