Blue Cross and Blue Shield Commission Structure

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With the new age of healthcare coming into play and the influx of applications that were soon to be seen, the old way of commission payout needed to be reconsidered. We all know that commissions attract top quality sales representatives because of the lure to set their own paycheck amount, that wasn’t the problem. BCBS did not cap the amount a sales rep could earn, so major dollars could be made. The real problem lied in simplifying the commission assignment from the applications received. If a sales rep couldn’t keep up with his or her applications after they left the sales team what else could be done to make sure that everyone was paid accurately and precisely. The new system needs to implement new technology, reduce secondary staff hours and increased accountability. Sales reps loved the allure of the addition to their regular pay but the work that went into cleaning up the files checking and rechecking to make you were paid on a month to month basis was tedious and some gave up and just took what they got, while other spent days or even weeks shifting through the thousands of sales to make sure they were paid for their own.

When implementing a structure to solve the common problems within the commission structure we first need to make it simple and easy to understand, to many moving parts can confuse people and not allow for a seamless transition. “Nothing kills a plan quicker than basing it around metrics that are difficult or impossible to actually measure. Whenever possible, avoid metrics that are dynamic (something that changes over time like pipeline), estimated, subjective, or incomplete”. (McDonald, 2013) After reveling this we can see why this compensation plan did not work, using metrics you cannot track is one of the common themes that ruin a commission plan faster than any other. These plan lose credibility and motivation “Not only will your reps be frustrated, they’ll also waste time checking and fixing their commission statements”. (Hanna, 2014)

In order to correct the commission confusion that has been the downfall of the application process for sales reps we will need to instill a few things to help clean up the process. First there needs to be a clean cut commission plan put into place with simple easy to read criteria that all sales reps understand. The disconnect between management and sales reps leads to mistrust and questionable tactics. Clean and concise rules and regulations leads to clarity for everyone. Secondly, create and install an effective customer relationship management or CRM tool. For effectiveness, you need to provide sales reps with a tool that captures information about each interaction with prospective customers. Thirdly tracking a lead is a continuous process. You need a very effective software that can keep a clean record of all your day to day incoming data. You could easily identify which one are fresh leads and which ones are returning customers.

In conclusion, sales representatives keep in contact with many potential clients throughout the day. They may be current or returning customers. Keeping track of customer leads is of the greatest importance, as losing track of them can lose sales that can make or break your commission check. Effective tracking has to start with the sales representative but the company also has to provide adequate software and measurement techniques. A sales lead tracking system has to be able to track many types of different pieces of information. Implementing an automated CRM tool to track these sales seems to be the first step in the right direction. Not only will this improve the sales payout system but it will allow accounting to better track the amount being paid out and increase the recording accuracy.

REFERENCES

About the Blue Cross andBlue Shield Companies. (n.d.). Retrieved September 1, 2015, from http://www.bcbs.com/about-the-companies/

Hanna, Michael; 7 ways to ruin a perfectly good sales compensation plan. February 28, 2014 http://labs.openviewpartners.com/overlooked-sales- compensation-factors/

McDonald, Devon; Show me the money a guide to creating a scalable sales compensation plan. September 13, 2013 http://labs.openviewpartners.com/creating-a-scalable-sales-compensation- plan/

Wasserman, E. (2010). How to Set Up a Sales Compensation Plan. Retrieved September 1, 2015, from http://www.inc.com/guides/sales- compensation-plan.html