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Realise the potential of superior compensation management – IBM Sales Performance Management

Presentation by Alan Chapman, Global Head of IBM Sales Performance Management, to E-reward's Showcase Compensation Management Software, 19 November 2015.
Your employees, and their everyday behaviours, determine your organisation’s success, and you know you need to compensate them for the actions that drive results. To do that, you need a system that allows you to focus on elevating results rather than corralling data. In this session, hear how your organisation can enhance incentive compensation management by providing better transparency to engage your employees and drive better effectivity whilst providing more flexibility to allow the business to support faster changes to plans to meet business critical objectives.

Realise the potential of superior compensation management – IBM Sales Performance Management

  1. 1. IBM Incentive Compensation Management Align Sales Performance with Sales Strategy
  2. 2. ► Sales Incentive Compensation is the link between corporate strategy and customer-facing activity ► This business process is one of the lowest hanging fruit for savings and efficiencies ► Next generation sales forces will need to rely on data for competitive advantage Three Axioms
  3. 3. Show me the sales incentive plan …“ and I’ll show you the company’s business priorities”
  4. 4. Priorities are reflected in comp plans and configured in SPM systems territory definitions, account assignments, plan measures, rates, crediting rules and more
  5. 5. “Our main goal was to get more strategic… flexibility meant everything in enabling us to clarify that vision and execute on it.” “IBM Incentive Compensation Management can support every idea we have in terms of how we want to manage compensation.” — Getty Images
  6. 6. Tailor incentives based on company priorities Bonus for bundling multiple key products together (e.g. mortgage along with insurance) Recognizing cross-selling new product families to their customers (e.g. first long-term debt product for that household) Rewarding employees for referring customers to another business unit — An IBM customer, North American bank
  7. 7. Reward associates who have spent time helping their guest choose a whole outfit IBM ICM analyzes sales tickets to identify associates whose guests have purchased a shoulder garment and three other items Extra 2.5% commission on the sale — Destination XL Tailor incentives based on company priorities
  8. 8. Tailor incentives based on company priorities Drivers Incentive Plan  Route efficiency (units per hour)  Customer satisfaction  Safety (hurdle for participation) — Waste Management
  9. 9. Sales rep dashboards to understand how they’re doing and target their future efforts
  10. 10. ► Sales Incentive Compensation is the link between corporate strategy and customer-facing activity ► This business process is one of the lowest hanging fruit for savings and efficiencies ► Next generation sales forces will need to rely on data for competitive advantage Three Axioms
  11. 11. Many firms still rely on a patchwork of spreadsheets, email, manual processes, and outdated legacy systems to manage and administer variable comp plans
  12. 12. Manual steps Workarounds Errors Legacy approaches are a drain on the company
  13. 13. Is it hard to imagine why?
  14. 14. Is it hard to imagine why?
  15. 15. With IBM – administrators organize their business logic visually to gain efficiencies, reduce errors and facilitate collaboration
  16. 16. Cost of errors and commission overpayments estimated at greater than $1 million per year — An IBM customer in financial services
  17. 17. FACT #1 REDUCE ERRORS BY MORE THAN 90%
  18. 18. FACT #2 REDUCE IT/ADMIN STAFFING BY MORE THAN 40%
  19. 19. FACT #3 REDUCE PROCESSING TIMES BY MORE THAN 50%
  20. 20. “Enterprises will miss the equivalent of 5% to 10% of annual sales as “lost opportunities” which could have been captured by improving the management of overall SPM”
  21. 21. “many plan participants maintain their own compensation tracking documents that they use to double check their compensation departments' calculations.” — David O'Connell, Aite Group
  22. 22. “By having transparency into the system we don’t have to worry about them saying, ‘Wait—I don’t get this.’ “…spend more time selling” — An IBM customer in mobile e-commerce
  23. 23. “If you don't get your territory right, you can't get you incentive compensation right. If you can't get your incentive compensation right, you can't motivate your sales team. We knew that the foundation needed to be started with territory management.” — EMD Millipore https://www.youtube.com/ watch?v=-25WYf8YiL0
  24. 24. “Previously, they only received compensation reports on a monthly basis; now, they have daily insight.” “By checking their own performance regularly, they can keep themselves on track to hit their targets.” — Huntington Bank
  25. 25. Utilize mobile technology for field sales staff “Over 1400 of our field sales reps can access their sales compensation system via their iPads along with the other tools they use on-site with customers.” “They don’t miss a beat when it comes to understanding the compensation implications of their selling activities.” — An IBM customer in the media industry
  26. 26. ► Sales Incentive Compensation is the link between corporate strategy and customer-facing activity ► This business process is one of the lowest hanging fruit for savings and efficiencies ► Next generation sales forces will need to rely on data for competitive advantage Three Axioms
  27. 27. SPM Maturity Curve Scaling a Market Time CHAOS pre-ICM STABILIZE the operation OPTIMIZE decisions & processes SPMCompetencyandValue
  28. 28. Manage your sales team
  29. 29. Pay for Performance YTDSales YTD Quota Attainment Boom Bust Analysis 2013Attainment 2014 Attainment Quota Distribution Top & Bottom Performers Ranking 1 2 3 4 Rep Marilyn Abdul Steve Jian Attainment 183% 121% 98% 42% #ofReps Quota Attainment % Manage your sales team
  30. 30. What can we learn with Watson Analytics?
  31. 31. Information you might already possess. Have you ever correlated it? ► Sales by product, payee, territory and month ► Compensation: Plan type, payout by component, payee and month ► Territory hierarchy: city, state, region, country ► Payee hierarchy: payee, manager ► Time in role ► Tenure with company ► Performance rating ► Base salary ► Education ► Last employer ► HR survey info (How well do you understand the comp? Are you paid fairly? etc.) ► External demographics (household income, real estate values, etc.)
  32. 32. All Payouts Data Store Easily get data from ICM over to Watson Analytics
  33. 33. Advanced analytics without the complexity
  34. 34. Think differently Designing effective comp plans Coaching your sales reps Territory decisions Hiring the right sellers Prioritizing leads Smarter quotas
  35. 35. ► Sales Incentive Compensation is the link between corporate strategy and customer-facing activity ► This business process is one of the lowest hanging fruit for savings and efficiencies ► Next generation sales forces will need to rely on data for competitive advantage Recap: Three Axioms
  36. 36. To learn more ibm.com/spm

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