Commission planning model that suits our industry

Description

A Commission Planning Model in Corporate Performance Management (CPM) software enables organizations to accurately forecast commission expenses based on factors specific to their industry. This integrates different data streams like sales data, employee performance data, and industry benchmark data into a unified model that assists in effective commission budgeting and management.

Example Use Case

Scenario: An insurance company uses CPM software for workforce planning. The business success hinges on the performance of its sales force, hence, it's crucial that it manages and plans its commission payout effectively in tandem with the market and industry practices.

Solution: The insurance company uses a CPM solution with a flexible commission planning model. The model incorporates past sales records, benchmarks industry commission rates, and integrates performance metrics to forecast future commission liabilities. The model also accounts for growth projections and variations in sales targets, enabling the company to budget commission expenses and maintain financial health.

Considerations

The commission planning model should be designed to accommodate the unique aspects and dynamics of your industry. Every industry approaches commissions differently, as such we recommend that you show your existing commission planning model (we assume in Excel) to the vendor and have them confirm that everything in that model is achievable in their product.

Questions to Ask a Vendor

• Industry Planning: How well does your system accommodate our industry's unique commission structures and variables? Can you show us different commission structures as examples?
• Flexibility: Is there a set of variables that we can change based on shifting business requirements, or when building a what-if scenario?
• Multiple Commission Plans: We have more than one type of commission plan based on the employee's role in the sale. Are you able to accommodate multiple plan types in one cohesive model?