We have all discussed the need for recruiting, retention, career development, breaking down the silos, and keeping teams motivated while avoiding burnout. Compensation is just one critical piece of the puzzle. Recently the Sales Advisory Board got together to discuss the evolution of incentives for sales teams while driving desired results and keeping teams motivated.

The jury is still out on the best model of incentives, individual or team-based. However, the advisory board agreed that their incentive models have changed since the pandemic’s start. Several advisory board members are using a combination of group incentives and individual performance, while others have done away with individual incentives and are 100% team-based. In the past year, some have moved from team-based incentives during the pandemic and switched back to individual incentives. Many began to look at incentives holistically and increased bonuses to make it more competitive.

Locations of the hotels also played a role in the incentive models used. Many advisory board members are looking to 2023 for the industry to stabilize and bring the sales objective back to 2019 levels, especially as hotels in city centers have been lagging the recovery curve when compared to resort destinations. All agreed that building forecast accuracy into the bonus plans was a mistake during these uncertain times.

One advisory board member explained the recent changes to their incentive plans, “One of the things that we did for our mainstream incentive plan was that we decreased the weight that budget achievement had and increased the weight that RevPAR penetration had because the budgets were such a shot in the dark of knowing what to expect for 2022. We still wanted to incentivize for the achievement of budget, but are paying out much less for that, whereas RevPAR you can control, so we have a much higher payout for that.”

Others talked about additional components to the incentive program, like hitting DEI and leadership goals. One advisory board member shared: “Our focus as a company is around diversity, equity, and inclusion. On the property and above property level, a percentage of your payout is the training component and participating in mandatory training within the company. So, it has nothing to do with sales and has more to do with culture.”

The advisory board members also discussed payout strategies, with many moving to quarterly payouts or a mix of quarterly and annual depending on the components. The change was often made to help with staff retention. Aligning incentives across all commercial teams was another change that has helped sales, marketing, and revenue management teams work together more cohesively.

A few more takeaways were how important flexible or remote work is to salespeople as well as growth and training within their company. Ultimately, no matter what the incentive plan advisory board members used, they all agreed one of the most important success measurements of a plan is talent retention.

Chris Hardy is the VP of Sales and Revenue Strategy, Parks Hospitality Group, and HSMAI Sales Advisory Board Member

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