Siebel Incentive Compensation Administration Guide > Plan Design >

Creating a Target Incentive

A target incentive is the total cash that can be paid for a bonus. A participant can have a personalized target incentive. The Siebel Incentive Compensation Calculation Engine can use static or variable target incentives to determine the payout for a plan participant.

• Static target incentives. A static target incentive is a component of a plan participant's salary or another amount. It generally represents the expected earnings at 100% performance.
• Variable target incentives. A variable target incentive can change daily. The script can be automatically executed during the calculation run, or the you can run the script using the plans or plan rules menus.

Typical target incentives include:

• The participant's salary (for example, if you make more than 80% of your MBO bonus, you are paid 20% of your salary)
• A target bonus amount (for example, if you make more than 80% of the MBO bonus, you are paid 20% of a target bonus of $5,000)

A target incentive script value can be computed from a participant's salary, and include prorated and weighted factors, and so on. A script can be automatically executed by the calculation run, or the script can be manually run using the commands on the plans or plan rules menus.

You can create target incentives and target incentive scripts at the plan or plan rule level. Existing plan participants, and those that are added, inherit the personal plan target incentive and the target incentive script from the plan. The participants also inherit the personal plan rule target incentive and the target incentive script from the plan rule. Because they are copies, the personal plan and the personal plan rule target incentive and target incentive script can be personalized for each participant.

You can create a participant's target incentive the Plan Participants view or use a script method and service to create a variable target incentive at the plan and plan rule level. The method or service can be invoked by using either the Calculation Engine or a predefined external script.

A script service defined at the plan level applies to plan participants. You can also personalize a target incentive at the plan participant level.

Inheriting Target Incentives and Target Scripts

Participant association with plans and plan rules determine how target incentives and target scripts are inherited. This inheritance occurs in the following ways:

• If a participant is associated with a plan, the plan participant inherits the target incentive and target incentive script from the plan. The dependence can be changed using configuration tools.
• If a participant is associated with a plan rule that is not the default, the participant plan rule inherits the target incentive and target incentive script from the plan. The dependence can be changed using configuration tools.
• If a participant is associated with a default plan rule, the participant plan rule inherits the target incentive and target incentive script from the plan rule. The dependence cannot be changed.

Defining a Target Incentive for a Plan

Use the following procedure to set the static and variable target incentives that determine the payout for a plan participant.

To create a target incentive for a plan

1. From the application-level menu, choose View > Site Map > Incentive Compensation Administration > Plans.
2. In the Plans list, select a plan, and then drill down on the hyperlink in the Name field.
3. In the Plan form, click the select button in the Target Incentive field.
4. In the dialog box, enter the amount.

   The default currency value is based on the currency field value selected for the plan.

To create a variable target incentive for a plan

1. From the application-level menu, choose View > Site Map > Incentive Compensation Administration > Plans.
2. In the Plans list, select a plan.
3. In the plan form, enter the name of the script in the Target Incentive Script field.