Our furry friends offer up a decent metaphor to explain the unique relationship between a corporation’s Business and IT organizations. In a healthy organization, IT development is born out of corporate strategy. However, at times things get off-kilter when IT development backs up with work or requests that are too complex to programmatically facilitate. In these instances IT becomes an unwelcome dependency on implementing corporate strategy, consequently resembling the “Tail wagging the Dog”. As we will see, the sales compensation enterprise is a prime candidate for this type of unwelcomed progression.
As industry-specific applications continue to mature, they become more and more user-friendly therefore opening themselves up to a wider non-technical user base. This transformation is very much like what happened back in the ’80s when PCs went from using a command line to a point-and-click graphical user interface, or in the 90’s when internet navigation also went from a command line to a point-and-click browser. These advances in simplifying technology serve the business side of organizations well and allow them to take on more of what once was only possible via an IT department. However, the road often traveled to make this discovery is painful, here’s an example of one such difficult path:
- A startup company begins with a couple of salespeople whose commissions are easily calculated and distributed using a spreadsheet such as Excel.
- The company experiences significant growth and expansion of products, consequently, the commission plans increase in complexity along with the supporting sales hierarchy and associated movements such as new hires, promotions, and terminations. In addition, supporting compensation elements such as quotas and Territories become more and more dynamic and complex.
- The business continues to use spreadsheets but is overwhelmed by the complexity and starts to slip in keeping pace with making comp plan changes that align with corporate strategy.
- Mistakes are made stemming from too many manual processes
- Sales reps lose confidence in payouts and overwhelm the compensation administrators with commission payout disputes
- Sales dip as sales rep motivation takes a dive
- Sales demand more visibility and they want it accessible online
- The business reaches out to IT to help solve the problem so they team up to create an in-house application.
- IT’s in-house application temporarily solves the problem but once again company growth and the need to stay ahead of competitors leads to the need for quick changes that pile up and leave IT overwhelmed.
- Again the search is on, now for a packaged cloud application that specializes in the automation of Sales Compensation. This software expects to provide a business employee with the ability to:
- Implement sales compensation plans and/or changes quickly
- Upload large volumes of sales transactions
- Publish commission statements online for sales reps to view
- Capture real-time key performance indicators (KPIs) for sales reps to view online via a personal dashboard
- Implement on small scale and later expand into a large-scale enterprise solution
- The business does its due diligence in scoping out the available applications and finds SalesComp
- The business partners with sales to give it a try and begins implementing it on a small scale to learn the application and give visibility to a couple of sales reps
- The business and sales adopt the new technology and develop a long-term rollout plan that will grow with the company and keep the business and its corporate strategy in the driver’s seat
