In July 2010, GlaxoSmithKline Plc (GSK), one of the world's leading pharmaceutical companies, announced that it would replace its existing system of evaluating and compensating its sales professionals in the U.S. As part of a new system, the bonuses of the sales professionals would be based on customer feedback and adherence to company policy rather than the widely used practice of focusing on individual achievement of sales targets. Industry observers viewed GSK's new sales force compensation plan as a radical change and their opinion was divided regarding the effectiveness of the new sales force compensation system.
- What are the various issues and challenges associated with evaluation and compensating a sales force? How effective will the new sales force compensation system help GSK and what are the pros and cons of such a system? How can the system be improved further?
- Please use at least two sources and minimum 200 words.