GlaxoSmithKline's New Sales Force Compensation System in the US

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

Case Details:


Case Code : MKTG258 For delivery in electronic format: Rs. 400;
For delivery through courier (within India): Rs. 400 + Rs. 25 for Shipping & Handling Charges


Product Design
Case Length : 10 Pages
Period : 2009-2010
Pub Date : 2010
Teaching Note : Not Available
Organization : GlaxoSmithKline Plc
Industry : Pharmaceutical
Countries : US


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 US.

As part of the 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.


To understand the various issues and challenges associated with evaluating and compensating a sales force.
To understand the pharma selling environment in the US.
To analyze the new sales force compensation system of GSK in the US and discuss the pros and cons of the system.
Explore ways in which the system can be improved further.


  Page No.
Introduction 1
About GSK 1
Changing Dynamics in the Pharma Selling Environment 2
GSK's Sales Force in the US 3
Delinking Sales Force Compensation and Sales Targets 4
Reactions 4
Looking Ahead 5
Exhibits 6


Sales Force Compensation, Sales Force Evaluation, Sales compensation system, Pharma selling environment, Sales productivity, Sales force profitability, Base salaries, Bonuses, Incentives, Reward, Overtime pay, Sales targets, Transactional product-focused model, Dialogue focused model, The Fair Labor Standards Act (FLSA), GlaxoSmithKline

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