To properly connect both the Ground and Express lines of FedEx under a single sales team, a

distinct compensation plan must be utilized. With Express and Ground both having different
Marking 428 Sales Management

FedEx Compensation
Alignment
April 19, 2011

initiatives, a unified plan would be based around average revenues and market share percentages.
The Express sector controls about 64% of the revenue and maintains a large market share within
FedEx. The Ground portion inputs much less revenue at 13% and also has smaller market
utilization (Godes). The correct compensation plan would take into account the differences in
revenues and account sizes for both Express and Ground.
To promote consolidation, selling the plan will be based off of a portion of Express
relative to the average revenue and a similar direction with Ground along similar lines of the
70/30 percentage plan. Account executives will be required to reach a target closing sale goal in
both sectors which will, in turn, force each executive to sell both Ground and Express. The
bonus index will be based off of account sizes and annual revenue; however, it will be similar
across the board in order to create a unified understanding of the system (Godes). This
compensation plan will allow for equal selling in both accounts and revenue sizes so that account
executives dont push for only large accounts. When looking at this compensation plan, many

Hilary Wadsworth-hjw5023

evaluating factors are taken into account in order to measure the popularity and success of the
plan.

Kevin Irvin- kci5006

Shawn Newlin- sgn5008
Ryan Thomson-rqt5017

Mary Prince- mkp5053

There are several key points and objectives that Jerry Beyl and his team should consider
when creating the compensation plan for the integrated sales force. First and foremost, Beyl must
promote cross selling between FedEx Express and Ground. Another top priority should be
creating an employee-wide awareness and understanding of the compensation plans
fundamentals and concepts. If employees have a keen knowledge of the plan, they will be more
adept at tracking and calculating their results, hence providing larger revenues for the company.
When executed accordingly, this new compensation plan will stimulate greater work
ethic from the sales force because employees will be able to quantify their personal company
impact more easily. That being said, Beyl must keep in mind that this new plan will serve as a
measurement of expectations from each individual employee. These aforementioned
expectations will be articulated and communicated through his plan. In turn, the new
compensation plan must be well defined and succinct. Although the organizational cultures of
FedEx Express and Ground are profoundly dissimilar, Beyl also needs to elucidate to the FedEx
sales force how essential it is to sell both services.
From a companywide perspective, the Ground and Express sales teams will react
positively to the new compensation plan. With this new plan, there will be less confusion
between the two departments. The two will be merged and, as a result, issues with sales,
management, administration, pricing, and operations will all be under the same department.
Also, customers will not have to contact multiple people in regards to their ground and express
mail. This will make it easier on the account executives because they will be in charge of a
particular customer with both ground and express mailing while understanding the benefits of
their different revenue levels.
By creating an integrated sales force, FedEx is opening the door to widespread company
expansion and immense revenue increases while simultaneously staying aggressively
competitive with companies such as UPS, USPS, and DHL. The changes instilled by this new
compensation plan, if properly implemented, will generate greater sales than incurred in previous
years.

References
Godes, David B. Sales Force Integration at FedEx(A-D). 506029. Harvard Business School
Publishing, October 14 2005. http://hbr.org/product/fedex-corp-structural-transformationthrough-e-bus/an/HKU098-PDF-ENG
"About FedEx Company Information." FedEx. FedEx Corporation , 2011. Web. 18 Apr 2011.
<http://about.fedex.designcdt.com/>.