Streamline Incentives with Oracle Incentive Compensation Cloud
Compensation is one of the most critical factors that drive employees to excel at work. Incentives are a form of payment in which an employee’s earnings are directly tied to the amount of product they sell, the success of their team, or the company’s success. Incentive compensation management is the strategic use of incentives to drive better business outcomes and closely align sales team behavior with the company’s goals.
Incentives can be structured in multiple ways, including awards, bonuses, commissions, and recognition. A company’s incentive compensation plan must align with its goals, but maintaining this alignment can be difficult. A significant pain point for sales and service professionals is that the commission and incentive processing process is often manual, cumbersome, and convoluted. Sales and service professionals are affected, but accounting shares the pain of complex commission processing.
These problems can be resolved by implementing automated solutions to provide a human experience that can boost revenues and produce employee happiness. Oracle Incentive Compensation Management (ICM) cloud is a next-generation, strategic, and modern platform that can fully automate your commission process and keep your employees happy.
Sales Performance Plans
Sales performance measures and tracks each sales representative’s progress toward specific goals. It provides a compensation plan that measures progress, calculates compensation earnings, determines participants’ compensation, manages compensation disputes, and credits participants. It reduces overpayment on sales commissions, lowers the cost of commission administration, and connects sales teams with organizational priorities.
Sales performance measures determine how sales representatives are compensated using criteria that evaluate progress on predetermined objectives. These measures are controlled and influenced by the representative and can be tracked. Components of a performance measure generally include goals (target/quota, credit category, product, measure formula), expression (revenue, % attainment), scorecard, and attainment to scores.
The sales performance plan optimizes territories, quotas, and incentive plans. It identifies issues by monitoring, sending alerts, and providing greater insight Into pay-for-performance. Companies should maintain distinct, original business plans and ensure unified plan performance reporting. They should use a plan with an easy configuration of performance metrics to track product hurdles and multipliers.
Why Select Oracle ICM?
Oracle ICM is an application that allows organizations to align their business objectives with sales force activities. It has a rich adaptable plan design with sophisticated crediting rule capability embedded with analytics, reporting, and BI. This solution integrates territory and quota management. Companies can automate the complex task of calculating variable compensation. Oracle ICM rewards a performance mindset to motivate employees to sell more products or solutions.
This solution uses real-time, interactive, closed-loop reporting; integration with IC transactional applications. It provides complete commission visibility with role-based visibility for dashboards and reports. Companies can add their external web content on the dashboard page, as well as export reports and PDFs. This graphical representation of data enables less time and money to calculate compensation. It provides a quick understanding of and attention to compensation for decision-making. Additional benefits of using Oracle ICM include the following:
- Credit Allocation: This feature uses hierarchy rules to determine who should receive credit based on a single-rule hierarchy with a streamlined rule definition. These rules provide cross-organization crediting and rollup, as well as participant snapshots. Companies can use combined or separate crediting or rollup rules, along with hierarchy, role, and team definitions. There are selective rollups with individual summary rollup selections.
- Currency Calculation: Manage globally with multi-currency goal definitions, calculations, and payments using Oracle ICM. Admins can set the operating or processing currency and the multicurrency based on the appropriate values for each relevant attribute: currency, conversion rate, and amount attribute.
- Dispute Management: Compensation managers can create, track, and resolve disputes using Oracle ICM. There are automated notifications for all involved parties. Managers can dispute actions; create, reassign and delegate; request more or update information; approve, escalate, withdraw, and reject requests.
- Organization Crediting: This is for single or multiple business units, and it provides credits and earnings and delivers on-time payments. Credits are processable and stamped with the desired currency. Oracle ICM generates an OTBI (Oracle Transactional Business Intelligence) Report, and REST APIs are used to calculate simulation.
- Payment Approval: There are transparency and error reduction processes for no-hassle, simple transactions in a familiar environment. There’s a complete transaction and payment traceability to see who is paid and when a payment occurs. Businesses can determine incentive compensation payment components, such as which transactions and adjustments to pay. This feature helps with approval and payment processing.
Oracle ICM integrates with CRM applications, Oracle CPQ Cloud, Oracle Marketing Cloud, Salesforce, Mobile, Outlook Platforms, and other third-party applications. Using the Oracle ICM app available for iOS & Android platforms, sales representatives can check payment components and balances, review earnings by plan component and performance attainment, status and details of any disputes, and most recent payments, conflicts, and credit transactions.
Oracle ICM Case Study #1
A large industrial manufacturing company was having issues with a lack of unification of data sources, such as invoices, credit memos, etc. They couldn’t make ongoing changes to the rates in the middle of the year and handle exceptions for certain payees, etc. They had disparate systems for commission calculations and adjustments.
The architects at SoftClouds provided the client with a new solution: Oracle ICM. They improved the scalability of calculation logic with the flexibility to modify ongoing rates and handle exceptions for certain payees using multi-divisional compensation plans.
As a result, the company had a new system for complex-inbound data handling with a seamless marriage of inbound data and calculation logic. This solution provided ease of maintenance, calculation accuracy, and transparency for the payees. Making on-time payments was now possible, which increased the company’s ability to achieve financial control and compliance.
Oracle ICM Case Study #2
A hospitality company had trouble with manual compensation processing, which created inconsistent estimates and formulas. They also didn’t have reports or dashboards for incentive compensation management. As a result, they failed to adapt plans to current market strategies and trends. The company had inaccurate incentive payments, high administration costs, overpayments, and unexpected operating costs. Their sales performance didn’t align with their organizational plans.
SoftClouds engineers implemented an incentive compensation module to track their sales and quotas. The team also created incentive rates for sales and travel expenses, implemented a bonus estimator process, incorporated group compensation modules, configured object workflows to automate the approval process, and built transactional business intelligence for commission reports and dashboards.
The new solution keeps the company’s sales representatives motivated and focused on achieving desired outcomes. It maximizes productivity by attracting and retaining talent. The compensation plans align with the business strategy for systematized business processes, reducing costs and time. Also, account-based pricing increased up-sells and cross-sells.
I believe that by implementing Oracle ICM, companies can use this solution to maximize their revenue potential and increase SFA (sales force automation) adoption. It ensures accurate, on-time payment by using a high-performance processing engine. This solution leverages enterprise capabilities to reduce costs by using an interactive dashboard to drive performance results. It enables complete commission visibility, providing transparency across companies. Performance plans and pay schedules for compensation can also be easily viewed using Oracle ICM’s graphical data visualization.
As the industry goes through a monumental change in technology and CX, traditional sales roles will shift, and the interfaces and route to the customer/clients will vary, which is expected to change sales and incentive compensation. In other words — ICM in the future could be used for non-sales personnel, and as a result, newer compensation models will emerge. I also expect “super sellers” to appear in sales, changing how compensation is usually distributed today. Also, as personalization starts more profound in the CX platforms, the sales compensation structures will get more design choices in the future.
This post was written by Brian Friedman, GVP of Global Strategic Sales at SoftClouds. Brian has a background in technology, business development, corporate management, and sales. He has been responsible for the creation and growth of numerous companies developing successful long-term relationships that have resulted in double-digit sales growth and continuing business expansion.
SoftClouds is a recognized leader in CRM/CX transformation with experience in numerous Service Cloud Implementations with pre-configured best practice business processes for multiple verticals/domains.
To learn more about this topic, please click here.