Managing a Multi-Phase Implementation of IBM Cognos ICM

Managing a Multi-phase
Implementation of IBM Cognos ICM
Presented by
Luke Marciniak
Project Manager
OpenSymmetry
Brad Burnaman
IBM Cognos SPM
Industry Solutions
and
Moderated by: Laura Roach
CMO, OpenSymmetry

©2012 IBM Corporation©2012 IBM Corporation
Luke Marciniak
Project Manager
6+ years in the Sales Performance
Management Space
Introductions
Brad Burnaman
Cognos SPM Industry Solutions
13 years in Incentive Compensation and
Sales Performance

Agenda
§ Incentive Compensation in Banking
– Risk and Compliance
– Financial Performance
– Technology
§ Huntington Bank Case Study
– Vendor Selection
– Phase I
– Phase II
– The Future

Risk and Compliance
6
Incentive compensation at banks has faced
changing regulatory conditions and increased
scrutiny on compensation practices
•Reduce risk amidst increased regulatory oversight (e.g.
Basel, Dodd-Frank)
•Balance risk mitigation and growth motivation
•Need for increased audit tracking and improved record
keeping
•Desire for scenario modeling capabilities

Risk and Compliance
► Workflow based on approval levels
► Exception reporting
► Comprehensive audit trail
CONTROLS & WORKFLOW
REGULATORY REPORTING
HANDLING DEFERRALS & CLAWBACKS
SCENARIO MODELING
► Understand comp spend at different
future economic conditions, loan defaults
rates, etc.
► Per Basel Accord and U.S. Federal
Reserve…
► Payment of awards should be
deferred so that the payments
can be adjusted as risks are
realized or become better known
► LCBOs will need to submit reporting 90
days after each fiscal year – regarding their
plan summary, process,
governance, and how their
plan deals with minimizing
excessive risk-taking.

Improve Financial Performance
Increasing the bottom line is a common business
driver for many different business decisions,
including incentive compensation
•Align individual production and organizational financial
performance
•Drive cross-selling
•Increase consistency of practices across the
organization

Align Incentives With Corporate Goals
< Canadian Bank >
§ 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 customer/
household)
§ Rewarding employees for referring
customers to another employee/BU

Institute a Culture of Selling
“Our industry historically has generated a
long line of order-takers”
“Cross-sell ratio has gone from 2 to 5.66”
Executive Vice President,Retail Sales
< Retail Bank in U.S. >

Technology
Key reasons technology drives companies to
change incentive compensation solutions
•Integrate disparate compensation and performance
systems
•Lower system maintenance costs
•Improve responsiveness in an uncertain economic
environment
•Reduce error rates caused by system complexity

An All Too Common Scenario

©2012 IBM Corporation
© 2013 IBM Corporation
A better example?
312-UCLA
317 – FAS
Daily Producer data
Daily Reconciliation file
Daily Agency data
Daily Terminated writing codes
302 – GEMS
19
286 – GEMS
13
Direct table
Access of producer info
- Producer & Agency Shared Tables
- Monthly FR Stmt
- Annual FR Territory File
- 1099 File
286 – Agent
EAP
Monthly Results File
Annual Results File
- Producer & agency
Shared tables
- Shared VFC tables
402 - Zeus
603 - CLOAS
605 - HAS
304 - Unity
201 - BARS
308 - LCS
315 - NBT
200 –
Transcend /
SAMS
307 -
Leverage
612 – Money
Mgmt
Extract file for Joe Carlton
955 – MMCS
258 –
Agency
Accounting
330 –
Agency Paid
For / AMR
Backup File
8035 – Clubs
& Awards
Distribution
Alliance File
- Daily Producer Info
- Xref File
- Monthly GA & Preferred Files
- Monthly FR Stmt
- Berkshire Run-off
- GA Contract Eligibility
- Active & Terminated Agents
- Preferred Leaders Club
AC02 – LRC
Producer Table
Producer Results
2 Compensation History Integration Files
Payroll
Salary Adjustments
253 – FR
Comp
Direct table access
For LRC results
FR History
Spreadsheets
Daily Trans
Daily Trans
Daily Trans
Daily Trans
Daily Trans
Daily Trans
Daily Feed of Payroll adjustments
Mid-month Feed of Payroll adjustments
Monthly reconciliation feedPowerstack
Adjustment
UI
Daily
Adjustments
Daily IV Phase Files
Daily Powerstack
Adjustments
Daily Powerstack
Adjustments
H04 Table
LRAS
NY Ref Table
For Max Life Premium
- Berkshire Form
Number Xref
- Product List for QRS FP
- Fictitious PA Codes Xref
(needed for term rider)
- Accounting Codes for PS
- Product Issue Age Xref
- DA Cluster (config &
product rates)
- QRSS Codes
- Mid-month Roscoe
Adjustment Files
- CDM No Manager File
- Partial Vesting Options File
- Health Persistency Xref
- 1099 Merge File
- 1099 Guardian Payer File
- 1099 Delete File
Daily DI/LTC Transactions
Monthly Terminated FRs
Monthly NameCode
Monthly Converted FRs
Distribution Alliance Xref
FR Persistency Info
FR Anniversary Calcs
Leaders Club
File Access
Daily Schedule A
Daily Primary/Secondary Agency Xref
Monthly FR Statement
AC01 – APR
Agent
Productivity &
Retention
- Monthly extract of
Producer comp
- Monthly extract of terminations
And appointments
AC03 –
Recruiting &
Retention
Daily New &
Terminated
Producer Data
- Daily Extract of FR Results
- Annual Extract of FR Results
Producer & Agency shared tables
306 –
Integrated
Illustration
Daily Agency & Producer data
AC4 - GDW
FR Comp Daily
- 10.98.200.73 File
includes SSN
- Extract for Joe Carlton
- HCSP Extract
- GEMDWNLD Extract
Daily extract
Monthly extract
Producer & Agency shared tables
Producer & Agency Shared Tables
328 –
Actuarial
Paid For
256 –
Commission
Expense
Process
Weekly Compensation
- Weekly Reconciliation Files
- Weekly Producer & Agency Files
- Monthly Namecode
First of Month Feed of Results
302 – GEMS
2
326 - ESD
Monthly DI, LTC, Multi-Life
- Producer & Agency Shared Tables
- Annual YTD Premium
316 – GA
Admin / GA
Contract
Monthly Producer Data
Monthly Agency Results
Monthly 1% Renewal File
YTD Renewal
Persistency Results
Monthly NameCode
100 –
PeopleSoft
GL
Monthly accounting
Monthly checks
Monthly Agency History
Bi-monthly Payroll
- Monthly Inventory File
- Monthly Life PD File, PFStat, FR Pren
Monthly FR Income Continuation
Monthly FR salary adjustments
280 - EFT
948 – PCA
(units)
321 –
Guardian
University
964 – GA
1099
863 – GA
Firm
Valuation
254 – Agent
Comp Model
Monthly Comp
Results
PVO Producer
Eligibility
Producer & agency
Shared tables
132 - CCDB
- Daily Trx.
- MTD Trx.
- Daily Trx
- MTD Trx
- Inforce Counts for Persistency
Daily Life extract
- Monthly Inforce File
- Monthly C&A Results
- Monthly Inventory File
(Berkshire)
Monthly PF Stat
Monthly PF Stat
Monthly PF Stat
Monthly PF Stat
Monthly DI Inforce
MTD Life Inforce
Monthly Life Inforce
- MTD Trx
- Daily Trx
- Persistency Info
- Persistency Info
- InForce Info
- FY Lives
- Persistency Lives
- Berkshire Inforce
- Extract for Joe Cox
Reporting
Service Fees
Milliman
GA Retirement Data
- Roscoe File
- Distribution
Alliance File
(DART)
- Product File
Daily Trx
Pre-merger File
Daily Changes
- Product File
- Form Number File
- ValdRules File
- File Header Layouts
- Leaders Club Combine
- Bonus Credit Product File
- Producer SSN Xref
- 10 Threshold Files (1 for each program)
- MDRT product files
- APR Requirements
- Dummy Records for Initialization
Net APR
Middle Mgr File
Joe Cox Files
- Middle Mgr File
- IUS File
- Leaders Club Files
- Production Credit File
- Pending Production
File
- Agency Recognition
File
- Backups of all input
files
- Innovative Underwriter
File
- Berkshire Bypass File
- Monthly Adjustment File
DI Inforce
Equity GIAC
Steetscape -
RIA
Asset Mgmt
Fees
706 – Group
Pension
Comp Sys.
214 – M&O
251 –
Consolidated
Commission
Agency
Database
281 – HO
Bills
802 –
Agency
Commission
Download
803 –
Terminal
Equity
622 –
Agency
Agent Comp
620 -
DataEase
AC27 - 588
Special
Premium
Daily Trans.
Agent Data
645 -
Alchemy
648 –
Agency
Sales
Record
625 – HR
Field Payroll
700 –
OmniPlus
Recordkeepi
ng System
111 – Recon
Plus
637 – PAS
Chase Bank
Transfer
617 -
Paybase
113 –
CheckFree
1099
-
606 – HCCH
(Health Claims
History)
909 – UCV
Client
Manager
257 -
SmartOffice

Slide 14
Gartner MarketScope for Sales Incentive Compensation Management(2010)
Impact of Improving Technology

The Effect of Compensation Errors
$400 millionVariable compensation spend per year
0.5% overpayment
$2 Million
1% overpayment
$4 Million
3% overpayment
$12 Million

Poll Question
16
What is the primary driver for your interest
in Incentive Compensation Programs?
A. Reduce Risk and Improve Regulatory Compliance
B. Manage Financial Performance
C. Improve Technology and Responsiveness
D. Something else

Huntington Bank Drivers
“We knew it was time to rethink our approach to compensation
management. Our CEO wanted to be able to compare sales
performance against incentives paid across the whole business.
Achieving this level of transparency with our home-grown legacy
systems was difficult. Moreover, the systems were becoming
increasingly costly to maintain, and the lead time for our IT team to
deploy updates when we wanted to make a change to one of our
compensation schemes hindered our ability to respond quickly to the
sales environment. We realized that moving to a single central
compensation management platform could address both of these
issues.”
Barbara Weigel
Vice President, Huntington Bank

Customer
Interviews
POC
It Started Like Any Other Project
Vendor Selection
Demos
RFP
Business
case

And Then…The Project Started
§ Phase I
§ Organizational Restructuring
§ OpenSymmetry
§ Phase II
§ The Future

§ Project Scope
– 300 Payees
– 15 Plans
– 16 Presenter Reports
– 20 Web Forms
– 34 Data Feeds
– Complex Crediting and
Eligibility Rules
– Complete Incentive Data
Mart/ETL Build
§ Project Team
– 2 PM’s: Varicent/HNB
– 2 Full time HNB IT resources
+ 3 contractors
– 1 Full time business segment
resource
– 2 part time HNB Incentive
Admin team resources
– 4 Varicent consultants
Phase I – Project Profile

Top 7 Sales Compensation Improvements Requested
22
83%
83%
69%
66%
62%
59%
55%
Improve reporting to the sales force
Improve reporting to management
Improve service to the sales force (to
provide a quicker response to inquiries)
Improve administration productivity
Increase credibility with the sales force
& management
Improve payment accuracy
Ease the creation & tracking of
adjustments
Source: 2012 SPM & Technology OpenSymmetry Survey Results

Change Management
§ Organizational Change
§ Goal of a Future Mode of Operation (FMO)
– Staffing models
– Production support
– Future phases
§ Training/Communication Strategy
– Payees/Managers
– Business sponsors and management
– Future segments

Organizational Change
Recognized need for
expertise in
compensation
organization structure
Recognized need for
future state planning
Recognized need for
custom training
Engage an SPM
partner to assist
How to
Execute
Where does your Sales Comp Sit in your organization?
Sales…Finance…Sales Support…Human Resources

OpenSymmetry Overview
§ Global experts in Sales Performance Management headquartered in Austin,
TX with offices in 7 countries
§ Service Offerings:
– Strategic Services
– Implementation
– Training
– Testing
– Managed Services
§ Why OpenSymmetry?
– We deliver value added consulting
– We partner with you, it’s all about teamwork
– We can provide independent advice
– We deliver successful results, whatever the challenge

OpenSymmetry Partnership
§ Side-by-side player/coach with customer team
§ In-depth knowledge of IBM Cognos
§ Organizational assessment/staffing needs
§ Future Mode of Operations (FMO) Playbook
§ Training
§ Testing

Phase II – What did it include?
§ 3 Business segments
– Call Center
– Branch and in store channel
– Business banking
§ Project Scope
– 5,000 Payees
– 48 Plans
– 2,000 Calculations
– 300 Tables
– 45 Data Feeds
– 30 Reports
– 20 Webforms

Phase II - Scope
§ Complete redesign of incentive plans for 2013
– 90% rework of IBM Cognos calculations already complete and
implemented for the call center
– 100% rework of Phase I presenter reports
– 10 new or redesigned data feeds
– Design considerations for building 2013 on top of 2012 plans in
production
And…Go Live in 7 Months

Phase II – How did we do it?
§ Pre-project on site player/coach activity with customer and
OpenSymmetry
§ Global OpenSymmetry resources
§ Dedicated customer project team
§ Dedicated IT Staff with augmentation
§ Team Profile included: 3 PM’s from key stakeholders: IT, HR
Incentive Team, OpenSymmetry
§ Business segment participation
§ Dedicated Customer Incentive Team Resources, QA and UAT teams

Phase II – Smart Project – turned challenges
into Success
§ Leveraged existing integration and reusable components while
keeping integrity of system
§ Requirement gathering approach
§ Volume of requirement documentation
§ Reduced learning curve of client and OpenSymmetry team
§ Large team with independent assignments
§ Use of standard testing methodology across team
§ QA team with limited experience in SPM tool
Identified challenges early and
turned them into strengths

Leverage experts internally and externally
Staff and train project effectively
Get early and often buy-in/feedback from key stakeholders
Generate excitement – “Who or What is next?”
Planning for the future phase – use a pre-discovery questionnaire
Plan for the future and continue to evolve
Tips for Future Projects

Thank You

Thank You
Take the OpenSymmetry SPM and Tech Survey!
Direct Link at: bit.ly/157TqIu
Or go to www.opensymmetry.com and click on banner
Participants receive a free copy of results!

Questions & Answers
Luke Marciniak
OpenSymmetry
Project Manager
luke.marciniak@opensymmetry.com
Brad Burnaman
IBM Cognos Sale Performance Management
SPM Industry Solutions
bburnaman@us.ibm.com

Managing a Multi-Phase Implementation of IBM Cognos ICM

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