Tip: Rethink Your Plan If One Person Runs Your Entire Commission Compensation Management Process
Often, small to mid-sized businesses have a single superhero on staff who oversees everything having to do with commission compensation management.
This person manages all commission calculations and payouts. They are the person you turn to when you need to set up new commission-calculation rules, pull historical commissions data, or answer any commission-related question. For our purposes, let’s call this superhero Debbie.
Debbie is amazing, and we all agree she deserves a well-earned break from time to time. But here’s something you probably haven’t thought about:
Debbie’s break could wreak havoc on your commission process if you don’t have a disaster-proof backup plan in place.
Do You Have a Debbie?
In many small and midsized businesses, there is exactly one person who understands how commissions are calculated and paid.
- When a salesperson questions a commission payout, they go to Debbie.
- When accounting needs to adjust a deal after an invoice changes, they go to Debbie.
- When leadership needs commission numbers for a board meeting tomorrow morning, they go to Debbie.
Debbie is the only person who truly understands how your commission process works, and when Debbie isn’t available, nobody else knows what to do.
And that’s a problem.
A Better Commission Compensation Management Process Benefits You & Debbie – Here’s Why
Perhaps Debbie has a rich, spinster aunt who will offer her a free, month-long cruise around the British Isles next summer. Maybe she will take maternity leave from August to October, so she can bond with her newborn daughter (and try to sleep). Possibly, she will have a complicated surgery near the holidays, and it will take her longer than expected to recover. Maybe she’ll take a few weeks off during the summer to go camping in Vancouver with her family. Or perhaps she’ll get stuck with jury duty for 5 exhausting weeks in Q1.
All of these are highly possible (well, almost all), and none of these are disasters – but they could be a disaster for your commissions process if Debbie is the only person who has the resources and the know-how to calculate and process commissions payouts for your company.
It’s time to change that.
Debbie Deserves a Disaster-Proof Backup Plan (and You Do Too!)
If any of those scenarios (or countless others) occur, Debbie will be out of the office for a while. And either she’ll have to work far ahead to “gift” herself the time off… or commissions processing will be delayed while she’s gone.
And if she didn’t have time to work ahead, due to an illness, your commissions are sure to be delayed. That’s a bigger issue than you realize.
When commissions are delayed or incorrect, the impact goes far beyond accounting. Sales teams lose trust in the system, disputes increase, and leadership spends valuable time resolving issues that could have been prevented.
3 Areas to Focus on to Disaster-Proof Your Commission Compensation Management Process
Debbie deserves peace of mind on her time out of the office – and that means she needs to have someone else able to cover for her when she’s out. Your business and your sales team also deserve peace of mind – the kind that comes from having a disaster-proof backup plan.
As your IT team has told you repeatedly, effective disaster proofing requires 3 key components:
1. Redundancy
If Debbie is the only person who knows how to run the commission calculations, your organization has a single point of failure.
Someone else should be able to fill in on Debbie’s duties while she’s away. This person doesn’t have to be a commissions expert like Debbie, but they should be able to access updated resources and complete pre-determined commission compensation management tasks when needed.
Disaster-proofing tip: Use a dedicated commissions calculation software solution that acts as a centralized database and provides one version of the truth. Various team members will need access to this system so they can sub for Debbie when needed. Make sure the system you choose features permissions-based access to keep your data secure.
2. Easy maintenance
In many organizations, commission logic lives in spreadsheets, email threads, or Debbie’s memory. That makes it nearly impossible for someone else to step in quickly.
Keeping data up to date and easy to look up ensures your team has the accurate, timely commission reports they need, even if your commissions expert is out of the office. The person who covers for Debbie should focus on maintenance, such as making sure records are updated regularly, even if no important commission calculation periods are ending and no payouts are looming.
Disaster-proofing tip: Ensure that you (or Debbie) create clear update procedures and document them. With these and an easy-to-use system, other workers with system access can keep important data up to date even if Debbie has an unexpected absence. Debbie shouldn’t have a mountain of paperwork slowing her down when she returns. You need her for her expertise, not for sheer drudgery.
3. Automation
Automated commission calculations ensure that payouts are consistent, repeatable, and transparent, which eliminates the manual spreadsheet work that often leads to errors and disputes.
By increasing automation and reducing manual data entry, many of Debbie’s tasks can take care of themselves. Manual copy/pasting is a waste of Debbie’s skill and a waste of her limited labor hours, so she really shouldn’t be focusing on that even when she is in the office. Plus, manual work leads to errors that can make your employees distrustful of your commission process.
Disaster-proofing tip: Automate all manual entry, no matter what. Rote processes, such as manual adjustments for discounted items or accounts aging, can be competently handled by good commission calculations software. Automation produces fewer errors than a human, and that saves time and money while significantly reducing headaches for your company.
Need an Immediate Solution?
We understand that most of these tips take time to set up. Of course, you can get Commission Plan by EthoTech implemented in less than a week, so it’s not much time – but what if you need assistance right now because your Debbie just got called to jury duty?
The clock is ticking. What do you do?
You call on the EthoTech team for help.
With over 20 years of commission processing expertise, we’re the perfect team to lend a hand when your office’s Debbie is gone. We’ve seen pretty much every commission structure you can imagine (along with a lot you can’t imagine), and we’re extremely skilled at unraveling a tangled web of commission-processing tasks and dependencies.
Whether you need us to fill in the gaps temporarily to keep your commission processing on track while Debbie’s out of town, or you need us to train a new person entirely, we’ll be there to help you. And if you already have Commission Plan, we’ll know about your install, and we can quickly show other members of your in-house team how to handle the gap while Debbie’s out.
If you need help now, want to prepare for seamless coverage in the future, or just want to talk through your options, the EthoTech team is here for you. Our #1 goal is to make sure your commission processing is seamless every single time.