What Would You do if You had an Extra 15,000 Hours of Free Time?
March 25, 2015
The other day I was talking to an individual on the phone and let’s just say that they have a very interesting sales process. It boggled my mind that they not only had multiple people that needed to be paid from one sale, but their entire compensation process was extremely complex and was done in a homegrown system. Surprisingly, this was not the first time I had heard of this type of sales compensation program. In fact, it is more common than one might think, with more than more than 72% of companies using excel or some sort of manual process to support their compensation management processes in one way or another. However, when you bring in all these different factors into the picture, how do you know you are truly looking out for the best interest of the company from a payout standpoint, and that the people that you need to pay, are getting paid fairly?
According to the OpenSymmetry 2013 Sales Performance and Technology survey, only 18.5% of respondents reported accuracy of greater than 99% on their compensation administration process, with the biggest challenging being the large number of manual adjustment and the degree of complexity of the entire sales compensation program. In terms of reporting and analytics, the biggest challenge that is seen is poor data quality, which is a major problem, especially with 50.3% respondents saying that they produce reports on a monthly basis.
The ability to mitigate risk and produce accurate, on-time numbers and reports is getting more cumbersome, especially since change is inevitable. As change occurs, the ability to be agile and transparent is crucial, and it all starts with the people, processes, and technology. As you start to look and evaluate at these key components, here are seven areas to really dig deeper into and ask questions as it relates to the running your sales performance management solution:
- Collect: In order to make informed decisions, it only makes sense to use past data. Are you able to pull data so that informed decisions can be made? Better yet, how many sources do you have to pull data from and do you feel comfortable analyzing it and presenting it to your manger?
- Crediting: What type of sales model does your organization follow? Are sales reps getting paid for something that they do not necessarily deserve? Do you have overlaps regionally or globally, causing headaches for not only the comp administer, but also all sales reps involved?
- Calculation: Is your calculator sitting next to you? Do you have enough trust in your system to give you the right calculations?
- Compensation: When was the last time an executive knocked on your door and asked why there are discrepancies in the payouts?
- Communication: Do you know how to properly communicate things to sellers, managers and stakeholders, such as how much you are getting paid? How do you communicate and resolve disputes?
- Change Management: It is evitable that change will occur. When payouts and processes change, how do you ensure that the sales team and leadership do not become frustrated, and that they understand the “what and whys?”
- Control: Do you have the right check and balances in place? Are you and your team liable for the mistakes of other people?
The other best piece of advice that I can give you is to consult with professionals if you have any doubts while answering any of these questions. At OpenSymmetry, we work with companies, each of which all have different compensation processes. Our goal is to ensure that your organization is able to break through barriers and find and define success. Success is achievable when you have the right people, processes, and technology in place and 99% of our implementations have gone live, eclipsing the industry benchmark of just 50%. Why do you care? We will make sure that you have the right resources to be on a proven path on rapid results. Success is: getting back those 15,000 hours. Picture that. If you have any questions, please don’t hesitate to contact me directly or schedule a meeting with one of our other experts.