About Cascade Orthopedic Supply
A major supplier to the Orthotics & Prosthetics (O&P) industry for over 30 years, Cascade Orthopedic Supply distributes over 300,000 products to O&P professionals throughout North America. The Chico, Calif.-based company has expanded organically and by acquisition to offer the industry’s most comprehensive product line to certified, independent providers of prosthetic and orthotic care.
The Challenge Growth events such as a business acquisition, merger, gigantic new account or game-changing product almost always jolt companies into making major process changes. Cascade Orthopedic Supply already knew it needed to improve its sales compensation management process, so when it recently acquired another company with an existing outside sales force – thus doubling its total sales force overnight – it decided the time for the radical change had come.
With Cascade’s legacy compensation process, top management (including the president) would run SQL reports, export the results to Excel spreadsheets, and spend multiple hours painstakingly calculating commissions each month. As the sales team doubled from four to eight representatives, it was clear that this would no longer be feasible. Moreover, reps had no visibility into their commissions until the checks were cut; a situation that Cascade believed was damaging sales performance.
“As our sales team expanded, we needed a more scalable and efficient way of managing compensation to increase sales performance and reduce our administrative burden,” explains James Mayfield, Business Analyst, Cascade Orthopedic Supply. “Essentially, with the old process, all our commissions calculations used to happen behind an impervious ‘curtain,’ making it extremely difficult for us to be strategic with compensation. We want reps to be able to look behind the curtain to better understand what and why they were being paid.”
And then there was the company’s CRM situation. Cascade had recently implemented Salesforce CRM and wanted to accelerate user adoption. It was believed – rightly, as it turned out – that an automated compensation management solution that linked to Salesforce CRM would help drive adoption of the CRM solution as part of an integrated sales performance-boosting environment.
Benefits at a Glance:
Increased Sales Performance More strategic sales behaviors Accelerated adoption of Salesforce CRM More efficient, lower cost, scalable compensation management The Solution In searching for an automated compensation management solution, Mayfield spoke with Cascade’s salesforce.com representative and learned that Xactly provided salesforce.com’s incentive compensation solution. On evaluating Xactly Express, Cascade discovered that it supplied the required automation, visibility and management reporting, as well as the ability to integrate with existing systems such as Salesforce CRM and the company’s ERP solution.
“We subsequently selected Xactly Express and rolled it out to users in April 2011,” says Mayfield. “The integration work was fairly easy, and the impact on the company was rapid and highly positive. It has delivered the benefits we were looking for, and has really opened our eyes and enabled us to use compensation strategically like a much bigger company.”
Increased sales performance Cascade’s sales reps now have visibility into their compensation on a near real-time basis: no more waiting for the paycheck to arrive to see what they’ve made. Instead, reps are able to check their numbers daily via up-to-date reports and dashboards, which is providing the company with a large sales performance advantages.
“The new visibility makes the reps more accountable, both to the company and to themselves,” claims Mayfield. “The ability to see where they stand in respect to quota on a daily basis re-engages them at the account level and is measurably energizing their day-to-day selling efforts and spurring to perform higher. And where setting quotas used to be a top-down effort, Xactly Express has empowered the reps by allowing them to set their own quotas and goals for the year. Every day they can open dashboards to see how they’re performing against the quotas they set themselves, which is a huge motivator.”
More strategic sales behaviors Xactly Express is also helping Cascade’s sales reps be more strategic in their selling behaviors. According to Mayfield, they are taking a more comprehensive view of accounts, and a more strategic view of the 300 vendors/suppliers that Cascade represents, and what they can get from selling particular products and sets of products into particular accounts.
“Xactly Express is empowering our reps to in essence create their own battle plans,” says Mayfield. “Related to this, we have started to introduce SPIFFs sponsored by various vendors, which helps the company, the vendor and the rep – and ultimately the customer.” Accelerated adoption of Salesforce CRM As Cascade had hoped, Xactly Express has also helped drive more rapid and deeper adoption of Salesforce CRM across the sales team. Through its tight integration (including single sign-in) with Salesforce CRM, Cascade’s reps are able to log into Xactly Express within Salesforce CRM. This is driving higher daily usage of the CRM solution since they are naturally checking their compensation numbers every day.
“Xactly makes it extremely easy to seamlessly integrate compensation management with Salesforce CRM, which is connected to our ERP system, and to manage custom fields,” explains Mayfield. “This is an additional and very important bonus for us because it gives us the integrated sales performance environment we need to compete most effectively. The one-two punch of Xactly and salesforce.com is very powerful.”
More efficient, lower cost, scalable compensation management From an operational standpoint, the use of Xactly Express has significantly streamlined and reduced the costs of Cascade’s overall sales compensation management process. Spreadsheets and management‘s time-wasting use of them to work out commissions, are out of the picture entirely. A single admin now handles the process part time. There is no risk of commissions not being calculated on time. The new system and process can scale its benefits to accommodate significant headcount increases in Cascade’s sales force; as well huge increases in the complexity and diversity of sales compensation plans as Cascade continue to expand. And, since reps aren’t waiting to month end to discover just what the economic fruits of their labors will be, disputes over commissions have dropped to almost nil.
“How much time does our president now spend with commissions? A few hours a year, rather than several hours a month,” says Mayfield. “Operationally, because of Xactly Express, we are doing much more in terms of compensating strategically with much less time and effort. Reps are more focused on selling, and finance, administration and top management have more time to focus on other issues.”
Moving forward Cascade is a growth story in a growth industry. With Xactly Express now implemented and well embraced by users, the company is looking at the many things they can do with the solution to help drive future growth and profits. Among these things is compensating differently for different sales channels, for example, 1-800 sales versus website sales. Additional incentives are being contemplated, such as a SPIFF for successfully encouraging electronic account invoicing. New plans are being considered, which can be modeled within Xactly prior to deployment. And commission clawbacks are being weighed for when invoices are not paid, as well as paying half-commission based on order and then invoice paid.
“Xactly Express gives us the tools we need to do a lot of things that make sound business sense, but that we could not have even considered doing in the past. Xactly Express is not just a compensation management tool; it’s a business success driver.”