New Michael Dunne White Paper and Webinar now available

Many organizations are working hard to improve their sales effectiveness.  Increasingly many of these organizations are turning to information technology to help improve the efficiency and effectiveness of their incentive compensation and sales performance management processes.  Many of these organizations are now in varying stages of rolling out Sales Performance Management (SPM) solutions.

During these deployments, organizations go through a number of distinct phases as they mature.  The first phase is to ensure that the processes they have in place are efficient and produce accurate results.  As organizations look 'beyond the numbers' they go through increasingly complex phases ending with business agility and overall SPM optimization. 

I asked Michael Dunne, X-Gartner analyst, and long-time veteran  of sales effectiveness and sales performance management to write a report, outlining these stages of evolution, and to provide some guidance for organizations who find themselves in different levels of  SPM maturity.


The result is a new report which provides great insight as to the evolution of SPM systems within an organization.  This is a must-read for anyone trying to educate themselves on the Sales Performance Management landscape.   I have also asked Michael to discuss this paper and answer any of your questions in a webcast. This is now scheduled for December 6th.

Click to download Michael Dunne whitepaper or to register for webinar Dec. 6th 

Six Trends document

On this blog, I have been writing about the 6 new trends in Sales Performance Management that I have observed over the past few months.  I have also had the opportunity to present these at  conferences and seminars.   Based on the feedback I have received, and some requests for a complete document,  I packaged up the list and put it in one document.    If you would like a copy it's posted at www.varicent.com  or leave me a comment here and I will forward it to you.

6 New SPM Trends - Trend 6 - Integration with More Applications

Traditionally a lot of Sales Performance Management Systems have been focused on the incentive compensation process.  While there can be many (occasionally hundreds) of input sources to an SPM solution, organizations generally consider outputs to be - commission statements, a payroll feed, and few summary reports.   

As SPM systems mature, it is more often the case that the SPM system houses the highest quality information in the organization about who is selling what to whom, at what price.  As commissions are paid of this data, it is normally the most scrutinized, up-to-date and accurate information in the company.  Organizations want to leverage this asset, typically by demanding new management reports.  This quickly moves to requests for more complex and broad-based reporting, often requiring new and different source data.  The natural evolution is then to make this information available to an even broader set of recipients.  This expansion generally requires feeding data to other systems.

 Some common examples are:

•          Feed information into a corporate data warehouse or business intelligence system
•          CRM integration between commissions and customer data
•          HR systems to integrate commission data with other payroll and compensation data
•          ERP system so that this information resides in the original system-of-record

Ensuring that your SPM system can pass data to other applications through standard interfaces like ODBC, web services and star schema generation allows compensation teams to provide compensation data in any format required by the receiving application.

Michael Dunne - 4 stages of Sales Performance Management

I just finished reading the draft of a whitepaper I commissioned with Michael Dunne.  Most people involved in Sales Performance Management know Michael from his years as an industry analyst with Gartner. He has a wealth of experience, and a unique perspective on this market.  

I asked Michael to write-up his thoughts on the evolution of Sales Performance Management.  He has segmented the adoption of SPM into four distinct phases and he provides guidance for organizations in each of these phases.  The full whitepaper and accompanying webinar will be announced shortly so keep an eye out for the announcement over the next few days. 

Follow @bhartlen or @varicent for regular updates and to get the details on the webinar and whitepaper when they are announced.

6 new SPM Trends - Trend 4 - Increasing requirements for Audit, Compliance and Visibility

There is an increased need for oversight in the world of Sales Performance Management.   There is a growing desire to scrutinize the inner workings of the compensation system and the related processes.  There are two main drivers of this change.  First, some organizations are cracking down on the internal audit processes.  They are driven by concern of new industry regulations.  Many are making sure that they can comply with the changes to incentive compensation brought on by the Dodd Frank Act[1].   In particular, they must comply with section 956 of that Act which states that covered organizations must disclose to the regulators (and there may be more than one in some cases) the structures of all incentive-based compensation arrangements.  The intent is that organizations should have plans that appropriately balance risks and rewards, are compatible with effective controls and risk management and are backed up by strong corporate governance and oversight.

The second driver for increased audit and compliance comes from organizations who want to better understand how the sales operations, HR and Finance processes are working with respect to SPM.  They are trying to evaluate the effectiveness and service levels for their key operational processes.  How long does it take to process all commissions?  How many disputes are filed with every commission run?  How long does it take to resolve these disputes?  Are commissions tracking towards the agreed targets?  Which management reports are being viewed?   These are just a few of the questions that organizations are looking for better answers for.

While many organizations have solid incentive compensation plans, documented processes and workflow surrounding compensation they cannot efficiently and effectively respond these new demands for reporting and audit.  Data from emails, conversations and sales-driven exceptions often fail to make their way into the system of record.   Hiring more administrative staff, or taking a long time to respond to audit requests, is not acceptable so many organizations are implementing new incentive compensation management systems to help.  As the majority of organizations also use spreadsheets and homegrown systems to manage incentive compensation the ability to provide the necessary insight also diminishes.  These tools do not provide the robust audit trail, embedded security, role based access and other key features required to pass an audit.   With changing and more stringent requirements for increased visibility on the horizon it is critical to have flexible reporting capabilities in the hands of those who need to provide data to all the oversight groups.

Potential buyers of SPM technology should survey the finance and internal audit groups within their organization to survey their existing needs, and anticipate their needs going forward.  This establishes a foundational baseline of requirements when looking for a new system.

---

[1] Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010

6 New SPM Trends - Trend 2 - Sales Adoption of Mobile Devices

Last week I blogged about the 6 new trends I see in Sales Performance Management. The first trend was about the need to handle increased business complexity.  This week's blog is about mobile devices for sales teams.

It’s no surprise that Ipads, smartphones and other mobile devices are being adopted by sales forces everywhere. Smart devices are now outselling laptops[1].   It seems almost every week there is a new entrant into the tablet wars.  The market is expected to grow from 26 million to over 80 million tablet users in the US^[2] alone. 

Many questions are now being considered by sales organizations everywhere. What is the appropriate mobile device for the sales team?  What is the right set of functionality that needs to be delivered to the mobile device?    There is no universal right answer, and the adoption of mobile technology for sales teams is a broader issue than SPM.  There are three key things that organizations have to look at when it comes to mobile adoption - Device Support, Functionality, and Culture.

Device Support – What platform do you need to support?  On the tablet side, Apple has gone out to an early lead with about 68%[3] market share of all tablets sold.  The market however is still young and there is lots of room for technology advances.  Organizations must consider whether they want to take a device specific approach, or an agnostic approach.  Looking for vendors who support standards like HTML5 and browser agnostic support gives an organization the most flexibility in tablet support.  Applications coded specifically for a platform may have tighter integration with that platform, but will be more limiting in terms of device support as the market matures and shifts.

Functionality -   Once the platform is decided, and then you must decide what functionality you want to deliver on the mobile device.  In most SPM scenarios simply replicating a full desktop or web experience on a smartphone doesn’t work.  Have a look at your current commission statement and imagine how much would be viewable on a Blackberry, Android or Iphone window.  Typically commission reports are multi-page statements with lots of columns and in order to comprehend the entire statement you would have to be able to look at more than one or two columns at a time.  Organizations are well advised to design reports and outputs specifically for the mobile device, and not settle for delivering full reporting onto mobile devices – just because you can.

Culture - this is often overlooked when considering mobile device support.  Some Sales Leaders want to ‘get everything on the smartphone and tablet’ to avoid all the wasted time lugging around laptops, trying to figure out VPN or other connecting activities.  The idea of ‘right here right now’ information delivery has a huge value over waiting for the sales reps to connect when they are back home, in a hotel or office.    There is another train-of-thought where sales leaders are concerned about everything that takes away from their sales teams ability to have customer facing time during the day.  The idea of delivering commissions, quota and territory update information constantly throughout the day is a distraction.  Their belief is that this kind of information should be delivered to the laptop/desktop when the reps are not out in the field.

The overriding trend we are seeing in mobile device support is that the adoption of mobile technology for sales is directly proportional to the frequency of data updates.  Organizations that report on sales and commissions daily are much more likely to want to drive this information out to mobile devices than organizations who update their data monthly or quarterly. 

---

[1]  IDC Worldwide Quarterly Phone Tracker, January, 2011

[2]  Forrester Research eReader Forecast 2010 – 2015 (US)

[3] IDC Worldwide Quarterly Media Tablet and eReader Tracker, September 2011