Achieving Sales Performance Optimization Through Automated Incentive Compensation Management

Achieving Sales Performance Optimization Through Automated ICM Jeff Staley Director, CRM Center of Excellence SAP Americas, Inc.

Agenda ,[object Object],[object Object],[object Object],[object Object]

Business Drivers for Automated ICM

Incentives Drive Financial Performance ¹ Accenture CRM Research Potential Dollar Impact in $M on Pre-tax Profit of Moving from Average to High Performance for $1Bn Business Unit - Accenture CRM research Brand Management Motivating and Rewarding People Customer Service Turning Customer Info into Insight Attracting and Retaining People Building Selling and Service Skills Strong Value Propositions Partner and Alliance Management eCRM Sales Planning Key Account Management Advertising Customer Retention and Acquisition Managing Product and Service Mix Promotion Ability to Change the organization New Products and Services Segmentation Building Service Culture Channel Management 1.5 13.0 13.0 12.0 10.0 9.5 9.0 9.0 8.0 7.5 6.0 5.5 5.5 5.0 5.0 5.0 3.5 2.5 2.0 3.0

Incentive Specific Pain Points Commission management is challenged with low quality data input, inflexible tools, and long cycle times. Currently, the Commissions Operations team meets these challenges through manual processes and labor intensive audits. Limited Speed And Agility To Adjust Managerial Visibility & Effectiveness Quality of Commission Calculation Inputs Labor Intensive Processes Pain Points ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Comments

Incentive Compensation is Difficult Hard to Calculate Hard to Manage Hard to Apply Vertical Knowledge Plan Complexity Volume Data Feeds ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Rate of Change Visibility Integration People ,[object Object],[object Object],[object Object],[object Object],[object Object],Sales Channel Employees ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Best Practices for a Performance Based Culture ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

The Market is Open for Co-Innovation SAP 22% ORCL (Incl.SEBL&PSFT) 12% $30.5 billion Enterprise Applications Market Sources: Company data, market reports, analyst estaimtes, preliminary for 2004; based on product revenue spending for application vendors (including license and maintenance revenue) MSFT 4% OPPORTUNITY ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],LEADERSHIP

SAP’s Ecosystem Strategy Profitable Ecosystem Growth Enable Adoption of NetWeaver and the Business Process Platform Foster Co-Innovation among customers and partners to create high-value solutions and services Create Value for all ecosystem stakeholders Enabling Goals Customers Partners Developers Fuel collective, self-sustaining growth

SAP – Callidus Partnership SELECT SAP/CALLIDUS SHARED CUSTOMERS Why SAP chose Callidus ,[object Object],[object Object],[object Object],[object Object],[object Object]

The SAP/Callidus Solution for Automated ICM

SAP with Callidus ICM: Closed Loop Business Scenario Sales Ops or Comp Analyst Sales Rep Reviews historical impact of sales performance vs. comp plans Determines appropriate changes to comp plans for products and territories Sells new product, receives comp statements. Initiates dispute for any discrepancies Reviews YTD performance of regions and current products performance Updates comp plan Receives notice of new plan and accepts it Reviews and settles dispute VP Sales Reviews success of program and compensation effect Comp Analyst VP Sales VP Sales VP Sales / VP Finance Sales Rep SAP Callidus

Integrated Business Process Flow: SAP/Callidus ICM Compensation 1. Review effect of past comp plans and performance 2. Model plans, set rules, release plans 3. Place Orders 4. Process compensation Sales Ops or Comp Analyst Sales Rep / Channel Partner Sales Force Automation / Channel Mgmt Model plans, create rules, release plans SFA & SD - Quote to Cash SAP ICM XI Process compensation based upon plans SD transactions 5. Analyze Effectiveness Sales Manage dispute process BI, SFA, Verify payments, Enter disputes SFA, HR Payroll, AP HR Payroll / AP Analyze plans and performance VP Sales, Finance SD transactions & Business Partner Biz Partner, Prods, Price, Territory

TrueComp Suite Analyze (TrueAnalytics) Target Audience: Executives, Bus. Analysts Build (TrueComp Manager) Communicate (TrueInformation) Target Audience: Field Sales, Field Mgmt. Resolve (TrueResolution) Target Audience: Field Sales, Field Mgmt. SAP Data Actionable Insight Plans, Rules, People Flexible Workflow Self-Service Target Audience: Comp Analysts, Comp Mgrs.

How Integration is Done Today CRM SAP Enterprise Business Suite Callidus FI Accounts Receivable SD Order Management Materials Management Business Intelligence Service Management FI Accounts Payable General Ledger HR Payroll SAP Enterprise Business Suite Business Intelligence Master & Transactional Data Source Systems Settlement & Reporting Systems Compensation Processing Business Partner

Integration Scenario and Roadmap Partner Contract will only include Powered by NetWeaver Certification for the Callidus TrueComp Incentive Compensation Management application Initial integration will focus on CRM and ERP Business Partner Master Data for employees or partners who will be awarded incentives via Callidus TrueComp SAP Business Intelligence SAP Enterprise Business Suite Settlement Systems Standard SAP Analytics Content SAP NetWeaver Business Process Platform (BPP) ,[object Object],[object Object],[object Object],ERP Transactional Data Master Data ERP CRM Master Data Transactional Data

Joint Value Proposition for Achieving Sales Performance Optimization

Drive Revenue and Profitability with Proven ROI

Strategic Benefits of an Automated ICM Solution *Source:SAP customer experiences Callidus ROI Whitepaper 2-5% 50-99% ,[object Object],[object Object],Improved Quality Sales Productivity 60-100% ,[object Object],Revenue 10-20% 10-20% 40-60% 2-5% ,[object Object],[object Object],[object Object],[object Object],Operating cost 4-6% 10-20% 4-7% 8-10% ,[object Object],[object Object],[object Object],[object Object],Impact Tangible Benefits *

Strategic Benefits of an Automated ICM Solution ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Higher Revenue Potential Lower Costs Increased Managerial Effectiveness

Tangible Benefits of an Automated ICM Solution* (1/2) ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],*Source:SAP customer experiences Callidus ROI Whitepaper

Tangible Benefits of an Automated ICM Solution* (2/2) ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],*Source:SAP customer experiences Callidus ROI Whitepaper

Why Companies Choose SAP/Callidus Solutions ,[object Object],[object Object],[object Object],[object Object],Tangible Business Benefits: ROI Business Agility Lower Risk Enterprise Alignment ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Analyst View on Benefits …. ,[object Object],[object Object],[object Object],[object Object],What Analysts Say About the Benefits of Automated ICM

[object Object],[object Object],[object Object],[object Object],Summary: Value of Joint SAP/Callidus Solutions

Distribution Industry Leaders Choose Callidus ICM Insurance Telecom Retail Banking Manufacturing & Technology

Customer Case Study: DIRECTV DIRECTV delivers satellite-based services to US customers in homes and businesses. DIRECTV’s complex operations include some of the world's most advanced technologies in the delivery of a seamless viewing experience. DIRECTV has more than 15 million customers, we're the industry leader in satellite service. ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Nortel Selects SAP/Callidus for Enterprise ICM Nortel is a worldwide provider of communications technology with 33,760 employees in over 150 countries. Nortel has a global sales force of approximately 3100 sales people who are paid incentive compensation via a labor intensive legacy compensation application and spreadsheets . ,[object Object],[object Object],[object Object],[object Object],[object Object]

Copyright 2007 SAP AG. All Rights Reserved ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Incentive Compensation Value Proposition Achieve Superior Business Value Operational ,[object Object],[object Object],[object Object],Strategic Goals Key Benefits Foundation ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],10+% of spend 2 – 5% of spend Revenue Growth

Achieving Sales Performance Optimization Through Automated Incentive Compensation Management

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Achieving Sales Performance Optimization Through Automated Incentive Compensation Management