So the saying goes, “What happens in Vegas, stays in Vegas!” Red or black? Hit or stand? Call or fold? When there are two clear choices in any situation, it’s tempting to take a gamble and go for broke. Maybe that’s true in Las Vegas, when taking a little downtime to get in on the thrill of the bet, but when we’re talking about the foundation of your entire sales commission management system, going “all in” needs to be a very calculated calculation.
After all, what happens in your sales commission software, definitely can’t stay in your sales commission software. Let’s break down the odds on the two main types of ICS and place our bets.
Your sales reps are crucial to your business’s success, and it’s important to ensure their compensation is transparent and accurate. When reps can clearly see the connection between the sales they make and the commissions they receive, you get happier reps, a stronger sales force, and more closed deals.
For these reasons, you may have decided it’s time to move on from spreadsheets for your sales comp management. Or perhaps you’re just starting out, and you want to do it right from the get go. (Smart!)
Either way, you’re now looking at your options, and there’s a lot to go through. What’s the best path forward?
Many companies are turning to Incentive Compensation Management (ICM) or incentive calculation software to keep track of sales commissions accurately. These tools are able to scale with your business no matter how large it grows, they can handle tremendous amounts of complexity, and they offer much-needed transparency into the whole process.
But even with ICM solutions, you have a number of options to choose from.
In this article, we’ll look at how incentive calculation software can be broadly grouped into two types, helping to jumpstart your search for the one that is right for your business.
ICM solutions come in two main varieties: out-of-the-box and configurable. The type you select should depend on your particular business needs.
As the term implies, an out-of-the-box solution is ready to use right away. You don’t need to do anything extra, and you don’t have to add special features. You just sign up and start using it.
This is obviously an appealing option compared to systems that can take quite a while to implement before you can use all of their capabilities. And if you find an out-of-the-box solution that meets all of your calculation and reporting needs, it makes for a tempting offer.
But in some cases, such simplicity comes with downsides. Solutions that work immediately may be limited in their capabilities.
A pickup truck is far easier to get in and drive than a semi truck, but that’s because the former pales in comparison to the power and towing capacity of the latter. If pickup-level capabilities are all you need from your incentive calculation software right now, then an out-of-the-box solution may work well enough.
But what happens when your team grows and your compensation plans become more complex? If you’re not careful, you could end up building your sales commission plans around the limitations of a system, rather than your business needs.
Configuring your incentive calculation software may take more effort to set up, but it offers much more flexibility. You can adjust the software to meet your specific business needs, rather than the other way around.
And once they’re implemented, configurable solutions should be easy to use, and they’ll scale much better with your business. As your team grows, your processes change, and your compensation plans become more complex, you can continue to adjust the configurations to keep up.
The downside is that they can take quite a while to implement. Depending on which ICM you choose and the specifics of your business, implementation could even be a years-long process.
At Performio, we don’t think you should have to choose between a solution that can get up and running right away and one you can configure as needed to meet your specific business requirements.
You get the best of both worlds with Performio.
Our sales performance, incentive compensation, and data management tools accurately calculate and report sales commissions, no matter how complicated your compensation plan may be. We offer pre-configured plan components to get you going right away, while also offering the configurability you need for a growing and changing sales team.
If you need a little more help deciding, check out our free ebook, A Buyer’s Guide to Incentive Compensation Management Software, which includes a comprehensive checklist for comparing your options.
And if you’re ready to see what Performio can do for your business, request a demo today.