Three Ways to Streamline Your Compensation Management Reporting

The number one priority with incentive compensation management (ICM) is paying commissions accurately and in a timely manner. A strong reporting strategy should be tied to this process, which can make a significant difference in terms of building employee trust and in increasing productivity.

A typical example of how reporting can impact ICM processes is the Compensation and Detail Statement. When designed well, this type of report acts like a receipt you’d get at a grocery store. Just like receipts allow customers to verify their transactions, see the details of their purchase, and move more easily through the buying process, compensation statements provide feedback to sales reps on completed contracts and offer tangible & immediate feedback which makes their results from their efforts more tangible.

Managing the distribution of requests across an organization can get unwieldy very quickly when administrators are receiving priorities from several stakeholders on a daily basis. Having clearly defined standard reports like compensation statements available can help reduce the stress. If one can apply an 80/20 rule to ICM activities – providing quality reports that answer 80 percent of the questions and focusing one’s attention on the 20 percent that require more expertise – one can achieve streamlined reporting that supports ICM activities and helps to attain crucial insights more rapidly.

This blog will provide three steps that can be taken right away to improve ICM reporting outcomes:

1) Build trust with more accurate and clear information

Variable compensation is a delicate subject as payees need to trust that their payments are accurate. As an administrator, you want sales reps to get what they need and then focus on selling. A starting point for building this trust is having everything necessary for salespeople to understand their compensation. Payouts in reports should reconcile back to payroll in order for them to be considered trusted resources.

2) Consider the importance of user experience

When one browses a website or report, immediate answers are expected. User want the least number of steps when interacting online. When creating reports, one should take an example from consumer and retail sites: avoid the abandoned shopping cart! Report consumers need to easily and quickly get to what they need.

3) Conduct an assessment

How does one determine what trusted facts users need to know or what is considered usable? Always solicit feedback from users. Ask stakeholders questions and explore all feedback carefully. This will prove invaluable during the design phase of reporting solutions. Some examples of questions which may be posed:

  • Is the information you’re getting accurate, overwhelming, confusing, or obsolete?
  • Are calls to action clear based off the information you’re receiving?
  • How do you think the data that is important to you could best be visually represented?

Following the interview process, it is recommended to create short and long term roadmaps to have a plan of action. Various portions of the plan can be measured using two axes: impact to stakeholders and ease of implementation.

When constructing a compensation model, various considerations should be explored in which some may be competing while others might be complementary.  Reports can transform a Sales Performance Management (SPM) strategy in several ways, but the initial step is to ensure the compensation report ties into payroll. Effective reporting should support accurate and efficient compensation rules. Although the task of calculating variable compensation accurately and conveying the results to payroll in a timely fashion should be a top priority, giving the attention to reporting upfront will reap benefits over time.

Check out IBM’s whitepaper Top considerations for implementing sales performance management and watch this video to see how to improve sales results and operational efficiencies with better management of incentive compensation plans.

For more information on ICM reporting strategy, please contact us at

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