Insights on Incentives has as its sole purpose the facilitation of thought and discussion on the subject of incentive compensation for banks and credit unions.  Once a month NSS will be sending out an e-mail with one insight on the area of incentive compensation.  The insights will come from our research, discussion with customers and finally, those of you who decide to offer an insight on this important sales management issue.

November 2003
The right number of performance measures.

There are certain guidelines for selecting the right number of performance measures.

  • The first is focus. The less performance measures the more focus you will draw from your sales team.
  • The second guideline is your overall business objectives, which are seldom supported by just one measure.
  • The last guideline is weighting. When you look at all of your performance measures as part of the whole, avoid having anyone fall below 15% of the target incentive compensation pool.

Having too many performance measures may lead to one of the measures being weighted too small to draw focus from the sales team. Three is usually a sound number. Four will work if they are of equal weighting.
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