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You build a compensation plan using the process illustrated in Figure 7 - 2:

1. Create a compensation plan.

2. Create one or more plan elements for the plan.

3. Create rate tables.

4. Assign the plan to your salespeople.

5. Customize plans for individual salespeople.

6. Change the plan or plan element when needed.

Oracle Sales Compensation calculates compensation based on a number of elements defined in the compensation plan assigned to a salesperson.

Each compensation plan has a name, an active period, and one or more plan elements.

   To build a compensation plan:

1. Open the Compensation Plans window.

By default, choose Compensation Plans Workbench from the Compensation Plans menu.

2. Provide a name and description for the plan.

In the Name field, provide a name for the compensation plan.

Suggestion: Consider defining plan names by job titles or area of sales you are compensating. For example, Global Computers enters the name DIRECT for the plan that defines compensation for field salespeople that sell the company's line of PCs.

In the Description field, enter comments about the purpose of the compensation plan.

3. For Active Periods, assign the period during which the plan will be effective.

The Oracle Sales Compensation payment process is driven by periods, so you need to assign the effective period by choosing a start period and an end period from a list of values.

• Start period: The plan becomes effective on the start date shown for the start period. For example, if the start period for the rollup structure is JAN-94, and this period is defined to start 01-JAN-94 and end 30-JUN-94, the plan becomes effective on January 1, 1994.

• End period: The plan is ineffective the day after the end date shown for the end period. For example, if the end period for the plan is DEC-94, and this period is defined to start on 01-DEC-94 and end on 31-DEC-94, the plan becomes ineffective on Jan. 1, 1995.

Attention: You must define your set of books in the System Parameters form before you can select periods. You must also have the period(s) in an open or enterable state. See Defining Your Calendar and Set of Books: page - 2 for more information about the Set of Books system parameter and see Opening and Closing Accounting Periods: page - 5 for information about the status of accounting periods.

When you assign a plan to a salesperson, you define an assignment period during which the salesperson is on that plan. Because you can assign the same plan to many salespeople, ensure the plan period is broad enough to encompass all necessary assignment periods. See Assigning a Plan to a Salesperson for more information.

4. Assign one or more plan elements to the plan.

Choose one or more plan elements from a list of values in the plan elements region. The list displays all plan elements you have defined.

After you enter a plan element, you can choose Element Details to verify that you have the right plan element.

To create a new plan element, see Defining a Plan Element.

5. Check the Allow Revenue Class Overlap check box if the plan elements assigned to the plan have overlapping revenue classes.

Use this option when you need to compensate a salesperson more than once for a transaction. For example, you may have a quota type plan element as well as a bonus based on achieving revenue targets, both of which have the same revenue classes.

6. Choose Validate.

Validate ensures that you have entered the plan information correctly and that Oracle Sales Compensation can use the plan to calculate compensation.

When you validate a compensation plan, Oracle Sales Compensation verifies that:

• The plan has a name and a period

• The plan has one or more plan elements assigned

• Each plan element has:

• A rate table with contiguous tiers

• At least one revenue class assigned

• A rate table structure that makes sense for the plan element type

• Each revenue class has at least one key transaction factor and at least one other transaction factor

• No two revenue classes are in the same rollup chain in the revenue class hierarchy if the Allow Revenue Class Overlap check box is unchecked (see step 5).

If each of the above conditions are true, Oracle Sales Compensation displays Complete in the Status field. When the Status field displays Incomplete, Oracle Sales Compensation cannot use that plan to calculate compensation.

7. Save your work.

When you save a plan, the values of that plan become the default values when you assign it.