By Cheechee Lin
UCLA Anderson Marketing Professor Sanjog Misra has been working on a joint project with Professor Harikesh Nair, of Stanford’s Graduate School of Business, that uses data analytics to develop effective incentives for a large contact lens manufacturer’s sales agents.
Misra and Nair use statistical models to develop improvements to the existing salary and commission model, which is based on guesswork and past performance. By implementing a low quota, no ceiling and monthly commission model at the firm, Misra and Nair have helped the contact lens firm increase revenue by 9% in one year, and an average revenue increase of $79,730 per agent per quarter.
In another study that Misra and Nair conducted, they helped motivate the firm's sales agents more effectively by developing two different compensation plans that satisfy different pay preferences.
Nair encourages other firms to work with academics to gain quantitative insight in improving HR and sales plans.
For more on this research, please read Rachel Emma Silverman's post on the Wall Street Journal's At Work blog.
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