Patent Publication Number: US-2007118424-A1

Title: Method and system for compensating a salesperson

Description:
BACKGROUND OF THE INVENTION  
      1. Field of the Invention  
      The present invention relates generally to a method and system for compensating a salesperson, and more particularly, to a method for compensating a salesperson of a company beyond termination of the salesperson&#39;s relationship with the company.  
      2. Related Background  
      Often companies hire salespersons to offer company services directly to clients. Typically, such salespersons travel to client locations, such as offices and residencies, to offer the company&#39;s services, and are compensated for each client brought into the company. Compensation may include onetime payments, such as a commission, or may be provided on a periodic basis. Salespersons often create ongoing relationships with each client as part of performing his or her employment duties, and devote many hours towards the upkeep of such relationships.  
      If and when the relationship between the company and the salesperson ends, the company typically terminates compensating the salesperson and gives the salesperson&#39;s clients to another salesperson. It is quite common for the salesperson to be replaced by another salesperson who inherits the clients and compensation of the now-terminated salesperson, when the now-terminated salesperson&#39;s compensation becomes high. Often, a well-performing salesperson is replaced by a new salesperson with a revised compensation package, because the company believes that it can pay less for the same duties to be performed. This does not facilitate a productive relationship between the salesperson and the company because the salesperson has a constant concern regarding job security. Additionally, if the salesperson&#39;s compensation is based on the number of existing clients, the salesperson has a constant concern about being replaced by a lesser-paid salesperson, disregarding the time and effort put into the company&#39;s business by the salesperson.  
     SUMMARY OF INVENTION  
      The present invention addresses the concerns discussed above. A method and a system for compensating a salesperson who markets and sells services to multiple clients are presented. For the purposes of this invention, a salesperson includes, but is not limited to, an independent contractor, an employee, a freelance contractor, and a partner. According to one embodiment of the present invention, a method for compensating the salesperson comprises providing compensation related to one or more clients assigned to the salesperson and continuing such compensation until each of the one or more clients withdraws from the services offered, thereby effectively terminating the relationships between the salesperson and the clients. For the purposes of this invention, a client includes, but is not limited to, a person or entity who receives the services and/or purchases the services directly, as well as a third-party beneficiary who receives the benefits of the services. Such termination may occur in one of two ways: first, the client may voluntarily terminate the services at any time, for example, by canceling the contract, upon which compensation to the salesperson ceases, for example, at the end of the following pay period. Alternately, the client, such as, a third-party beneficiary, may become deceased, thereby nullifying the need for the services and, at such time, compensation to the salesperson ceases. However, compensation to the salesperson does not terminate based upon the salesperson ending his or her association with the service provider or company. This method of compensation increases financial security for the salesperson and accordingly, increases loyalty towards the company, which facilitates productivity.  
      Additionally, the salesperson has a steady flow of compensation by knowing exactly how many clients he or she maintains and brings in, and need not be so concerned with pay periods where few clients were brought in. Compensation to the salesperson is based solely upon the number of clients assigned to the salesperson, thereby allowing the salesperson to determine how much or how little time he or she should devote to working. If the salesperson&#39;s relationship with the company is terminated, or if the salesperson is unable to perform the job required, compensation continues until the last client previously assigned to the salesperson either becomes deceased or terminates the service agreement. The salesperson does not lose his or her work efforts to another salesperson who may come into the company as a replacement. Accordingly, the company has no financial incentive for replacing an existing, good-performing salesperson, because the company cannot reduce the commissions payable due for existing clients by terminating or adjusting the pay package for any existing clients. This removes the concern by the salesperson of being replaced by a lesser-paid salesperson, and facilitates loyalty towards the company.  
      According to another embodiment of the present invention, a system for compensating a salesperson includes a database containing a plurality of clients stored in a computer-readable memory, one or more interfaces to allow the salesperson to access the client database, and a call center for interacting with clients and with salespersons. A client, in a particular geographic territory, may sign up for a company&#39;s services, for example, through the salesperson associated with the geographic territory, by contacting the call center, or through the company&#39;s Internet website. If through the salesperson, the salesperson may provide the client information to the call center, which in turn enters the client&#39;s information into the client database. Alternately, if the client contacts the call center directly, then the call center enter the client&#39;s information directly into the client database and then contacts the salesperson responsible for the geographic location that includes the client. The salesperson may access the client database via an interface, such as a Web interface, to review client information. The company also uses the client database in determining the compensation for the salesperson. Further, the system may include one or more computer applications to facilitate processing client intake and to generate sales reports for compensation of the salesperson.  
      In yet another embodiment of the present invention, a programmable computer for use in compensating a salesperson is provided. The programmable computer includes at least one memory or computer-readable medium that includes at least one region for storing computer-executable program code, and a processor for executing the program code stored in the memory. The program code includes modules for inputting new clients into a database, assigning clients to a salesperson based upon a geographical territory, and compensating the salesperson on a periodic basis based on the assigned clients within the database. Each pay period, the program code may generate sales reports for each salesperson. Such sales reports indicate whether new clients have been added to the database within the pay period as well as whether previous clients have remained enrolled with the company. The programmable computer automates compensation of the salesperson, thereby providing an efficient means for performing the payroll duties of the employer by reducing the manual time and costs often associated with such payroll duties. 
    
    
     BRIEF DESCRIPTION OF THE DRAWINGS  
      The present invention is more readily understood from the detailed description of the embodiments presented below considered in conjunction with the attached drawings, of which:  
       FIG. 1  illustrates a system for compensating a salesperson, according to an embodiment of the present invention; and  
       FIG. 2  presents an exemplary process flow for compensating a salesperson, according to an embodiment of the present invention. 
    
    
     DETAILED DESCRIPTION OF THE INVENTION  
       FIGS. 1 and 2  are discussed together to describe an exemplary embodiment of the present invention.  FIG. 1  presents a system  100  for compensating a salesperson, according to an embodiment of the present invention.  FIG. 2  illustrates steps in a process flow describing an exemplary embodiment of the present invention. The steps need not be in the sequence illustrated, and some steps may be essentially simultaneous. In the embodiments described below, an insurance company provides health insurance for pets. However, the disclosed system and method may be used for the sale of any type of insurance product or a product where there is a continuing obligation for a client to pay for a particular service.  
      In this embodiment, the company  101  seeks to develop quasi-partnerships with salespersons to market health insurance policies to pet owners at veterinary clinics. At step S 201 , an individual may contact the insurance company in order to become a salesperson or a Territory Partner (“TP”)  104 . Each Territory Partner  104  is assigned one or more exclusive geographic territories where the TP  104  is responsible for the clients located in each territory. Upon entering into an agreement with company  101 , where such an agreement may be, for example, an employment contract, a sales contract, or a distribution contract, at step S 202 , TP  104  makes an investment into the company  101  in exchange for proper training, marketing materials to provide to prospective clients, and to cover other miscellaneous expenses, such as obtaining a license for accessing and using the company&#39;s client database  102 . This method fosters a partnership environment such that by investing his or her own finds, TP  104  is a “partner” of company  101 . Once completing the required training, at step S 203 , company  101  assigns one or more exclusive geographic territories to TP  104 . Each geographic territory includes multiple veterinary clinics where TP  104  may distribute marketing materials and also may market directly to pet owners. The geographic territories may be categorized by zipcode, by county, or by some other category.  
      At step S 204 , a pet owner may enroll a pet  105 , the client, into one or more insurance programs offered by company  101  either directly through TP  104 , as shown at  1 . 2  in  FIG. 1 , or by contacting company  101  directly, such as through a call center  103 , as shown at  1 . 1 , or via a company Web interface  106 , as shown at  1 . 9 . Upon enrollment, at step S 205 , information regarding pet  105  is entered into a pet database  102 . Pet information may be entered into the pet database  102  either by call center  103 , as shown at  1 . 3 , or by TP  104 , as shown at  1 . 5 , via the Web interface  106 .  
      At step S 206 , each pet is assigned to TP  104  based on the pet&#39;s geographical location. If pet  105  registered for insurance independent of TP  104 , then, at step S 207 , TP  104  receives notice of pet  105  as added to his or her geographic territory, from the call center  103 , as shown at  1 . 4 . Alternately, if TP  104  enrolled pet  105 , TP  104  may contact the call center  103  and provide the pet information, as shown at  1 . 4 , in order for the call center  103  to enter the related pet information into the pet database  102 , or optionally, TP  104  may enter the pet information directly into the pet database  102 , as shown at  1 . 5 . Once information regarding pet  105  has been entered into the pet database  102 , at step S 208 , TP  104  may access the pet database  102  at any time to review the information for each pet enrolled within the TP&#39;s exclusive territory.  
      To determine the proper compensation for TP  104 , sales reports  107  may be generated on a periodic basis by company  101 , for example, on a monthly basis, at S 209 . To do so, company  101  accesses the pet database  102 , as shown at  1 . 6 , and uses one or more software applications to query the database  102  for all registered pets assigned to TP  104  as of the query date. Company  101  also queries the pet database  102  for data regarding which pets enrolled within the last pay period, such as the last month, and which pets that enrolled prior to the pay period have remained enrolled. Upon retrieving the data, company  101  generates a sales report  107 , as shown at  1 . 7 , which may be provided to TP  104 , as shown at  1 . 10 .  
      At step S 210 , compensation is determined from the TP&#39;s sales report  107 . At step S 211 , TP  104  receives a monthly compensation for each pet that has maintained an insurance policy up to the time the sales report  107  is generated, such as, for example, $2 per pet, as shown at  1 . 8 . Additionally, as shown at step S 212 , for each pet enrolled within the pay period of the sales report  107 , such as pet  105 , TP  104  receives a one-time enrollment fee, such as, for example, $10, regardless of whether pet  105  enrolled through TP  104 , or through call center  103  or the Web interface  106 . Thus, TP  104  essentially is guaranteed compensation for each pay period, so long as the current pets remain enrolled. TP  104  may work as little or as much as he or she wishes, thereby maintaining control of his or her compensation. Additionally, TP  104  is aware of the exact amount of compensation he or she will receive each pay period since TP  104  may access the pet database  102  and query his or her own client information.  
      Compensation to TP  104  repeats each pay period, regardless of whether TP  104  remains associated with company  101 . Thus, at step S 213 , if TP  104  were to either leave or be terminated from company  101 , TP  104  would no longer receive the $10 enrollment fee for each new pet added within TP&#39;s territory, after TP&#39;s employment ends. However, TP  104  would continue to receive the $2 fee for each pet enrolled at the time TP&#39;s employment ends, so long as each pet remains insured with company  101 . Accordingly, the system and the method of the present invention provide financial security to TP  104  regardless of whether TP&#39;s association with company  101  remains intact, and foster a productive and loyal relationship between company  101  and TP  104  by allowing TP  104  to maintain control of his or her compensation.  
      The inventive method also may be embodied in computer-executable code that is stored on a computer-readable medium, for example, a floppy disk, a hard drive, removable media, an optical memory, a magneto-optical memory, a RAM, a ROM, a flash memory, so-called “memory sticks,” and the like. The code may be coupled with a processor and one or more applications within the system described above to facilitate compensating the salesperson automatically, thereby reducing manual time and costs associated with common payroll management.  
      While the present invention has been described with respect to what is presently considered to be preferred embodiments, it is to be understood that the invention is not limited to the disclosed embodiment. To the contrary, the invention is intended to cover various modifications and equivalent arrangements included within the spirit and scope of the appended claims. The scope of the following claims is to be accorded the broadest interpretation so as to encompass all such modifications and equivalent structures and functions.