Designing Your First President’s Club

Many senior revenue leaders have asked Insight Partners to help structure their President’s Club contests for the year. Based on these conversations, we’ve laid out some guidelines to make your President’s Club truly memorable, and more importantly, something that really motivates your sales team.

What is President’s Club?

Let’s start with the basics – President’s Club (as known as Achiever’s Club, Winner’s Circle, etc.) is an annual contest that is awarded to an elite group of sales reps, sales leaders, and sales technical resources for achieving specific goals — typically attainment of quota. This concept started way back in 1907 with NCR as a way to motivate and reward top-performing reps, and the reward mechanism has now spread throughout the corporate world. For sellers, the financial incentives for overperformance are significant and motivate many. A President’s Club award that comes with peer recognition and a unique prize is highly motivational for many people. When the contest stakes are meaningful, they can drive high-performing behavior and encourage reps to go above and beyond their normal performance expectations. When deployed well, the incentive can have a material impact on the overall performance of the company.

At what stage of my company’s growth should we introduce a President’s Club?

One question we get often is, am I too small to have a President’s Club? The short answer is that it depends on the culture of your company and the focus you want to place on driving and rewarding the sales team. If your sales team is smaller than 25, you can probably leverage other reward mechanisms (e.g., provide upgraded suites at Sales Kickoff for your top reps) versus having a Club event. Once you begin to scale above 25, the Head of Sales should determine, with the support of your CEO, Finance, HR, and Marketing whether a Club event makes sense for the team, and then jointly align on how to structure the program.

What are the criteria to attend President’s Club? Most organizations seem to pick 100% of quota attainment.

Although achieving 100% of quota is a significant accomplishment and should be recognized with an award and announcement, if you’ve designed your compensation plan and quotas well, 50-65% of your reps should be close to achieving or exceeding 100% of plan. That’s a significant percentage of your organization, and it reduces the exclusivity of President’s Club. Many companies send anywhere from 5% -20% of their top performers, and the percentage depends on how exclusive you want to make the event.  The number you send could increase in a year where the company significantly outperforms expectations and decrease when the company underperforms.

So, I should just make it a moving target where 20% win? Then at least I know how much I’ll spend.

There are pros and cons to the two main ways of setting criteria — fixed percentage of team members, and fixed target criteria.

Fixed Percentage of Team

This approach is the most predictable in terms of financial impact. The company determines a set percentage of the sales team that can attend and they use a stack ranking by role to determine the winners. Many companies require that winners achieve a minimum performance threshold (100% of plan) to avoid the risk of sending reps that have underperformed. This is simple to model and simple to explain to the organization.

The challenge with this approach is that it can demotivate some reps. If you’ve outperformed all year and are going to finish at 135% of plan, but would fall outside of the top 20% of reps, should you be left out of the fun? What happens if someone beats you out on the last day of the year for that final spot?  Not only would that impact you as a rep, but the story may flow through the organization and could demotivate others.

Fixed Target 

This approach sets performance criteria for the reps to win President’s Club. This is typically a percentage of plan and may include a minimum sales dollar/euro amount. For example, if you model out your expected performance for the year and expect 23% of people to achieve 135% or higher, then you should set your award criteria at 135%. Anyone who hits that target and meets any other criteria you stipulate should be able to win the award. The benefit of this approach is that you can recognize everyone that achieves those targets, motivating a broader portion of the organization.

One challenge to this approach is the financial modeling needed to budget appropriately and the risk that more than the expected percentage achieve the target. This could drive up costs but hopefully also comes with a commensurate performance improvement. The other risk is that high performers could relax a bit once they hit the criteria and save some deals for the following year.

What other criteria should be considered?

The most common criteria outside of quota achievement considered is tenure. It’s typical to exclude sales reps who have been on quota for less than 9 months of the year. The reason for this is that it’s difficult to set accurate ramp quotas for new reps, especially if they inherit active territories.

Other criteria can include things like a minimum revenue amount, a minimum amount for a specific product (if you’re trying to ensure balance across products), or a certain amount by region (if you have sales team distributed globally). Just don’t make the contest so complicated that your reps can’t understand it.

Who else besides quota-carrying sales reps should be eligible?

  • CRO/Head of Sales always attends. They’re the host of the event so even if the organization doesn’t achieve overall company goals, the Head of Sales needs to be there. If you have leaders that oversee an entire region (EMEA), it is also common to see them attend if members of their team are also attending.
  • Sales Leaders are typically included based on their team achieving 100% of plan. For player-coaches, it’s possible to include a personal performance requirement in addition to the team performance.
  • BDRs/SDRs/Sales Engineers, Sales Ops. Some companies exclude these support functions in an effort to keep the award exclusively to quota-carrying reps. Personally, I’ve always liked the idea of rewarding a small percentage of sales support functions. This type of recognition can have a material impact on the motivation of team members who typically don’t have a high variable component to their pay. However, given the roles these individuals have, they shouldn’t be eligible to have 20% of the organization win the award. Typically, this group is limited based on overall sales performance with a varying percentage of individuals being eligible based on how the organization performed; for example, if the organization hit 100% of its sales target, 5% of support personnel could be eligible with that number scaling to a higher percentage as the performance of the sales org increases. The selection is done by the head of sales with input from the team leaders and alignment from finance on budgeting.
  • Non-Sales Functions. In most companies, the President’s Club is a sales award only, and other groups are not eligible to participate. However, some companies may elect to allow a small number of non-sales people (customer success, product development, services, and marketing) to win the award as a motivational tool; in these cases, the number of non-sales people should be significantly smaller than the sales attendees. Remember, this contest is designed to motivate front-line sales reps and reward them for outperforming. Usually “wild card” non-sales slots are not used until your sales organization scales to a much larger size (e.g. +75).
  • Executives. This depends on the size of the sales organization and the number of individuals attending the President’s Club. The CEO should attend since this sends the signal that sales is important to the company — plus, it gives the sales team access to the CEO. For larger companies where there are 20-30 people attending, it may make sense for other direct reports of the CEO to attend. This further shows the company’s support for the sales organization and having the company’s top executives in attendance sends that message. This is also an opportunity for the executives to hear about what’s on the sales reps’ minds and understand the challenges they’re facing in the market.

So, we’ve figured out who should win and what the criteria is, but what exactly are the awards?

The most typical award is to participate in a group trip — an event where all the winners go together to celebrate their success with their peers and the executive team.  The trips are usually to beach resorts or to interesting tourist destinations in North America (Napa Valley, NYC or Cancun, Mexico) or Europe (London, Paris, Rome). The location of the trip depends on the size of your team, the budget you have and the location of your organization. If you’re just starting out with your first PClub, then we recommend that you keep it local to your region and expand the locations to international over time (as additional motivation as your company grows).

What’s included in the trip?

Most award trips are all-expenses paid for both the winner and their significant other. This includes coach airfare, standard hotel rooms, dinners and activities. If an individual wants to upgrade their airplane seats or hotel room, they can do this at their own expense.

Are the trips taxable?

Yes, award trips are taxable (even if you have a few hours of training included) and are not considered business trips. In the U.S., the attendees are responsible for the taxes on the trip amount. This is fairly common, although some companies may choose to gross up the paycheck of award winners to cover these taxes.

We’ve never had incentives like this before, what’s the best way to start?

It’s tempting to go straight to the amazing destinations and hope for the best. However, if you haven’t established a culture of contests, the impact that you get from the trip will be muted. We recommend a multi-year path to build up the hype and drive a culture of competition in your organization. If you’re not sure where to start or if it’s later in the year and you are just kicking this off, we recommend going with an award of some type rather than a trip. There are a few standard award categories that companies use.

  • Travel vouchers: These are simple and easy, but they don’t establish a way to show off to the winners’ peer group that they’re one of a select group of winners. If you go down this route, we’d suggest that you create an internal page for winners to share some photos from their award trip.
  • Cars: Some companies award one-year leases for high-end cars. The challenge with this is the insurance requirement — does the company cover or does the employee? Additionally, what do you do if the employee leaves the company before the lease is up? Our experience with these types of awards is that they’re difficult to administer and therefore we don’t recommend them.
  • Watches: Rolex or similar high-end watches are good contest prizes.  Not only are they motivating, but they can be worn as a badge of success for years to come. Personalize the watch by having the company logo engraved on the back.

Once you’ve started to build the culture of competition, then you can up the game by doing a moderate trip, and then bump it up again the following year with a trip to a more unique destination.

One thing to keep in mind is that your awards, destinations, and events should all take into consideration the diverse nature of your sales team members and the culture of your business.

At what stage should we do President’s Club?

As mentioned above, President’s Club awards can be given at any stage of a company’s development.  However, trips should probably not be considered until you have 30 or more sales reps. The reason for this is that if you only have 10 sales reps and only 20% can win the trip, you’ll have the executive team hanging out with only 2 reps.  We’d recommend that until you scale to 30 reps, you stick to vouchers, cash awards, or watches.

When and how do we announce this incentive?

To get the maximum value from the contest, we suggest a staged approach to the announcement.

At the sales kickoff, announce that this year, the contest prize will be a President’s Club trip with the location to be announced in Q2. Get the hype going at kickoff but keep the location a secret. In Q2, send out an email or print announcement to each sales rep’s home announcing the contest location. This gives maximum impact on the announcement and ups the excitement level. In Q3 you should be ready to email a video of the venue to further motivate the organization. Q3 is also when you should start a regular cadence of tracking and announcing the standings of those people who are eligible for incentive. In Q4, send out monthly notices counting down to the end of the year. And, shortly after year-end, send out the announcement of who won the award.

What kind of budget should I have for this type of event?

Watches, car leases, and travel vouchers offer the opportunity to spend $8-10,000 per winner. Trips will vary based on destination and the types of activities included, but a good rule of thumb is $15,000 per couple.

This is a significant expense. Sales operations should manage the structure, the program, and report on the results. We recommend you hire an event planner to manage the booking of the trip, flights, hotels, and activities, including a final dinner. Depending on the size of your team, you could manage this internally with Ops and the support of marketing, and an administrative assistant.

 

Done effectively, President’s Club trips and similar incentives can energize an organization and drive significant outperformance. They can also help retain and motivate top talent. So, while you’re thinking about your plans for the new year, give some thought to where you’d like to celebrate your success and start planning for President’s Club.

How to Plan a Virtual SKO that Educates, Motivates, and Entertains

November and December are always frantic times for sales leaders, as they are focused on closing out the current year while simultaneously preparing for the upcoming year. There are a hundred things to consider, from redesigning compensation plans to setting quotas, and capacity planning. And then there is the daunting challenge of hosting the sales kickoff (SKO). Each year, sales leaders develop multi-day, in-person events to train and update their sales teams on new techniques, processes, and tools, celebrate the successes of the past year, and energize the team for the year to come. With increasingly distributed teams, lingering concerns about the pandemic, and constrained budgets, more teams may be considering hosting sales kickoffs virtually.


Key Insights

  • With increasingly distributed teams, lingering pandemic concerns, and tighter budgets, teams are considering hosting virtual team events, including sales kickoffs (SKOs).
  • Planning a virtual SKO requires different planning and presentation than simply hosting your normal SKO over video conferencing.
  • Virtual SKOs can offer unexpected benefits from physical events, including opening the SKO to the entire company and offering guest speakers who may have previously been out of budget.

Making a sales kickoff virtual isn’t just doing last year’s event over video; it’s fundamentally different in both planning and presentation. And if you plan ahead and follow these tips, it can be even better than those in-person events. One of the biggest opportunities is the ability to extend the SKO into a full company kick-off. For a minimal additional cost and effort, everyone in the firm can hear the vision of the CEO and sales leaders, get insight into the sales strategy, and most importantly, understand precisely their role in helping sales achieve its goals. Another key benefit of the virtual event is the flexibility it offers when booking guest speakers: By avoiding the logistics of flying guest speakers to events, you can engage someone from anywhere in the world, or even engage someone previously outside of your budget range.

Virtual SKOs require a different approach than in-person events

To help you plan a successful virtual sales kickoff, here are 5 key considerations and a few useful tips from our portfolio and from Jacco van der Kooij, Managing Director of Winning by Design.

Drive impactful engagement

It’s easy to multitask during a virtual event, so you have to create something that is compelling and holds the audience’s attention.

  • Hype it up by leveraging short-burst videos to create breaks in the presentations and mix in music to change the mood.
  • Keep the sessions short and succinct — approximately 45 minutes.
  • Spread the sessions over a few days with no more than a 4-hour session block, rather than holding an 8-hour-long marathon event.
  • Leverage music, video, and interactive presentation tools to shake things up.

Plan and practice

We’ve all had those moments where the video platform doesn’t work right, or a presenter forgets that they’re on mute. In a normal meeting, it’s mildly annoying; in an SKO with 100+ people on the call, it’s disastrous.

  • Double the amount of time needed to create the event.
  • Test your technology with each speaker, and always have a backup plan.
  • Practice the transitions to create smooth and natural handoffs.
  • Record sessions in advance, and stick to the timing.
  • Have one dedicated moderator and one dedicated tech support person.

Teach them something new

This is true even in physical events, and in a virtual one, you can’t keep your audience captive.

  • Use breakout rooms to engage smaller groups.
  • Assign pre-work for attendees.
  • Train the trainers in advance. Make certain that they can drive impactful sessions.
  • Ask your reps in advance for feedback on what they want to hear or learn about. Also, at the end of a segment, ask one member of the audience to summarize their key takeaways. Then have them select the next person to do the same.

Let them catch up with their peers

One of the best parts of SKOs is being able to share best practices and war stories with peers. Make your virtual event memorable by giving them this capability when they weren’t expecting it.

  • Plan specific times for catch-up sessions.
  • Create coffee chats or happy hours with random assignments of attendees to breakout rooms.
  • Create “wedding table” assignments for breakout rooms to ensure teams socialize.

Keep it going after the event

Because a virtual event costs a fraction of a physical event, you can hold follow-on events throughout the year.

  • Create a reinforcement program to drive home key learnings from the SKO.
  • Host a mid-year event. Things change rapidly; a mid-year meeting allows you to course-correct.
  • Use Slack channels or Teams chats to collect ideas live during the sessions and to communicate with the attendees throughout the year.

The shift from physical events to virtual may seem daunting, but if you keep the above considerations in mind, you will create a game-changing event. Take advantage of technology and the reduced cost to expand the reach of your event and energize the whole organization, not just sales. But most importantly, remember that during your event, you should always aim to educate, motivate, and entertain.

10 Steps to Crush Your Sales Kickoff (SKO) Event

If you are a sales leader, you likely spent the last few weeks scrambling to close deals before the year end. As a result, you’re probably starting January by finalizing your compensation plans and quotas and planning two of your most important events of the year: the Sales Kickoff (SKO) and President’s Club.


Key Insights

  • Sales Kickoffs (SKOs) and President’s Clubs are two of the most important events of the year for revenue teams.
  • SKOs should energize the organization, inform and excite everyone about the company’s strategy for the year, and get the whole sales team heading in the same direction.
  • The most successful SKOs are well-prepared, align around key themes and messaging, celebrate the previous year’s success, and are delivered in an engaging, interactive format.

Designed well, these two events should excite the sales team for the year ahead. They help you set and sell a strategy that inspires everyone to roll up their sleeves (again), and also celebrate the team’s accomplishments from the previous year. If you put in the effort and attention to detail, you’ll put yourself in the driver’s seat as you scale up your business.

How to design a successful sales kickoff

SKOs may have a bad reputation amongst sales reps. This is largely due to a history of poorly planned events, filled with boring presentations, delivered to hundreds of people simultaneously with minimal interaction. Nobody wants to sit through that. To top it all off, these events are costly, and reps are out of the field for 2-3 days, meaning that there isn’t any revenue being generated.

Executed well, SKOs should energize the organization, inform and excite everyone about the company’s strategy for the year, and get the whole sales team heading in the same direction. If you adhere to the following criteria, you’ll deliver a sales kickoff that will align your team and make them productive this year and beyond.

  1. Have a well-defined strategy for the year. This is your chance to explain the strategy to the entire sales organization and rally them around a common aspiration. Make sure that the message is clear and that all the presentations delivered during SKO align with that strategy. Ensure your reps know their role in executing the strategy by giving them clear marching orders, as well as collateral that supports their key talking points with prospects and customers.
  2. Make the content interactive. Back-to-back presentations are boring for anyone, so refrain from a parade of presenters and instead create a series of workshops or rotational sessions. The best kickoffs combine amazing presenters (who present for 60 minutes in the main room) with round-robin sessions and workshops for 30-45 minutes. The best workshops impact how the sales team engages their prospects and clients and/or leverage and explain the tools and techniques that help them to do their jobs. The movement and change in pace will keep the sales reps’ attention, and the interactivity helps ensure that all reps are participating. If there are new products or features being launched, this is the opportunity to ensure that everyone is aligned on the messaging and sales pitch. Marketing, product, and tech leaders, along with the CEO, should describe their strategies and how their activities will support the sales team.
  3. Celebrate successes from the past year. SKOs provide the opportunity to have a formal look back on the previous year (what worked, what didn’t) and applaud your superstars. Take some time to talk through what happened — both good and bad — and then highlight anyone who achieved plan or showed exceptional effort to help another rep or the overall team. Small award plaques are a great way to present top performers with something that acknowledges the value they have contributed to the company. Bring them up on stage while their peers applaud them, have someone read a sentence of why they’re being recognized (e.g. Sally Jones achieved 145% of plan and $750k in sales), and take a picture with the CRO and CEO. By proactively building a culture of success and recognition in your business you will make your team excited and proud to be recognized in front of their peers.
  4. Leverage themes and imagery. We’ve all sat through dozens of kickoffs where we are going to “Race for 202X” or “Ignite Sales 202X” or something similar. Those themes sound corny and can fall flat if they’re not woven throughout the entire meeting. Likewise, these types of themes can have a major impact if they’re integrated into all communications, internal branding, and contests for the remainder of the year. That theme should show up in your contests (i.e., Q1 – Start your Engines, Q4 – the Final Lap). Pick a theme, stick with it, and make sure it’s different from themes used in the last two years.  Work with marketing to be creative. Sales themes can become tired and overused.
  5. Be prepared for the meeting. If possible, you should communicate sales territories, compensation plans, and quotas in advance of the SKO. Clarity in segmentation, compensation, and territories will help to ensure your sales teams apply the material presented to their specific situation. Plans don’t have to be 100% complete, but the closer to final you can be, the better the outcome of your kickoff. If the sales reps go into the sales meeting blind, the best they’ll be able to do is apply it to last year’s activities. More likely, they’ll just listen without being able to truly connect the material with the activities expected of them. This is one reason that SKOs are often in late January or early February. The timing enables management to finalize strategy and plans before presenting to the team.
  6. Get new hires off to a great start. If you’re going to hire new sales reps, try make sure that they’re onboarded in time to join the kickoff sessions. There is no better way to indoctrinate them into your team’s culture than by surrounding them with their teammates and sharing stories. One of the best parts about an SKO is the networking that your teams can do, especially if you have a global team. Having your new hires meet the top reps from each region will help accelerate their onboarding process. For those that join after the kickoff, you can repurpose some of the material for your onboarding training.
  7. Keep logistics simple. Pick a location that is near (the majority of) your team or easy to get to. You don’t want to have people waste an entire day getting to the location or getting home. Also, plan dinners at the hotel or nearby restaurants. This ensures that you can continue to build a solid networking experience for your sales teams and that they don’t waste too much time going to a new location after sitting in sessions all day. Finally, don’t forget to provide enough time for breaks. Your teams will still need to engage with customers, so give them sufficient time to catch up on emails and calls in between sessions.
  8. Stick to a reasonable budget. Because you’re celebrating success and kicking off the new year, you want a venue and event that reflects the company. We’re not suggesting that you host your kickoff at the Ritz Carlton, but make sure that the venue is designed for corporate events, and then invest in the key items that will make the event memorable. Make certain that you have audiovisual (AV) support, lapel microphones, large projector screens, and the ability to play music over the AV (which is essential to fill the time as presenters walk to the stage). Invest in a few small gifts for attendees (notebooks with the company logo, clothes with the company logo, or similar), a little something for them to take the experience away with them. These should preferably reflect the theme for the year (e.g., “Racing to Win”). Expect to spend around $2,000 per attendee for a professional event. This spending guidance varies based on the location, duration of the event, distance traveled, etc.
  9. Require attendance. 100% of your reps should be there to hear the company’s strategy and to network with their peers. If you’ve announced a save-the-date well in advance, you should require 100% attendance; sales reps should be expected to modify customer meetings or other plans if you’ve given enough notice. The best SKOs also have 100% attendance from the executive team — that’s right, even your CIO and General Counsel should be there — this is the chance to show the sales organization that the entire company is behind them and supports their efforts. Given the investment in the SKO, you should maximize the ROI through full attendance.
  10. Assign an owner and rehearse. Successful SKOs are successful because someone has been orchestrating the event and sales leaders are engaged early in planning the agenda and cadence of the content. Someone in your company should be managing the SKO, whether this is sales ops, sales enablement, marketing, or if you have a larger organization, an event manager. This person or team will ensure that presenters practice their speeches, stay on time, and ensure smooth handoff between presenters. Even if you are doing an SKO for the first time and you don’t have a dedicated team working on your SKO, you can still make this work with some basic project planning.

The SKO is your chance to start the year strong and get your team motivated and excited about the new year. Remember, align the team on a single strategy with a few big bets. Celebrate the previous year’s successes, but focus attention on what needs to be done this year. Make your kickoff the jumpstart that your organization needs to ensure this year is your most successful year yet.

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