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Incentive Compensation Processes

The following sections introduce the major groupings of Incentive Compensation processes. For more information, see the referenced chapters.

Plan Design

Compensation administrators define plans and plan rules. The plan and rules together define the performance measures on which the employee is evaluated and paid. Plans are designed in the Compensation Administration views. For more information, see Plan Design.

Sales Hierarchies

Incentive Compensation sales hierarchies are developed using a top-down structure of hierarchies that include positions, quotas, and territories. Sales hierarchies can differ from an organization's reporting hierarchy, which may include direct, channel, and vertical reporting.

The Incentive Compensation calculation engine is used to compensate employees and managers based on current as well as previous hierarchies. The compensation engine can reference a hierarchy version at any time in the process.

Sales hierarchy versions are based on dates, and may require formal approval. A single hierarchy can include a number of positions that are associated with multiple territories and territory hierarchies. For more information, see Sales Hierarchies.

Sales Crediting

Incentive Compensation sales crediting allocates credit for sales based on assignment rules for specific hierarchies. Credit allocation assignments can be based on historical rules. The credits are validated before they are posted as transactions. For more information, see Sales Crediting.

Incentive Compensation Quotas

Incentive Compensation Quotas is a quota-setting and management tool that helps organizations involve sales and sales management in the quota setting process. The quota tool allows sales representatives to focus on how much business they must close within a certain time period to meet the target quota.

Top-level quota targets can be defined, and then cascaded down the sales hierarchy. As managers develop the quota for their sales representatives, the managers can apply a number of adjustments and quota factors to the target number. The application of quota factors allows managers to vary the quota target for each representative according to the differences in each representative's territory and account responsibility, the market conditions, the competitive landscape, and other factors. Using charts, reports and other views within the Siebel application, managers can perform a detailed analysis of the representative's past period performance and future pipeline to develop the factor amounts. After the final quota is determined, the quota can be distributed over a number of time periods and modified again to account for seasonal differences and period trends.

The quota targets and factors are communicated to the field representatives, allowing sales managers and representatives to jointly review and approve quota targets and develop strategies to achieve the goals. By involving field representatives in the process, organizations can increase acceptance of the final targets by sales representatives.

After final quota numbers are determined, the numbers can be rolled up to compensation administrators and executive management, and then implemented as part of the compensation plan. Compensation analysts can use these estimates to model compensation payments and potential achievement levels. As organizational changes are introduced, and market conditions shift, sales managers and administrators can approve quota adjustments and apply changes to the plan, establishing accurate calculation and payments. For more information, see Quotas.

Compensation Estimation

Employees can review estimated compensation for each active deal, apply different criteria to the deals, and model how the compensation changes according to the selling strategy. For more information, see Compensation Estimation.

Transaction Workbook Imports and Exports

The Siebel Incentive Compensation Transaction Workbook is a repository and staging area for compensable transaction data. In the Transaction Workbook, administrators and managers can review orders from the Siebel Order module, a third-party order system, or any other compensable transactions, and modify the orders if necessary.

Orders from the Siebel Order module can be imported into the Transaction Workbook using the Import Transactions process from the Transaction Workbook. After compensable transactions are included the Transaction Workbook and necessary changes are made, the Export Transactions or Accumulate Transactions process can be used to export the transactions to the Calculation Workbook and Achievement Containers. For more information, see Transaction Workbook Imports and Exports.

Achievement Containers Workbook

The Siebel Incentive Compensation Achievement Containers Workbook accumulates units and revenues into containers according to the aggregate performance measures for each measure period. Administrators can reaccumulate data in containers to pay for group and manager performance. The Achievement Containers Workbook also compensates transactions based on the multiple statuses of the transaction. The workbook allows users to reconcile or true-up calculations. For more information, see Achievement Containers.

Incentive Compensation Calculations

After transactions are reviewed, and employee scores entered, compensation can be calculated. These activities are performed from the Incentive Compensation Tracking screen. Calculating compensation typically involves three activities— exporting sales transactions, running the calculation engine, and releasing the run results.

First, transactions are exported to the Calculation Workbook and accumulated in achievement containers. Next, the calculation engine is run to determine the amount of earnings. After these calculations are reviewed and verified, the results are released for review by field representatives and managers.

The calculation engine uses the compensation plans, rules, and the selected participants for the current calculation run, and, based on transactions in the Calculation Workbook and the Employee Workbook, calculates the compensation to be paid to each employee. For more information, see Incentive Compensation Calculations.

Employee Compensation Tracking

After compensation has been calculated, administrators can use several views and reports to review payment amounts and quota achievement. Administrators can see the full details of plans and rules including payout rates, draw balances, recognition awards, quotas, and quota achievement. For more information, see Compensation Tracking.

Employee Balances and Payment Releases

Siebel Incentive Compensation maintains compensation balances for each employee. These balances are the difference between an employee's Released Balances to Date and Earnings to Date amounts, computed during a calculation run.

Employees should monitor these balances to compare them with earnings statements and released payments. The compensation administrator reviews balances, corrects them as needed, and releases payments based on the balance details. For more information, see Employee Balances and Payment Releases.

Output Views

Compensation administrators, managers, and employees can use views, charts, and reports that summarize compensation earnings and quota achievements, and itemize the transactions that make up compensation payouts. The Incentive Compensation views are:

  • All Compensation
  • My Compensation
  • My Team's Compensation

Depending on the employee's role in the organization, other views can be accessed. Sales and service representatives can access views that present personal information. Managers can access views presenting their own personal information, and views containing information for their direct reports. Compensation administrators can see available data in the compensation output views.

Multi-Currency Transactions

Siebel Incentive Compensation can be used by companies that operate in several countries, and conduct transactions in multiple currencies. In such an environment, compensation plans, plan participant compensation, orders, and other compensation-related data can involve various currencies. For more information, see Multi-Currency Transactions.

Rate Calculation Syntax

Siebel Incentive Compensation offers preconfigured formulas with specific rate calculation syntax. Use this syntax if you need to create new formulas for rate calculation rather than using the default formulas. For more information, see Rate Calculation Syntax.

Server Components

A variety of server components govern the operation of Siebel Incentive Compensation. For more information about the server components that must be running for Siebel Incentive Compensation operation, see Incentive Compensation Server Components. This appendix also has information on event logs.

Configuring Incentive Compensation

Configuring Incentive Compensation describes procedures that you can use when developing filters, performance measures, currency conversions, net change, plan date, quota revenue credit, and transaction records.

Siebel Incentive Compensation Administration Guide