Compensation Blog — Prosperio Group

Compensation Blog — Prosperio Group

Experts in Compensation Plan Design

We are committed to providing the best compensation design services, custom and industry surveys, and implementation support to companies who want to strategically align compensation with organizational goals.

All by Beth Carroll

Jul 4
Jul 4 Freight Broker Organization Structures Part 2: Split Model

In the previous article we looked at the Cradle to Grave organization structure and the common compensation approaches used to go along with those roles. Now we will look at the Split Model, the roles commonly found in this model, and how they should be paid (spoiler…paying everyone a commission (% of the load), while common, is suboptimal).

Jul 4
Jul 4 Freight Broker Organization Structures – Part 1: Cradle to Grave

I’ve been working with freight brokers for over 15 years now, helping them revise their organization structure and align their compensation plans to support the goals of their business. While the number of different possible organization structures is almost limitless, there are really only two approaches, with some variations on each: Cradle to Grave and Split Structure. This article deals with the first; we will address the Split Structure in the next article.

Jul 4
Jul 4 Commission vs Goal-Based Incentives Part 4: Preparing for Goal Based Incentives

We’ve been working our way through the various ways you can calculate incentive pay and have covered quite a few so far. As a recap, here are the various methods and the articles you can reference to find the content on that method.

Jul 4
Jul 4 Commission vs Goal-Based Incentives Part 3: Retroactive vs Progressive

A better approach, though I admit it’s harder to explain, is the progressive rate. This pays the higher commission rate only on the dollars within the tier…NOT back to previous tiers or the first dollar. This allows you to get a much smoother payout curve so there is now very little reason to cheat the plan.

Jul 4
Jul 4 Commissions vs Goal-Based Incentives Part 2: Draws vs Seat Cost

On the commission side of our graph (see the article from September 2023), we are moving toward using some sort of “goal” to affect payout, rather than simply paying a straight commission from the first dollar. One of the ways companies initially think of doing this is by deducting the salary or a “seat cost” from the commission calculation. This ensures that commissions are not paid until the employee as covered their costs to the organization, which is usually an approach that CFO’s like… a lot. And it can have it’s place in an organization, particularly when it is just starting up. However, it does have some downsides.

Jul 4
Jul 4 Commission vs Goal-Based Incentives Part 1

In previous articles we looked at different organization structure such as Cradle to Grave or Split model organizations and I referenced the need to understand different compensation approaches when dealing with split roles so that you can do something OTHER than simply paying everyone a smaller and smaller percentage of the GM$. This article will be the first in a series that will go into detail on these different approaches and how you can learn to select the best one for your various roles.

Jun 20
Jun 20 The In's and Out's of Successful Recruiting and Compensation - June 2023

In this webinar, Beth previews key topics covered for her upcoming training and answers questions from the audience. Learn more strategies to recruit and retain top talent and how to shape your organizational structure to fit your compensation needs.

May 11
May 11 Introduction to Brokerage Organization Structures and Compensation Methods - March 2023

At the TIA’s recent Lunch and Learn, Beth gave a quick introduction to the most common Freight Brokerage organization structures, compensation methods, and the pros and cons of each.

Oct 8
Oct 8 Beth Carroll 2021 OTA Annual Conference Presentation Video

The Ohio Trucking Association recently hosted their 2021 OTA Annual Conference, presented by Pilot Company, this week in Columbus. Over 160 in-person and virtual attendees joined exhibitors and sponsors for the event. The conference featured outstanding programming, opportunities to network and of course featured speakers, including Beth Carroll.

Jun 30
Jun 30 OTA On The Air - Episode #24 - Taming the Compensation Monster

Earlier this month Beth Carroll was a guest on an episode of OTA on the Air with President & CEO Tom Balzer. For anyone unfamiliar, OTA on the Air features industry experts and thought leaders who provide updates on the regulatory, legislative and compliance environment. Beth will also be one of the Keynote Speakers at this year’s OTA Annual Conference in September.

Mar 14
Mar 14 TIA Delivers Podcast #2 - Making Goal-Based Incentives Work for You

n this episode of TIA Delivers Podcasts, Beth Carroll, Managing Principal of Prosperio Group, provides insights into the series she has been writing for TIA's 3PL Perspectives Magazine. The series, “Going Beyond Commissions”, details the different approaches to goal-based incentives. Her unique perspective and range of industry knowledge are extremely valuable to the 3PL community and this is an episode that you won't want to miss!

Sep 10
Sep 10 How Restriction Fuels Temptation

The Psychology of Motivation and Rewards - In this new category of blog post, guest columnist, John Burkholder, gives us the rundown about how restriction actually fuels temptation.

Aug 4
Aug 4 August 3PL Perspectives: Going Beyond Commissions

In this month’s issue of 3PL Perspectives, Beth dives into the differences between commission and goal-based incentives. For instance, did you know that A non-discretionary bonus is based on a formula, which can be every bit as precise, objective, and LUCRATIVE as a commission plan?

Jul 11
Jul 11 Freight Advisors Podcast - Guest Beth Carroll

Beth was recently a guest on The Freight Advisors where she had a great conversation with Jared Taylor about the importance of compensation in the freight space. Whether you're a logistics provider or an asset trucking company, getting the right compensation package in place is incredibly important. They also walks us through what that looks like, how to think about compensation, and the importance of emotional intelligence while devising the right strategy.

Jun 10
Jun 10 Incentive Compensation in a Post-COVID World

Beth was recently invited to be a guest columnist for the Tenney Group blog and did a great Q&A regarding Incentive Compensation in a Post-COVID World. If you are interested in how other companies have been handling changes to their compensation plans as a result of COVID-19, you’ll definitely want to give it a read.

Jun 10
Jun 10 Is it Ok to Double Bonus?

The answer depends, in part, on how the goal was initially set and if there was any provision for double crediting when goals were allocated. Sometimes each sales rep is an island unto themselves, and the sum of their goals equals the overall sales budget. Other times some overlap is built into the system of goal allocation and the sum of the individual goals may equal more than 100% of the overall sales budget. If the goals were set with the planned overlap, then the answer is easy – it’s fine to reward with double credit because the reps were double goaled. But what if the goals weren’t set that way at the start?

May 8
May 8 Handling Compensation Windfalls

One of the less common occurrences in the world of sales compensation is a windfall, or “blue bird” sale. Sales reps love them, but they drive compensation managers (and owners who must pay them) nuts; the pay earned from incentives is often grossly out of proportion to the effort involved…

May 8
May 8 3PL Perspectives - The Economics of Commissions: Part 3

In the first two articles of this series, we looked at the various ways commissions can be calculated in such a way that "costs are covered," namely using a draw, a multiple of salary, or a threshold approach. In the second article, we looked at three different ways of scaling a commission rate relative to production: flat, retroactive, or progressive. We also discussed setting a fixed tier for production (e.g., $20,000) or a relative tier (75% of goal, where goal is individualized based on a person’s book of business). This article will focus on another very popular method for calculating commissions: the matrix.

Apr 29
Apr 29 How to Estimate Sales Revenue or Gross Margin

My mathematical trick here is something that is derived from “The Rule of 78’s” which is typically used in other applications (such as mortgage interest payments), but it works just fine here as well. You can Google “The Rule of 78’s” or “Sum of the Digits Method” to get a deeper understanding. You might ask “how do we get the number 78”? 78 is the sum of …

Apr 20
Apr 20 3PL Perspectives - The Economics of Commissions: Part 2

In the last issue of 3PL Perspectives, we looked at the three basic methods for calculating a commission relative to a production threshold: draw, seat cost, and threshold. Now we will look at the ways you can calculate the commission itself. There are also three methods to consider: flat rate, retroactive rate, and progressive rate.