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OpenSymmetry IBM Sales Performance Round Table Malaysia
The document discusses challenges faced by organizations in managing sales performance and compensation, emphasizing that traditional methods like spreadsheets can lead to costly errors. It presents IBM's Sales Performance Management (SPM) as a solution that automates processes, reduces errors, and improves efficiency. The roundtable includes insights from various experts on optimizing compensation plans to drive sales behavior and meet corporate goals.
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Similar to OpenSymmetry IBM Sales Performance Round Table Malaysia
OpenSymmetry IBM Sales Performance Round Table Malaysia
- 1. © 2013 IBMCorporation 22 April 2013, Monday | Shangri-la Hotel, Perak Room, Basement 2, Kuala Lumpur Sales Performance Management Round Table
- 2. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur2 Did you know? Compensation plans that are managed using spreadsheets or home grown solutions may be riddled with errors, producing inaccurate payments and costing your organization thousands, even millions of dollars annually… $400 millionVariable compensation spend per year 0.5% overpayment $2 Million 1% overpayment $4 Million 3% overpayment $12 Million
- 3. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Presenter(s) 3 Kevin Gray Product Marketing Manager Sales Performance Management IBM kevin.gray@ca.ibm.com Laura Roach Vice President, Marketing OpenSymmetry laura.roach@opensymmetry.com
- 4. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur4 Agenda 8:00 am – 9:00 am Breakfast and Networking 9:00 am – 9:30 am What is SPM, Business Challenges Organizations Face and the IBM Solution Kevin Gray, Product Marketing, IBM 9:30 am – 10:00 am How to Ensure Your Compensation Plans are Accelerating and Optimizing Performance to Meet the End Goal Laura Roach, CMO, OpenSymmetry 10:00 am – 10:30 am Roundtable – Hot Topics / Best Practices 8:00 am Registration
- 5. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Two Axioms 5 1 2
- 6. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Two Axioms 6 1
- 7. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Sales Performance Management Is Hard 7 • Get the checks out on time • Make sure they’re accurate • But also. . . ü Be flexible and nimble for changing priorities ü Manage complex assignments ü Set accurate goals and targets ü Generate enthusiasm ü Deliver timely and insightful reports ü Resolve questions and disputes ü Do it with less headcount
- 8. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur How Is Sales Compensation Managed? 8 CSO Insights - 2012 Sales Compensation & Performance Management, Key Trends Analysis Spreadsheets (54%)Home Grown (22%) Commercial Software (14%) Manual (7%) (3%) 61% Spreadsheets 19% Home grown 8% Commercial Software 10% Manual 2% Unknown
- 9. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur SPM: Issues and Challenges 9 Errors Transparency Shadow Accounting Long Cycle Times Audit & Compliance Labor IntensiveInflexible Legacy Systems
- 10. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur SPM: Addressing the Pain Points of Several Business Constituents 10 • How does my comp plan work? • How much can I make? • If something is wrong on my commission statement 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 & auditability Sales Ops & Comp Admins • Are the comp plans working? • Which people I should focus my energy on? • Am I in compliance? Management & Executives 3 2 1 Sales Reps
- 11. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Why Companies Adopt SPM Technology 11 Reduce Errors Shorten Cycle Times Replace technology Improved Decisions Flexibility Modeling and Costing Internal Audit Legislation Industry Regulations Risk Reduction
- 12. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur SPM: A Working Definition 12 SALES PERFORMANCE MANAGEMENT § Streamline compensation processes § Reduce errors § Improve sales performance § Align behavior with goals § Meet compliance requirements To Meet These Challenges Automates the process of administering, calculating, reporting & analyzing variable-based pay programs
- 13. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur IBM Cognos Sales Performance Management Incentive Compensation Build, model and administer variable pay programs that drive desired sales behavior Channel Management Gain a single, accurate view of your entire sales force and all your distribution channels Territory Management Manage crediting and frequent sales coverage changes across territories Territory Management Quota Management Channel Management Incentive Compensation IBM Cognos Sales Performance Management Quota Management Plan and distribute quota targets efficiently across all levels of your sales organization CRMERP HRIS $£€ BI Other 13 Users & Roles - Security - Data Integration Hierarchies – Workflows – Scheduling – Rules – Calculation Engine - Auditability
- 14. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Two Axioms 14 1 2
- 15. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Gartner Marketscope for Sales Performance Management 15 Organizations adopting SPM technologies 90% 40% 50% Reduce errors By more than Reduce processing Times by more than Reduce IT/Admin Staffing by more than Gartner MarketScope for Sales Incentive Compensation Management (2010)
- 16. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Getty Images 16 16 Spreadsheets that previously needed to be manipulated for a comp plan change prior to implementing IBM Cognos SPM
- 17. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Mitel 17 Centralized payout administration from 30 to 3 employees for North and South America 30 3
- 18. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Elavon 18 Payout process reduced from 2 weeks to 2 days2 2
- 19. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Cognos SPM Drives Smarter Analytics 19 • 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 reporting 1 2 3 4 Grow, retain and satisfy customers Manage risk, fraud & regulatory compliance Increase operational efficiency Transform financial processesSmarter analytics
- 20. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Hertz: “Enabling a Business Model Change” 20 New head of sales redesigned compensation to help the rental company become “more sales-friendly” Customers formerly had to rely on a different sales rep for every line of business, from corporate sales to tours Now customers “can get everything done through one salesperson” Lynn Ferrara, Sr Director of compensation and HRIS
- 21. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur mBlox: “Focus Sellers on Selling” 21 “When people didn’t understand what their achievement was, we got pushback on everything about our plan” “By having transparency into the system we don’t have to worry about them saying, ‘Wait—I don’t get this.’” “…spend more time selling” Steve Love, CFO
- 22. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Hong Kong | Wealth Management & Broker: Flexibility to Change 22 “we didn't want to have to rely on IT services whenever we make changes” “gives business users the ability to fully manage the compensation process without requiring deep technical skills” “drive a competitive edge for our sales organization” Chief Operating Officer, Wealth Management & Brokerage < Hong Kong based Wealth Management & Brokerage >
- 23. © 2013 IBMCorporation Incenting based on controllable profits “a lot of things that go into that profit margin are outside of the territory manager’s control… such as the cost of raw materials” “But they can have an immediate impact on profitability by focusing on pricing” “Now that we have moved to a net-based sales plan a territory manager can see a direct relationship between his behavior and the amount of his check.” Carla Clark, Project Manager for Commissions
- 24. © 2013 IBMCorporation Management reporting to drive performance “(Managers) can understand, at a glance, the productivity of all of their associates” “Management uses the information about store productivity—how many units the store sells every hour, and how many dollars each of those transactions is worth—to help drive training programs” Walter Sprague, Sr VP of HR
- 25. © 2013 IBMCorporation 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
- 26. © 2013 IBMCorporation Institute a Culture of Selling “Our industry historically has generated a long line of order-takers” “Nobody can hide…People who have the right mindset flourish in this kind of program” “Cross-sell ratio has gone from 2 to 5.66” Executive Vice President, Retail Sales < Retail Bank in U.S. >
- 27. © 2013 IBMCorporation Bonus Program – Auditing & Visibility § 5,000 payees in Capital Markets § For annual discretionary bonus program which was previously run using spreadsheets § Greater auditing around the bonus process, better tracking of approvals and sign off < Capital Markets division of Canadian Bank >
- 28. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Compensation Administrators: Scenario Modeling 28
- 29. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Compensation Administrators: Configure the system to reflect your compensation program 29 Workflow Processes
- 30. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Sales Representatives: Dashboards 30
- 31. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Sales Representatives: Plan Agreement 31
- 32. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Sales Representatives: Self Calculators 32
- 33. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Sales Management: Dashboards 33
- 34. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Sales Management: Reporting 34
- 35. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Sales Management: Reporting 35 Quota Distribu,on Pay For Performance Analysis
- 36. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Key Differentiators 36 Business User Friendly Configure vs. code Visual flow approach Flexibility Commission, MBOs, etc. Meet changing needs Flexible data model Performance & Scalability Built for high transaction volumes Imports, calculations, etc.
- 37. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur In-the-Labs: Leveraging the IBM Portfolio 37 Sales Performance Management Cognos TM1 SPSS
- 38. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur38 Now you know… Compensation plans that are managed using spreadsheets or home grown solutions may be riddled with errors, producing inaccurate payments and costing your organization thousands, even millions of dollars annually… $400 millionVariable compensation spend per year 0.5% overpayment $2 Million 1% overpayment $4 Million 3% overpayment $12 Million
- 39. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Presenter(s) 39 Kevin Gray Product Marketing Manager Sales Performance Management IBM kevin.gray@ca.ibm.com Laura Roach Vice President, Marketing OpenSymmetry laura.roach@opensymmetry.com
- 40. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Two Axioms 40 1
- 41. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Total Rewards Model 41 Organizational Culture Business Strategy Human Resource Strategy TOTAL REWARDS STRATEGY Compensation Benefits Work-Life Performance & Recognition Development & Career Opportunities Attract Motivate Retain Employee Satisfaction & Engagement Business Performance & Results © 2012 World at Work Organization
- 42. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Total Rewards Model 42 Organizational Culture Business Strategy Human Resource Strategy TOTAL REWARDS STRATEGY Compensation Benefits Work-Life Performance & Recognition Development & Career Opportunities Attract Motivate Retain Employee Satisfaction & Engagement Business Performance & Results © 2012 World at Work Organization Variable Pay “Sales Performance”
- 43. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Motivational 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 administer 43
- 44. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Getting the Design Right 44 § Growth – New products – New markets § Diversification § Consolidation § Hunter/farmer role split or hybrid § Direct/indirect channels § Sector specific challenges 2. Pay/Paymix 3. Compensation Type 8. Compensation Structure 4. Metrics 5. Use of Other Programs 6. Crediting and Payout Timing 7. Rules 1. Number of plans/structure/eligibility ArchitecturalPlan Components DetailedDesign Components
- 45. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur SPM – The Complete Vision 45 Sales Compensation Administration & Design Sales Process / Methodology Sales Coaching & Training Candidate Assessment, Selection & On- Boarding Territory & Quota Business Intelligence Sales Strategy Sales Performance Management Business Process Management (BPM) Enabling Technologies
- 46. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur IBM Cognos Incentive Compensation Management Focus Incentive Compensation Build, model and administer variable pay programs that drive desired sales behavior Channel Management Gain a single, accurate view of your entire sales force and all your distribution channels Territory Management Manage crediting and frequent sales coverage changes across territories Territory Management Quota Management Channel Management Incentive Compensation IBM Cognos Sales Performance Management Quota Management Plan and distribute quota targets efficiently across all levels of your sales organization CRMERP HRIS $£€ BI Other 46 Users & Roles - Security - Data Integration Hierarchies – Workflows – Scheduling – Rules – Calculation Engine - Auditability
- 47. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur47 How do you Ensure Your Compensation Plans are Accelerating and Optimizing Performance to Meet the End Goal Sales Kick Off Done… Do you know if you’ll hit your target? Are you plans driving the right behavior?
- 48. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Motivate and Drive Sales Behavior 48 Does your organization believe sales compensation plans can motivate and drive sales behavior? Yes / No
- 49. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Motivate and Drive Sales Behavior 49 Is 99% Accuracy Good Enough?
- 50. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur50
- 51. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur WorldatWork and OpenSymmetry 2012 Sales Performance and Technology Survey 51
- 52. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur52 Shadow Accounting Job Duplicity Recruitment Overpayments Loss of Morale / Trust in system Time spent administrating disputes Retention Lawsuit
- 53. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Motivate and Drive Sales Behavior 53 Have you fully optimized your current technology?
- 54. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur54 84% of respondents use Excel to support compensation management 91% use Excel to support the annual planning cycle 91% use Excel for sales compensation reporting and analytics 19%
- 55. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur We are the 1% 55 • A formal process with required documentation and approvals used to administer the sales compensation plan • The sales compensation administration process documented is updated regularly • Less manual adjustments • Use SPM technology • Use 3rd Party reporting tools for Static and Ad-hoc reports Utilize workflow • Investment has exceeded expectations in regards to Accuracy • Would spend more time ensuring data feeds are clean and accurate
- 56. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur What 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. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Top 7 Sales Compensation Improvements Requested 57 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 World @ Work OpenSymmetry Survey Results
- 58. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Common Reporting Needs 58 Real-Time Deployment Managed Deployment Consistently Fast Security Pixel Perfect Design High Volume Publishing Simplified Data Access Varying Levels of Aggregation Functional Needs Non-Functional Needs
- 59. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Business Intelligence Capabilities 59
- 60. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Business Case 60 Strategic Revenue Growth Operational 10% of total spend on commissions/subsidies Core Benefits 4 – 7% of spend on commissions • Increase Profitable Sales • Penetrate New Markets/Increase Market Share • Gain Competitive Advantage • Channel Loyalty • Understand Link Between Plans and 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 and Disputes Business Case
- 61. © 2013 IBMCorporationSales Performance Management Round Table | Kuala Lumpur Questions & Answers 61 Kevin Gray Product Marketing Manager Sales Performance Management IBM kevin.gray@ca.ibm.com Laura Roach Vice President, Marketing OpenSymmetry laura.roach@opensymmetry.com
- 62. © 2013 IBMCorporation Sales Performance Management Round Table 22 April 2013, Monday | Shangri-la Hotel, Perak Room, Basement 2, Kuala Lumpur