Skip to main content

4 Ways Automation Improves the Commission Process

Mar 18, 2019
3 min read
Sales compensation is an organization's largest investment. Learn how automating compensation management can improve the efficiency of your commissions process.

Your commission process says a lot about your future as a company—including your overall growth potential. Are you content with following the status quo? Even if it means your employees and your bottom-line suffers? Are you inching onward or launching forward? There are four key ways that automation improves the commission process to set you up for success. If your organization is genuinely committed to growth, it will need the best and brightest tools to get there.

The best and brightest tools do not include manual spreadsheets, at least, not when it comes to sales incentive compensation—especially considering 80% of spreadsheets contain errors. Anything less than an automated, intelligent, data- and purpose-driven comp solution will decrease your company’s morale and revenue potential. Simply put, if you want to motivate reps and enable quota attainment, you can’t afford to stick to the status quo.

In a recent webinar and product demo, Xactly’s Director of Product Management, Andy Drogo, discussed the state of manual compensation processes. With over thirteen years of sales comp experience supporting him, Drogo shared a helpful compensation self-assessment, a snapshot of life with automated processes, and a brief overview of Xactly SimplyComp™, which allows you to purchase, create, and implement plans in just minutes.

The following blog reviews key highlights from the webinar. You can also watch the full recorded webinar here.


Everything You Need to Know About Incentive Compensation

A Brief Self-Assessment

In order to launch forward, it’s important to first identify the state of your sales compensation processes. Answer these six questions to understand the strengths and weaknesses of your current solution:

  1. What percentage of your incentive comp process is manual?
  2. How accurate are your payments? (even a 1% error rate can be costly!)
  3. Do your comp admins secretly fear growth?
  4. How much visibility do your sales reps have into their own compensation?
  5. How often are you dealing with disputes?
  6. How could technology improve these processes?

If your answers are less than encouraging, you’re not alone. Many companies, big and small, struggle with achieving an accurate and seamless sales compensation process. Fortunately, by identifying these areas of concern, your organization can move towards improvement. In this case, improvement looks a lot like implementing an automated comp solution.

What Makes Automation the Secret Sauce?

Gartner reports: “Organizations that abandon manual processes and spreadsheets and adopt. . . incentive compensation technologies. . . reduce errors by over 90%, processing times by over 40%, and IT/administrative staffing for ICM by more than 50%.” That’s significant time, manpower, and finances you’re losing because of manual incentive compensation management. More specifically, there are four major ways that automation improves the commission process:

  1. Increased organizational visibility
  2. Up-leveling of manual processes
  3. Reduction in errors and disputes
  4. Addition of significant time savings

Your sales team needs to see its current numbers and goals in a real-time environment. By allowing them to model various deal scenarios, you can motivate sales reps while increasing trust in the process. Similarly, management teams benefit from increased visibility by being able to identify areas where their support may be needed.

Under the heavy hand of manual compensation, your comp admins spend their time toiling in excel instead of doing their actual jobs—strategic financial planning. For companies that do not automate their compensation processes, it typically takes reps six to eight weeks to receive payment after a deal has been closed. That’s far too long. That‘s six to eight weeks that your reps become increasingly frustrated and your comp experts waste answering tedious emails, addressing disputes, and rerunning numbers. According to the 2018 Sales Comp Administration Survey, however, 95 percent of companies who use ICM technology have payouts completed in less than six weeks, with the majority under three weeks.

You’ll Need these Best Practices

In today’s fast-paced, competitive business environment, sales organizations can’t afford to sacrifice efficiency and performance for manual compensation processes. Choosing the right type of automated solution is paramount to achieving increased visibility and decreased complications. In order to select the best solution for your company, there are several best practices you should know. These best practices should be evident in any solution worth its weight.

Your automated commission solution should include:

  1. Best-of-breed templates
  2. Ability to add different users with ease
  3. Ability to create and edit rules
  4. Ability to scale with company growth
  5. Familiar look and feel (without the complications of manual processes)
  6. Customizable templates

By implementing an automated commissions solution—the right automated commissions solution—you can set your company up to reach and surpass your process, financial, and morale goals. As you’ve probably guessed, Xactly SimplyComp™ meets all six of these best practices criteria. Watch the webinar to hear the full audio and to see a short demo of the product, you’ll learn:

  • How to best use incentive compensation for company alignment
  • Best practices based on over fourteen years of incentive compensation data
  • The impact that automation has on the entire comp process
  • How providing increased visibility to sales rep establishes trust and promotes performance

Ready to start a conversation? Request a live demo with an Xactly Expert.

  • Incentive Compensation
Lisette Walberer
Lisette Walberer
Content Marketing Manager

Lisette Walberer is a Content Marketing Manager at Xactly. She earned her BS from NAU and is pursuing an MA in English from ASU. She has experience in both content strategy and creation.