Organizations use Incentive compensation management (ICM) solutions to oversee sales remuneration. Understandably, these systems are complex in nature and yet need to be flexible enough to accommodate special one-off scenarios. ICM systems must also be quick and easy to change as well as scale up in order to enable business to quickly implement new market strategies and plans. And above all, given that these systems deal with people’s money, they also have to be extremely stable and reliable.
This presents a unique set of challenges to organizations to looking to automate or improve their ICM process. Here are some of the best practices that that our most successful and sophisticated customer teams employ at various stages of their journey.
Best practices for the Planning Phase:
Here are some Best practices to follow while planning to implement and ICM solution
- Data strategy
- One of the biggest late-realization pain points. ICM is a processing engine, but it relies on the correctness of incoming data in order to calculate the right results.
- Will all the data sources be aggregated at a single data warehouse? Are there multiple upstream system providing files in different data formats? Are all business units maintaining data using the same keys? Would you be able to merge these data sets without duplication or conflicts? These are very important questions to answer
- Meet with your internal data managers early in the process. Try to centralize the data in a single database if possible, else agree to standards that will allow teams to maintain and provide their data in a common format. Poorly structured commission plans can limit sales performance.
- Resourcing strategy:
- Organizations can often misestimate the involvement needed from their teams. Several stakeholders are often responsible for their day to day duties in additional to helping with the implementation of a new ICM system
- Some upfront project planning to determine, how much effort may realistically be needed from which stakeholder at which time can help avoid delays and budget overruns. Speak to Intangent about it, we can bring our years of experience and guide you on what you may actually end up needing
- Transitioning from legacy product to IBM ICM
- A lot of knowledge may reside with people who run the legacy system. Important to align everyone to this endeavour.
- Change is never easy. Will the same teams be running the new system? Will the new system make certain roles redundant or less important? What would happen to those people?
- Align everyone to the success of this project
- Select the right solution
- Different products and different strengths and capabilities. Within each product, there are often different modules that can be utilized in different ways
- Execute a small “blueprint” project with ICM experts to identify the most fitting and economical solution direction to pursue. These early decisions can have huge cost and quality impact.
Best practices for the Implementation Phase:
Here are some Best practices to follow while Implementing an ICM solution
- Create readable documents
- If your business users can’t review the requirements documents quickly and easily, they likely won’t be able to spot missing or incorrect requirements
- If it’s not captured in a document clearly, chances are it will be missed or misinterpreted while being designed by the tech team. Remember, the build consultants may not be familiar with your business.
- Emphasize on clear and easy-to-read documentation thought the project. It will automatically allow for the right quality checks to occur along the way.
- Create Reusable components
- Many of the highly successful implementations follow an iterative path. The core model plumbing is created, tested and deployed first, and then with that learning more plans are added to it later.
- Making the core logical components and feeds reusable can really help cut implementation cost for subsequent phases.
- Speak to Intangent about specific ways in which you can design functionalities that can reused for other components and comp plans in future.
- Don’t inject logic into the reports
- Compensation logic should be kept as much as possible in the calculation module. Reporting should ideally just be pulling precalculated values from Data Stores, and then simply filter, structure and display to the end user
- Injecting logic in reports can lead to duplication of logic, inconsistency in results across reports. It can also make the system inflexible and expensive to change and maintain
- Discuss your Locking Strategy upfront
- Locking requirements can tend to get ignored till very late, sometimes till after go-live. But locking calendars need to be built into the model design from the start. Changing them can require you to rebuild your system in some cases. Locking brings compliance benefits but can have flexibility implications
- Speak to the your ICM experts ahead of time to understand the implications of various locking options on your business, and select a locking strategy that best suits the compliance and flexibility needs of your business
Best practices for the Post Go-Live Phase:
Here are some Best practices to follow while running and maintaining an ICM solution
- Follow a robust support process
- Your ICM implementation was a success because you followed a good, reliable process of capturing complete requirements, getting them reviewed, doing a thorough design, testing the build well, and then planning the deployment. Retain this DNA in your post go-live process as well.
- e. Even for a small change, capture the requirements and review with business to ensure they’re correct and complete. Allow the consultant some time to think about the design and its larger implication on the model. Skipping these steps can cause regressions, defects, and a make system documentation outdated.
- Regression testing
- ICM models are complex data models. Changing as small piece in eligibility can lead to huge variance in payouts.
- Invest in Regression testing after each change is made to avoid any errors introduced inadvertently.
- ICM 10 has API capabilities that can allow you to automate part of the regression testing. Speak to Intangent about how you can save huge recurring cost by creating your automated regression testing tools.
- Performance monitoring
- Over time, calc times can grow from a few minutes to several hours. In most cases, performance only catches attention once it’s the calc times become very high, at which point it can take huge amount of rework and redesign or resolve. Monitoring calc times and working with your consultants to periodically redesign slower modules can help you maintain steady performance.
- Performing periodic data clean-up activities can also remove a tremendous amount of load from the system. Speak to your Managed Services consultants about how to quickly and safely remove unused components, feeds, calcs and data elements from your model
- Planning fiscal-end comp plan changes
- Treat the comp plan changes as an implementation project. Start discussions ahead of time
- Involve your Managed Services consultants early in the process to understand the cost and timeline implication of proposed changes. Doing this at an early stage can allow you to explore cheaper alternatives that may be equally acceptable to your business users
- Also, your Managed Services consultant may be able to suggest efficiencies based on their domain and industry knowledge.
Having a successful ICM system can be complex challenge, but following the these and several other best practices can help you achieve it. Speak to Intangent to explore where your greatest efficiency gain lie and how you can make quick strides towards your ICM objectives.