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A Helpful Framework

By: J. Mark Davis, Managing Principal, Valitus Group, Inc.

If you’ve been involved with the task of defining sales roles and creating incentive compensation plans for them, you’ve likely heard the term “prominence” as a factor that helps define both the role as well as provide directional clues as to the appropriate sales compensation design. So, what is prominence and why is it important to evaluate? In this first part of a two-part article, we’ll define prominence and take a look at how to determine the prominence of a sales role. Next month’s article will follow with the very prominent implications for sales compensation design.

Referencing a chapter that I wrote in The Sales Compensation Handbook – Second Edition (published by Amacom), prominence is defined as:

The influence of the sales rep in the mix of all the marketing variables that collectively create the message heard by the buyer.

In other words, prominence is a measure of the degree of influence or personal persuasion a sales role has on the customer buying decision. It is not an absolute measure, nor is it easily quantified. Instead, it captures the relative influence of the sales role compared to all of the other variables in the marketing mix that create a competitive profile for a product or service (e.g., product quality, advertising, price, and post-sale service). When prominence is high, the sales rep is heavily involved in differentiating the company's offering from those presented by the competition. When prominence is low, the sales rep is unable to exert much positive influence on the customer's buying decision.

Prominence is important to gauge as it has a direct impact on a number of key sales compensation design decisions. Because prominence is essentially a function of account control by the sales rep, anything that tends to alter the level of control also alters prominence.

Key Indicators of Prominence

There are a number of factors that are good indicators of prominence. The following list of prominence indicators is not all inclusive. There may be other factors you need to consider in assessing prominence for your sales organization (e.g., whether the role is field-based versus inside sales). However, this list is a good start to illustrate the factors that will be meaningful in efforts to measure prominence.

• Type of selling - This refers to whether the sales effort entails prospecting for new accounts versus managing existing accounts. In general, prospecting for new accounts is more challenging and equates to a more prominent sales job than one in which the sales rep is primarily managing and/or penetrating existing accounts.
  
  
• Channel orientation - This is the medium of distribution through which a company brings its product or service to the market. A role that sells direct to the end-user typically equates to a greater degree of prominence than one that sells through an indirect channel of distribution.
  
  
• Creativity - This refers to the sales role's need for spontaneous, creative skill to establish a competitive profile for the product or service. The more creativity required to execute the sales process, the more prominent the role.
  
  
• Pricing authority - This is the extent to which the role can control or influence the pricing of the product or service. As pricing authority increases, so does prominence.
  
  
• Level of support - The more highly supported the role in the sales process (e.g., marketing administration, customer segmentation and identification, technical sales support, and information technology), the lower the role’s prominence.
  
  
• Product/service competitiveness - Product positioning and brand awareness are factors that contribute to product or service competitiveness. The more improbable, untested, and unknown the offering, the more persuasion and advocacy are critical to the effectiveness of the sales force and, thus, the greater the level of prominence.

High-, medium-, and low-prominence sales jobs are easy to recognize. For example, the classic door-to-door sales person who seeks to sell an unadvertised and unknown product is prominent in the success of the business. This sales rep must frequently overcome the extreme reluctance of a prospective customer and the job usually requires a substantial tolerance for negative responses. The sales rep's challenge is to make the customer receptive to the form and medium of the contact, the product or service category, and the specific brand.

As a way to frame a consistent and logical approach to assessing prominence, click here to see a sample prominence analysis that considers all of the aforementioned prominence indicators. In this example, we compare the relative prominence level of three common sales roles:

• Account Executive - This AE role is the classic new business “hunter.” The charter of this role is to open new accounts with no ongoing account management requirements. The AE has a high degree of pricing authority, is relatively unsupported in its efforts to obtain new accounts, and sells a product with relatively little market awareness.
  
  
• Account Manager - This role is the classic “farmer,” seeking to manage and further penetrate an existing base of accounts. There is no new account selling requirement for this role. The AM is deployed on a named account basis, with the measures of success being account revenue growth across the breadth of the offering and minimizing churn. The AM role is well supported from Corporate and the product enjoys a moderate amount of brand awareness.
  
  
• Channel Manager - This is the type of channel management role that focuses on sales into the channel. In other words it doesn’t have much access to the end-user customer. Instead, it focuses on equipping and leveraging the channel partner’s sales resources to effectively sell the company’s offering. As such, the role is primarily about educating and training the channel partner reps in the value of the product offering and how to effectively sell it. The Channel Manager role requires a fair amount of creativity to gain the attention and loyalty of the channel reps. The product has a moderate amount of brand awareness.

As profiled in this sample prominence analysis, the Account Executive role is clearly a high-prominence sales job. The Account Manager role is medium-prominence and the Channel Manager role is relatively low-prominence. Note that this is an assessment of the role’s prominence as it was intended to operate, not of an individual incumbent in the role. As you can see from this example, the Harvey Ball assignment on a number of these factors may be open to debate. However, if applied consistently, this tool provides a helpful framework with which to logically assess the relative prominence of an organization’s roles.

Following this analysis are several implications for the design of appropriate sales compensation plans. While prominence is not something that's easily quantified, a consistent, logical approach to measuring prominence as shown here will enhance the understanding of an organization's various sales roles and, on that basis, result in a more consistent application sales compensation design principles.

The prominence of a sales job in the marketing mix should be understood as a dynamic concept. Prominence varies as the point of customer contact, the product mix, the sales message, the sales role, and the type of customer vary. Because there is usually some change to all or some of these factors in a given business, the prominence of a given sales role will also change over time. As such, it's important to regularly assess the prominence of an organization's sales roles. Specifically, any time a new sales role is created, the sales coverage model is altered, the fundamental product/service mix is changed, or a new sales compensation plan is designed, the prominence of the organization's sales roles should be evaluated.