Using Managed
Services To Maximize
The Potential Of
Your Incentive
Compensation
Management (ICM)
Solution
Introduction
1
Technology is a key productivity driver. Designed and maintained properly, technology can focus, integrate and harness your company’s energies to ensure everyone works toward a single goal. A well-implemented Incentive Compensation Management (ICM) solution integrates with your business processes and aligns incentive plans with your strategic goals.The ICM solution connects the overall strategy with front-line activities to ensure consistency throughout the organization. From the executive boardroom to the management table and down to customer-facing sales staff, the company’s overall goals are internalized by managers and the teams they lead.
ICM solutions provide substantial alignment across the organization. They are a tool kit that allows companies to develop compensation strategies that incent and reward desired behavior. Keeping an ICM system working at its full potential requires expertise, guidance and insight.
Benefits of Incentive Compensation
Management (ICM)
FLEXIBILITY
IMPROVED REPORTING
INCREASED MORALE
ICM solutions offer some key benefits to companies, including:
A proper ICM system is flexible, allowing administrators to tweak and revise plans as the marketplace, industry and sales team changes.
ICM holds a significant amount of data on sales activities, and that data can turn into reports which show trends, inform strategic planning and facilitate executive decision-making.
The immediate, clear access to data is a morale-booster for sales teams. Account
representatives can use the system to conduct “What If” analysis and predict their potential payout if certain sales strategies become successful.
ICM also allows managers to pinpoint the conduct of top performers, while encouraging entire teams to model those behaviours.
Navigating the Changing
Environment – Managing Your
ICM Technology
INTRODUCING NEW PLANS
OPTIMIZING THE SYSTEM
REVISING EXISTING PLANS
EXPANDING THE REPORTING INVENTORY
As the company expands and the compensation strategy becomes more sophisticated, the organization must add new plans. These plans must be accurately implemented in the ICM solution in a timely fashion.
Run the system at its highest potential by taking advantage of new product features, maintaining the system regularly, and implementing changes using best practices and recommended
methodologies.
External factors can impact compensation strategies mid-year, requiring that sales organizations modify their compensation plans with minimal warning and aggressive implementation schedules.
Reporting needs related to the sales function are constantly evolving. New managers, new products, and new trends in reporting contribute to an on-going report development cycle. Addressing these challenges requires a flexible, scalable system, which a robust ICM solution can provide. It also requires ongoing access to expertise and IT skills to keep the system operating at its potential and helping the company meet its goals.
Business environments often undergo rapid change. The competitive landscape shifts, technology advances and the marketplace demands different products and services. As the business environment changes, your strategic and operating plans must be revised. For
companies relying on ICM solutions, this dynamic environment presents a number of technical challenges:
Using Managed Services to
Maximize ICM Capacity
Some companies will undoubtedly struggle to keep pace in this rapidly-changing environment. Many will lack the in-house product expertise needed to keep their system optimized, focused and aligned.
In these cases, using a Managed Services arrangement is an effective long-term solution.
Moreover, the working relationship between a Managed Services team and its client firm usually follows an Engagement Model. As an example:
Engagement models help clarify what work is being taken on, and at what cost to the customer. This is very important when operating with a third party.
A well-run Managed Services team will provide clients with weekly status and activity reports, offering insight into time spent on various deliverables, outstanding defects or changes, overall status of tasks, and any other pertinent system information.
Benefits of Managed Services
Reverse Engineering
The team’s broad experience with multiple customers and multiple incentive compensation methods allows them to reverse engineer any ICM model.
Troubleshooting Ability
The team has encountered everything, including the most common problems and the most uncommon problems. Drawing on this experience, the team can diagnose issues quickly.
Greater Adaptability
As the business becomes more complex, the Managed Services team can guide the organization through complicated scenarios.
Scalability
The Managed Services team can augment core teams to provide immediate capability, ensuring the system grows in lock step with the company and the marketplace.
Greater Focus on Core Business
This is perhaps the top benefit of using a Managed Services team. By outsourcing the management of the ICM solution, the compensation team can focus on the business of compensation – understanding plan effectiveness, key performance indicators, and compensation strategy.
Using a Managed Services teams has significant resource implications for firms. It saves the organization from an ongoing, serious investment in IT resources. Furthermore, the Managed Services team offers direct benefits that will keep the system working at its top potential. These include:
