Let’s face it: incentives are one of the best motivators. Who would not like to gain a reward for their work? Can’t see many hands up.
There are many options for promoting best performance but incentive compensation is probably the most effective possibility. This income can be based only on a seller’s performance or in addition to his base salary, which means income is not guaranteed, it depends if he meets certain goals that management established. Bonuses can be awarded not only for each sales rep’s performance but also for the team as a whole, which is a good option for companies that don’t have a possibility to measure individual employee’s performance.
Financial reward encourages sales reps to do their best and stay engaged, which causes higher company revenue thanks to sellers’ results.
In small businesses where there are not many employees calculating incentive compensation in Excel or a calculator may not be the problem but in bigger companies may cause serious chaos.
For this type of problem, there is an approachable solution called Incentive Compensation Management (ICM) by Varicent, which is significant to another management process – Sales Performance Management, which takes a broader view on sales.
ICM focuses on collecting data about sales, crediting the correct payee with the sale and compensating them. It sounds easy, but there are many steps between getting data and compensation. During computing salary in Varicent ICM solution for example we calculate attainment for each employee and also for teams, the payout for each sale depends on factors that are also assigned in ICM (based on client’s requirements) or payout for meeting the goals.
Varicent ICM is a system that after calculation not only gives us raw data but also a possibility to build reports where employees can view their performance over the months. They can examine their transactions, check how many more they need to meet the goals, what is their position in rankings and last but not least how much their compensation is. The results and hierarchy access levels are generated by ICM according to the previously uploaded sales structure, therefore there is no risk of accidentally sending the file with commission details to the wrong employee.
This advantage and the fact that Varicent ICM does not need programming skills makes this solution very intuitive and convenient for the whole team regardless of IT experience. It is a simple and transparent tool used by the graphical user interface.
Benefits of using Varicent ICM solution are incredible. The study found that on average there was:
- 75% reduction of time spent on variable comp plan implementation,
- 65% reduction of time spend on the payout process and incentive calculations,
- 90% improvement in payment accuracy,
- 80% reduction of time spent on auditing and compliance*.
Naturally, these are not all the possibilities and pros of this system, but imagine how those benefits can accelerate the growth of your organization. Don’t hesitate to contact us for more information. We are looking forward to help you with the customization of Varicent ICM solution according to your needs and give you hints on how to use this tool effectively.