OpenSymmetry IBM Sales Performance Round Table Malaysia

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Presentation from the IBM / OpenSymmetry Round Table Event in Malaysia on 4/22/13. Presenter: Laura Roach, Chief Marketing Officer with OpenSymmetry

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OpenSymmetry IBM Sales Performance Round Table Malaysia

  1. 1. © 2013 IBM Corporation22 April 2013, Monday | Shangri-la Hotel, PerakRoom, Basement 2, Kuala LumpurSales Performance ManagementRound Table
  2. 2. © 2013 IBM CorporationSales Performance Management Round Table | Kuala Lumpur2Did you know?Compensation plans that are managed using spreadsheets orhome grown solutions may be riddled with errors, producinginaccurate payments and costing your organizationthousands, even millions of dollars annually…$400 millionVariable compensation spend per year0.5% overpayment$2 Million1% overpayment$4 Million3% overpayment$12 Million
  3. 3. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurPresenter(s)3Kevin GrayProduct Marketing ManagerSales Performance ManagementIBMkevin.gray@ca.ibm.comLaura RoachVice President, MarketingOpenSymmetrylaura.roach@opensymmetry.com
  4. 4. © 2013 IBM CorporationSales Performance Management Round Table | Kuala Lumpur4Agenda8:00 am – 9:00 am Breakfast and Networking9:00 am – 9:30 am What is SPM, Business Challenges Organizations Face and theIBM SolutionKevin Gray, Product Marketing, IBM9:30 am – 10:00 am How to Ensure Your Compensation Plans are Accelerating andOptimizing Performance to Meet the End GoalLaura Roach, CMO, OpenSymmetry10:00 am – 10:30 am Roundtable – Hot Topics / Best Practices8:00 am Registration
  5. 5. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurTwo Axioms512
  6. 6. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurTwo Axioms61
  7. 7. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurSales Performance Management Is Hard7•  Get the checks out on time•  Make sure they’re accurate•  But also. . .ü  Be flexible and nimble for changing prioritiesü  Manage complex assignmentsü  Set accurate goals and targetsü  Generate enthusiasmü  Deliver timely and insightful reportsü  Resolve questions and disputesü  Do it with less headcount
  8. 8. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurHow Is Sales Compensation Managed?8CSO Insights - 2012 Sales Compensation & Performance Management, Key Trends AnalysisSpreadsheets(54%)Home Grown(22%)CommercialSoftware(14%)Manual(7%)(3%) 61% Spreadsheets19% Home grown8% Commercial Software10% Manual2% Unknown
  9. 9. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurSPM: Issues and Challenges9Errors TransparencyShadow Accounting Long Cycle TimesAudit & ComplianceLabor IntensiveInflexibleLegacy Systems
  10. 10. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurSPM: Addressing the Pain Points of Several Business Constituents10•  How does my comp plan work?•  How much can I make?•  If something is wrong on my commissionstatement how can it get it fixed quickly?•  Manual calculations and adjustments take forever!•  Modifying the comp structure is difficult•  Management is asking for better reporting &auditabilitySales Ops &Comp Admins•  Are the comp plans working?•  Which people I should focus my energy on?•  Am I in compliance?Management& Executives321 Sales Reps
  11. 11. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurWhy Companies Adopt SPM Technology11Reduce ErrorsShorten Cycle TimesReplace technologyImproved DecisionsFlexibilityModeling and CostingInternal AuditLegislationIndustry RegulationsRiskReduction
  12. 12. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurSPM: A Working Definition12SALESPERFORMANCEMANAGEMENT§  Streamline compensationprocesses§  Reduce errors§  Improve sales performance§  Align behavior with goals§  Meet compliance requirementsTo Meet These ChallengesAutomates the process ofadministering, calculating,reporting & analyzingvariable-based pay programs
  13. 13. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurIBM Cognos Sales Performance ManagementIncentiveCompensationBuild, model and administervariable pay programs thatdrive desired sales behaviorChannelManagementGain a single, accurate viewof your entire sales force andall your distribution channelsTerritory ManagementManage crediting and frequent sales coveragechanges across territoriesTerritoryManagementQuotaManagementChannelManagementIncentiveCompensationIBM CognosSales PerformanceManagementQuota ManagementPlan and distribute quota targets efficiently across all levelsof your sales organizationCRMERP HRIS$£€BI Other13Users & Roles - Security - Data IntegrationHierarchies – Workflows – Scheduling – Rules – Calculation Engine - Auditability
  14. 14. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurTwo Axioms1412
  15. 15. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurGartner Marketscope for Sales Performance Management15Organizations adoptingSPM technologies90% 40% 50%Reduce errorsBy more thanReduce processingTimes by more thanReduce IT/AdminStaffing by more thanGartner MarketScope for Sales Incentive Compensation Management (2010)
  16. 16. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurGetty Images1616 Spreadsheets that previously needed to be manipulated for a comp planchange prior to implementing IBM Cognos SPM
  17. 17. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurMitel17Centralized payout administration from 30 to 3 employees for Northand South America30 3
  18. 18. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurElavon18Payout process reduced from2 weeks to 2 days2 2
  19. 19. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurCognos SPM Drives Smarter Analytics19•  Coverage model and role deployment•  Sales priority linkages to the field•  Insight to sales effectiveness•  Incentive and sales forecasts•  Program impact and modeling•  Error and dispute reduction•  SPM process scalability•  Flexibility and resource optimization•  ICM and quota cycle time decreases• Auditing and compliance tracking• Program governance• Program and process reporting1234Grow, retain andsatisfy customersManage risk, fraud &regulatory complianceIncrease operationalefficiencyTransform financialprocessesSmarteranalytics
  20. 20. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurHertz: “Enabling a Business Model Change”20New head of sales redesignedcompensation to help the rentalcompany become “more sales-friendly”Customers formerly had to rely on adifferent sales rep for every line ofbusiness, from corporate sales to toursNow customers “can get everythingdone through one salesperson”Lynn Ferrara, Sr Director of compensation and HRIS
  21. 21. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurmBlox: “Focus Sellers on Selling”21“When people didn’t understand whattheir achievement was, we got pushbackon everything about our plan”“By having transparency into the systemwe don’t have to worry about themsaying, ‘Wait—I don’t get this.’”“…spend more time selling”Steve Love, CFO
  22. 22. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurHong Kong | Wealth Management & Broker: Flexibility to Change22“we didnt want to have to rely on ITservices whenever we make changes”“gives business users the ability to fullymanage the compensation processwithout requiring deep technical skills”“drive a competitive edge for our salesorganization”Chief Operating Officer, Wealth Management &Brokerage< Hong Kong based Wealth Management & Brokerage >
  23. 23. © 2013 IBM CorporationIncenting based on controllable profits“a lot of things that go into that profit marginare outside of the territory manager’scontrol… such as the cost of raw materials”“But they can have an immediate impact onprofitability by focusing on pricing”“Now that we have moved to a net-basedsales plan a territory manager can see adirect relationship between his behavior andthe amount of his check.”Carla Clark, Project Manager for Commissions
  24. 24. © 2013 IBM CorporationManagement reporting to drive performance“(Managers) can understand, at aglance, the productivity of all of theirassociates”“Management uses the informationabout store productivity—how manyunits the store sells every hour, andhow many dollars each of thosetransactions is worth—to help drivetraining programs”Walter Sprague, Sr VP of HR
  25. 25. © 2013 IBM CorporationAlign Incentives With Corporate Goals< Canadian Bank >§  Bonus for bundling multiple key productstogether (e.g. mortgage along withinsurance)§  Recognizing cross-selling new productfamilies to their customers (e.g. first long-term debt product for that customer/household)§  Rewarding employees for referringcustomers to another employee/BU
  26. 26. © 2013 IBM CorporationInstitute a Culture of Selling“Our industry historically has generated along line of order-takers”“Nobody can hide…People who have theright mindset flourish in this kind ofprogram”“Cross-sell ratio has gone from 2 to 5.66”Executive Vice President, Retail Sales< Retail Bank in U.S. >
  27. 27. © 2013 IBM CorporationBonus Program – Auditing & Visibility§  5,000 payees in Capital Markets§  For annual discretionary bonusprogram which was previously runusing spreadsheets§  Greater auditing around the bonusprocess, better tracking of approvalsand sign off< Capital Markets division of Canadian Bank >
  28. 28. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurCompensation Administrators: Scenario Modeling28
  29. 29. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurCompensation Administrators: Configure the system to reflectyour compensation program29Workflow Processes
  30. 30. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurSales Representatives: Dashboards30
  31. 31. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurSales Representatives: Plan Agreement31
  32. 32. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurSales Representatives: Self Calculators32
  33. 33. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurSales Management: Dashboards33
  34. 34. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurSales Management: Reporting34
  35. 35. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurSales Management: Reporting35Quota  Distribu,on  Pay  For  Performance  Analysis  
  36. 36. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurKey Differentiators36BusinessUser FriendlyConfigure vs. codeVisual flow approachFlexibilityCommission, MBOs, etc.Meet changing needsFlexible data modelPerformance& ScalabilityBuilt for high transactionvolumesImports, calculations, etc.
  37. 37. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurIn-the-Labs: Leveraging the IBM Portfolio37Sales Performance ManagementCognos TM1SPSS
  38. 38. © 2013 IBM CorporationSales Performance Management Round Table | Kuala Lumpur38Now you know…Compensation plans that are managed using spreadsheets orhome grown solutions may be riddled with errors, producinginaccurate payments and costing your organizationthousands, even millions of dollars annually…$400 millionVariable compensation spend per year0.5% overpayment$2 Million1% overpayment$4 Million3% overpayment$12 Million
  39. 39. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurPresenter(s)39Kevin GrayProduct Marketing ManagerSales Performance ManagementIBMkevin.gray@ca.ibm.comLaura RoachVice President, MarketingOpenSymmetrylaura.roach@opensymmetry.com
  40. 40. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurTwo Axioms401
  41. 41. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurTotal Rewards Model41OrganizationalCultureBusinessStrategyHumanResourceStrategyTOTAL REWARDSSTRATEGYCompensationBenefitsWork-LifePerformance & RecognitionDevelopment & CareerOpportunitiesAttractMotivateRetainEmployeeSatisfaction &EngagementBusinessPerformance& Results© 2012 World at Work Organization
  42. 42. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurTotal Rewards Model42OrganizationalCultureBusinessStrategyHumanResourceStrategyTOTAL REWARDSSTRATEGYCompensationBenefitsWork-LifePerformance & RecognitionDevelopment & CareerOpportunitiesAttractMotivateRetainEmployeeSatisfaction &EngagementBusinessPerformance& Results© 2012 World at Work Organization Variable Pay“Sales Performance”
  43. 43. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurMotivational Incentive Plan Design§ Consistency with company strategy§ Market competitive§ Pay mix to drive the right behaviors for different roles§ Clear line of sight for the salesperson§ Reward on measurable, controllable performance§ Simplicity and transparency§ Differentiated payout by performance level§ Plan integrated with other reward / performance management aspects§ Easy to administer43
  44. 44. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurGetting the Design Right44§  Growth–  New products–  New markets§  Diversification§  Consolidation§  Hunter/farmer role split orhybrid§  Direct/indirect channels§  Sector specific challenges2. Pay/Paymix3. Compensation Type8. Compensation Structure4. Metrics5. Use of Other Programs6. Crediting and Payout Timing7. Rules1. Number of plans/structure/eligibilityArchitecturalPlanComponentsDetailedDesignComponents
  45. 45. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurSPM – The Complete Vision45SalesCompensationAdministration &DesignSales Process /MethodologySales Coaching &TrainingCandidateAssessment,Selection & On-BoardingTerritory &QuotaBusiness IntelligenceSales StrategySales PerformanceManagementBusiness Process Management (BPM)Enabling Technologies
  46. 46. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurIBM Cognos Incentive Compensation Management FocusIncentiveCompensationBuild, model and administervariable pay programs thatdrive desired sales behaviorChannelManagementGain a single, accurate viewof your entire sales force andall your distribution channelsTerritory ManagementManage crediting and frequent sales coveragechanges across territoriesTerritoryManagementQuotaManagementChannelManagementIncentiveCompensationIBM CognosSales PerformanceManagementQuota ManagementPlan and distribute quota targets efficiently across all levelsof your sales organizationCRMERP HRIS$£€BI Other46Users & Roles - Security - Data IntegrationHierarchies – Workflows – Scheduling – Rules – Calculation Engine - Auditability
  47. 47. © 2013 IBM CorporationSales Performance Management Round Table | Kuala Lumpur47How do you Ensure Your Compensation Plansare Accelerating and Optimizing Performanceto Meet the End GoalSales Kick Off Done…Do you know if you’ll hit your target?Are you plans driving the right behavior?
  48. 48. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurMotivate and Drive Sales Behavior48Does yourorganizationbelieve salescompensationplans canmotivate anddrive salesbehavior?Yes / No
  49. 49. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurMotivate and Drive Sales Behavior49Is 99%AccuracyGoodEnough?
  50. 50. © 2013 IBM CorporationSales Performance Management Round Table | Kuala Lumpur50
  51. 51. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurWorldatWork and OpenSymmetry2012 Sales Performance and Technology Survey51
  52. 52. © 2013 IBM CorporationSales Performance Management Round Table | Kuala Lumpur52Shadow AccountingJob DuplicityRecruitmentOverpaymentsLoss of Morale / Trust in systemTime spentadministrating disputesRetentionLawsuit
  53. 53. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurMotivate and Drive Sales Behavior53Have you fullyoptimized yourcurrenttechnology?
  54. 54. © 2013 IBM CorporationSales Performance Management Round Table | Kuala Lumpur5484% of respondents use Excel tosupport compensationmanagement91% use Excel to support theannual planning cycle91% use Excel for sales compensationreporting and analytics19%
  55. 55. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurWe are the 1%55•  A formal process with required documentationand approvals used to administer the salescompensation plan•  The sales compensation administrationprocess documented is updated regularly•  Less manual adjustments•  Use SPM technology•  Use 3rd Party reporting tools for Static and Ad-hoc reportsUtilize workflow•  Investment has exceeded expectations in regards to Accuracy•  Would spend more time ensuring data feeds are clean and accurate
  56. 56. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurWhat Does Good Incentive Compensation Management Look Like?56§ Transparent communication of performance§ Higher profit margins§ Highly accurate, timely compensation payments processing§ Balanced sales territories§ Fair, motivational quotas§ Simple, motivational, flexible compensation plans§ Reduced turnover of sales talent§ Accurate sales forecasting§ Reduced sales cycles and lead conversion§ Better regulatory compliance
  57. 57. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurTop 7 Sales Compensation Improvements Requested5783%83%69%66%62%59%55%Improve reporting to the sales forceImprove reporting to managementImprove service to the sales force (toprovide a quicker response to inquiries)Improve administration productivityIncrease credibility with the sales force& managementImprove payment accuracyEase the creation & tracking ofadjustmentsSource: 2012 World @ Work OpenSymmetry Survey Results
  58. 58. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurCommon Reporting Needs58Real-TimeDeploymentManagedDeploymentConsistentlyFast SecurityPixel PerfectDesignHigh VolumePublishingSimplifiedData AccessVaryingLevels ofAggregationFunctional NeedsNon-Functional Needs
  59. 59. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurBusiness Intelligence Capabilities59
  60. 60. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurBusiness Case60StrategicRevenue GrowthOperational10% of total spend oncommissions/subsidiesCore Benefits4 – 7% of spend on commissions•  Increase Profitable Sales•  Penetrate New Markets/IncreaseMarket Share•  Gain Competitive Advantage•  Channel Loyalty•  Understand Link Between Plansand Results•  Deliver New Plans Quickly•  Handle Complexity and Change•  Reduced Overpayments/Errors•  Reduced Admin and IT Resources•  Improved Auditing and Tracking•  User Self Service for Reports andDisputesBusiness Case
  61. 61. © 2013 IBM CorporationSales Performance Management Round Table | Kuala LumpurQuestions & Answers61Kevin GrayProduct Marketing ManagerSales Performance ManagementIBMkevin.gray@ca.ibm.comLaura RoachVice President, MarketingOpenSymmetrylaura.roach@opensymmetry.com
  62. 62. © 2013 IBM CorporationSales Performance ManagementRound Table 22 April 2013, Monday | Shangri-la Hotel, PerakRoom, Basement 2, Kuala Lumpur

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