Arck Systems Case Study

Introduction
This paper will discuss how an optimal sales system should be implemented by Arck Systems through analyzing the changes incorporated by Bryan Mynor for the recently acquired Lux Software’s sales force’s compensation plan. We will begin with an overview of the major issues Arck Systems faced when assessing how the company should modify the plan. An examination of Arck Systems and Lux Software Inc.’s current compensation plans as well as the benefits and disadvantages of making changes to those compensation plans will then be introduced. Next, our recommendation for Arck Systems to create one unified compensation plan for both sales forces will be discussed, stressing the importance of a meticulous implementation of well-defined multiple customer value source plan into Arck Systems’ business strategy. Finally, we will conclude the paper by briefly reiterating the key details of the case, our analysis and recommendation.
Background: Arck Systems and Lux Software Inc.’s Compensation Plans
Arck Systems acquired Lux Software Inc., who enjoyed faster growth and higher margins, in an effort to grow market share through the expected synergies the two companies would experience once completely integrated. The acquisition resulted in Lux’s EVP of Sales, Chris Snyder, leaving the company. Snyder also recruited most of his sales management team with him leaving only Lux’s key salespeople. Bryan Mynor, EVP of Worldwide Sales at Arck, was assigned to manage the sales department for Lux. Initially, Mynor believed that the sales incentive plan at Lux was similar to Arck’s only to realize that Lux’s incentive program was much more lucrative to its top performing salespeople. Upon further investigation, Mynor discovered that Lux salespeople were able to manipulate the sales system to obtain higher pay outs. The