Quotas and Quota Allocation
This chapter covers the following topics:
Overview
Quota is the total sales target (in terms of money or quantity of products) that must be achieved in a specific time period. Quota Allocation is the process by which the Sales Management allocates quota to Sales Representatives in different territories and regions. You can allocate targets by territories and by products.
For example, the Sales Management of an organization in US West sets a target of 1 million product units for their sales teams for the year 2004-2005. The Sales Management later allocates this quota to Sales Representatives in different US West territories such as California and Oregon based on the sales performance and potential in each of these regions. In this example, 1 million product units is the quota, and quota allocation is the process by which this quota is allocated across territories.
Information in this section will enable you to:
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Understand process flows for quota allocation
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Understand the concepts of market eligibility, product eligibility, and product spread
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Understand the quota approval process and quota statuses
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Understand top-down and bottom-up quota allocation.
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Understand quota allocation views
Process Flow
The following figure illustrates the process flow for quota allocation:
Process Flow for Quota
Create Quota
The trade planning process begins with the Sales Management allocating sales targets to Sales Representatives in different territories and regions. First, create a quota and then allocate it to lower levels of the sales team hierarchy. After you create a quota, you can also define the market eligibility and product eligibility for the quota to identify regions, territories, and products, which the quota must target.
Approve Quota
The designated approvers must approve a quota before it becomes active. A quota does not need to go through an approval process if you are the creator and approver of the quota according to the approval rules.
Allocate Quota
After a quota is approved, you can allocate it to Sales Representatives in the lower levels of the sales team hierarchy. Sales Representatives can then review their quota and suggest changes to the allocation. You can review these inputs and reallocate the quota. Multiple such top-down bottom-up cycles can occur before the quota numbers are finalized.
Activate Quota Allocation
You can activate a quota allocation after finalizing the quota allocation numbers. Quota allocation is the final quota number that the individual territories and regions in the sales team hierarchy must achieve.
After you activate a quota allocation, the sales teams will receive workflow notifications. They can view their targets or quota numbers by logging into the Account Manager Dashboard and you can monitor and track sales performance through the Account Manager Dashboard. For more information, see the Account Manager Dashboard chapter in this guide.
Market Eligibility, Product Eligibility, and Product Spread
Market Eligibility
Market eligibility defines the territories that a quota must target. Defining market eligibility enables you to classify it and ensure that sales targets are achieved by executing trade promotion activities in the specified territories. Territories are created in the Oracle E-Business Suite Territory Management module, and are based on various customer and geographical attributes.
Product Eligibility
Product Eligibility defines the products and product categories that the Sales Representatives must focus on selling. Products are items in the Inventory System. Product categories contain products. For a quota, you can define product eligibility for product categories and products. While defining product eligibility, you can either include or exclude products from the product category.
Product Spread
After defining products for a quota, the product spread is generated based on products that you define, and the sales data of the previous year. For example, the sales data of January 2004 is used to forecast the demand for January 2005, and the products are allocated based on this forecast.
The product spread appears as a worksheet and displays the products and the product allocation numbers either on monthly basis or quarterly basis, depending on the time spread that you have selected during quota creation. If a product does not fall under any of the product lines, it is accounted for in a general category. The total sum of all product allocation numbers in the product spread is exactly equal to the quota.
For example, you have created a quota for 100,000 product units for the year 2005-2006, and have selected the time spread as quarterly. You have included Product A, Product B, and Product C in the product eligibility, and have generated the product spread. Assume that the sales that was achieved in the previous year 2004-2005 was as shown in the table below:
| Product | Jan - Mar | Apr - Jun | Jul - Sep | Oct - Dec | Total |
|---|---|---|---|---|---|
| Product A | 3,600 | 4,050 | 2,790 | 1,080 | 11,520 |
| Product B | 4,500 | 3,645 | 3,600 | 1,890 | 13,635 |
| Product C | 6,750 | 3,510 | 1,485 | 2,700 | 13,635 |
| Product D | 4,500 | 5,400 | 3,600 | 10,800 | 24,300 |
| Product E | 4,950 | 5,040 | 4,050 | 12,060 | 26,100 |
| Grand Total | -NA- | -NA- | -NA- | -NA- | 90,000 |
The following table shows this data as the percentage value that will multiplied by the total quota number for the current year (100,000 product units) to get the new quota values.
| Product | Jan - Mar | Apr - Jun | Jul - Sep | Oct - Dec | Total |
|---|---|---|---|---|---|
| Product A | 4% | 5% | 3% | 1% | 13% |
| Product B | 5% | 4% | 4% | 2% | 15% |
| Product C | 8% | 4% | 2% | 3% | 16% |
| Product D | 5% | 6% | 4% | 12% | 27% |
| Product E | 6% | 6% | 5% | 13% | 29% |
| Grand Total | -NA- | -NA- | -NA- | -NA- | 100% |
The percentage values are multiplied by the quota number for the current year; and the products Product A, Product B, and Product C are automatically allocated based on this calculation. The product spread appears as shown in the table below:
| Product | Jan - Mar | Apr - Jun | Jul - Sep | Oct - Dec | Total |
|---|---|---|---|---|---|
| Product A | 4,000 | 4,500 | 3,100 | 1,200 | 12,800 |
| Product B | 5,000 | 4,050 | 4,000 | 2,100 | 15,150 |
| Product C | 7,500 | 3,900 | 1,650 | 3,000 | 16,050 |
| Others | 10,500 | 11,600 | 8,500 | 25,400 | 56,000 |
| Unallocated | 0 | 0 | 0 | 0 | 0 |
| Grand Total | -NA- | -NA- | -NA- | -NA- | 100, 000 |
The sum total of the allocation numbers of Product A, Product B, and Product C is 44,000 (12,800 plus 15,150 plus 16,050). The Products D and E that were a part of the base calculation are represented as "Others" in the allocation process. Therefore remaining 56,000 (100,000 - 44,000) product units are allocated and accounted for in the Others category.
You can also manually edit the allocation numbers and save your changes. If you reduce the quantity of products that has been assigned to a territory, then the balance is moved to the Unallocated category. For example, if you reduce the allocated number of Product A to 3,000, then the remaining 1,000 product units are moved to Unallocated. The product spread appears as shown in the table below.
Note: Unallocated are not present for all time periods in the product spread.
| Product | Jan - Mar | Apr - Jun | Jul - Sep | Oct - Dec | Total |
|---|---|---|---|---|---|
| Product A | 3,000 | 4,500 | 3,100 | 1,200 | 11,800 |
| Product B | 5,000 | 4,050 | 4,000 | 2,100 | 15,150 |
| Product C | 7,500 | 3,900 | 1,650 | 3,000 | 16,050 |
| Others | 10,500 | 11,600 | 8,500 | 25,400 | 56,000 |
| Unallocated | 1,000 | 0 | 0 | 0 | 1,000 |
| Grand Total | -NA- | -NA- | -NA- | -NA- | 100,000 |
Notice the changes in the Total column for Product A. If required, you can later reallocate these products by moving them out of the Unallocated category.
You can also add new products to the existing product spread. The quota for the new product will be allocated based on the sales figures for the specific product in the previous year. You can also manually change the allocation numbers for the new product, and make manual adjustments to balance the allocation.
If you remove a product from an existing product spread, then the "Others" category increases by the number of the removed product.
For example, if you remove Product A from the existing product spread, then the allocation numbers of this product are moved to the Others category; the product spread appears as shown in the table below.
| Product | Jan-Mar | Apr - Jun | Jul - Sep | Oct - Dec | Total |
|---|---|---|---|---|---|
| Product B | 5,000 | 4,050 | 4,000 | 2,100 | 15,150 |
| Product C | 7,500 | 3,900 | 1,650 | 3,000 | 16,050 |
| Others | 13,500 | 16,100 | 11,600 | 26,600 | 67,800 |
| Unallocated | 1,000 | 0 | 0 | 0 | 1,000 |
| Grand Total | -NA- | -NA- | -NA- | -NA- | 100,000 |
Therefore, whenever you make any manual changes in the product spread, automatic adjustments are made to the product allocation numbers such that the total sum of the product units is always equal to the quota.
Note: You can make changes to the product spread only for the current and future periods.
Org-Striping In Quota Allocation
In Oracle Channel Revenue Management, territories are not org-specific; an operating unit can span multiple territories. Org-striping enables you to allocate quota based on sales data of specific operating units rather than territories.
If org-striping is implemented in your organization, then you can segregate territories by operating units for quota allocation. Regardless of the territories, sales data of the same operating unit as the quota is used for quota allocation. This option is useful for companies that have multiple operating units and segregate sales activities by operating unit rather than territories.
If you have access to multiple operating units, then you can select the operating unit that you would like to access. The quota allocation summary screen "Details of the Default Operating Unit" is derived from the MOAC profile option, MO: Default Operating Unit. See the Oracle Channel Revenue Management Implementation Guide for more information.
Quota Approval and Statuses
A quota can become active only after it is approved by the designated approvers. The quota status changes based on whether the approvers approve, reject, or put the quota on hold. A quota need not go through an approval process if the person who creates the quota is the approver according to the approval rules.
The following table describes the various statuses that a quota may go through.
| Status | Description |
|---|---|
| Draft | The quota status appears as Draft when the quota has not yet been submitted for approval. A quota in the Draft status can be updated any time. From Draft, the quota status may change either to Pending Approval or Cancelled. If you are the quota owner, then you can directly change the status to Active. |
| Pending Approval | The quota status appears as Pending Approval if the quota is awaiting approval. The quota status may change to either Active or On Hold if all approvers respond positively. The quota status changes to Rejected if the approvers reject the quota. |
| On Hold | On Hold is an interim status, which means that the quota has already obtained approval, but is not completely ready to be made active. From On Hold, the quota status may change to either Active or Closed. |
| Rejected | The quota status appears as Rejected if the approvers reject the quota. From Rejected, the status can be changed back to Draft. |
| Active | The quota status appears as Active after the quota has been approved. From Active, the status may change to either Closed and Cancelled. |
| Cancelled | The quota status appears as Cancelled if it has been aborted. From Cancelled, the status can only change to Archived. |
| Archived | When the quota status appears as Archived, the quota can no longer be used. This status cannot change to any other status. |
| Completed | The quota status appears as Completed after all the activities that are associated with the quota are complete and the quota has been achieved. |
| Closed | The quota status appears as Closed after the quota period comes to an end. |
Top-down Bottom-up Allocation
Oracle Channel Rebate and Point-of-Sale Management supports top-down, bottom-up quota allocation. Top-down allocation is the process by which the Sales Management allocates quota to lower levels. Bottom-up allocation is the process by which the lower levels of the sales team hierarchy offer their inputs, and request for modifications to be made in the quota allocation.
In a top-down, bottom-up allocation, the Sales Management first allocates the quota to lower levels of the sales team hierarchy. The lower levels then review the allocation, offer their inputs, and request for changes to be made in the allocation. The Sales Management may incorporate these inputs and make the changes. Multiple such top-down, bottom-up cycles may continue until the allocation numbers are finalized. After the allocation numbers are finalized, you can activate the quota.
Quota Allocation Views
The Quota Allocation page gives a summary of allocations that have been created for a quota.
The following table describes quota allocation views.
| View | Description |
|---|---|
| Allocation Number | The unique number, which is assigned to the allocation |
| Allocation Type | This appears either as:
|
| Hierarchy | The territory hierarchy |
| Allocation Status | The status of the allocation |
| Approved Date | The date on which the allocation was approved |
| Active From | The period from which the allocation will be active |
| Active To | The period until which the allocation will remain active |
| Allocation | The quota that has been allocated |
| Worksheet icon | The amount that has been allocated to each of the hierarchy levels |
About Notes, Team, and Product Options
Notes enables you write and record information that you would like to communicate to others who deal with a quota or quota allocation at various levels. You can create any number of notes, edit and modify them.
The Team option enables you to add or remove other groups or users to the activities of quotas, claims and offers. By using this option, you can assign access to team members. The access that the group or team member gets depends upon the group type to which the team member belongs.
The Product option enables you to choose from existing product families and products you want to include or exclude in your quota, claim, or offer. Click the image for a list of values.
Creating and Managing Quotas and Quota Allocations
Information in this section will enable you to:
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Create quotas
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Update market eligibility for quotas
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Update products for quotas
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Generate and modify product spreads
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Submit quotas for approval
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Approve quotas
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Create quota allocations
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Submit change requests during top-down, bottom-up allocation
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Update request submission during top-down, bottom-up allocation
Creating a Quota
Quota is the total sales target (in terms of money or quantity of products) that must be achieved in a specific time period. You should first create a quota, and then allocate the quota.
To create a quota, log into Oracle Trade Management with Oracle Trade Management User responsibility.
Navigation: Trade Management:Administration>Trade Management > Quota > Quotas > Create.
Notes:
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Number: If you leave this field blank, the system generates a new quota identification number automatically.
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Owner: By default, the user entering the quota details becomes the quota owner.
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Quota: Total sales that must be achieved.
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Start Period/End Period: These are defined in the General Ledger (GL) calendars and limit the start and end periods for the quota. The start and end periods and the time spread determine how the quota is divided and tracked. For example, if you select the start period as Jan 04, end period as Jan 05, and select the time spread as quarterly, then the quota will be divided on a quarterly basis--Jan-Mar, Apr-Jun, July-Sep, and Oct-Dec.
Note: The values that are listed in the time spread LOV depend upon the start and end periods that you have selected. If the selected period spans a year, the time spread LOV displays the values--Yearly, Monthly, and Quarterly. If the selected period spans a quarter, the time spread LOV displays the values--Quarterly, and Monthly.
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Threshold: Quota thresholds enable you to monitor the activities of a quota and recognize inconsistencies such as over-spending and non-adherence to quota norms.
Using the Quota Creation Public API
You can access the Create_Quota Public API in Oracle's Integration Repository as an alternative way to create a quota. The Integration Repository is an integral part of Oracle E-Business Suite. It provides a complete catalog of Oracle E-Business Suite's Business Service interfaces. The tool lets you easily discover and deploy the appropriate business service interface from the catalog for integration with any system, application, or business partner.
Access Oracle's Integration Repository by logging in as sysadmin using sysadmin as the password. Click on Integration Repository and follow this navigation path for the Quota Creation Public API:
Marketing and Sales Suite > Funds and Budgets > Trade Planning Quota > Quota Public API
You can use the Create Quota Public API to create, update and delete a quota and to create and update product and account Spreads. The API contains a list of quota creation parameters and their descriptions.
Updating Market Eligibility for a Quota
Market eligibility defines the territories that a quota must target. By updating market eligibility for a quota, you can specify the territories that the sales teams must target. Defining market eligibility ensures that the quota is achieved by executing sales activities in the specified territories.
To define market eligibility for a quota, log into Oracle Trade Management with Oracle Trade Management User responsibility.
Navigation: Trade Management:Administration>Trade Management > Quota > Quotas >
Use the Market Eligibility screen to define Market Eligibilities for the quota.
Updating Products for a Quota
You can define products for a quota by selecting broad groups of products (category sets and categories) or by selecting specific products. You can use a combination of category sets and categories. For example, you may select a particular category but exclude certain products within that category.
To update products for an existing quota, log into Oracle Trade Management with Oracle Trade Management User responsibility.
Navigation: Trade Management:Administration>Trade Management > Quota > Quotas > Quota Name > Products.
Notes:
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Exclude: Use this check box to exclude products.
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Remove: Use this check box to remove a product or product category that has been added to a quota.
Generating and Modifying a Product Spread
You can generate the product spread after defining products for a quota. The product spread is generated based on the sales data of the previous year. It appears as a worksheet and displays products and product allocation numbers either on monthly basis or quarterly basis depending on the time spread that you have selected while creating the quota.
After generating a product spread, you can modify the allocation numbers, and add new products or product categories to it. Whenever you make any manual changes to the product spread, automatic adjustments are made to adjust the allocation numbers so that the sum of all product allocation numbers in the product spread is equal to the quota.
To generate and modify the product spread for a quota, log into Oracle Trade Management with Oracle Trade Management User responsibility.
Prerequisites
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Products must have been defined for the quota.
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The quota must be in the Draft status.
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Modifiers that are created in Advanced Pricing directly will not be available for update in Trade management.
Navigation: Trade Management:Administration >Trade Management > Quota >Quotas > Quota Name > Generate Product Spread.
Notes:
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Generate Product Spread: The product spread is generated based on the products that you have defined for the quota, and the sales figures of the previous year. If there is any remaining quota requests after the selected products have been allocated, it is accounted for in a general category named Others.
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Edit Product Spread: Use to modify the product spread. The product spread displays the distribution based on the time spread that you have selected (monthly or quarterly). The inventory is updated based on order management and POS [Point of Sales] data imports. The Inventory data is updated on this screen based on a concurrent job. All data coming from Order management is considered as 'Inventory In' while POS data is considered as 'Inventory Out'. A monthly time spread divides the quota on a monthly basis (January, February, March) while a quarterly time spread divides the quota is divided on a quarterly basis (January-March, April -June). The product sales achieved during the same period in the previous year is displayed against the respective targets for the current periods.
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Add Another Item: Enables you to add products or product categories to the product spread.
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Recalculate: After making changes to a product spread, click Recalculate to redistribute products based on the changes made.
Note: You can modify the product spread only for the current and future periods. If you reduce the quantity of products that has been assigned to a territory, then the balance is moved to the Unallocated category.
Submitting a Quota for Approval
A quota becomes active only after it is approved. The only instance where the quota does not require approval is when you are both the creator, and the approver of the quota according to the approval rules.
To submit an existing quota for approval, log into Oracle Trade Management with Oracle Trade Management User responsibility. Notifications are sent to the approvers after you submit the quota for approval.
Navigation: Trade Management:Administration >Trade Management > Quota >Quotas > Quota Name > Request Approval.
Approving a Quota
After a quota has been submitted for approval, you will receive workflow notifications if you are the designated approver.
To approve a quota, log into Oracle Trade Management with Oracle Trade Management User responsibility.
Navigation: Trade Management:Administration >Trade Management >Home > Tools > View Notification Work List.
Adding or Removing Users
The Team option enables you to add or remove other groups or users to the activities of a quota. By using this option, you can assign access to team members. The access that the group or team member gets depends upon the group type that the team member belongs to. For example, if you add the Administrator Group to a quota, then all the team members belonging to that group will have administrator rights on the quota.
Use the following procedure to add or remove users.
Prerequisites
An existing quota.
Steps
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Log into Oracle Trade Management as Oracle Trade Management User and navigate to Quota > Quotas.
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Click the hyperlink of the quota.
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Click the Collaboration side navigation link, and then click Team.
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Select either User or Team from the User/Role drop-down list, and select the appropriate value from the Name LOV.
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Optionally, check the Edit Metrics check box.
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Optionally, to remove a User or a Team, click the corresponding Remove icon.
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Click Update.
Creating a Quota Allocation
Use the quota allocation process to distribute targets to each level in a sales team hierarchy. When the discount values on a product fluctuate related to the price of base products, the discount amounts can be managed automatically. For example, the discounts on dairy products may vary based on the price of milk. Also, the discount on a product may vary based on the territory that the customer falls under.
Navigation: Trade Management:Administration >Trade Management > Quota > Quotas > Quota Name > Allocation > Create.
Notes:
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Hierarchy: Select the territory name that you have defined in the Market Eligibility.
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Start Level, End Level, and Start Point: The Start Level can be anywhere within the territory hierarchy. For example, in a hierarchy level of Country > State > City, the Start Level does not always have to be Country. It can also be State or City. The End Level, and Start Point must be less than or equal to the Start Level.
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Method :
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Even Distribution: Allocates quota equally across all the territories.
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Manual: Manually enter the quota that must be allocated to each territory.
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Prior Year Sales Total in Amount: Allocates quota based on the sales figures of the previous years
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Basis Year: This LOV is activated if you select the method as Prior Year Total Sales in Amount. The quota will be allocated based on the sales figures of the basis year that you select here.
Submitting a Change Request For Top-down, Bottom-up Allocation
After a quota allocation has been created, if you are a Sales Representative and recipient of the quota allocation, you can review the allocation, offer your inputs, and put in a request for changes to be made in the allocation. You can also add supporting documents to justify why you need to revise your original quota allocation; you can request an increase or decrease to your quota allocation. A workflow notification is sent to the approver after you submit the request.
To submit a change request based on an existing quota allocation, log into Oracle Trade Management with Oracle Trade Management User responsibility.
Navigation: Trade Management:Administration >Trade Management >Quota > Quotas > Quota Name > Allocation.
Notes:
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Worksheet: Click the link corresponding to the allocation for which you would like to offer your inputs.
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Quota Number: Enter the quota number that you would like to recommend, and optionally enter a justification in the Notes field.
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Supporting Docs: Documents can be any type of electronic file (.doc, .pdf, .xls, and so on). These are the documents that contain information to support your request for a different quota number.
Updating a Request Submission For Top-down, Bottom-up Allocation
If you are the Sales Manager who has created the allocation, you may accept or reject the request submissions that have been made by the Sales Representatives.
To accept or reject a request submission, log into Oracle Trade Management with Oracle Trade Management User responsibility.
Prerequisites:
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An allocation has been initiated, and the allocation is not active yet.
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You are the creator of the allocation.
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The recipient has made a request submission.
Navigation: Trade Management:Administration >Trade Management > Quota > Quotas > Quota Name > Allocation.
Notes:
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Worksheet Column: In the Worksheet column, click the link corresponding to the allocation for which the request submission has been made. The list of all the territory hierarchies are displayed. To identify the territory that has submitted the request, check the Requested Amount, and the Allocation Status columns. The Requested Amount column shows the details of the total amount that has been requested by the territory, and the allocation status appears as Submitted.
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Action Required: Select an option based on whether you wish to approve or reject the request. If you reject the request, the allocation status changes to Rejected. The submitter may make changes in the request and resubmit it.
Approving a Quota Allocation
A quota allocation can become active only after it is approved.
To approve a planned quota allocation, log into Oracle Trade Management with Oracle Trade Management User responsibility.
Navigation: Trade Management:Administration >Trade Management > Quota > Quotas > Quota Name > Allocation > Worksheet.
Notes:
The Worksheet shows the distribution of the quota across the territory hierarchy. Change the allocation status to Active, and click Update.
Searching for Quotas
The Quota Search Results page displays the list of quotas that fit the search criteria that you specified in the Quota Summary Advanced Search page.
Click Modify Criteria to search for quotas based on a different search criteria.
Advanced Search
The Personalize option enables you to search for quotas based on specific criteria. Use the following procedure to filter the search results, select the columns that must be displayed in the Quota Summary page, and save the search.
Prerequisites
None.
Steps
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Log into Oracle Trade Management as Oracle Trade Management User and navigate to Quota > Quotas.
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Click Personalize.
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To further search for quotas in an existing saved search, select the name of the saved search from the Saved Search drop-down list. To create a new search view, select All Quotas from the drop-down list.
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In the Search Criteria region, select the criteria based on which you would like to search for quotas.
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In the Filter search by region, select from one of the following:
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My Records: displays all the quotas that you have created.
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My Team’s Records: displays all the quotas that are created by the team to which you belong.
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All Records: displays all the quotas.
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In the Display Options region:
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Select the columns that must be displayed in the Quota Summary page, by moving the required columns from the Available Columns to Displayed Columns.
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Select values from the Sort Rows By, Then By, and Finally By drop-down lists, and select a Sort Order (Ascending or Descending) for each of the options. The data will be sorted based on the options that you select here.
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Enter the number of rows that must be displayed in the Quota Summary page.
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Enter a name in the Save Search As region.
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Click Save.
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Click Save and Apply to save the search as the default search. You can also optionally check the Use as Overview Page Default to save the search as the default search.